Standard Oil Company; Trusts, Industrial -- United States
This secret arrangement made the actual rate of the South Improvement
Company much lower--sometimes half, sometimes less than half, what all
others paid. The railroad officials were not to collect these enhanced
freight rates from the unsuspecting subjects of this "contract" to
turn them into the treasury of the railroads. They were to give
them over to the gentlemen who called themselves "South Improvement
Company." The "principle" was that the railroad was not to get the
benefit of the additional charge it made to the people. No matter how
high the railroads put the rates to the community, not the railroads,
but the Improvement Company, was to get the gain. The railroads
bound themselves to charge every one else the highest nominal rates
mentioned. "They shall not be less," was the stipulation. They might be
more up to any point; but less they must not be.[57]
The rate for carrying petroleum to Cleveland to be refined was to be
advanced, for instance, to 80 cents a barrel. When paid by the South
Improvement Company, 40 cents of the 80 were to be refunded to it; when
paid by any one else, the 40 cents were not merely not to be refunded,
but to be paid over to his competitor, this aspiring self-improvement
company.[58] The charge on refined oil to Boston was increased to
$3.07; and, in the same way, the South Improvement Company was to get
back a rebate of $1.32 on every barrel it sent to Boston, and on every
barrel any one else sent. The South Improvement Company was to receive
sums ranging from 40 cents to $1.32, and averaging a dollar a barrel on
all shipments, whether made by itself or by others. This would give the
company an income of a dollar a day on every one of the 18,000 barrels
then being produced daily, whether its members drilled for it, or piped
it, or stored it, or refined it, or not.
To pay money to the railroads for them to pay back was seen to be a
waste of time, and it was agreed that the South Improvement Company
for its members should deduct from the ostensible rate the amount to
be refunded, and pay the railroads only the difference. Simplification
could not go further. The South Improvement Company was not even to be
put to the inconvenience of waiting for the railroads to collect and
render to it the tribute exacted for its benefit from all the other
shippers. It was given the right to figure out for its members what the
tribute would amount to, and pay it to them out of the money they owed
the railroads for freight, and then pay the railroad what was left,
if there was any left.[59] The railroads agreed to supply them with
all the information needed for thus figuring out the amount of this
tribute, and to spy out for them besides other important details of
their competitors' business. They agreed to make reports every day to
the South Improvement Company of all the shipments by other persons,
with full particulars as to how much was shipped, who shipped, and to
whom, and so on.[60]
Public-domain text, read in full here on John Shaqi.
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