The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1903-01-15

The reason, I suppose. why it has been
so commonly assumed that the railroads
exact an unconsciOnable amount for
their product, transportation, is that it
has beeen assumed that railroads have
not been, and are not. subject to the law
of competition nor to the law of supply
and demand nor to any other natural
law fixing the amount of their remuner-
alton as such laws do fix the amount
of the remuneration of the farmer.
Now / believe the fact is, not only that
the law of competition has applied and
does apply to the railroad traffic in this
country, but that from certain inherent
peculiarities of the railroad carrying
trade, that law of competition has af-
fected ana does aftect the railroads
much more strlugently and dlsastrOusly
than any other form of economic ac-
tivity. I believe further that other nat
ural laws or forces are constantly at
work automatically regulating and con-
trolling the compensation of railroads.
So that there is no more ground for as
suming that the railroads are Overpaid
than there is for assuming that any
other form of industry is overpaid-''
Mr. Gleed argued that while the i'm
mediate cost of transportation to a rail-
road is small, the cost of keeping the
road ready to produce transportation
makes the railroad business essentially
different from other lines of business.
Thus" said Mr.. Gleed, 7 think it
would be clear that in the production OF
transportation the proportion of invari-
able expenses to the variable is enor-
mOusIv larger than in any other line of
production. To keep the machine ready
and this must be dOne-the railroad
cannot lie fallow-to keep the machine
ready means almost immediate bank
ruptcy if there be no traffic; it means
bankruptcy very soon if the volume Of
traffic be small, and it means bank
ruptcy before a very long time if the
total tonnage be not, in fact. vast. And
herein lies the weakness the defense
of Il
have tonnage Its invaria bic expenses
are so vast that it must have a vast
volume of freight; it must have this
freight every month and every year; II
must be properly distributed; and this
Must is quite as imperative and mex
orabIe as the Must which rests upon
the farmer to ship his grain
Indeed it is more so. The farmer
can vary his crop. If it does not pay to
ship corn he can raise cattle-cattle can
walk. If it does not pay to ship wheat
he can take it to the mill and have 1t
ground. If rates become absolutely pro-
hibitive he can, as last resort, raise
little of everything and help to build
up such separate, independent, detached,
self sustaining communities as existed
before railroads We're invented This
last is an extreme illustration. of course,
but I am comparing the relative weight
of the 'Musts' resting respectively on
the farmer and on the railroad; and
say tracing the matter to the very end,
] LfaL II the people SHlpDtu IBtIAllS lnEy
yet could live; but the railroad would
die"
COMMUNITY IS PROTECTED.
Speaking of the protection of q COM
munity from railroad excesses, Mr.
! Gleed said.
Another protection to such a COM
munity as I have described lies in the
peculiar nature of the transportation
business az heretofore outlined. 1t lies
lin the fact that profita bic TailrOading
4 frqoFraffNeiW lis tonnage II
low rates rather than medium tonnage
at medium rates or small tonnage at
high rates; that there may be more net
profit in eleven tons at one dollar a
ton than in one ton at ten dollars
Profitable raiIrOading inperatively
calls for f1uX; for the maximum move
ment of commodities. The railroad IS
always anxious that you shall pro-
duce and ship more cattle and more
hogs and more corn and it is to its
4 interest in every way possible to pro-
mote this additional production and ex-
4 change If lowering the rate from ten
/ dollars to one dollar viii evoke eleven
/ tons where only one was shipped be
fore, the railroad profits by lowering
/ the rate.
Again. as I have already suggested
+ there is in the hands of the producer
! and consumer a remedy which l shall
call the remedy by substitution, and
! this remedy or defense like several 9TH
! ers I have already mentioned applies
i TO the trust question aS We'll as 10 tie
/ railroad question. A while ago the
( great packing companies began raising
] the price of beef, and instantly they
found that the people had begun to eat
something else The rise in beef stop
ped. IF the rates on sugar are too h1gh
we shall start beet sugar industries
and raise beets instead of corn and
make our own sugar. If the rate on
boots is too high we shall tan hides
and make our own shoes. If the rates
on corn and starch are too high we
shall make our own starch out of our
own grain The farmer can vary his
/ product: the railroad cannot; all that
it can produce is transportation.
Thus it appears to me that the far
mer not only has the benefit of cOmpe-
titi0n to a peculiarly acute and effective
degree. but also the protection of other
natural laws and forces some of which
{ I have described
But you may say, 'Conceding the
fact that the temptation to the rail
roads to compete and cut is peculiarly
great yet the roads are few in number
( comparatively and under intelligent
control and it has been easy for them
to combine and resist the temptation
on the contrary, it has not been easy
and some of them have actually been
heard petitioning municipal law to in
teFvene and save the railroads from
themselves. There has been as mat
ter of fact and as a result of these
natural forces 1 have described, an
enormous reduction in the price of rail-
road transportation not to be paralleled
in any other line In proof of this fact
I submit a few figures taken from the
bulletin of the United States depart
ment of agriculture on this subject is
sued in 1898:
Tn 1866 the shipper paid on the aver
age for each ton carried one mile over
the Rock Island road 2.40 cents, in 81
.95 cents; over the Michigan Central in
IS 1S2 cents. in '97 81 cents; over the
Fitchburg in Sc. 3-O5 cents, in '97 .S7
cents: over the New York Central in
Sc PIG cents. in 's7 81 cents. over the
Milwaukee in '66 2.77 cents, in ~
cent. over the Alton in IS 2.32 cents, in
81 SO cents; over the Burlington in '6e
2.60 cents in 81 rs cents.
"On most of the roads above mention
ed the sripper paid in Sc more than