Railroads: Rates and RegulationsRipley, William Zebina
History
Railroads: Rates and Regulations
Ripley, William Zebina
Railroads -- Freight -- Rates -- United States; Railroads and state -- United States
Rival cities again intervened and finally the whole matter was of
necessity referred for arbitration to a commission. Even then both the
Erie and the Baltimore & Ohio roads were well advanced on the road to
bankruptcy. For us, however, the immediate result of importance was a
permanent reduction of the general level of freight rates, not alone
for the trunk line territory but for the entire country. The diagram
on page 413 shows this plainly. From an average revenue per ton of
freight moved one mile of 1.92 cents in 1868, intermittently upheld
until 1872, the fall of over one-third to about 1.1 cents in 1882 was
sudden and continuous. The end was not yet. The renewed outbreak of
a rate war between the trunk lines in 1881 and again in 1884 led to
further reductions. The decision in 1882 of the Thurman Commission on
Differentials settled nothing.[13] All kinds of traffic were affected.
Immigrants were carried from New York to Chicago for $1.00 a head.
East-bound grain rates were as low as eight cents. At last, late in
1885, the warfare was terminated by an elaborate pooling agreement.
These struggles brought about great reductions in the revenue of the
carriers concerned; but declines in rates after this period were, in
the main, more gradual, with short intervals of relief interspersed.
One immediate result of these lower freight rates was the impetus
given to economy and systematic operation. This is the period when, as
we have said, pooling as a device for restraint of competition first
appeared in the "Evening" contracts on beef shipments in the West, in
the notable Southern Railway & Steamship Association in 1874 and in
the trunk line pool in 1877. Agreement between the anthracite coal
roads began about 1872 and has continued with increasing effectiveness
ever since.[14] This was also the heyday of the through freight lines
which were now operating from every important western centre. In 1876
the first attempt at a systematic scheme of rate adjustment between
competing localities was made in trunk line territory.[15] Order
was indeed emerging out of chaos. In respect of operation, larger
locomotives and cars and longer trains were rapidly coming into use.
On the Lake Shore the average train load in 1870 was 137 tons. Nine
years later it had risen to 213 tons. The widespread substitution of
steel for iron rails was not yet to follow for some time. For in 1880
only three-tenths of the mileage of the country was laid with steel.
This proportion rose to eight-tenths in 1890. It was doubtless this
change during the eighties which made possible the heavy decrease in
operating expenses which occurred during the five years subsequent to
1881. It appears, indeed, as if the need of economy was enforced by the
decline of rates in progress; but, as usual, the supply of economies
waited upon the demand and, in fact, tarried well behind it. To this
circumstance may be attributed some of the financial hardships suffered
Public-domain text, read in full here on John Shaqi.
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