The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1902-04-27
Only seventy thousand Miles of indie
pendent Track and All of Ii Is
at Mercy of Combines.
TESTIMONY OF MR.. PROUTY
BEFORE THE HOUSE COMMITTEE ON
INTERSTATE COMMERCE..
He Says Competition Is Gone Forever,
and the Only Remedy Il SUI
pervisiOn Of Rates.

biBnluCAuL 10 near senator McMlllans OF
Michigan. say that the time was rapidly
approaching when government ownership
OF railways might be reality He is an
uItra-conservative business man Of large
wealth. a progressive but cautious public
man. and one whose sound judgment is
considered OF value by men of all parties.
He provoked into making the state
ment of possible public ownership by his
explanations of why there should be one
great passenger station in Washington for
all roads. IL was not a deliberate prophe-
cy, but. coming from senator of his care
ful speech, is Of Importance Three years
ago this same man would have been
shocked at the bare suggestion Of such an
ownership.
In this connection some exceedingly in
teresting information is to be had from
the reports OF the hearings of the House
committee on interstate and foreign COM
merce. This week IT has had under consid-
Grafton the bill Of Representative Corliss
extending 10 the Interstate-commerce Com
mission the authority to require all trans
portation companies TO publish rate sched-
ules and TO provide severe punishment
when these are not rigidly adhered 10. 1t
has long been the theory of many who
have made a study of the transportation
question that il was OF the greatest COM
mercial Importance to provide a transport
tation system with rates which were as fair
and equal to all as the postal rates, and
that the only way to secure such rates was
TO give the transportation companies the
power TO severely punish violators. The
necessity Of this was clearly discussed by
Mr.. Prouty, of the Interstate-commerce
Commission.
THE GREAT SYSTEMS.
In his testimony Mr.. Prouty pointed out
that the elimination of competition was the
only possible result OF the decision which
made Illegal ali joint traffic associations.
He said he could expect nothing less than
the consolidation of all railroads, and the
problems to be considered are the pay
rnent OF rebates and the granting of dis
elimination. In making the basis for his
statement. Mr.. Prouty classified the great
railway systems as follows: The Wander
bilt system embraces 1880 miles. This in
cludes the Northwestern road, which is a
part OF that system. but is not down on the
books. The Pennsylvania system has 1850
miles This includes the B. & O., Chesa-
peske & Ohio and the Norfolk & Western,
nominally controlled jointly by the New
York Central and the Pennsylvania. These
two roads are in fact controlled by the
Pennsylvania and should be added TO the
Pennsylvania system. making system of
1900 miles. The Morgan-Hin system,
which embraces roads which Mr.. Morgan
controls. aggregate 81 800 miles. Mr.. Nor
gan and Mr.. Hill control the $1,000 miles
embraced in the Northwestern merger. Mr..
Morgan controls the Southern road and
also to-day controls the Louisville & Nash
VILE. Add that TO the previous figures
with smaller roads and it makes 1900 miles
OF road controlled by Mr.. Morgan. The
Gould system is placed at 5000 miles The
Hartman system now embraces 210O0
miles; this is Mr.. Harriman's estimate.
The total is 114.o00 miles controlled by five
systems There remain the Atchison, the
Rock Island, the San Francisco and the
Milwaukee as the only important independ-
ent systems. They aggregate 1900 miles.
These q. 900 miles. added to the 114,O0O miles
previously mentioned. form the monopoly
OF the railroads of this country in the
hands OF five men.
Commenting on this, Commissioner
Prouty said to the congressional commit
tee: There are 100000 miles of road in the
United States. There are approximately
10000 miles not controlled by the five sys-
TENS and the few independent companies
Seventy thousand miles of railroad that
does not begin anywhere nor go anywhere!
Seventy thousand miles of railroad that
Is absolutely dependent for its existence
upon these five great systems! You may
talk about railroad competition, you may
rely on railroad competition to reduce
rates, to regulate rates. but there is no
railroad competition. Five men, seated
around table in the city OF New York,
from Kansas City to the gulf. from Kan
sas City to the seabOard, from the Missouri
river to the seaboard and from the grain
fields TO Chicago and Duluth. There is no
competition on grain
CANNOT BE REACHED BY LAW.
.These men have a pooling arrangement
that can never be reached by law One of
\fwo things must result. Either these five
men will agree upon some modus vivendi.
upon some apportionment Of territory. as
they have done in England. resulting in the
highest freight rate there in the world
Either this or they will become partners.
or one man will buy out the other four. The
competition which has been relied on in the
pas1 is thing of the past Governor Van
SAINT says we must compel competition
Therefore, he wants 20 dissolve the North
ern Securities Company Suppose YOU dis
solve the Northern Securities Company
What have you gained? Both railroads are
still owned by the same men. They are
merged. They will still be friendly You
cannot by any possible force make the men
who sit around this table I'm New York fix
ing rates become enemies. Morgan bought
his stock in the open market. Can you de-
prive him OF IL? Suppose you could Sup
pose you could break up every railroad
combination. disintegrate the New York
Central lines. dissolve the connections be-
tween the powerful Pennsylvania lines dis
member the Hartman system and the
Could system. etc. You would have this
country In a state OF chaos and a state OF
bankruptcy in the railroad world But
there IS a remedy.
when you have a condition in this coun-
try where on virtually controls its
railroads. what are you going 10 say about
f.? We asked Mr.. Hartman that question
and We asked Mr.. Hill that question Mr.
Hartman and Mr. Hill both said: You
need not be at all alarmed. We will take
care OF the public. We will reduce freight
rates. Instead OF being reduced rates are
rising There Is "A steady advance IN rates