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wheat and flour for export had been the same, and the carriers had exacted such rates except where lower rates on wheat were induced by competition. Water competition on the Great Lakes limits rail rates to the various ports on both wheat and flour during the navigation season, and to a degree before the opening and after the close of navigation, and the published and actual water rates on wheat had been from 2 to 4 cents lower than those on flour. It was also found that to a limited extent the cost of service might be greater in the transportation of export flour than in that of export wheat. The export rate on flour included delivery on board ship, while the rate on wheat ordinarily did not, and at New York an additional charge of about 1 cents per bushel for loading wheat was made. The exportation of flour had steadily increased, but for the previous six years the increase had not been marked, and a decrease was shown by comparing exports in 1894 and 1898. The Commission was of the opinion that public policy and good railway policy alike require the same rate on export wheat and export flour. Such rates tend to develop both the industries of the United States and the traffic of the railways. The Commission is not, however, authorized to settle national or railroad policy; its duties are confined to administering the act to regulate commerce, and in view of all conditions as we found them we did not feel warranted in deciding that a somewhat higher rate on flour than on wheat was in violation of that statute. We did decide that the published difference was too wide, and that the rate upon flour for export ought not to exceed that upon wheat by more than 2 cents per 100 pounds. The relation of rates on domestic shipments of flour and wheat was not involved in the decision, as the export and domestic shipments were handled under different conditions. It further appeared that carriers engaged in the transportation of export flour from Minneapolis at a rate 1% cents less than the domestic rate to the port of export refused to make any corresponding concession to millers at intermediate points. The Commission ruled that this was unjust and unlawful discrimination against such intermediate traffic, and that whatever line participated in such lower export rate on flour from Minneapolis must make a corresponding rate upon similar traffic from intermediate points. The Commission also held that in the application of export grain rates the carriers should in no case make the rate from any point to the seaboard less than that from any intermediate point on the same line. There may be instances, said the Commission, where a carrier should be permitted to meet railroad competition without reference to its intermediate territory, but when the very existence of an important industry depends upon the carrier being required to treat intermediate territory as it does the more distant territory, the rule of no greater charge for the shorter distance clearly applies. The third branch of the case related to the publication of tariffs upon grain and flour transported to the seaboard for export. Besides the claim that the act does not require carriers to publish rates on export traffic, which was disposed of in the first part of the decision, it was urged that export rates upon grain and grain products can not be published and maintained. We found that this was not so, because in the main for the previous six months they had been maintained. Grain had been almost uniformly taken to the seaboard upon a published rate. The through rate on flour had been made by adding the published inland tariff to the ocean rate, and this inland tariff had been in most cases adhered to. When certain lines said that they could not adhere to the published rate, they meant that it would interfere either with the amount of export business which they could do or with the profit derived from that business. These lines in the past have quoted a rate for every shipment, while other competing lines had observed a fixed rate. Naturally if these lines should be compelled to maintain a published rate, as their competitors had done, it would place them at some disadvantage in comparison with the past. So in domestic business the weak line could more favorably compete with the strong line if it were under no obligation to publish its rates, while its competitor was compelled to do so. We said that not only can traffic in export grain and flour be conducted upon the basis of a fixed inland differential, but we doubted whether the great bulk of that traffic could be conducted in any other way. To permit each carrier engaged in this traffic to quote a different rate from day to day would result in a condition intolerable to the railway and the shipper. If the law did not require it, the carriers themselves would be obliged to establish a fixed inland rate upon export business. These southern lines, which take only a fraction of the export flour business, might be allowed to quote rates, as they have, upon individual shipments. That would amount to a kind of differential in their favor which strong lines could afford to allow; but the great bulk of the flour traffic could not be carried on upon that theory. The foundation of the whole act is publicity in the rates of the carrier, and there can be under that act no regulation and no application of its provisions unless the rate is published and the published rate maintained. The Commission said that if it had the power to relax the rule it might see fit to exercise it in favor of the southern lines in the matter of the transportation of flour, but that no such power exists, and whatever rule is applied in one case must be applied in all cases. It was further observed that whatever hardship may be imposed upon a few lines of railway is more than counterbalanced by the advantage accruing to others, and especially to the shipper and the community as a whole. We held accordingly that rates on export traffic must be published and filed in accordance with the provisions of section 6 of the statute; that so-called through export rates made by adding the ocean rate, whatever it may be, to the inland rail rate, whatever it may be, are not analogous to joint rates made by joint arrangement between railway carriers subject to the statute, in the sense that the total rate must be published and filed, and it is enough if the railway carrier publishes and maintains its own rate to the seaboard; that if there is in fact such a joint arrangement that the rate is a joint rate under the sixth section of the act, then the entire through rate should be published, and not the inland division, which in that case might vary while the entire rate remains the same.
The order in this case has not been fully complied with. In some instances, as shown below, the difference against flour is more than 2 cents and in others it is less. From Chicago the differences between export rates on wheat and flour are higher on flour as follows: To Boston, 4 cents; New York, 2 cents; Philadelphia, 1 cent; Baltimore, one-half cent; Norfolk and Newport News, no difference. From Mississippi River points the proportional rates on export wheat and flour are higher on flour as follows: To Boston and New York, 4 cents; Philadelphia, 3 cents; Baltimore, Norfolk, and Newport News, 2} cents. Export rates through the Atlantic ports are not higher from any intermediate than from any more distant point. This statement indicates that the relative export rates on wheat and flour from Chicago to Boston and from Mississippi River points to all the ports named are not in conformity with our order. From Kansas City to Galveston and New Orleans tariffs effective December 17 make the proportional export rates from Kansas City to either of those points the same on wheat. and flour. Some few intermediate points take somewhat higher rates than those from more distant shipping points. This was forbidden by the Commission not only in this case but also in the Board of Railroad Commissioners of Kansas case, hereinafter mentioned.
GREATER CHARGE FOR SHORTER THAN FOR LONGER HAULS.
During the year decisions have been rendered in several cases involving greater charges for shorter than for longer distances. One proceeding was entitled “In the Matter of Alleged Violations of the Act to Regulate Commerce by the St. Louis & San Francisco Railway Company” (8 I. C. C. Rep., 290). The rates enforced by the respondent company on live poultry in carloads to Chicago were higher from Marshfield, a point in Missouri, than for the longer distances from Springfield and other more distant stations on its line to and including Columbus, Kans. This road meets the competition of other roads at Springfield and various junctions to the west of Springfield, yet nowhere west of Springfield did the respondent or any of its competitors make a greater charge for a shorter than for a longer distance on this traffic. Such rates on live poultry from Springfield and more westerly points were not unreasonably low. The respondent carrier made as low a rate to St. Louis from Marshfield as it did from Springfield. The investigation covered freight articles generally, but the testimony was confined to live poultry. We held that the greater charge from Marshfield than for the longer distance from Springfield and other more westerly stations constituted a departure from the general rule of the fourth section, which the carrier was bound to justify in this proceeding. It was also decided that the higher rate from an intermediate locality to a common destination constitutes a prejudice to that locality and shippers and traffic therefrom, and a preference to the more distant localities and shippers and traffic therefrom, which, if found to be without sufficient excuse, must be held unreasonable and undue, and therefore in contravention of the third section. The respondent relied to some extent upon the fact that rates from Springfield and various stations west of that city were joint rates made by agreement with its rail connections from St. Louis to Chicago, while the charge from Marshfield was a combination of respondent's local rate to St. Louis, the Mississippi River bridge toll, and the local rate from East St. Louis to Chicago. It claimed that its agreement and concurrent action with the St. Louis-Chicago lines for joint rates from Springfield to Chicago rendered the circumstances and conditions applying on the Marshfield and Springfield traffic substantially dissimilar. This proposition was not sustained. We held that the respondent was engaged with other carriers in the through transportation to Chicago of freight from numerous points on its road, including Springfield and Marshfield, and that it could not lawfully call itself merely a local carrier from Marshfield while engaged in through carriage from Springfield and other points on its line, and thereby justify higher rates to Chicago for the shorter distance from Marshfield than for the longer distance from Springfield and more distant points of shipment. This was in accordance with the ruling of the Commission upon a like question in the Social Circle case, which was sustained by the United States Supreme Court upon application by the Commission for enforcement of the order in that case (162 U. S., 184). We held that the respondent had failed to justify its higher rate from Marshfield than from Springfield and other more distant stations for the carriage of live poultry to Chicago, and that by keeping such higher rate in force it was acting in violation of the fourth and third sections of the act. In conclusion it was said that the respondent should not insist upon making higher charges to Chicago from Marshfield than from more distant points of shipment upon other kinds of traffic, unless it is prepared to justify such action by showing an essentially different state of facts than appeared in this proceeding. In another case, brought by the Chicago Fire Proof Covering Company against the Chicago & Northwestern Railway Company and the Pennsylvania Company (81. C. C. Rep., 316), it appeared that the defendants, in transporting asbestos articles to Lima, O., and other eastern points, charged more for the shorter distance from Summerdale, a point within the city limits of Chicago on the Milwaukee division of the Chicago & Northwestern Railway, than for the longer distance from points on that division north of Chicago, including the city of Milwaukee. The carriers had through rates in effect from the stations north of Chicago, but on traffic from Summerdale the carrier east of Chicago insisted upon the higher charge made by adding rates to and from the point of connection in Chicago. These through rates were not denied to Summerdale before it became part of Chicago, some years ago, through extension of the city limits. No good reason was shown why the carriers should charge more on less than carload shipments from Summerdale than from points north of Chicago to and including Milwaukee on traffic destined to eastern points, and we held that such greater charges from Summerdale were in violation of the fourth and third sections of the statute. It also seemed that the rates on carload shipments to the East from Summerdale should be as low as those in force to the same destination from Milwaukee; but as carload lots took somewhat different routing than less than carloads from Summerdale, and the evidence as to carloads was not specific, no opinion on that branch of the case was expressed, and the complainant was granted leave to apply for further hearing.
The case of the Board of Railroad Commissioners of the State of
Kansas v. The Atchison, Topeka & Santa Fe Railway Company et al. (8 I. C. C. Rep., 304), disclosed some departures from the general rule of the fourth section in the making of export rates on grain. Several defendant carriers engaged in transporting wheat and corn from points in Kansas and Missouri and intermediate points to Galveston and New Orleans made lower export rates on those commodities from Kansas City, Mo., or points in that vicinity, than from some of the intermediate stations on their respective lines. These export rates were much lower than the corresponding domestic rates, in case of which the fourth section was invariably observed. The circumstances and conditions governing the transportation of grain from the longer and shorter distance points were not found to be substantially dissimilar. We held that the higher rates from such intermediate points subjected those localities to undue prejudice, and that if the carriers were allowed to make these low export rates they should in making them treat all intermediate territory alike, and to desist henceforth from charging