Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1906-05-05


into a large part of the United States
have given the Standard Oil Company
an unfair advantage of from l to Il cents
per hundred pounds.
This discrimination seriously limits in
dependent refinerS in some markets, and
shuts them out completely from other
market. 1t is accomplished by the use of
commodity rates-that is. rates which ap-
ply only to petroleum and Its products
ard by refusal to prorate.
The true principle of commodity rate
making is to more nearly equalize com
petitive conditions, but the general effect
Of its use in the case of oil has been to
give the Standard relatively much lower
rates TO common markets than those CIV
en- to its competitors.
For instance in shipments to New Or
leans and other points on the lower Mis-
sissippi river and the Gulf. the ordinary
class rates on similar low grade articles
from Toledo, Cleveland and Pittsburg
only > cents above the rate from Whit
ing. The commodity rates on oil are from
! Whiting. The normal principle Of com
modify rates would make the charge the
| same from all four OF these points. in
stead OF Increasing the dIfferential
| ing refinery the railroads went OF tho
Mississippi prorated with IN" eastern
| roads on oil shipments from the Pennsyl-
| vania and Ohio districts into most parts
| Of the West and Southwest. After the
| establishment of the Whiting refinery
these roads refused to prorate from
| points east OF Whiting. This refusal in
creased the natural disadvantage Of the
| eastern refineries from l to 49, cents per
| hun ircd pounds. Tn" discrimination is
| the more conspicuous in the case of the
southwestern railroads because they do
! prCratc with the railroads from Chicago
| 10 St Louis on oil from WHIT ne.
Most Of the secret rates. ana some OF
th- open Determinations discovered by
| tn, bureau were abolished by the rail
roads shortly after such discovery. The
| more important changes thus far noted
| are as tCllo VS.:
|. The secret rate of 9 cents per barrel
| frcm Dlean to Rochester ami 10 cents
per barrel from Olean to Buffalo has beer
| changed to IN open rate OF - cents per
| barrel to R1chestsr and - cents per bar
| rel 10 Buffalo on shipments of all refined
oil products. and the practice Of blind
| bllliHg of oil has Lrrn discontinued by
| the Pennsylvania Railroad.
.. The low tank-a:r rates made by the
| Rutland Railroad from Norwood 70 Bur
| l.ngton. Rutland ana Bellows Falls. Vt,
| have been made applicable on oil in bar
| rels.
| B The cancellation Of the secret rate
| from Whiting to Grand junction Will re-
| due. by about three fOurthS the Stand
| ar;ls advantage ever competing refinerS
at Toledo. Clt"elanG and vi',!nitr on ship
mtuts into large part Of the South. In
| stead Of u or L. cents the diT1Ecntial
against tn. m is new or cents per hnu.
drcd pounds, while the disadvantage OF
/
ria has been correSpondnGly reduced.
| 1. The cancellation of the sacrct rate
| from Whiting to Evansville VIII reduce
| the Standards advantage over competing
| refine RS at Toledo on shipments into many
| ether parts ot the South from about g..
! cents to 3io cents Fer hundred pounds
| TIE advantage which tn" Standard has
| enjoyed over competitors in Cleveland.
| FIT s'urG and other INDEPENDENT refining
| l.oints has been correSpordingly reduced.
| :. The cancellation of the secret rates
| c,
| substitution of the rate IF 10 cents will
| reduce the Standards dyantage from II
| cents to Z cents PR hundred pounds.
with a corresponding reduction of its adj
vantage over more "ast3riy refining
| points.
published rates from Whiting into north
! : IN Indiara and Michigan by about or 3
cents per hundred pounds. and have put
! the rates on practically an equality, dis
lance considered. VITA those from Tole-
| do and more easterly points.
| I. The New York. New Haven & Hart
| forti Railroad has resumed the practice
Of pronting on oil. thereby reducing the
average freight charge to independent re-
fncrs of western Pennsylvania and Ohio
| on shipments into L large part of Con-
necticut. Rhode 1sland and Massachu-
| sets by about s cents per 100 pounds.
| This will materially increase their oppor-
tunt% for competition with the Standard
Oil Company in that territory. The inter-
state commerce commission recently de-
nounced the former practice and recon-
mEndCd q CnaGSe.
S. A large number of the secret rates
| of California railroads have been pup
lishcd as open rates. While urder rne
contract system of selling fuel oil gtner-
ally employed in that region tho concerns
| formerly ENJOYING the secret rates cor.-
| tinue to benefit from them. this revision
| of tariffs obviously operates to the bcne-
| fit of independent shippers on future bus
| mess. A number of discrepancies in open
| rates on the Pacific coast have also been
| adjusted.
ers of less Importance. mean much more
| than the increase of freight charges to
| the Standard. They show in striking
fashion the good which has already re.
| suited from this investigation. They put
| independents upon Il fairer footing ana
| make competition possible in territories
| heretofore inaccessible.
Nevertheless, the widespread discrimi-
nations in open rates still in force leave
| the independents at serious disadvantage.
| Tie investigation has only incidentally
| touched state shipments from distributing
| centors, particularly in less than carloads.
| The few instances examined suggest tho
| probability OF Determinations on such
shipments which. taken in connection
with through traffic. may result In dis
ordinations on interstate business;
/ have cited these particular instances
to show the various methods by which
determinations are obtained. and to call
particular attention to methods which.
ii legal, are mere devices to obtain exact
lv the same result would be obtained
nv rebates paid on interstate business.
ANY freight discrimination, whether 1t he
state or interstate, tends to give control
of markets to the preferred shipper, and
makes monopoly possible If existing law
merely prohibits a special device for OBJ
tanning discrimination. and permits the
same result to be accomplished in a dlf-
fernrt way then the ltSlSiatlon is u tiiat
extent sham.
This investigation has SHOWN very
~~~AY~A~