Without attempting in this connection to formulate a complete theory
of freight rates, it may be said that there are three factors to which
weight should be given in fixing charges: First, _the cost of
service_. The total costs of transportation, including a fair return
on invested capital, must be covered by total receipts. Furthermore,
the minimum rate charged any particular class of commodities ought to
be sufficient to pay the operating expenses incurred in transporting
the goods. Second, _the value of the service_. This fixes the maximum
rate that may be charged. Were the railroads to charge more than the
service is worth to the shipper the service would not be desired.
Third, _the value of the commodities_. Between the minimum rate fixed
by the operating expenses and the maximum charge determined by the
value of the service actual rates may vary through a wide possible
range. In determining what rates within this range will be
theoretically most just and least discriminatory, consideration should
be given both to the value of the service and--more than is the case
at present--to the value of the articles transported. By doing this
rates will be paid by the various articles of freight more nearly in
proportion to their ability to pay.