The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1895-08-31

effected by what he called the clipper COM
pact. In 1894 the average rate for iron
ships was Sc SO and for wooden vessels
Sc 06, while the present rates were So 64for
iron and IS 40 for wooden ships.
1t was admitted by the company's repre-
sentative that the depressed condition of
things generally required the greatest
economy on the part of every one but he
did not think it was fair to make the rail-
road bear the sole burden of relieving the
distress of the farmer.
Attorney Martin-What proportion of the
wheat raised in the State and shipped to for
eign ports in 1894 passed over the lines of the
Southern Pacific Company?
Smurr-About 43 per cent and fraction.
Stanton - What percentage of all freight
earnings of the company is derived from
wheat?
Smurr-In 1893 we earned about 50 OOO, 900,
including the movementof wheat between in
terror points, and in 1894 about half that
amount, owing to the short crops that year.
Mr.. Lansing, in presenting statement of the
finances of the company, will give you the
and you will then be able to calculate what
proportion of them was earned in the carrying
OF wheat.
La Rue-Do you in making your tariffs
equaiZe rates so as to meet the conditions of
the different localities?
Smurr-Yes, sir, but we must take market
and water competition into consideration.
La Rue-There have been reductions made
since that of December, 1894?
Smurr-We have made no material reduce
tons since then.
was proper, would my method as suggested in
the resolution be fair?
Smurr-No, it would not be fair.
At this point Mr.. Smurr spread upon the
table a Typographical map of California,
showing the lines of the Southern Pacific
Company in the State. With the aid of
this, he then proceeded to explain on what
no for ri do IIa
Tidewater points are the detectives. Port
Costa, Stockton, South Vallejo and San Fran
cisco are the principal tidewater terminals.
In response to question by Commits
sioner Stanton it was stated by Mr.. Smurr
that tariff based on distance alone was
impracticable, because of other conditions
that must be considered. These were
principally the distance from market of
the locality known as market competition,
and the competition created by water
ways. He further explained:
In the San Joaquin Valley we have the San
Joaquin River as competitive factor far
south as Fresno. In the Sacramento Valley we
have the Sacramento River, and in the Salinas
Valley we must compete with the Pajaro Rail-
road, which carries the wheat to Moss Landing,
whence 1T is carried by water to San Francisco.
With such conditions to contend with a dis
lance tariff i'll regular arithmetic progression
would not fit the situation. Nearly every
where we have to meet competition, either
active or far removed.
Our grain tariffs are on an arbitrary basis of
rate-makfng for all points susceptible to water
competition.
Our December 1894 reduction was made on
the representations of the grain-growers of the
upper San Joaquin Valley OF the distress pre-
vailing at that time, and if we had not made
reductions at that time / believe the farmer
would have Jared as we'll, for. the clipper COM
bine would probably have had to take that
much less from the grain-shipper.
StantOn-Mr. Smurr, allow me to call your
attention to certain popularity find in
looking over certain comparative tables have
here. | would like you to explain, II you can,
why different rates are charged for the same
haul to Port Costa from different points.
find that from Maxwell to Port Costa, dis
lance of I02 miles, the rate is 50 05 per ton;
from Reed TO Port Costa, distance of lob
miles, 81 80; from Livingston to Port Costa,
1O5 miles, 81 30; from Volta to Port Costa, 103
miles So SO.
La Rue-The rate from Reed is due to its be-
ing nearer to Marysville than the other points.
Smurr-The difference is caused by the de-
gree of water competition.
Stanton-Let US take Maxwell and Living
ston. Why IS the rate 81 05 from Maxwell and
81 so from Livingston?
Smurr-There is a greater degree of water
competition from the former place than from
the latter.
CIark-Was the reduction made by the COM
pany in December, 1894, in the nature OF
horizontal cut?
Smurr-It was not.
La Rue-If 1t were necessary to make say
reduction of 10 per cent would an injustice be
done by making 1t general?
Smurr-We would not think of making
horizontal reduction. We would apply the re.
duced rates TO the localities where we thought
they were most needed-for instance, to the
place most remote from idewater.s The farmer
who is so near ude-water as 10 get a rate of 81
to tits not so badly in need of q reduction,
even If his rate is ) cents mile per ton, as the
farmer whose rate, owing to his distance from
a shipping point is SO a ton, even If he is pay
ing only at the rate OF cent mile per ton.
This is the view we take of the situation.
Martini would like to call your attention
again to the question of DR.. Stanton with ref
erence TO the difference charged Maxwell and
Livingston. Is it not due to the greater water
competition at Maxwell?
Smurr-That is what stated. Now to return
to my explanation of the basis on which rates
are made. We take Port Costa, the great ship
ping point for grain, as the starting point
Stockton, Sacramento and San Francisco are
given ditferentials that are entirely arbitrary.
Stockton's grain rates are made under special
conditions, fixed years ago by the commercial
body of that city and the company.
Stanton-There are some points from which
the rate is cents mile per ton.
Smurr-I have no doubt of that; and in some
localities it is even higher, perhaps.
La Rue-Yes; find a rate here that's as high
as ~ cents mile per ton.
Smurr-That is due TO the short haul, which,
as l explained before, is much more expensive
in proportion than a long haul. 1t is also
probably due to the character of the road.
Mountain roads are more expensive TO operate
than those in the valleys In the case of a
short haul the cent rate might apply, while 1
cent mile might be good rate from other
points Where there is difference in the
rates there is always q good cause. Water
competition is not always a factor. In some
localities, where competition is keen, we are
satisfied if we get something over the bare cost
of hauling the freight, that is the operating
expenses. but we take it so asto tighten the
burden of other portions OF our roads in meet
ing the fixed charges. Matchmaking in coun-
try like this is by no means a scientific propo-
sition. To run road so as to compensate the
owners it must not only return something over
operating expenses, but must leave surplus
after also paying the fixed charges. Our claim
simply is that our rates are justifable on any
standard that can be brought to bear on them.
pany any more of the share of the operating
expenses and fixed charges than other commo-
dities in proportion to the respective volume
of each handled?
Smurr-No, sir.