IMPORTS AND EXPORTS.
The low rates in favor of foreign goods and of domestic goods intended
for export amount to a serious discrimination. Paul Morton told the
United States Industrial Commission that goods were carried from Hamburg
to Denver for less than the rates from Chicago to Denver.[113] Complaint
was made many years ago that the Pennsylvania Railroad and other roads
charged lower rates, even 50 percent lower, on goods shipped in from
foreign countries than on domestic traffic of the same sort.
Investigation revealed in some cases a far greater difference than 50
percent.
At one time the rate on tin plate from Liverpool via Philadelphia and
the Pennsylvania Railroad to Chicago was 24 cents a hundred, while the
rate from Philadelphia over the same road was 28 cents.
In the Texas and Pacific Case the record showed that books, buttons,
carpets, clothing, etc., were carried from England, via New Orleans to
San Francisco for $1.07 a hundred, while the same articles of domestic
manufacture paid $2.88 on the same trains from New Orleans to Frisco.
Boots and shoes, cashmere, confectionery, cutlery, gloves, hats and
caps, laces and linens, etc., took the same blanket rate of $1.07 from
Liverpool and London to San Francisco, while similar American goods paid
the railroads $3.70 a hundred from New Orleans to California. In some
cases the railroads received only ⅙ as much for the transportation of
foreign goods as for domestic goods. The Interstate Commission held that
“any difference in charge between foreign and domestic traffic is
unlawful,” and ordered the discrimination to cease, but after long
litigation the United States Supreme Court decided that among the
circumstances and conditions to be considered in judging rates are the
conditions of ocean traffic and water competition to interior ports in
the United States, etc., so that a carrier may be justified in making
low rates to secure foreign freights which would otherwise go by
competitive routes or not go at all.[114] The practical result appears
to be that railroads may nullify the protective tariff and discriminate
in favor of foreign shipments to any extent that is necessary to make
them move, regardless of the question whether or no they ought to move
under such conditions.
Foreign manufacturers cannot only ship their goods across the country
more cheaply than our manufacturers can, or at least such of them as pay
schedule rates, but can also get special rates on all raw materials they
buy here and ship over our lines for export. For example, a Chicago
miller pays 21 cents per one hundred lbs. to get either wheat or flour
to New York, while the English miller can buy wheat in Chicago and take
it to New York for 13 cents. In some cases the rate on flour has been as
much as 11 cents more than the rate on wheat. Since 2 or 3 cents a
hundred lbs. is a good profit, our millers cannot grind for export
against the English millers.[115] The railroads turn down our millers
and establish a protective tariff for free trade England, protecting her
millers against competition.
American shippers take such advantage of the low export rates as they
can, but sometimes these concessions are made to the shippers in one
city and not to those of other cities; for example, the railroads
carrying export flour from Minneapolis at a discount refused similar
concessions to shippers at intermediate points.[116]