Railroads -- United States; Railroads -- United States -- Finance
papers; and President Garrett’s public utterances, and those to his
Board, were filled with enough statements to show what he intended to
do.... I heard him [say] that upon the completion of his lines, like
another Samson, he could pull down the temple of rates upon the heads
of these other trunk lines.”[5]
Under these circumstances a dispute between the Baltimore & Ohio and
the Pennsylvania in 1874 over the former’s connection with New York
had far-reaching consequences.[6] The Pennsylvania refused to carry
Baltimore & Ohio cars over its line north from Philadelphia, and as a
retaliatory measure the Baltimore & Ohio reduced passenger fares from
Washington and Baltimore to Western points from 25 to 40 per cent.[7]
The reduction in rates thus begun inaugurated the first of the great
railroad wars. The cuts soon extended to east-bound passengers and to
freight, and forced corresponding cuts on the Pennsylvania, the Lake
Shore & Michigan Southern, the Michigan Central, the New York Central,
and the Erie. Rates on fourth class and grain from Chicago to New
York, which had been 60 cents per 100 pounds in December, 1873, and
40 cents in December, 1874, fell to 30 cents in March, 1875. Rates on
special, or sixth class,[8] went as low as 12 cents from Baltimore and
Philadelphia to Chicago. Passenger fares from Chicago to Baltimore and
Washington were reduced from $19 to $9, to Philadelphia from $19 to
$12, to New York from $22 to $15, and to Boston from $22 to $15. The
New York Central and the Erie quoted fares from New York to Chicago
of $18 and to St. Louis of $20, and the Baltimore & Ohio replied by
a cut to $16.25 to Chicago. In April, 1875, the Baltimore & Ohio cut
freight rates from Cumberland to Baltimore over 50 per cent on the four
regular classes, and the Pennsylvania at once announced still greater
reductions.[9]
The effect of this warfare on railroad revenues was sufficiently
serious to cause the Baltimore & Ohio to recede somewhat from
its independent position and to enter into negotiations with the
Pennsylvania;[10] but the terms of the resulting agreement proved
unsatisfactory to the other trunk lines, and no general pacification
was obtained. Late in 1875 rates nevertheless generally advanced,
and in December a general agreement was concluded, followed by a
general increase. This agreement was again hopelessly disrupted by the
following April, when cuts in east-bound rates followed each other with
rapidity. The published rates on grain, which had been 45 cents at the
beginning of March, 1876, fell to 40 cents on March 7, 35 cents on
April 13, 22½ cents on April 25, and 20 cents on May 5. In June rates
on west-bound freight fell to 25 cents first class to Chicago, and 16
cents fourth and fifth class, actual rates going much lower; and it
was possible to travel from New York to Chicago first class for $13.[11]
Public-domain text, read in full here on John Shaqi.
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