Standard Oil Company; Trusts, Industrial -- United States
The net effect of this pool with the railroad was that the oil
combination succeeded in making its rivals pay 64 cents a barrel to
reach the East and the seaboard, while it paid only 16[214]--except on
the traffic guaranteed the Pennsylvania Railroad--a difference against
competition of 48 cents a barrel, a difference not for cheapness. "It
only costs the pipe line 7 cents," the independents explained to the
Interstate Commerce Commission, "and the published rate is 52. They are
willing to pay 52 or even 70 cents on some of their product if they can
make the other people pay 52 upon the whole of theirs."
So much of the contract as we have referred to was admitted. Why was
it, then, the counsel for the railroad fought against showing it, even
to the point of pleading that it might incriminate his client?[215]
It was asserted, as of his personal knowledge, by the counsel of the
independents that this was because another part of the bargain gave the
proof that the rates which had been made under the agreement to put
them up and keep them up were extortionate; that by a bargain within
the bargain the oil combination carried oil for the railroad for the
280 miles for which they ran practically side by side, and for this
charged it only 8 cents a barrel. The public, shipping either by the
railroad or by the pipe line, had to pay 52 cents a barrel for 500
miles; but by this arrangement between themselves the two carriers
would do business at 8 cents a barrel for 280 miles, at which rate the
charge to the public to the seaboard should have been not quite 15
cents instead of 52 cents.
The statement was also made that the oil combination, instead of
giving the railroads the business it has guaranteed them, makes its
obligation good by turning over to them periodically a check for the
profits they would have had on hauling that amount of traffic. As the
guarantee was made as a consideration for the maintenance of high
freight rates, such a payment by it would amount, in cold fact, to
paying those in charge of the highways a large bribe to deny the use of
them to the people.
This declaration of the provisions of the bargain was made by the
counsel for the refiners seeking relief from the Interstate Commerce
Commission. In his argument demanding the production of the document
he said: "I have had it in my hand and read every word of it, and know
exactly what it contains."[216]
Public-domain text, read in full here on John Shaqi.
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