The San Juan islander. [volume] (Friday Harbor, Wash.) 1898-1914, 1906-05-12
STANDARD OIL
and REBATES
PRESIDENT SENDS GARFIELD RE.
PORT TO CONGRESS.

|
Standard Officials Say They
are Doing an Honorable Bus.
mess in an Honorable Manner.
Washington, May Z. President
Roosevelt yesterday transmitted to
congress the report of James R. Gar.
field, commissioner of corporations,
giving the results of his investigation
of the subject of transportation and
freight rates in connection with the
oil industry.
In his message the president ex-
pressed the view that the report is of
capital Importance because of the ef-
fort now being made to secure such en-
largement of the powers of the inter
state commerce commission as will
confer upon the commission power in
some measure adequate to meet the
clearly demonstrated needs Of the sit
uatiOn.
The facts set forth in the report, he
declares, are for the most part not dis
puted. That the Standard Oil Com
any has benefited enormously up
almost to the present moment by Sc.
cret rates, many of which are clearly
unlawful, the president says the re-
port clearly shows, the benefit there
by secured amounting to at least
three-quarters of a million a year.
On this subject he SAYS:
Public Pays the Expense.
''This three-quarters of a million
represents the profit that the Standard
Oil Company obtains at the expense
of the railroads; but of course the ul
innate result is that it obtains much
arger profit at the expense Of the
public.
"a very striking result of the in
vestigation has been that shortly after
the discovery of these secret rates by
the commissioner of corporations the
major portion of them we're promptly
corrected by the railroads, SO that
most of them have now been done
away with.
"This immediate correction, par
tial or complete, of the evil of secret
rates, is, of course, on the one hand,
an acknowledgment that they were
wrong, and yet were persevered in un-
til exposed; and, on the other hand,
proof Of the efficiency of the work
that has been done by the bureau of
corporations.
The statement is added that the de-
partment of justice will take up the
question of instituting prosecutions in
at least certain of the cases, and the
opinion is expressed that congress will
enact into law the bill of Senator
Knox to correct the Interpretation Of
the immunity provision rendered in
.JudgeH umphrey's decision. Contin-
uing, the president says:
Advantage Over Independents
''But in addition to these secret
rates, Standard Oil profits immense
ly by open rates which are so ar
ranged as to give it an overwhelming
advantage over it's Independent COM
petitors.
''This is characteristic example Of
the numerous evils which are newt
able under system in which the big
shipper and the railroads are left free
to crush out all individual initiative
and all power of independent action
because of the absence of adequate
and thoroughgoing governmental con-
troll. Exactly similar conditions OBJ
tain in a large part Of the West and
Southwest.
Is is not possible, he says, to put
into figures the exact amount by
which the Standard Oil profits
through the gross favoritism shown it
by the railroads in connection with
the open rates.
s'That profit, Of course, comes not
merely from the saving in the rate it.
self as compared with it's competitors,
but by the higher prices it is able to
charge and by the complete control of
the market which it secures, thereby
getting the profit on the whole con-
sumption"
Device Used BY Railroads.
The president calls attention to that
feature Of the report recording the
manner in which the law is evaded by
treating as state commerce what in
reality is merely part of interstate
commerce.
He says it is clearly shown that this
device is employed on the New York
Central railroad, as we'll as on many
other railroads, in such fashion as to
amount to thwarting the purpose Of
the law, although the forms Of the
law may be complied with.
It is unfortunately not true. he saws
that the Standard Oil Company is the
only corporation which has benefited
and is benefitting in wholly improper
fashion by an elaborate series Of rate
determinations.
The sugar trust, he adds, according
to the results Of the investigation
now in progress, rarely, il ever, pays
the lawful rate for transportation.
He declares that in the effort to pre-
vent the railroads from uniting for
improper purposes I'VE have very un-
wisely prohibited them from uniting