River Falls journal. [volume] (River Falls, Pierce County, Wis.) 1872-2019, 1905-06-01
GOVERNMENT RATE MAKING
Professor Meyer, Of Chicago Claims
it Would be Detrimental to
the Northwest.

y
Chicago, today in discussing the re
suit of government ownership and
regulation abroad.
Professor Meyer is recognized rs the
foremist authority in the subject of
the relation Of railways to commerce
and Industry in this country. He has
taught economics at Harvard and is
now assistant professor on that sub
.iect at the University of Chicago. He
has just returned from Washington,
where for several days he appeared
| before the Senate Committee on In
terstate Commerce.
Zone of the most important ques-
| tions that must be considered in rela
ton to the proposed legislation to
| grant governmental regulation of
rates to the Interstate Commerce
commission or any other body that
congress may see fit to create for
that purpose" said Professor Meyer,
is the condemnation by the Inter
state Commerce commission of two
of the greatest and most beneficent
railway rate practices to be found in
this country, namely, the granting of
extremely low rates to grain and all
kinds of agricultural products which
are designed for export, and the
granting low rates to commodities
brought into the interior on through
bills of lading as against commodi-
ties shipped in the first instance to
an American port and then reshippedt
This embraces rather widely the gem
eral subject of differentials. Let rae
cite first the practice of discrimira-
ton in favor of export trade. 1t is
very old one and has been of enor
NOUS benefit to American farmers.
Often the rates upon grain and all
kinds of agricultural products for eN-
port have been only so per cent OF
/ the rates for the movement Of these
same articles to the Atlantic seaboard
for consumption. Thus the railroads
have been able to reduce heir rates
on agricultural commodities with
greater rapidity than they would 9TH
erwise have been. 1t would have
been impossible to make the reduc-
tions extend equally to domestic
trade, for those reductions would not
have increased consumption upon the
Atlantic seaboard and would have dc
creased the net returns from hand
ling the business.
1.-THE low rates made upon our eX-
ports have enabled the American
| farmer to compete with Europe, not
only with the farmer of England
and Russia but with the farmers OF
western and central Europe them
selves. But for this the American
farmer could not have displaced the
western Europe farmer to the extent
to which he has done it.
''The produce exchange made this
practice subject of complaint be-
| fore the Interstate Commerce Com
mission. The chambers of commerce
| in Minnesota ana indiana, and q
number of state oranges, passed res
olutions protesting against the de-
cision of the commission condemning
| the practice of lower rates on grain
for export. This protest stated that
| the western farmers were raising
grain for the purpose OF making
living, that they were not philan-
thropists, and that they did not pro-
pose making the New York elevator
men the beneficiaries of their labors.
Luckily the decision OF the Interstate
Commerce Commission was reversed
by the supreme court, else the value
Of western grain would have been re-
duced NUMBER of cents per bushel.
SIN another case which came before
| the commission there was involved the
Iuuestion of the building up of the
! grain export trade from Philadelphia
| and Baltimore. 1t was necessary to
| induce steamships to come to those
ports because they would not come in
| ballast and they could not get car
goes comprising only those things
| which were destined fGT those ports
under existing conditions. In order
to bring ships to their wharves, 1T
was necessary to grant percentages to
! the steamships upon trade brought
| from Europe for import to interior
points. That resulted in practical
reduction Of import rates. Freight
| from Liverpool to Chicago could be
brought in by Philadelphia ard Bal
| timore at no greater rates than those
existing between Liverpool and New
York Furthermore, through rates
were established which made it
cheaper to- ship on through bills to
| Chicago and other western cities than
have the imports pass through the
hands Of jobbers in New York. This
| led to the development OF the great
wholesale business in the principal
western cities.
.DThis practice offended the import
! erss Of New York and suit against
| the railroads ensued. The Interstate
Commerce Commission ordered that
| The practice be discontinued. The
supreme court overruled the decision
| Of the commission on a question of
law. the question being that the In
| terstate Commerce Commission had
decided that in interpreting the long
and short haul clauses the commits
sion could not take cognizance of
conditions auroad. The court held
that, being confronted by a great va
riety of conflicting interests between
which it was well nigh impossible to
hold the balance, in order to solve the
difficulty the Interstate Commerce
Commission had eelected one interest
out of many and had decided upon
that TO the exclusion Of others. The
court said that the commission had
concentrated it's attention opon the
American manufacturer and the
American seaboard and the importer
on the Atlantic seaooard, to the ex-
clusion OF the facts that the arrange
ment of rates complained against en-
Outraged competition between New
York. Philadelphia and Baltimore,
ard that it gave to the consumer in
the interior the benefit of the com
petition.
There is little ,,ou~ that if the
Interstate Commerce Commission
possessed the rate making power
which it is so eagerly seeking it
would exercise this power. as it has
endeavored to do in the past, in such
\ way as to hamper the great agri-