Fergus County argus., 1906-05-08
GARFIELD ON
STANDARD OIL
Report Of the Commissioners Of Cor
porations to the President ls
Very Important.
Independent Operators Have Little
Chance Of Success-lnstances Of
Discrimination Cited.

showing that the Standard Oil COM
pany is still receiving rebates from
the railways. James r. Garfield, COM
missioner of corporations, speaks of
his personal visit to the oil fields and
of the great mass of data obtained
by him either personally or through
agents of the bureau of corporations.
The preliminary study OF the subject
was transportation, which enters large
ly into the cost of the finished pro.
duct and hence is most important
factor in competition.
Taking up the subject of the output
of refined oil, Mr.. Garfield finds that
it amounts to about 26,000,00O barrels
annually, of which the Standard Oil
company directly and indirectly con-
trolls about 23,000,0O0, and approxi-
mately the same proportion of the
other finished products of petroleum.
Continuing, the report says:
The Standard claims that the To-
cation of it's refineries and the use of
pipe lines are natural advantages
which it is justly entitled to by rea-
son of the energy and foresight of it's
managers. While in measure this |
is true, it must not be forgotten that
these advantages are in part obtain
ed by means of unfair competitive
methods after years of fierce indus.
trial strife.
The Pipe Line System.
The development of the pipe line
system by the Standard Oil company
was the result of special agreements
with railroads. Furthermore, those
so-called natural advantages have been
and are being greatly increased by
discrimination in freight rates, both
published and secret, Interstate and
state, which give the Standard mo-
nopolistic control in the greater por-
ton of the country and which SO linl-
it competition as to practically pre-
vent the extension of the business
of any Independent company to a
point which even remotely endangers
the supremacy of the Standard
AN immediate result of this delimi
tation of the competitive area is
shown by the prices of ordinary il
Eliminating oil throughout the country
After deducting the freight rate, the
price Of such oil is usually from two
cents to five cents a gallon in the
non-cOmpetitive fields. A reasonable
profit upon refined oil is about one
half cent per gallon. 1t is cleal
that exOrbitant profits are obtained
in the nOn-cOmpetitive fields. This
monopolistic control extends from
the well of the producer to the door
step of the consumer"
Mr.. Garfield cites the fact that the
New York Central railroad refused fol
itself and affiliated lines to give &C
cess to records of state rates. At the
beginning of the investigation, he says
the Standard Oil company denied that
it had obtained in recent years or was
now obtaining any rebate or other
transportation discrimination a.
against its competitors, any yet, he
says, that most careful review OF
the facts and the explanations leads
up to the conclusion that the Standard
Oil company has habitually received
from the railroads, and is now rece1v
ing, secret rates and other unjust ant
illegal determinations.
In 1904 these rates saved to tn
Standard Oil company three-Quarter
OF million dollars, representing tn
difference between the open rate
and the rates actually paid. Thes
determinations, he says, have been S
long continued, so secret, so ingel
iously applied to new conditions
trade, and SO large in amount, as
make it certain that they are due
concerted action by the Standard @
company and the railroads. He sa!
further that the Standard Oil col
pany is receiving unjust discrmin
tions in the matter of open rates, IL
published rates from the leading Stan
ard shipping points being relative
much more than rates from the shi
ping points of it's competitors.
Instances of Discrimination.
Mr.. Garfield then refers to seve
instances of important discrimination
in favor of the Standard Oil comnar
in various parts of the country, an
says that most of the secret rates ar
some of the open determinations di
covered by the bureau were abolis
ed by the railroad shortly after sut
discovery. After calling attention
the good which has already results
from the investigation, Mr. Carrie
says changes effected have put Il
independents upon a fairer footir
and make competition possible in te
ritories heretofore inaccessible. tt
report concludes as follows:
Nevertheless, the widespread di
ordinations in open rates still
force leave Independents at serio,
disadvantage. The investigation hi
only incidentally touched state shi
ments from distributing centers, pa
ticularly in less than car loads. II