The system of charging for transport =according to distance=, which is still in force throughout the civilised world, except in the Postal Service, appears to me to be =founded on a wrong principle=. It has no doubt been adopted on the assumption that the greater the cost of production the greater should be the charge, and, therefore, that as it costs more to build 100 miles of railway than one mile, and takes more coal or electric current to haul a train for 100 miles than for one mile, it is necessary to charge more for the longer distance. Even the Post Office still clings to the same idea, in charging higher rates for the telephone trunk service according to distance, although the charges for telegrams are the same for any distance! It is significant that whereas the net profits from railways remain more or less stationary, that of the Post Office with uniform rates continually increases, and that the telephone system with charges according to distance is so far the least satisfactory branch of the Post Office. It is no doubt a general rule that the price of an article depends upon the cost of production, but when dealing with transport the analogy fails. In the case of a national system of railways the provision of a regular service of trains to and from all parts of the country is a necessity. Such a service requires that trains must run at stated intervals advertised beforehand from one terminus to another, say from A to Z, with various stopping places between those points, which may be represented by other letters of the alphabet. The cost of running each train will be the same, whether it contains 20 passengers or 200, whether some or all of the passengers alight from or board the train at any intermediate station or at either terminus. Therefore, the actual cost of carrying a passenger from A to Z is not, in fact, more than from A to B, or from M to Z. The same consideration applies to goods with even greater force. With goods the cost of handling them has to be considered, as well as the cost of haulage. If goods are sent from A to B only they must be handled twice, and this is no more than if they are sent from A to Z, assuming there is no need for change of trucks.