The citizen-Republican. (Scotland, Bon Homme County, S.D.) 1???-19??, 1906-05-10
RAILROADS and STANDARD
OIL IN GIANT CONSPIRACY

poses OF protecting themselves ana lAo
general public as against the power OF the
great corporations"
He favors, as an lemen of competition,
putting alcohol used In the arts on the free
list and of keeping the fee to oil and coal
lands Of the Indian tribes or on the public
domain In the government. the lands to-
be leased orion such terms and for such
periods as will enable the government to
entirely control them.
Garfield's Report. /
In summarizing his report Commissioner
Garfield speaks OF his personal visit to the,
oil fields and of the great mass OF DATE
obtained by him either personally orr
through agents of the bureau of corpor-,
atoms. The preliminary study of thisi
was transportation. which enters so large
ly into the cost OF the finished product and
hence a most important factor In compel
| tition.
Taking up the subject OF the output of
refined oil, Mr.. Garfield finds that. it
amounts to about 26.0OO,O00 barrels annual
", OF which the Standard Oil ompany dis
rectly and Indirectly controls about 23,000,-;
900 and approximately the same proportionI
OF the other finished products of petrol
leum. Continuing the report says:
1.-THE Standard claims that the location
of Its ref1neries and the use OF pipe lines
are natural advantages to which 1t Is just
ly entitled by reason OF the energy and
foresight Of It's managers. While in a
measure that Is true, 1t must not be for
gotten that these advantages were in part
obtained by means of unfair competitive
methods after years OF fierce Industrial
strife.
Pipe Limo Advantages.
1.-THE development of the pipe line sys-
tenn by the Standard Oil company was tho
result Of special agreements with rail-
road companies. Furthermore those So
called natural advantages have been, and
are being greatly increased by discrimina-
tions in freight rates. both published and.
secret, interstate and state. which give
the Standard monopolistic control In the
greater portion Of the country, and which
so limit competition as to practically pre-
vent the extension Of the business Of any
independent to a point which even remote
ly e~ndangers the supremacy Of the Stand
ard.
A immediate result OF this delim.ta-
ton Of the competitive area is shown by
the prices Of ordinary illuminating oil
throughout the country. After deductinE
the freight rate, the prices Of such oil is
usually from two cents to Ave cents a
gallon higher In the non-competitive than
IN the competitive fields. A reasonable
profit upon refined oil is about one-half
a cent. per gallon. 1t is clear that exorbf-
tant profits are obtained in the non-com-
petitive fields. This monoro1istic control
extends from the wells of the producers
I luc uooISlep OF the consumers
Mr.. Garfield cites the fast that the New
York Central Railroad company was the
only one which refused for itself. and az
mated lines to give access to records OF
states rates.
Tho Inevitable Denial.
At the beginning of the investigation, hc
says, the Standard OIL company denied
that 1t had obtained In recent years or
was now obtaining any rebate or other
TRANSFORMATION fSrriDo{patio a q oro;n.t
its competitors. and yet he says that a
most careful review of the facts and the
explanations leads to the conclusion that
the Standard Oil company has habitually
received from the railroads, and is now re-
ceivlng. secret rates and other unjust and
illegal determinations"
In 1904 these secret rates saved to the
Standard Oil company three quarters of a
million dollars, representing the difference
between the open rates and the rates actu-,
ally paid. These discriminations,' he
says, have been so long continued, so Sc
cret. so ingenuously applied to new cond.-
tons of trade. and so large In amount as
to make it certain that they were due tot
concerted action by the Standard and the
railroads."
He says further that the Standard Oil
company is receiving unjust discrimina-
lions in the matter OF open rates, the pub
lshed rates from the leading Standard
shipping points being relatively much low
er than rates from the shipping points OF
its competitors.
Seven Cases of Discrimination.
Mr.. Garfield then refers to seven in
stances of important Determinations in
favor Of the Standard Oil company IN vari-
Gus parts of the country, and says that
most of the secret rates and some of tho
open determinations discovered by the bu-
reau were abolished by the railroads short
ly after such discovery. After calling at
tcntlon to the good which already has re-
suited from the investigation, Mr.. Garfield
says that the changes effected have put
the independents upon fairer footing and
make competition possible in territories
heretofore inaccessible. This report con-
cludeS as follows:
Nevertheless. the widespread discrim-,
nations In open rates still in force leave
the independents at serious disadvantage.
The investigation has only incidentally
touched shipments from distributing CEN
tiers. particularly in less than car loads.
The few instances examined suggest the
probability Of determinations on such
shipments which, taken in connection with
through traffic, may result in discrimina-
tons on interstate business.
Mere Devices for Evasion.
II have cited these particular instances
to show the various methods by which
determinations are obtained, and to call
particular attention to methods which, If
legal, are mere devices to obtain the same
result as would be obtained by rebates
paid on interstate business. Another
freight discrimination, whether 1t be state
or interstate, tends to give control OF mar
kets to the preferred shipper, and makes
monopoly possible. If existing law merely
prohibits a special device for obtaining,
discrimination, and permits the same re-
suit to be accomplished in a different way.
then the legislation to that extent is a
sham.
This Investigation has shown very
clearly one glazing defect in the Interstate!
law, viz: the method Of fling
and publishing tariffs. Although a tariff
or a rate has been filed with the commits
sion n compliance with the terms of the,
law. none but the favored shipper NAV
know OF its existence. Tariffs may be
made and rates may be combined in such
manner as to make it practically imnos-
siblc for the ordinary shippers to find,
them. AS long as the state rates are NOT
required to be made public, and shippers
use SUCH rates in combination with inter
state rates. all manner of devices to evade
the purpose of the law are possible. All
stale rates used in connection with inter