Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1907-01-29
STANDARD OIL MONOPOLY
Interstate Commerce Commission Makes
Report to Congress on Combinations
SECRET RAILWAY RATES AID COMBINE
Find Competition stihed
and Public MisIed as to ReIa-
uons Between Companies
Onering OIL for sale.

WASHINGTON, Jan. 8.-The Interstate
Commerce commission has sent to congress
a report of the Investigations made by II
under the Tillman- Gillespie resolution con-
corning the relations of common carriers
by rail to the production and distribution
of oil. The report covers the distribution
of petroleum and its products east Of the
| Mississippi river and, incidentally, the
Kansas and Texas fields. The report points
out generally the methods by which the
Standard OH company has built up and
| perpetuated it's monopoly" 1t is asserted
that the ruin Of its competitors has been
/ a distinct part of the policy Of the Standard
| Oil company in the past, systematically
| and persis.ently pursued. The reporS says
No instance Is found where any railway
company has been interested in oil lands
/ or in petroleum production, and only one
| instance is shown where officials OF rau-
way company we're interested in the pro-
! ductiOn and sale of OIL This relates 70
! certain officials of the Baltimore q ONO
/ southwestern railroad having owned stock
| of the Argand Refining company, which
! was, on their recommendation. atterwaTd
sold to the STANDARD OIL company, ana t1o tne rSs
ferred to the Galena OIL company stand
! ard company
| Lies the handling Of petroleum from the
| mouth Of the well until IL Is sold to the re-
taller and sometimes = TO- the consumer, 0nss tts
| margin OF profit is very large. Estimates
made In the report show proht on re-
fined oil from the Sugar Creek refinery az
| Kansas City of from to cents per gal
! Ion. A much higher profit is indicated tor
gasoline. The sale Of refined oil from the
| large Standard refinery at whiting Is cor
respondingly profitable.
shrewd Advertising Plans.
The evidence shows little basis for the
| contention that the enormous dividends OF
hn do arA ND1NF a n l.
mate result of it's economics. Except for
its pipe lines, the Standard has but little
legitimate advantage over the Independent
The Standard buys advertising space in
many newspapers, which 1t fills, not with
| advertisements, but with reading matter
prepared by agents kept for that purpose
olizes the handling Of petroleum from the
nary news. The assumption is that this
literature furnishes many of the ideas
touching the great benefits conferred upon
the public by the Standard OH company
Standard absolutely to control the price OF
crude petroleum and the price which its
competitors in a given locality shall pay.
II can raise the price in one locality and
and paid for at advertising rates, as ordi-
verse the process when it desires to do 30.
Whoever controls the avenues OF transpor-
tation of the raw material or of the re-
fined product can speedily drive his COM
tion and distribution Of petroleum is no
exception to the rule.
The pipe line system OF the Standard, the
report contends, is not a natural. but,
rather, an artificial advantage. 1t is argued
that the reason why long pipe lines COM
peting with those of the Standard have
not been provided is found In obstacles in
the way Of such undertakings, having been
opposed by the railroads, whose right-of-
was has generally stood as a Chinese wall
against all attempts to extend pipe lines
secret Rates Secured.
g..
not received rebates in recent years, SC
, far as has been discovered. but II has
nevertheless enjoyed secret rates possessing
all of the element of Illegal rates. and the
advantages so obtained over independent
shippers have been of very great value
to that company. Numerous instances OF
, discrimination in favor of the Standard
|. resulting from the published railway rates
! were found says the report. In this con-
, neotion the following is an instance given
A low rate of 10 cents per hundred pounds
upon petroleum and It's products existed
! for many years from Neodosha, Kan.
l where the Standard operated refinery, e
: Of 1.-THE the Standard: but when the STANDARD
3 constructed its refinery at Sugar creek
> Kansas City, and connected It by pip,
, line with the Kansas oil wells, the raj
. rate was advanced from 10 to II cents pei
hundred pounds. While the railways In
OF os' the hnaI standard @ % the the significant fact re
| mains in this and many other cases callet
| TO the commissions attention that the rat
| was not changed until II came to be 70
the interest OF the Standard that 1t SHOULD
3 be changed. and It was changed as tina
3 company naturally would desire.
In discussing the assertion contained II
q the report that the ruin OF its competitor
has been a distinct part of the policy o
: the Standard on company" the commits
sion says one method has been the or
: ganization OF a perfect system OF espionag
over the shipments OF its competitors, re
sulting in knowledge as to the destination
OF every car of oil leaving the refinery o
an independent.
Agents Must Strangle Competition.
|. The Standard agent at the destination
4 says the report, is held responsible II tn
l. Independent oil is sold.
e 'It does not appear" says the report
"a ''that the railroad companies have diTecte
Il the furnishing of this information, or tina
r. the practice has been sanctioned by su
q perior officials of the roads, but II does ap
l. pear that such information is systematic
/ ally obtained from railroad employees. tn
testimony shows that the Standard. at on
q time, II 1t does not now, devoted fun
IA 70 the purpose Of obtaining this informa
ton. It has frequently happened, whe
\ the supply of independent oil in a particu
J. lar territory was low and a shipment wa
" peculiarly necessary, that the shipmen
II has unaccountaby gone astray. Informs
II ton also appears TO have been given tn
y Union Tank line. a creature of the Stand
:, ard concerning the whereabouts OF Il
cars, while such information was not fun
n nished 10 other owners OF tank cars, an
10 some discrimination In tank car mileage
lie favor OF the tank line is shown for on
y railroad"
"a II is asserted that IL is the practice OF III
- Standard, whenever a competitor erects
A. storage tank, to which the oil IL tram
2 terred from the tank car. to reduce tn
y price of oil, in that locality to such polr
a. as to make the business improbable
y such competitor. while prices were msiI
1s tained In other localities There was muc
er complaint that the railroads allowed II
10 Standard to erect its tanks at convenieI
nc points on the right-of-way and declined
ae accord this privilege TO independent r,
10 hners The commission says II Is satishs
10 that such discrimination has been veI
n generally practiced In the past.
As The report shows that 'at present evel
. considerable railroad In the United Stat
NJ is buying Of the Galena OH company. OF
ha Of the standard companies most OF 1
. b,hrfcattnR and signal oils the prices ma