Fort Worth gazette. [volume] (Fort Worth, Tex.) 1891-1898, 1891-11-19
THE RAILWAYS.
Ohio and Mississippi Directors
Oppose the Transfer.
WHO PAYS THE FREIGHT?
An Able Article From the Railway Review.
Card of Thanks From MIR. Brown.
Other Railroad News of
General Interest.
Who Paws the Freight.

Who Pays the Freight?
Under the above caption the Railway Re-
view says: " Who pays the freight, the
consumer or producer2' is question much
discussed at the present time, particularly
/ by those who are endeavoring 10 ascertain
the relation properly existing between the
railways and the people, having particularly
in mind the farming community of the
| West With the Alliance and kindred vote
seeking politicians it has long been favor
tie assertion that the farmer was taxed in
both directions; that ne was obliged not
only TO pay the freight on all articles pur-
chssed for his own use, but on all produce
sTsed and sold by him as well; his market
isbeing made by taking from the sale price at
Il designated point the cost of transporta-
ton 10 that point. Or III other words, that
he. receives for grain on his farm, the price
AT Liverpool less cost of transit, while he
pays for his plOw the price at the manufdc-
tory added to the freight from that point
TO his farm; and if Oh the one hand the
grain merchant in Liverpool lowers the
price Of grain, or the transportation COM
panies increase the charge for carriage, the
farmer must suffer; while on the other
hand. if the plOw-maker advances his price
Tor the plow at the manufactory, or if the
railroad company advances its charge for
carriage TO the farm, he must also suffer,
and that therefore and in all cases the
farmer pays the freight.
1T may aid in the discussion Of this Ques-
ton ii it shall be determined in advance
exactly what is meant by the freight. 1t is
simply that portion of the total cost at des-
tination which is entailed by the transfer
of the property from its place Of original
production to its place of final cCnsump-
ton, the entire cost to the consumer being
the expense of production and added
charges, including transportation, which
accrue to the property IN Its transfer from
the beginning TO the end of its movement
The farmer says he pays the freight on
the grain he sells because he receives for
ps{3fs grain at the home market the price in
Liverpool less the cost Of transportation
and handling to that point; but with the
definition as to what "the freight really is
in mind 1t may be well to inquire what
fixes the price at Liverpool; or, to broaden
the inquiry, what fixes the price OF any
commodity at any place Of consumption
So far as individual articles are concerned,
pthe answer 10 this question must vary with
the circumstances attaching to each, but
speaking, generally, it may be said that the
price of all commodities at the point of
consumption is the cost of produc-
ton and trdnsfa: expenses Gn-
FrluGing transportation from the
cheapest available source of adequate
supply. If this assumption is correct the
price of grain at Liverpool is fixed by the
cost OF grain at point which, added TO
the freight and other necessary expenses
for transportation, will deliver it at Liver
pool for the least gross cost. Under the
varying circumstances of the amount of
FfToductioH, the supply of trans Ortation IA
ciliLleS or other circumstances, this point
is not d fixed one. AT one time it may be
India, AT another Russia, or at other times
the United States; but wherever II may be,
that is the determinate basis of the market
price. But, it may be asked, why does Liv-
erpoOl assume to make the market on grain
for the entire world? Simply and only be-
fSause it is the representative market of
country which consumes more than it pro-
duces of the grain product, and thereby
supplies continual demand. That this is
the governing principle is shown by the oc-
scasional variation from the rule when for
'any cause the demands OF other markets
temporarily set aside the supremacy of
Liverpool and fix the price according 10 the
necessities of the case.
But whatever may thus control the price
sat the basic market, II is at this point that
the dividing line Of contribution for tran
spOrtation charges comes in. Up 10 this
point the consumer and not the producer
pays the entire cost of transportation, to-
gether with all other charges, but beyond
s~etais point other parties contribute. If by
reason of a more distant location, more
expensive method of transportation, or for
any other reason the farmer on our West
ern pralries cannot compete upon equal
terms with the farmer of India, or other
base of supply for the Liverpool market.
he is obliged to contribute is his quota of
the expense. and as penalty for his unfor
tunate location or other observation-disclosures
circumstances, the additional cost neces-
sary to get his produce TO that market. Or,
stated in another way, he is obliged to meet
il the markets of the world the price which
is determined by the rule above quoted.
In N Gle
also 10 show that it applies to all classes of
commodities. an illustration nearer home
and easier of comprehension will be of Il
advantage. Suppose the price of 4 plow at
the manufactory at Racine, Wis, to be $50,
ana the cost of transportation to place it in
the hands of the Nebraska farmer. 81
Suppose also that the price of similar
plow at South Bend Ind, is $40, and the
cost of carriage 10 the Nebraska farmer
81, then the total cost of the plow in either
case is SD. Suppose again that the carrier
from Racine raises his price for tranSporta-
ton to $50 per plOw, while the cost of
sTarriage from South Bend remains the
same. What is the result? The Nebraska
farmer does not pay any more for his plow.
but the producer of the plow at Racine is
obliged to accept fifty cents less at his
price at the mandatory than before, or ne
cannot sell the plow. Or, in other words,
the farmer continues to pay the cost and the
sxcer of the Racine pillow is obliged
" pay the extra fifty cents carriage
charges in order that he may be on
common footing with his rival
producer Of plows in South Bend. This is
the principle which governs the payment of
freight throughout the world. Were pro-
ducers confined 10 u single market the case
would be different, but So long as under our
sBresent system of transportation the mar
Rets of the world are open 20 all, so long
will the rule which we have formulated APP
ply. namely, that the price at any given
market IS determined by the cost of pro-
duction and expenses attending the transfer
s3rom the cheapest available source of ade-
quate supply, which total cost up to that
point is paid by he consumer; and any ad-
ditional cost entailed by being more dis
tant or because of unequal facilities or
more expensive methods, are at the cost of
the producer.
Tail Lights.
5. R. Thompson of the Canda cattle car