The San Francisco call., 1896-03-25
Traffic War of the Past Three
Years to Give Way to a
Dreaded Peace.
NO NEW SCHEDULES TILL MAY.
The Subsidy to Be Paid the Panama
Route Carriers Equal to $50
Ton.

the work of the railroad magnates, who
are endeavoring to bring into existence
again the old Transcontinental Traffic
Association, it is known in railroad circles
that they are actively though quietly at
work perfecting the plans for reorganiza-
ton.
The men in this conference are those
representatives of the various roads who
have general charge of the traffic depart
ment, the Southern Pacific representative
being J. C. Stubbs, who is tle third vice
president of his road as we'll as general
traffic manager. This body considers and
decides upon the broad propositions in
volved, such as differentials and subsidies,
and the arrangement of details is then left
to a subse quent meeting of the general
freight agents of the various roads in
terested.
That the work of the railroad men now
in conference in New York is progressing
satisfactorily is shown by the fact that
meeting of the general freight agents of all
the transcontinental lines has been called
to meet at Milwaukee March 80, and it is
believed that the work before it will be to
fix up the details, such as new rate sheets,
that will make possible the full and COM
plete rehabilitation of the Trans onti
nent tai Association.
Although there is Federal law against
what is known as a pooling arrangement,
that obstacle is overcome by very simple
and ingenious arrangement, which does
away with the 'pool" in fact, but main
tains it in spirit, and by means of which
the entire country so far as its transpor-
tation requirements are conc, rned, is
placed at the mercy of combination that
has often and amply demonstrated its dis
regard for the general public interest when
that interest contlicted in any sense with
its own.
Instead of there being a general pool
formed, an arrangement Is agreed upon
whereby each road is to issue certain
freight schedule, based on a differential
tan arbitrary difference in rates) that is
calculated to give it its fair proportion of
business. In this way no carrier has any
excuse for attempting to invade the terri
tory of a rival, and thus all competition is
stif1ed, and the danger and evils of a rate
war are averted. 1t is on this basis that
the reorganization of the Transcontinental
Traffic Association is being effected.
That body went to pieces about three
years ago through the recalcitrancy of the
Great Northern, which declined outright
to continue to pay its proportion OF the
$72, 800 then being paid by The Transconti-
mental Association to the Pacific Mail
Steamship Company, which in those days
by means of rental contract, and which
also had its own steamers on the Atlantic
side. The example of the Great Northern
was followed shortly by the Northern Pa
cifc and by the Canadian Pacific. Then
came the withdrawal of the subsidy, the
expiration and cancellation of the contract
between the Pacific Mail and the Panama
Railroad, the through-freight war through
the instrumentality of the North Ameri-
oop vi in, hi ia
City, and finally the complete disruption
of the Transcontinental Traffic Association.
And ever since rates have been in 8 most
demoralized condition.
But when the Panama Railroad Com
pany allowed itself to be beguiled and
again tangled up in the net adroitly spread
by C. P. Huntington through the Pacific
Mail Steamship Company ray of hope
was infused into the situation, and it was
not long, as events proved. before joint
meeting of the transcontinental lines was
deemed advisable and desirable.
What the action of the association in
the matter of agreeing to pay subsidy of
S72 500 per month TO the Panama carriers
means to the merchants of San Francisco
may be surmised in the light of an anal
ysis of certain facts and figures.
According to the dispatches from New
York, where the magnates are in session,
the proposition Is to pay the Pacific Mail
ship Company and the Panama
Railroad Company $72 $500 per month,
which amount is to be divided in the pro-
portion of 55 per cent to the Panama COM
pany and 45 per cent to the Pacific Mail
Company. This is not designated a SUBJ
sidy by the railroad people, for that would
be violation of the law, but is to be paid
for rental of 800 tons on each outgoing
steamer Three steamers leave New YORK
and this port every month on the through
route via Panama. The rental is therefore
to pay for 5000 tons month, or at the
rate OF something over $2O per ton. When
the railroads thus jointly agree to pay the
Panama route something over $40 per ton
for freight the question naturally asked by
the merchants is, What will be the all-rail
rate between New York and San Fran
ciscop AS a matter of fact, however, there
has been less than $500 tons moved over
this route during the past three onths,
and this has cost the shipper only from IS
to $12 per ton.
What makes the San Francisco shipper
feel aggrieved is the breach OF faith on the
part of the Panama Railroad Com pany.
This company has always been most ear
nest in the protestations of independence
and of maintaining the isthmus route as
a genuine and actual compe titor of the
railroads. This it was in position to do,
as was known to the mercantile commu-
nifty, because it, and not the Pacific Mail,
has voice in all traffic arrangements
made, and it is the Panama company that
now casts the vote for itself ana the Pacific
Mail in the deliberations of the transcon-
tinental lines at New York.
1t is not likely, even under the most
favorable circumstances, that the advance
in rates will go into effect before May
next. The freight agents will not get
together until March 30, and it will take
them some little time to build up the new
given to the public of the proposed
changes Another important fact in this
connection is that the Panama Railroad
Company, about three weeks ago in an
nouncing its sailing schedule Of west bound
steamers, at the same time declared that
the existing rates were guaranteed until
May l.