The Grange advance. [volume] (Red Wing, Minn.) 1873-1877, 1875-01-05
was altogether dropped. 1t had stood
upon the statute books for two years,
but no attempt had ever been made to
enforce it.

but no attempt had ever been made to
enforce it.
EARNINGS AND EXPENSES.
AS the returns show that while the
operating expenses of three roads have
exceeded their gross earnings; that the
net earnings of others have not equaled
the interest on their funded debts: and
that the average income of even our
most prosperous roads, after deducting
operating expenses, is only about six
per cent. on the investment made in
them, it is evident that the passage of
any law, the effect of which would be
to reduce the rates at competing points,
must necessarily compel many compa-
MES to advance rates at competing
points. The result Of such a change
would be to unsettle the values of prop.
erty both real and personal, and to
materially disarrange business in its
various branches, at such points. Man
ufactories heretofore established in
these places in consequence Of induce.
ment afforded them by low rates Of
transportation. must necessarily suffer.
AN ILLUSTRATION.
In connection with this, and in illus
tration of the effect Of the operation Of
the law recently enacted in illinois, l
may be permitted to relate a case
which came under our observation soon
after the pro rata tariff imposed in
that State became operative. Being in
the place Of business of q prominent
Detroit firm, and noticing upon the
sidewalk large quantity Of lnanufac.
tured goods which had just been re.
ceiyed, one of the proprictors remarked
to me that they chad formerly received
their entire supply of these
goods from town in the
interior of Illinois, but since the
new railroad law had been in force in
that State, the rates Of freight from
that point had been advanced so
greatly that they We're then compelled
to purchase in an eastern market
The moral is too plain to need pointing
out. This was single case inciden.
tally noticed, and was only one mani
festation Of the revolution made in
trade by the Illinois law. The people
|of our State are making siren
uous efforts to cause the establish
inent of manufactures in Michigan, by
calling to their aid the capital and skill
of other states, and one of the princi-
pal inducements offered is the compare
lively low rates of transportation, due
to that competition, which in itself ena-
bles corporations to make special rates
for the encouragement of such establish
ments. A law preventing discrimina
ton between competing and uncompe-
ting points, would, of course, virtually
prohibit this healthy and necessary
competition, and would really be in an
tagonism to the principle Of the consti-
tutional prohibition against the consol-
idation Of competing lines, the reason
of that prohibition being that the ten
dency Of such consolidation would be
to destroy competition.
1MPRAcT1cAB1L1rY OF REGULATING BY
DISTANCE.
A company, therefore, can often afford
to charge for long haul only a
third or a quarter as much
per mile, as they would be compelled
to charge for short haul to pay the
actual expense to themselves with a
reasonable margin. And this simple
fact also illustrates the futility Of at
tempts to regulate rates by distance
alone. If companies should charge for
long distances at the rate at which
they are compelled to charge for short
ones, their profits would he immense,
while if they were limited to ordinary
long distance rates for short hauls,
they would be speedily ruined.
HOW CAPITAL. IS AFFECTED.
A law restricting rates Of freight
practically separates the management
from the ownership Of railroad prop
erty. AS foreign capitalists do not
invest in such property for the benefit
of the State alone, we cannot expect
them, under such circumstances, to
invest at all. The railroads which
we have heretofore been enabled, with
the aid of their capital to build,
have enriched the State in the
enhanced value of her lands, in the
growth and prosperity of her ,nanilac-
turing interests, and in the develop
ment Of her vast mineral resources.
NO FIXED REGULATIONS EQUITABLE.
1twould seem, therefore, that tariff:
law to be just to all roads, could only
be made in such way as to apply to
each road separately; to regulate rates
from station to station; to distinguish
between the directions in which traffic
is carried; to allow for the competition
Of other modes of transportation; to
regard the influence of the season upon
business and travel; and to take into
account the distance of the freight from
its destination. These are some Of the
more salient considerations in the fran
ing of such law. After many years