Wichita eagle., 1888-11-17
NO RAILROAD WAR.
Chauncey H. Depew Explains the Rate
Situation.

OnouuoCy NJ VcY0U 0ARaoAuS sAV 4soe0
Situation.
NEW YORK, Nov. 16.-In a talk with a
Post representative today, and in response
| to inquiry for news of the railroad rate
| war, Chauncey NJ. Depew said: s'There is
no railroad war and no chance of there
being one. Formerly" he continued. ''of
| the west bound traffic the New York Cen
trail had 32 per cent, gain of 30 per cent
| carried by the Pennsylvania Under the
operation of the pool the New York Cen
trail had q per cent and the Pennsylvania
22 per cent, the reduction being due
| to the grading OF differential lines
which had lost their business in main
| tanning the absolute tariff agreed upon
about four months ago. we found that our
business was being taken from US and that
our best shippers were transferring their
business. This continued and grew so
rapidly that we determined we must either
substantially retire from the west bound
business or make the open rate the same
as the rate was by other lines as nearly as
we could ascertain. AS soon as we dis
covered what we believed to be the real
rate, under the rules of our association we
gave notice to Commissioner Fink to in
form all other lines of our new tariff"
How does the interstate commerce law
affect the Central under existing circum-
stances?
''The New York Central obeys the inter
state law. / presume we are not affected
on points this side of Buffalo, but on
points beyond we are, undoubtedly. AL
though state corporation we live up to
the spirit of the interstate commerce law"
What does the Pennsylvania want?"
"As I understand the Pennsylvania,
they want to abolish differenuials. To
Car hot Shav va oh hQ
during the whole fall made frequent re-
ductions on easr-bound business to meet
differentials claimed by weaker lines.
These reductions have been made every
time without notice. We supposed that
they did the same on westward traffic, but
eastward the rate was an open one: Inc
differential rate is all wrong in theory,
undoubtedly, but after several disastrous
wars to get rid of the system ninety-nine
out of hundred Of the railroad men Of
the country believe that there is no other
way of promoting stable rates or of pro-
tecting railroad investors. A railroad tariff
between two points should be as well
known and as stable as the postage rate.
IL the shipper during Generalization of
rates can get better rate by rival line
than his competitor it is just as bad and
dangerous discrimination as If 1T was
practlced by the same line. If there were
no diiferentials two or three lines includ-
ing the Central and PENNSYLVANIA, would
carry eight-tenths of the traffic. Under
these conditions, if the trade
laws governing commercial houses
prevailed, they would speedily drive their
weaker competitors into bankruptcy and
close them up and out. But railroad
lives forever. 1t is a semi-public highway
and the public would not permit it to stop
or be stopped. As soon as the line which
is at disadvantage in distance or fact dis
covers its business gone it proceeds to bid
for business at lower rates than the
stronger lines and at rates which will give
it traffic. Stronger lines meet it and take
the whole of the business The weaker
line passes it's dividends, defaults on the
interests of its bonds, passes into the hands
OF a receiver, ceases even to earn it's oper-
ating expenses and the receiver is
granted the right to issue certificates |
whi ch take precedence Of first mortgage |
to raise money to pay the simple expenses
of operation. Then the bankrupt line con-
trolls the situation and by doing business |
for nothing destroys the business of the |
strong roads and the value of the property. |
Then the investors in railway securities |
which are now practically the only securi- |
ties for investments left in this country, /
call halt, compel a readjuStment. rates |
are restored to fair and reasonable basis, |
the weaker lines are granted in settlement |
the differentials which make up for their |
tIlo IdliTOlttiS UcCOilc pIOSpcE-
Gus, the speculator in rates disappears and |
the business community transacts their |
business upon ordinary calculations gov
erning their product, without having them |
destroyed by action of the common carrier.
Then the railroads discover that money |
lost to themselves and uncalculable |
amount lost on disturbance of business to |
abolish differentials haye been sacrificed |
for nothing. | believe that in time the |
theory to which the country is now COM
mitted that the government through an
commission should prevent rail
road abuses and extortions and discrimi |
nations upon one line will be extended to
leSalize a pool by which method alone
the same evils can be stopped |
when practiced by competing lines against
one another. So far as the public is con-
cerned all routes from one point
to another are one and
system which simply prevents
one line from discriminating in favor OF
one of its own customers against another,
and the destruction of the pool promotes
still more violent discrimination as to one
shipper against others, as different lines
has enormously exaggerated the evils
which it was created to remedy. The
whole of the existing trouble is in the i'm
possibility of railroads legally forming a
pool. A recognition of a proper system
will settle the whole difficulty in twenty
four hours. At present, however. there is
no railway war and there is no chance OF
there being one"