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
Rebate equivalents were given in the form of elevator rebates and
allowances. Elevators owned or controlled by railroad companies were
leased at nominal charges to favored shippers, or secret commissions
were paid to favored parties for all grain consigned to specified
elevators. One railroad for example paid a concern, holding a line of
elevators on the railroad, 1¼ cents per 100 on all grain consigned to
those elevators.[78]
In this case the consignment was 150 cars a day from November to May,
averaging 32,000 to 34,000 lbs. a car. The commissions therefore
amounted to $4 a car, $600 a day, $120,000 a year.
The United States Industrial Commission says, under the head of “Freight
discriminations and allowances to elevators:” “On each of the leading
railways from grain-producing sections to Chicago, allowances, ranging
from one-half to 1½ cents per bushel, are made on grain to one or two
favored firms.... The favored elevators are thus enabled to pay higher
prices for grain. The average profit in handling grain is less than 1½
cents per bushel, and smaller buyers can thus easily be driven out of
business.... The small shipper being driven out of business, the large
dealer is then in a position to depress the price of grain to the
producer.”[79]
The railroads deny equal rights in the building of elevators. A railroad
which had granted the right for two elevators at Elmwood on the
company’s right of way refused to give H. & Co. the same privilege. The
State Board of Transportation ordered the railroad to discontinue the
discrimination against H. & Co., and give them the same privileges as
others. But the United States Supreme Court held that the road could not
be forced to grant its property for private use.[80]
One method of discrimination I learned of in the West a few years ago is
not adequately described in any report.[81]
The head of a road running into Chicago from Missouri River points
formed a grain company to buy grain in Kansas City and sell it in
Chicago. The railway guaranteed the grain company against loss. When
wheat was 50 cents in Kansas City and 60 cents in Chicago, the grain
company paid 51 cents in Kansas City to get the grain. The railroad
charged the regular 10 cent tariff. The grain was sold at 60. The
railroad paid back 1 cent on the guarantee and still made 9 cents. And
the railroad-grain-company-combine was able to drive other buyers out of
the market and other railroads out of the traffic. The Santa Fe, for
example, carried 28 percent of the grain going into Kansas City, but
only hauled 3 percent out to Chicago.
Public-domain text, read in full here on John Shaqi.
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