Railroads: Rates and RegulationsRipley, William Zebina
History
Railroads: Rates and Regulations
Ripley, William Zebina
Railroads -- Freight -- Rates -- United States; Railroads and state -- United States
Competition to be of
advantage in the way of progress must always have in view the survival
of the fittest and the elimination of the unfit.
The vast extent of the United States, the necessity of transporting
commodities great distances at low cost and the progressiveness of
railway managers, has led to an extraordinary development of the phase
of rate making above-mentioned. The principle of the flat rate, based
upon the theory that distance is a quite subordinate, if not indeed
entirely negligible, element in the construction of freight tariffs
under circumstances of competition, was fully accepted twenty-five
years ago.[103] J. C. Stubbs, traffic manager of the Harriman lines,
speaking of transcontinental business in 1898, clearly expressed it as
"the traditional policy of the American lines as between themselves to
recognize and to practise equality of rates as the only reasonable and
just rule ... regardless of the characteristics of their respective
lines, whether equal in length or widely different." It is the theory
upon which the southern basing-point system is founded; and it is the
common practice in making rates into and out of New England--being
in fact vital to the continued prosperity of this out-of-the-way
territory.[104] President Tuttle, of the Boston & Maine, has most
ably supported this principle of equality of rates irrespective of
distance. "It is the duty of transportation agents," he says, "to so
adjust their freight tariffs that, regardless of distance, producers
and consumers in every part of this country shall, to the fullest
extent possible, have equal access to the markets of all parts of this
country and of the world, a result wholly impossible of attainment if
freight rates must be constructed upon the scientific principle of
tons and miles." This is the principle of the blanket rate attacked in
the famous Milk Producers' Protective Association case in 1897;[105]
and it is the practice which has been so fully discussed of late, as
generally applied to lumber rates from the various forest regions of
the United States into the treeless tract of the Middle West. The
principle, while applied thus generally in the construction of tariffs,
is of far greater applicability in the making of special or commodity
rates. Wool rates afford one of the best examples. Under such rates
the bulk of the tonnage of American railways is at present moved. The
essential principle of such special rates, constituting exceptions
to the classified tariffs, is that of the flat rate; namely, a rate
fixed in accordance with what the traffic will bear, without regard
to the element of cost, that is to say, of distance. But a noticeable
trend away from the flat rate is evident in recent decisions of the
Interstate Commerce Commission; especially in the Intermountain
case,[106] revision of the wool and cattle rates,[107] and the general
disposition to lessen special tariffs all along the line.
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