The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1893-02-24
UNHOLY TRAFFIC ALLIANCE
How the Pacific Mail and TRANSPORTS.
mental Association Worked Together.
An Agreement That Kept Up Freight Rates
Ovation to Mr.. Herbert in the House
Bills Passed by the Senate.
THE PACIFIC MAIL.

It's Agreement with the Transcontinental As
sociation Explained by Mr.. Leeds.
WASHINGTON, Feb. 23.-The Panama-Pa.
cific Mail investigation was resumed to-
day, and the Pacific Mail end of the lnves.
tigation was taken up. Mr.. Leeds who was
formerly the traffic manager of the Gould
roads. but is now the representative of the
merchants of California, who form the
Merchants'TrafiicA Association of California,
which proposes to put on line of steamers
in opposition to the Pacific Mail COM
pany, testified that there had been
q compact between the trsnscontinental
railroads and the Pacific Mail Steamship
Company. The railroads paid the Pacific
Mail q subsidy and reserved the right to
say what classes OF freights the steamships
should carry and also fixed the rates to be
charged. The management of the Pacific
Mail was absolutely In the hands of the
Transoontinentsl association. so far as rates
and business were concerned. The effect
OF the agreement was also 10 keep MP the
freight rates on siow-going merchandise
around Cape Horn by clipper ships. lt
was to some extent true that merchants in
the interior were compelled to see their
freight go clear through to the coast from
the cast paying the through rate, and then
local rates instead Of having tho freight
delivered on the through trip.
Witness did not think the Panama rail-
road ought to be made free to all and all
mend to his company to 20 into the scheme
OF all without the Panama railroad
agreement. The object of the transcon-
tinentai association had been to destroy
competition between the seabOardS In Or
der that the railroads might charge higher
rates. In pursuance of this policy the as
ISOLATION paid the Pacific Mail company
S75.C0o month in consideration OF the
steamship company allowing the railroads
to fix freight rates. and the Pacific Mail
paid the Panama railroad 1000 q month
for exclusive transportation rights over
the railroad. The amount of freight
the Pacific Mail company might carry
monthly was strictly limited. Witness un-
derstood that the Pacific Mail was a gov
eminent subsidized line, and that the roads
In the Transcontinental association had re-
ceived government aid. 1t was true that
their secret agreement sought to prevent
the people from getting the benefit Of iull
competition.
Mr.. Leeds said that he had made caIcu-
lation of the burdens paid by the people
of California for transportation with
in the State only. The gross an
nual earnings of the Southern Pacific
Railroad Company alone. in the State OF
California, amounted to S30000.000. or $50
per head of the population. Freight rates
in California should be decreased 25 per
cent, or $500. coo annually over the South
ern Pacific. For carrying freight from San
Francisco to Fresno. two hundred miles.
IS cents per hundred was charged. which
would carry the same freight from New
York to Wichita, Kan. No other country
than California could stand such rates.
E. l.. Openheim. secretary treasurer and
director Of the Panama Railroad Company.
was examined. He said that the reason the
Panama Railroad Company dld not renew
It's contract with the Pacific Mali was be-
cause the railroad company wished to gain
it's ind pendence. He further said that in
the Pacific Mail his company insisted on
making rates. but the nonrenewal was the
result of actions Of G. p. Huntington In the
matter.
Gen. John Newton. president of the COM
p8ny, cOrrOOorated the testimony of Mr..
Openheim, and the committee adjourned.