Los Angeles herald., 1907-01-29
Saysthe Independents
Are Throttled by
Standard
Rates Are Reduced and
Unfair Methods
Used
Interstate Commerce Commission
Handles RockefeIIers Monopoly
Without Gioves-Suggests
Possible Remedies
BY Associa ted Press.

by ASSOCIATED IreSS.
WASHINGTON, Jan. 2S.-The inter-
state commerce commission today sent
to congress a report of the investiga-
tions made by it under the Tilman-
lations 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 generally to the methods by
which the Standard Oil company has
built up and perpetuated it's monopoly
1t is asserted that "the ruin of IT'S COM
petitors has been distinct part of the
policy of the STANDARD Oil company in
the past, Systematically and persistent
ly pursued
mo instance" the report says, "is
found where any railway company has
been interested in oil lands or petroleum
production, and only one instance is
shown where officials of a railway
company were interested in the pro-
duction and sale of oil. This relates
to certain officials of the Baltimore
~ Oiiio coulllWSStSIIl TdllTOdu having
owned stock of the Argand Refining
company, which was on their recon-
mendation afterward sold to the STAN
dard Oil company, and the lubricating
contract which the road transferred to
the Galena Oil company, a STANDARD
Oil subsidiary.
Controls Every Branch
The Standard Oil company largely
mOnOnO1iZaS the honHlinor Of
from the mouth of the we'll until it Is
sold to the retailer and sometimes to
the consumer, and under ordinary cir
Cumstances it's margin of profit is very
large. Estimates made in the report
show profit on refined oil from the
Sugar Creek refinery at Kansas City
of from to cents per gallon. A
much higher profit is indicated for
gasoline. The sale of refined oil from
the large Standard refinery at Whit
ing is correspondingly profitable.
THE evidence she VS. little basis for
the contention that the enormous divi-
dends of the Standard Oil company are
the legitimate result of it's economies
Except for it's pipe lines, the Standard
has but little legitimate advantage over
the independent refiner
THE Standard buys advertising
space in many newspapers which 1t
nils, not with advertisements but with
reading matter prepared by agents
Kept for that purpose, and paid for at
advertising rates as ordinary news. The
assumption is that this literature fur
nishes many of the ideas touching the
great benefits conf, rred upon the pub
lie by the Standard Oil company.
possession of the pipe lines enables
the Standard absolutely to control the
price of crude petroleum and the price
which its competitors IN given To-
cality shall pay. 1t can raise the price
In one loclaity and obtain it's own oil
from another, and raise the price when
ever 1t desires to do so. Whoever con-
trolls the avenues of TRANSFORMATION of
raw material or of the refined product
can speedily drive his competitors out
of existence and the production and
distribution of petroleum is not an ex-
ception to the rule"
Pipe Lines Limited
The pipe line of the Standard, the re-
port continues, is not a natural but
rather an artificial advantage. It is
argued that the reason why long pine
lines competing with those of the
Standard have not been provided is that
obstacles in the way of such under
takings have been placed by the rail-
roads whose right of way has generally
stood as a Chinese wall against all at
tempts to extend pipe lines. Ordinarily,
it is said, the Standar, has not re-
ceiVed rebates in recent years, so far
as has been discovered, but it has
nevertheless enjoyed seer t rates pos
sessing all the elements of illegal re-
bates, 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-
nection the following is an instance
given:
"The rate of ten cents per 100 pounds
upon petroleum and it's by-products
existed for many years from Neo-
dosha, Kas,, where the Standard op-
Grated a refinery, to Kansas City. This
was for the interest of the Standard,
but when the STANDARD constructed its
refinery at Sugar Creek, Kansas City,
and connected it by pipe line with the
Kansas oil wells the rail rate was adj
vanced from 10 to II cents per hun
dred pounds. While the railways in
sist that this was not done at the in
stance of the Standard, tbs significant
fact remains i'm this and many other
cases called TO the commissions atten-
tion that the rate was not changed
until II became to be to the interest Of
the Standard that it should be changed
and II was changed as that company
naturally desired"
In discussing the assertion contained
I'm the report that 1.-THE ruin of it's
competitors has been a distinct part
(EnudNnuaaA aau.