Railroads: Rates and RegulationsRipley, William Zebina
History
Railroads: Rates and Regulations
Ripley, William Zebina
Railroads -- Freight -- Rates -- United States; Railroads and state -- United States
Does a constant rate applied over a long stretch on the same line
constitute local discrimination? May the nearer points rightfully
protest against the fact that equally low rates are accorded to remoter
points? This is the gist of the controversy in the very suggestive
Milk Rate cases in 1897.[227] Here the conflict of interest between
producer and consumer is obvious. The city of New York naturally
desires a wide market from which to draw its supply. On the other hand,
the nearby producers wish to enjoy the advantages of nearness to the
market to the fullest degree. Study of the evolution of rate sheets
clearly shows how such grouping of charges over long distances may be
in the nature of a compromise to avoid actual violation of the long and
short haul principle. Oftentimes places scattered along over a hundred
miles of railroad enjoy absolute equality of charges. Obviously, the
ton-mile rate steadily falls within such a group with progressive
remoteness. Yet it is an inevitable feature of tariff building.[228]
It is the kernel of the admirable trunk line rate system. Such an
equalization of rates between points unequally distant from a given
centre, not infrequently arises in connection with mere competition of
transportation routes. Referring back to the diagrams on page 219, it
may happen that a complainant at X, the nearer point, recognizing the
inevitableness of a low rate at Y, may succeed in securing an agreement
that, while its charges cannot be less than at Y, at least they shall
not be more. This was all that was asked in the "rare and peculiar"
case of Youngstown, Ohio.[229] But it is apparent that such a solution
differs only in degree from those previously discussed. The question of
principle remains the same. The roundabout route to New York up back
by way of Youngstown could continue to compete at Pittsburg for as low
a rate as on direct shipments, even if it observed the long and short
haul principle to which the Pennsylvania direct route was committed,
only by charging much lower rates per ton mile on Pittsburg traffic
through Youngstown than was levied on business there originating. This
raises precisely the same question of distribution of joint expenses
between local and competitive traffic, already discussed. In certain
contingencies under the second variety of the oyster cases, such a
solution might apply. Would Chattanooga, for example, assuming it to
belong in the second class of oyster cases, be contented with an
equality of through rates with Nashville, leaving its local rates out
to smaller towns as they are?
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