Iron County register. [volume] (Ironton, Iron County, Mo.) 1867-1965, 1906-05-10
GARF|ELD'S REPORT
SENT TO CONGRESS
PRESIDENT ACCOMPANIES II
WITH SPECIAL MESSAGE.
FREIGHT RATES AND OIL.
Statement Mnde That The Depart
ment of Justice VIII Fake Up
the Question of Institute
ing Prosecutions.

Washington. President Roosevelt
has transmitted to congress the re-
port of James R. Garfield, COM
missioner 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 expresses the view that
the report is of capital Importance, be-
cause of the effort now being made to
secure such enlargement of the pow
ers of the interstate COM
mission as will confer upon the COM
mission power in some measure ade-
quate to meet the clearly-demon.
strated needs of the situation. The
facts set forth in the report, he de-
clares, are for the most part not dis
puted. That the Standard Oil Co. has
benefited enormously up almost to
the present moment by secret rates,
many OF which were clearly unlawful,
the president says the report clearly
shows, the benefit thereby secured
amounting to at least th~ree-Quarters
of a million a year. On this subject
he says:
This th~ree-quarters of a million repre-
sents the profit that the Standard Oil
Co. obtains at the expense of the rail-
roads,; but of course the ltimat result
Is hat 1t obtains, a much larger. profit
at the expense Of the public. A very
striking result of the investigation has
been that shortly after the discovery of
these secret rates by the commissioner
Of corporations, the major portion of
them were promptly corrected by the
railroads, so that most OF them have now
been done away with. This immediate
correction, partial or complete. of the
evil of the secret rates, is of course on
the one hand an acknowledgment that
they were wrong, and yet were perse-
vered in until exposed; on the other hand,
a proof of the efficiency of the work
that has been done by the bureau of cor
porations.
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
hope is expressed that congress will
enact into law the bill of Senator
Knox to correct the Interpretation of
the immunity provision rendered in
Judge Humphreys decision. Con
tlnulng, the president says:
But in addition to these secret rates
the Standard Oil profits immensely by
open rates, which are so arranged as to
give it an overwhelming advantage over
its independent competitors. This Is a
characteristic example Of the numerous
evils which mhisa ere IN ine SiG asin under .n a sfXbs e
railroad are left free to crush out all
Individual initiative and all power of in
dependent action because, of the absence
mental control. Exactly similar condi-
lions obtain in a large part of the west
and southwest.
1t is not possible to put into figures the
profits through the gross favoritism
shown it by the railroads in connection
with the oDen rates. ~"
The profit of course comes not merely
by the saving In the rate itself as COM
pared with its competitors. but by the
higher prices 1t is able to charge and
by the complete control Of the market
which it secures, thereby getting the
profit on the whole consumption.
The president calls attention to that
feature of the report regarding the
manner in which the law is evaded by
treating as state commerce what in
reality is merely a part of interstate
commerce. He says 1t 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 thwart
ing the purpose of the law, although
the forms Of the law may be com
piled with"
1t is unfortunately not true. he
says, that the Standard Oil Co. Is the
only corporation which has benefited
and is beneftting 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, If ever, pays the lawful rate
for transportation. He declares that
in the effort to prevent the railroads
from uniting for improper purposes
1--WE have very unwisely prohibite
them from uniting for proper pur
poses: that is, for purposes of pro
tecting themselves and the genera
public as against the power Of thu
great corporations"
He ~favors, as an element of com
petition, putting alcohol used in tn,
arts on the free list, and of keepin.