The Somerset reporter., 1905-05-04
The Panama Railroad

There has been some question expref-
ed 10 regard TO the running of the Pana.
ma railroad now that 1t has come into the
hands OF the government and 1t has been
matter Of considerable interest TO GER
tain trans-cOntinental roads whose rates
OF traffic may be somewhat effected
should the rates of this short road across
the lsthmus be materially lowered.
In view Of this uncertainty Secretary
Taft has concluded to publish a letter
addressed to James J. Hooker of Cincin-
natl in which he makes known what
seems to us to be the reasonable policy
OF the government in operating this road
and the three steamships connected there
with which run from New York to
Colon. The statement in part is as fol-
lows:
"The policy of the government IN
managing the Panama Railroad Ia to
charge such rates as will pay for the car.
rage OF the goods across the isthmus, a
reasonable returR on the Investment of
the government, and nothing more. Ii
In favor of any of the connecting steam.
ship lines. 1t may be that this policy
will affect the transcontinental rates az
to those classes of freight that can stand
the isthmus trip, favorably for the ship
per. However, Mr.. Wallace, our chief
engineer and railway manager of ex
perience, thinks that the proposed
changes will not have much influence on
franaannfinanfa1 hnnanap a thinHe
that but q small proportion of that
which goes to make up transcontinental
freight can be carried by the isthmus.
The long trip and the fact that the mer-
chsndise cirried is to be a considerable
period In the tropics exclude the possibll-
ity of carrying many kinds.
"The Panama Railroad Company owns
three steamships, which ply between
New York and Colon. We shall make
the rate upon these ships as low as pos
sihle consistent with paying reasonable
compensation for the carriage and the
investment. We shall run them merely
for the purpose of preventing combina-
tion to raise the rates for the delivery Of
material for the construction of the canal
from the United States to the sthmus.
"The government is not running and
New York and San Francisco or between
l'San Francisco and New York; hence the
relation of its policy to transcontinenta
rates is only indirect. The policy of the
Panama Railroad Company heretofore.
in view OF the ownership Of the three
ships and the docks at Colon and its re-
sulting ability to exclude from the New
York and Colon business any other
steamship line, has been to monopoize
the trade between New York and Pana-
ma on the one side, while it's arrange
ment for exclusive through billing be-
tween New York and San Francisco with
the Pacific Mail Steamship Company pro-
duced monopoly for the Pacific mail
trade on the other side between Panama
aud San Francisco on the north and a
monopoly for the Chilean and Pacific
steamship companies from Panama to
the south. So far as the action of the
Panama Railroad Company can break up
these monopolies, it is being taken.
"The governments acquisition of the
railway line WAS not primarily for the
purpose of affecting railway or ocean
rates, trsnscontinental or otherwise. IT
was for the purpose of acquiring an in-
strument with which TO construct the
canal, an instrument absolutely inds-
pensable to the accomplishment OF our
purpose within reasonable time. The
incident that we must hold the railroad
under franchise requiring US to do a
commercial business is what imposes
upon us the obligation to do what we
can to make just rates and prevent dis
elimination, and this we shall do. II
this amelorates conditions we shall be
very glad. II it does not, 1t will not be
in our power to do more.