COMMODITY DISCRIMINATIONS.
Unfair discriminations in respect to special commodities are very
common. The New Haven and Hartford charges $80 a car on peaches from New
York to Boston, 228 miles, while the same peaches come from Georgia
points to New York, 1150 miles, for $162 a car. The Commission says the
$80 rate is arbitrary and unjust and that $50 a car would be a
reasonable charge.[217]
The Atlantic Coast Line Railroad made its rate on peaches depend on the
valuation put on the fruit, in order that by increase of rate in
proportion to valuation, shippers might be led to put low valuation on
their shipments and so provide the railways with an argument against
paying the real damages in case of accident or loss.[218]
From some places shingles are carried at rates as low as those applied
to lumber, while shingle shippers at other points pay more than the
lumber rates. This is held an unjust discrimination against shingles,
and against the places and shippers that pay the high rates.[219]
Railroads make high rates on ties, higher than on lumber, in order to
prevent their shipment to other parts of the country, and so diminish
their value and lower their cost to the discriminating railroad. The
president of one railroad stated the policy clearly: “We are simply
following what we consider our interest, which is to prevent the
shipment of tie lumber.”[220]
Early this year, 1905, the South Side Elevated road of Chicago wanted
400 carloads of ties. The blanket rate on ties from the entire yellow
pine belt to Chicago is 26 cents per hundred lbs. On shipments
originating between Luzon, La., and Pearl, Miss., the Illinois Central
made a special tariff (March 22 and April 6, 1905), fixing the rate on
ties at 26 cents per tie, each tie to be billed at 130 lbs. This was
equivalent to a reduction of the rate to 20 cents per hundred lbs., and
no shipper outside of the favored region could compete in the Chicago
market. It is suspected that the party who got the Elevated contract
knew beforehand that the railroad would issue this special tariff, and
was therefore able to underbid competitors in perfect safety.[221]
A rate of 90 cents a ton is charged on coal for a special use such as
railroad supply, while the same coal must pay $1.85 between the same
points if intended for manufacturing or other industrial domestic
use.[222]
It is unjust discrimination to charge more for carrying cattle and hogs
than for carrying packing-house products, and the desire of the carrier
to get more business by so doing is no excuse.[223]
The railroads have carried dressed meats from Omaha to Chicago at 18½
cents, while charging 23½ cents on live-stock from Iowa points nearer
Chicago. The packer could buy the cattle at Fort Dodge, Iowa, ship them
to Omaha, kill them and ship the dressed carcasses to Chicago, cheaper
than the live-stock owner at Fort Dodge could ship the cattle to
Chicago. Some years ago on arbitration, Mr. Fink and Judge Cooley being
the arbitrators, it was decided that the fair ratio between live-stock
and dressed meats from Chicago to New York would be 26 cents per hundred
for live cattle, and 45 cents for the dressed carcass. But the railroads
have reversed this relation, although the Interstate Commerce Commission
has decided that the rate on dressed meats should be higher than on
live-stock.[224]
Recently, January 1905,[225] the Commission has reaffirmed its decision
of 1890 and held that it is unlawful to charge more for transporting
live-stock from Missouri River points and St. Paul to Chicago than for
carrying packing-house products between the same points, but the Beef
Trust cares nothing for the opinions of Judge Cooley nor for the orders
of the Interstate Commerce Commission, and the Trust controls the
railroads.
On shipments from Chicago east to New York the rates are 28 cents per
hundred and 45 cents on dressed beef. Formerly the same rule applied in
the West, but when the Beef Trust began to build up great packing-houses
at Omaha, Kansas City, and St. Paul, they wanted to make the rates on
cattle from the West to Chicago higher than the rates on beef, so as to
force live-stock to come to their stockyards on the Missouri River where
they had a practically absolute monopoly, and the railroads obeyed their
behest. Shippers fought the change, and in 1890 the Interstate
Commission ordered the railroads to desist from charging more for
live-stock products than for packing-house products. The railroads did
not dare to raise Armour’s rate on dressed beef, so they reduced the
live-stock rate to 23½ cents, the same as the rate for dressed meats.
Armour then demanded and received a rebate of 5 to 8 cents a hundred
lbs. on packing-house products. The rebate was secret at first, but
after the Elkins Bill was passed the beef men made a contract with the
Great Western road at the rate of 18½ cents and the rate was published.
The cattle rate remained at 23½ cents so that Armour and his railroad
allies were again in open defiance of the orders of the United States
Government issued through its Interstate Commerce Commission. The new
decision of the Commission, January, 1905, requiring the railroads to
charge more for live-stock than for live-stock products has not been
obeyed and is not likely to be.[226]
“Could anything more clearly show the power of the Trust,” says Mr.
Baker, “than this reversal of the order of rate-making as manifested in
the tariffs east of Chicago, so that beef, the high-priced product, is
shipped at 18½ cents, while cattle, the low-priced product, is shipped
at 23½ cents, simply to enable the Trust to close the Chicago market—the
best market in the country for export cattle—to thousands of western
cattle growers? They cannot afford to ship live-stock to Chicago at 23½
cents when the Trust can ship the products of the same cattle, weighing
only 60 or 70 percent as much as the live animal, at 18½ cents. They are
therefore compelled to ship to Missouri River points where the Beef
Trust is in absolute control.”
A rate of $1.25 per hundred lbs. on oranges from California to points on
and east of the Missouri River, while lemons are carried for $1 to the
same points—is held unreasonable.[227] A higher charge on rye and barley
than on wheat is unjust.[228]
Western millers complain that the discrimination between flour and wheat
on shipments to the East is causing them much injury and will put them
out of business. The Commission decided that the difference should not
exceed 2 cents a hundred, but it has no power to enforce its order and
“frequently for considerable periods there is very great discrimination
between the rates on flour and the rates on wheat.”[229]
Railroads can discriminate against a whole industry by advancing rates
on particular commodities above the fair level, as illustrated in the
recent advances on hay and lumber.[230]