The heart of the railroad problem: The history of railway discrimination in the United States, the chief efforts at control and the remedies proposed, with hints from other countriesParsons, Frank
History
The heart of the railroad problem: The history of railway discrimination in the United States, the chief efforts at control and the remedies proposed, with hints from other countries
Parsons, Frank
Railroads -- Freight -- Rates -- United States; Railroads and state -- United States
The fight now going on in Kansas between the people and the Oil Combine
has forcibly illustrated the methods of the Standard. When the Kansas
oil fields began to show signs of large prosperity the Standard went
into the State, put up refineries and storage tanks, laid pipe lines,
and began to build a through pipe line from Kansas to its Chicago
station at Whiting. By getting the railroads to raise their rates on
oil, compelling producers to agree to sell their oil only to the
Combine, resorting to cut-throat competition to drive them out of any
market they attempted to enter, they practically captured the oil
business of the State and were able to put the price of crude oil down
and squeeze the independents until many of them were ready to sell out
to the Combine at the victor’s own price.
The power of the Trust over the railroads is illustrated by the case of
Mr. I. E. Knapp of Chanute, who went to the field in 1899 and secured a
number of paying wells. He also obtained a market for his crude oil with
the Omaha and Kansas City gas companies, transporting the oil in tank
cars of his own. In the recent investigation in Kansas it appeared that
he had enlarged his business till he had 20 tank cars in transit. He
paid the railroads 10 cents per hundred lbs. to Omaha and Kansas City,
and they counted the weight at 6.4 lbs. per gallon. With this rate and ¾
of a cent mileage on his cars he was able to make a good profit, but
suddenly in May, 1902, two weeks after he had signed a year’s contract
with the gas companies, the railroads changed the weight classification
to 7.4 lbs. per gallon, adding thereby $7.50 per car to the freight,
while the freight on the products of crude remained unchanged. That is,
the Standard could still ship gas-oil as a product of crude at the old
weight of 6.4 lbs. a gallon.[299]
Mr. Knapp protested and the railroad agents, admitting that the
classification was arbitrary and not general even on their own roads,
succeeded in getting the order reversed, but only for a short time, when
back it went, and in reply to further protest from the Kansas agents
their superior officers wrote that they were tired of the correspondence
and declined to discuss the matter further. So for 11 months Mr. Knapp
had to fulfil his contract with a handicap of $7.50 per car more cost
than he had figured on. The result was that in May, 1903, he turned over
his crude oil to the Standard which thereafter supplied the Omaha and
Kansas City gas companies, while Knapp’s 20 cars were side-tracked and
in the spring of 1905 were still idle at Chanute.
Public-domain text, read in full here on John Shaqi.
Reviews
Reviews
No reviews yet
Be the first to share your thoughts on this work.
Elsewhere in the archive
Join the Discussion
Join the discussion
Sign in to leave a comment or review.
Sign InorCreate an account