St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1885-02-19

to keep back the shipments of corn
whether any practicable reduction of the
freight charge would bring the corn to
market. They say, further, that even if
we can move the present crop by making
low rates, we may never get those rates up
again, IN the face of a popular belief that
the lowest rates ever voluntarily made
by railroads should be insisted upon
as permanent basis, and with
these doubts we hesitate to try
an experiment which may, in the
end, cost US great deal of money.
We recognize, they say, the wisdom of
meeting the market-feeling our way by
gradual reduction in the rates, but what
we are afraid of is, that when we get the
rates down, in order to move corn at the
present low price, the farmers will never
let us put the rates back again, no matter
what corn is worth.
The present situation, it seems to me,
illustrates very clearly the evil consequent
ces of mistaken public opinion upon so
important a question as this one of trans
pOrtatiOn.
remember two or three years ago, when
corn was selling at very high price, the
freight rates were advanced on a certain
railroad, two cents per hundred pounds.
The farmers were receiving good prices and
could well afford to pay this increase in
the freight charge, but said it was an out
rage. They said the railroad could Just as ,ceU
afford to carry at the old rate then, as it could
the year before, ,ohen corn ,Cds not so high.
They said it cost the railroad no more to
carry corn when it was worth forty or fifty
cents bushel, than when it was worth
fifteen or twenty cents a bushel, and argued
that the cost of the service, rather than its
value, much be taken as the basis of its
charge.
That Is just what the railroads west of
Chicago are afraid of to-day. If this fear
could be removed, do not believe there is
a doubt they would Immediately make a
reduction in the rate They would reason
that the best way to find out how much of
a reduction is necessary, what is the real
value OF the service, is to try the expert
ment; but, being afraid. they do not reason
in this way. They say the experiment is
too dangerous for us to try, at all events
until we are perfectly sure what the value
is, and that there is no possibility of moving
the crop unless we do make reduction.
They know, if the public does not, that
the expression what the traffic will bear I"
means: that they cannot charge more than
the traffic will reasonably bear. 1t takes
time to ascertain what is the value of the
service. We know that the present rate is
not one at which the railroads can make
much profit and we must move with great
caution, lest we make mistake, because
the public will take advantage of any mis-
take we make, and insist next year. or the
year after, if prices are. better, that never
theless the railroads shall not make any
advance in their prices
On calling attention to Mr.. Perkins
statements, the commissioners say:
Attention is called to Mr.. Perkins
statement that few years ago when one of
the railroad companies sought to advance
rates on account of high prices of grain it
was claimed by the public that the railroad
could just as well afford to carry at the old
rate then as it could the year before when
corn was not so high, and to his statement
that the officials of the railway fear that if
the rates are now reduced they could never
without trouble be raised even under
changed circumstances. Those who argue
that the price Ofcarriage should be reduced
on account of low price of products, with
out reference to other circumstances, would
seem to be logically driven to concede
that when prices advanced rates should also
advance
"A proper rate is neither more nor less
than reasonable rate, and when all con-
trolling circumstances are considered, the
real value of the service rendered consti-
tutes reasonable rate. A consideration
of all the circumstances is u task extremely
difficult, but not impossible"
If anything further was required to show
tI,o of oil 81,
laws of competition, of supply and demand,
of the effort of capital to seek profitable
employment and to develop the business
in which it is engaged, to operate without
interference, | think here is an argument
in favor of such course.
The railroads in Iowa to-day are hesitating
about reducing their rates. are hesitating
because they are afraid of State interference
and / say to you now that the history of
rates in the State of Minnesota for the past
five years shows greater reduction, and a
greater percentage of reduction on the
amount Of business carried, than that of
any state where the rates are fixed by
commission, and, in fact greater, ! believe,
than those of any state in the Union. The
moment you establish n commission to fix
! these rates, the railroads are put on the
defensive In place. OF seeing now tney can
reduce their rates and increase their ton
mage to supply the necessary revenue, they
will at once be placed in position where
their whole efforts will be to maintain
rates as against a commission who have no
responsibility and no ownership or interest
in the property or in its development.
/ / have undertaken to show you that rates
in Minnesota were lower OH grain than in
older states south and east of us. / want
to show you that the expenses in Mime
sofa are higher than those of the railroads
with whose rates we have made comparison
EXPENSES PER TRAIN MILE.
From railroad commissioner report for
1884, page 73, table V.
st. Paul, MINI. & Man. Ry.. 81 rs
Northern Pacific. .......................... | 10
Chicago & Northwestern (see Iowa
report ACKNOWLEDGEMENTS. ~
Chicago, Burlington & Quincy (see
Iowa repOrt......... ..................... 81
Chicago, Milwaukee x St. Paul (see
Iowa report .................. .......... ~
(fhinaun DncLr leland X DaniHr