The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1897-05-17
THE POOLING CONTRACT
MIR. BLANCHARD EXPLAINS m
CHARACTER AND PROVISIONS,
And Tells why the Railway COmpa-
mics Desire Legislation That Will
LeGaIixe Its Existence.
the Editor of the indianapolis Joumal:

ventures which are to be decided by
chance or fraud. while railway pooling
means certainties of which the public has
full f~oreknowledge, and only the railways
incur the possible hazards. Railway pools
do not specify rates, because they cover
fixed terms during which changes in rates
may be made necessary by law, by al
tered trade conditions, by rates at other
points. etc. The rate-making function and
agreement is, therefore, entirely distinct
and separate from the pooling agreement.
Senator Plat (of Connecticut said in 1881:
What is a pool? 1t is simply an agree
ment between competing railways to APP
portion the competitive business, that, and
nothing more"
This being true, d legalized pool agree
ment would read substantially as follows,
in all respects which touch public interest:
1--WE agree to report to a joint officer and
always at the tariff rates, weights and
classification applicable thereto, as from
time to time legally published, filed and APP
proved, all tonnage carried by us between
the specified points.
After each company shall have retained
90 per cent. of it's gross receipts on its own
tonnage, the sum of the remainders shall
be divided between them monthly in pro-
portions agreed or arbitrated.
"All questions of difference hereunder,
except those of law, shall be decided by ar
bitration.'
Two unassailable transportation princi-
pies uphold such agreements, and atten-
ton should be drawn thereto at the out
set. Some standards of rates must be rea-
sOnable, and, being so fixed, approved by
the Interstate-Commerce Commission,
legally announced to forwarders before
shipments and uniformly collected from
consignees, the railways then challenge
proof of any possible public wrong from the
division of such legal proceeds between
them as they may agree. Only the rates af-
feet the public interest. Their apportion-
ment is not a just public concern any more
than sharing the cost of constructing and
operating joint double tracks, union depots,
belt lines, etc.
Pools are moreover for the public welfare,
because they stop solicitations for rebates
and the payments thereof; they transfer
unconsigned or asserting tonnage first, or,
if not that, money, to the carriers in def
icit from the acknowledged overpluS of
their associates, who are therefore only
parties who can be injured; they account
for all the included traffic at the tariff
rates, and il rebates are nevertheless paid
which PRODUCES an excess of any carriers
due tonnage, the company thus unworthily
securing such excess, must pay not only the.
rebates, but the excess tonnage or money
balances to its associates.
POOLING STOPS REBATES.
Pooling therefore stops rebates, because
each party thereto shares the proceeds of
observed rates and the comforts of man
agement and peace with law and conscience
which good faith, thus reinforced, brings
to both associates and rivals.
The agreeing carriers also share the in
cluded competitive traffic in substantially
the proportions of their previous carvings,
while shippers continue to choose their
routes because only the traffic of asserting
forWarderS is used for tonnage equal1za-
ton. Pooling combines the facilities of the
agreeing lines as II they were one COM
pany organized to carry the tonnage of a
community as impartially as they would
that of one great firm. If one railway
charges all the members of one firm alike,
it is also the best corporate and national
policy for all companies to charge like
rates between the same points to all h&ns:
Pooling secures stable rates for all, not
only at traffic centerS, but those local
points which depend thereon, whereas
small shippers at both central and tribu-
tarv points now incur two disadvantage
they can neither sell to or compete with
the large shippers at large points, nor can
they ship against them with equal profits
from small points, where the rates ARP
usually held firmly. Pooling gives the pub
lie the united facilities of all lines at times
of casualty or emergency.
Proper emulGtions are stronger under
pools which assure equal rates, because
only improved Facilities, speed, courtesy
and promptneSs attract and retain business
hereunder, whereas rebates are now more
relied upon. Pooling simply seeks to con-
duct competitive business upon the impair
tial rates and rules observed at local
points, where applications for preferential
cut rates are not entertained, but where
applications for public reductions of rates
$50 nna Hnai6n6 ffn
ences and usually upon the merits of the
causes.
POOLING PREVENTS FRAUDS.
Pooling secures uniform inspections for
the detection of false weights, misdescrip-
tions, etc, by which honorable merchants
may be d%efrauded by others who are not,
and thereby further tends to put all pa
irons upon equal shipping conditions. There
were 1876, 600 cases of misdescription by for
warders detected by the railways at three
seaboard cities last year in west-bound
through freights.
The following facts sustain the foregoing
verment
Former pooling actually diminished re-
bates and would have stopped them before
now had it been SO legalized as to justify
long-term agreements. If honesty were not
always observed under pools it is no ar
SuHlenC against lnem. NO laws nave
stopped ConqueStS, reprISalS or crimes
among nations or persons, therefore union
and laws are the more necessary. 1t would
be as proper to allege that the customs
laws have failed because undervaluations,
~defalcations and smuggling continue. I'M
porters who underValue goods to eVade GUS
toms laws will misdescribe their wares to
railroads to subvert uniform and just trans
portation charges. The government uses
all it's power to stop such frauds upon its
rules and revenues, but the railways can
rely only upon their voluntary and separate
action il the recent decision is maintained.
ferred from road to road, but not to the ex-
tent conjectured. In the last year of the
eastward pools from Chicago. St. Louis, Pc
Oria, Cincinnati, Louisville and indianapolis
all the tonnage charged from one route to
another at all those points was 2.2 per
cent. of the total, and without a pro-
test from shippers. The cash paid by the
same companies to each other in many set
Elements did not average 9 cents per ton.
whereas cuts in through rates are usually
90 cents per ton or more. OF about $12. 600
600 pooled freight earnings less than 5000, 600
changed hands. and over one-half the last
amount was returned to those who paid the
excess balances, because, to get their
money back. they reduced their tonnages,
and not their tariff rates. Not a shipper or
consignee was harmed by these results.
No American pool can be cited which adj
Vanced rates unless to restore unjuStiiable
rate-war reductions. When the trunk lines
eastward and westward tariff class rates
between Chicago and New York was II
cents per 100 pounds. When they discon-
tinued pooling. in 1886, it was under 80 cents.
None contend that pools have fOstered, or
that their legalization will increase discrim-
nations, because their purpose and effect
are alawys TO minimize them.
POOLS DO NOT LIMIT TONNAGE.
Nor have pools restricted tonnage. The
westward tonnage from New York city