The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-05-05

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~ meet 40 ,IrnfI, lem, stated fe"ds
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shia report pre for me INST raft net dts-
futed II II unly ihr differences from
them Siai are disputed md even Nv thiH 70.
erect tho dispute r. practically limited ~ 'h"
aueatlnn ~ o. vhsfhcf thp transactions ara
or are r,t technically legal Tho fer'ft
ehoNs that iue sintdnfd OF Conn any has
benefited enormously up almost to the
present moment ~ secret m'rs, many ~
ihese fecret rates beinF clearly unlaw ~,
This benefit amounts ~ at east three.
ouartnrs ~ . million q yrar This thrc"-
quarter i q million representa- tho profit
tina, tho standard Oh Company obtains ~
tho pSpenac " the rnilr ,da but ~ course
the ultimate result IL thnt u obtains n much
larger profit at the eSpen-o u the public.
sEoRE RArRs ~ scISpED
A very stink ing result 81 the investlfa-
ton has cen that shortly after the dis
covery Of these secret rats by the Conn
missioner Of Corporations, the major por-
ton Of them were promptly corrected by
the railroads, go that most ~ them have
now been done away with. This immediate
Correction, partial or complete, Of the evil
Of the secret rates H.. Of course. on the one
hand an acknowledgment that they were
wrong, and yet were p~ersevered in until
exposed; and on tho Other hand 4 proof Of
the efficiency OF the work that has feen
hone by the Bureau Of Corporations. The
Department Of Justice will take up the
question of instItuting prosecutions in
at least certain Of the cases. Eut
IL il most desirable to enact into
law the bill introduced by Senator Knox
to correct the Interpretation OF the immu-
nifty provision rendered in Judge Hum
phrey's decision. The hands of the Gov
eminent have been greatly strengthened
in securing an effective remedy by the
recent decision Of the Supreme Court in
the case instituted by the Government
against the tobacco trust, which decision
permits the Government to examine the
books and ecord of any corporation en-
gagged in interstate commerce., and by the
recent conviction and punishment of the
Chicago, Burlington and Quincy Railroad
and certain OF it's officers.
PROFITS BY OPEN RATES.
But in addition to these secret rates the
Standard Oil profits immensely by open
rates, which are 80 arranged as to give it an
overwhelming advantage over its indepen-
dent competitors. The refusal OF the rail-
roads in certain cases to prorate produces
analogous effects. Thus in New England
the refusal Of certain railway systems TO
prorate has resulted in keeping the Standard
Oil In absolute m~onopolistic control Of the
field, enabling it to charge from $500 900 to
$780, 900 a year more to the consumers Of oil
in New England than they would have
had to pay had the price paid been
that obtaining In the competitive fields.
This is a characteristic example OF the nu-
merous evils which are inevitable under a
system in which the big shipper and the
railroad are left free to crush out all in
dividual initiative and all power Of inde-
pendent action because Of the absence Of
adequate and thorough going governmental
control. Exactly similar conditions obtain
In q large part of the West and Southwest.
This particular instance exempliies the
fact that the granting to the Government Of
the power 10 substitute a proper for an
Improper rate is in very many instances
the only effective way in which TO prevent
improper discrimination in rates.
It Ia not possible to put into figures the
exact amount by which the Standard profits
thro ugh the gross favoritism shown it by
ths railroads in connection with the open
rates. The profit Of course comes not
nnarely by the saving in the rate itself &c
compared with it's competitors, but by the
higher prices 1t is able to charge. and (even
without reference to these higher prioes)
by the complete control Of the market which
It secures. thereby getting the profit on the
whole consumption. Here again the only
by which the Determinations can be
cured Ia by comforting upon the Interstate
Commerce Commission the power to take
quick and effective action In regulating the
rates.
One feature Of the report which In espe-
ciaIly worthy Of attention 10 the showing
made as to the way In which the law is
evaded by treating as State m
what Is In reality merely q part Of inter-
state commerce. It is clearly shown, for
instance, that this device 10 employed on
the New York Central Railroad. as we'll as
ON many other railroads, in such fashion
a. to amount to thwarting the purpose Of
the law, although the forms Of the law may
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