Pittsburg dispatch. [volume] (Pittsburg [Pa.]) 1880-1923, 1889-05-14
THE EFFECT OF COMPETING ROADS.

The reference of Mr.. Carnegie in his in
terview in THE DISPATCH the other day to
the responsibility of Messrs. Mccullough
and Stewart for the policy of the Pennsyl-
vania company which called the Pittsburg
and Lake Erie road into existence, occasions
some little talk. We have no disposition to
undertake the decision of the personal issues
that may arise in the discussion of railway
questions. But we desire to dissent from
Mr.. Carnegie's view to the extent of point
ing out that whoever was responsible for the
policy that made the Pittsburg and Lake
Erie road necessity, unwittingly did the
Pennsylvania Railroad interests service.
To state the proposition in its brosdest way,
the building of competing roads to Pitts
burg caused such an expansion of traffic that
the roads whose monopoly is taken away,
gained by it.
The advantage which the opening of
competing line conferred on Pittsburg ap-
pears most plainly from the iron statistics.
The year the Pittsburg and Lake Erie road
was built the production of finished iron in
Pittsburg was Az, 900 tons, or 17.6 per cent
of the whole product of the country. In
1888, four years later, the production was
81, 900 tons, or 20.S per cent. The great
er portion of the actual increase was
due to the revival of activity; but the
increase in Pittsburg's proportion of
the total product of the country was due
to the improvement brought by moderate
railroad competition. No other cause can
be attributed for the gain of 80 per cent, or
about 15O, 900 tons. The statistics of later
years would include the gain from natural
gas; but this gain must be credited solely to
the improved rates secured by a competing
line.
Now it must be plain that the gain in this
single item indicates a corresponding in
crease in other items. The addition of 15O,-
600 tons through railroad competition,
means when the coke, ore, pig iron. coal
and limestone freights are added, gain of
goo, 900 tons in the item of iron freig ghts
alone Give a corresponding increase to
other lines of traffic, and the total increase
in freight traffic from Pittsburg alone, re-
sulting from the opening of the P. & L. E.,
will be found to exceed the entire tonnage
of its whole line for that year. In other
words, while the new line earned liberal
profits, it caused an expansion of traffic
which spread to the lines with which it
competed. This is corroborated by the in
crease of both net and gross earnings which
the Pennsylvania Company's reports show
for the years after the Pittsburg and Lake
Erie was built.
Competing lines are an advantage, and
when brought to bear on determinations
such as the Pennsylvania Company laid on
Pittsburg in the last decade, their good
effect extends to the corporations whose un-
healthy monopoly is broken. The lesson
should have its effect upon the railway
men who imagine that the secret of success
lies in strangling competition. Since no
new competition is involved in the present
problem, it should be plain to our present
railway managers that their truest pros
peritv, as well as the progress of the COM
munity, lies in such rates as will stimulate
Pittsburg industries and expand her freight
traffic