The Columbian. [volume] (Bloomsburg, Pa.) 1866-1910, 1907-05-23
STANDARD OIL DEFIANT.
Charges Contained in the
Corporation Bureau Re-
ports to President.
CONTROL BY PIPE LINE
Refuses to Act as a Common Carrier
Fnils 30 File Tariffs, Charges FIX
or.bitant Rates and Tries to De
stroy Competition by Unfair Means
For Enormous Profits.


Washington, May 21.-Herbert
Knox Smith, Commissioner of Cor
porations, submitted to the Presi-
dent the bureaus second report on
the oil industry. The first report,
Issued in May, 1906, when James r..
Garfield was head of the bureau,
contained sensational charges against
the Standard Oil Company In regard
to rebates. This second report which
deals with selected topics" is fully
ms severe on the Standard Oil Com
pany al the first.
1t attempts an anlysis of the mo-
popoly which the Standard has
gained and declares that this has
been maintained not through the
control of natural resources but
through the use Of unfair practices.
The Commissioner accuses the Stan
dard on Company of ignoring and
evading the common carrier require
ments IN the rate law of 1906 and
suggests that this should receive the
Presidents careful attention. A
letter from the Commissioner to the
President gives summary of the re-
port.
THE Standard" says the Com
missioner, has as It's only compe-
titors in the refining business about
seventy-five small refneries, whose
total consumption Of crude oil is less
than that of single one OF the
Standard, to wit, the Bayonne re-
nnery, and less than one-ifth of the
Standards total consumption. over
fifteen of these competitors are de-
pendent for their supply of crude oil
upon the Standards pipe lines, and
are 30 restricted by this dependence
as to be capable of little effective
competition or growth. In the pipe
line business of the Eastern and
midcontinent fields It has up to the
present but one competitor of any
zignificance-the Pure OH Company
and that competitors pipe line
business Is not more than one-twen-
ieth of that of the Standard.
The Commissioner points out that
the system of railway C.scrimina-
Hons allowed the Standard to con-
tpol substantially that link in the
business that lies between the re-
lnery and the consumer.
by means oil its great pipe line
system" the Commissioner adds, "It
slso controls the gap between the
PRODUCER Of oil and the refinery. 1t
las now q pipe line system of more
than 10000 miles. covering com
pletsly the Appalachian, Lima-India-
IA. Illinois and midcontinent fields,
With great trunk lines running to the
seaboard and to the great markets
and distributing centers where its
Iargest reffneries are located. All
attempts on the part of others to
construct competing lines have been
utterly opposed by the Standard and
usually with success. BY means OF
vexatious litigation and preempting
of rights of way, by the aid of rail
roads which refused rights of way
lcross their lines and adjusted their
rates 30 as to injure competing pipe
ltnes.
Another important element in the
Standards control over the industry,
1s Commissioner Smith sees IT, con-
sists in the company's marketing
methods.
TT uses very generally" the Com
missioner says, "the bulk system OF
delivery to retail dealers by tank
wagons cheaper, safer and far
more convenient method of delivery
han by barrels. This not only re-
fnces the cost of marketing greatly
nut also has eliminated largely the
.obber from the business. Dealing
'hus directly with the retailer, the
.Aandard Is enabled to arrange such
local price differences as it may de-
dre for the purpose OF destroying
local competition without disturbing
Is prices over any large section OF
arade.
The commissioner charges further
that the Standard lines have since
the 1906 law was passed changed
their policy OF publishing statistics
Of runs, shipments and stocks of oil
80 as to make such information of
much less value than before.
The last point which the commiss-
Toner makes against the Standards S
attitude toward the common carrier
regulations is that 1t has aimed to
make It's rates the same or practi-
eally the same rs railroad rates, and
that these are enormously higher
shan the cost of transportation.
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