The morning call., 1892-03-28
MORE RESTRAINT OF TRADE.

1t is not easy to understand the exact
nature of the change which the Transconti-
mental Association made at Chicago on Fri
day in the subsidy paid by the trausconti-
mental railroads to the Pacific Mail; but it
appears that reduction of one third is to
BE- made in the sum paid by the railroads to
buy off competition in west-bOund business
to points north of Mojavc, and that a cor
responding reduction is to be made in the
sum paid to buy off competition in east
bound business from all points south of
Mojave. 1t was further determined that
the Pacific Mail should not be allowed TO
carry freight to or from San Diego or any
California point south of San Francisco.
The Pacific Mail Company has now 10 be
heard from on the question.
However it may act. the original situa-
tion Will probably remain unchanged. As
matters stand the transeontinental railroads
pay to the Pacific Mail a sum which approx
imates TO s1,0Oo.ooO year in consideration
of its refusal to give California the benefit
of water competition; or. in other words.
for depriviDg the State of its natural adj
vantage in the possession of a seaport. The
sum paid may vary, but it is not likely that
it will vary enough TO induce the Pacific
Mail directors to turn over new leaf and
enter actively into competition with the
railroads. So far as shippers are concerned
it matters nothing whether the railroads
pay S1,000G00 or S750,0Oo, or $4,000 or
100000 What they complain of is that
any subsidy at all should be paid for the
unlawful purpose of restraining trade.
The new stipulation in regard TO San
Diego explains the nature OF the bargain.
BY the contract which the Pacific Mail Com
pany made with the Government, its steam
ers are bound to touch at San Diego, going
and coming between San Francisco and
Panama. The railroads now insist that
they shall not receive or discharge freight
at that point. Ii they did receive freight
at San Diego there is a possibility that they
might move the wheat which is grown there
to Port Costa, and the Southern Pacific
would lose the income it derives from car
rying that wheat $50 miles by rail at
charge which aDsOrbs the profit of the
wheat-grower. To prevent this the South
ern Pacific and the Atchson and Topeka re-
qure the Pacific Mail Company to bind
itself not to do the work for which its ships
were built, and not 10 render the service for
which it receives a subsidy. disguised under
tile name of postal allowance, from the
United States Government The question
which is now exercising the mercantile
community is how long this restraint of
trade shall be permitted to continue, for the
aggTandizemenJ of a few individuals who
own the railroads and the stock in the Pa
cifc Mail
1t is idle to try to move these persons by
appeals to right and wrong They did not
60 into the railroad steamship business it
seems for their health. They went in for
eoin-for all the coin that is in it; and that
is their objective point to-day. They will
cripple trade, check industry, neutralize the
advantage Of our seaport, exact all the
freights the traffic will bear, and nullify
the railroad commission law, so long as that
course appears to promise dollars. The
future eff both the Southern Pacific Railroad
and the Pacific Mail is mighty uncertain tits
doubtful ifthe steamship company could last
long if the railroad subsidy were withdrawn.
And as to the railroad, the present owners
have only got four or five years equity in
1t. The subsidy bonds begin to mature in
1895; before the century ends they will all
be due. Wild schemes for their extension
at nominal rate Of interest have been
suggested, and there have been times when
they might have commanded votes in a
good-natured Congress. But the railroad
managers have shown themselves so AFRO
gantly Indifferent to all interests but their
own. and their reputation in this regard Is
so we'll known all over the country, that il
would be as much as any Congressman
political life is worth to vote for an extern
sion to-day. The bonds will have to be met
In full. principal and interest, and as the
company cannot meet them foreclosure and
sale are ineyita hie