New-York tribune., 1907-01-10
STUBS ON MONOPOLY.
BENEFITS ALL, HE SAYS.
Western Traffic Managers Deny
That Competition Is Shfed.
IBy Telegraph to The Tribune ]


binations IN the country. J. c. Stubbs. traffic di
rector of the Union Pacific and Southern Pacific
system, and NJ Hannaford, ce-president in
charge OF traffic for the Northern Pacific, both
maintained on the witness stand that the great
railway consultations in the West had been
beneficial, not injurious, to the owners of the
railways and to the public we'll They both
went further and declared that rate and general
traffic conditions would be practically the same
probably better. in the long run if all the rail-
ways west of the Mississippi River were brought
under common ownership and control
Commissioner Lane. interested in this new
doctrine of railway economics, asked Mr. Han
naford if he thought it would be good thing
for all the railways in the United States to be
brought under common ownership and control
The witness replied that if Mr.. Lane had in view
public ownership he thought that was "too
broad proposition for him to discuss
The ground upon which Messrs. Stubbs and
Hannaford defended railroad monopoly that
1t tended to put a stop to rate wars and to
make rates stable. Stability of rates. they con-
tended. was a good thing for the railways, be-
cause it insured them reasonable profits and
thereby enabled them to make needed improve
ments. and also for shippers, because it insured
them that they were all getting good rates
their competitors. and because it enabled the
railways to provide them with reasonable facili-
ties
Mr.. Stubbs pronounced the clause of the
amended interstate commerce act requiring
thirty days notice of change of rates the most
benefcent provision of the law, because 1t tend
ed in the direction as common ownership
of parallel lines-that is. to increase the stabil-
ity of rates.
Messrs. Severance and Kellogg, the attorneys
representing the government. made determined
efforts to-day TO induce the two traffic man
ayers to admit that concentration of owner,
ship meant the sitting of competition.
Mr.. Stubbs the witness stand for the
greater part of the day. and his examination
covered all points connected with the history
and traffic arrangements of the Southern Pa
cfc. the Union Pacific, the Central Pacific and
many of the allied lines under the control
of Mr.. Hartman.
Mr.. Stubbs asserted from first TO last that the
Union Pacific never had been an active COM
petitor of the Southern Pacific California
business for the reason that it ha1 outlet be-
yond Ogden its own rails direct TO Calf
forna. Such competition. hs said had ex-
listed between the two roads In the past was
still in existence
UNION PACIFIC ONLY LINK.
The Union Pacific. he asserted. was and is
only link in the transportation service between
the Missouri River and California and not a
separate and complete transcontinental line
At the opening of the afternoon session MI
Kellogg asked Mr.. Stubbs If he would permit
the cutting OF rates by the Southern Pacific in
order 20 take business from the Union Pacific. or
vice versa
NO" he replied.
Did you cut rates on the Southern Pacific in
order 70 get business from the Union Pacific
prior TO the consolidation
81 think not"
You never did that"
NO"
Never cut any rates?
we never originated any cut rates"
Are not transcontinental rates about 10 per
cent higher than before the consultations"
"A1l the transcontnental lines tried to advance
rates about 10 per cent but it could not be
maintained"
Mr. Kellog Submitted TO the witness state
ments showing that the Union Pacific had pros
pered greatly in the last few years. and asked.
in view OF this. il he considered the present
rates as equitable and not too high.
Il consider them as entirely reasonable"
And the competition between the Union Pa
cifc and the Southern Pacific is still keen is it?"
Just keen"
do you think this?"
mo. know it,
Commissioner Clements asked if the Southern
E.N
press Company. and Mr. Stubbs replied that ne
believed 1t did. He then asked IL the Union
Pacific held stock in the Wells Fargo Company
The witness unable to answer, but the
Union Pacific attorneys said that the railroad
held about 30 per cent OF the express company
stock.
HEALTHY COMPETITION a NECESSITY.
Questioned by Commissioner Harlan regard
ing railroad competition Mr. Stubbs said that
owner for parallel lines did not mean the
destruction of competition.
Mr.. Hill" he said. lis probably the leading
railroad man in this country. and he cannot, If
he would, destroy competition between the Great
Northern and Northern Pacific He must
ploy vice presidents and general managers.
These have their regulations to uphold to
construct They win work for their own line
against the other line and competition is In
evitable. If Mr.. Hill should take that spirit out
of mis- men lie might well hand their manage
ment over to one-hundred- dollar clerk
Mr.. Stubbs was succeeded on the stand by ].
n. Hannaford second vice president of the
Northern Pacific. who is in charge of the traffic
on that line Mr.. Hannaford said that in the
pools conducted prior to 1897 the Union Pacific
and Southern Pacific represented sep
arate lines. He had always considered the
Southern Pacific, and the Union Pacific in con-
nection with the Oregon Short Line
pettors of the Northern Pacific for Portland
traffic. The witness said that the Northern Pa
cfc could not he an active competitor Of the
Southern Pacific on business from the East TO
San Francisco because the boat service of the
latter line between New York and Galveston
could not be equalled the lakes Mr..
Hannaford did not consider a combnati ton OF
transcontnental lines meant destruction of
competition, and declared that business rivalry
between the Great Northern and the Northern
Pacific is sharper to-day than before they went
under the same management.