The Washington herald., 1907-05-20

The predatory tactics Of the Standard
on Company in building and operating
pipe lines and its further activities in
making the common-carrier provision Of
the rate law nugatory are strikingly de-
scribed in report by the Commissioner
Of Corporations to the President.
The trust has been dlslodged. the gov
eminent believes, from the advantages it
had in discriminatory freight rates. only
10 take refuge behind this second barrier.
Most OF the Standards trunk lines have
fled no tariffs at all. and refuse 10 ac-
cept or deliver oil owned by others. Other
Standard lines, while filing certain rates.
have done so in such a manner as 70
reduce their apparent compliance 70 an
absurdlty"
They have named rates at the Offices
Of the Interstate Commerce Commission
% perfectly insignificant points" where
no one wishes to ship oil or 70 where
only the Standard has refneries They
place impossible restrictions upon the ac-
ceptance Of shipments requiring single
shipments 10 be AT least 75. 90 barrels. or
even $4,000 barrels. in quantity. Commis-
sioner Herbert Knox Smith. in making
his investigation Of this phase Of the
trust, also finds that the rates charged
are wholly excessive and unreasonabl
RepIete with Incidents.
This chapter Of the prolonged inquiry is
quite as replete with incidents Of CONNIE
ution-killIng methods as was the report
on The Transportation OF Petroleum"
made public a year ago. The commissioner
shows that the Standard has resorted IN
numerous practices 10 prevent the con
struction Of independent pipe lines. It has
secured the cooperation Of railroads 10
prevent acquisition Of rights Of way over
or under the tracks. Stock in rival enter
prises has been purchased at exorbitant
prices for purposes of control
The railroads have also aided the Stand
ard in securing and maintaining its pipe
line monopoly. Where the Standard has
built pipe lines 10 the seahoard. the freight
rates for oil have been increased 10 the
point where competition became impoSsi-
hle. Those projecting pipe lines have fur
Their been subjected 10 vexati0us litigation
Some Of the information gathered by the
Bureau OF Corporations has been with
held, lest II interfere with the prosecution
7f the big suit filed az St Louis. The
report however, covers the position OF the
Standard in the oil industry Local price
determinations and marketing methods
are given secondary consideration.
Influence Clearly shown.
The Standards dominating influence is
Emphasized. in letter Of transmittal 10 /
he President. Mr.. Smith SAYS that I'm I
9oi the Standard and affiliated concerns /
'eined over 81 per cent OF the crude OIL /
un through reineries, producing more /
han S6 per cent of the country's total /
'utput Of Illuminating oil. maintained a .
iw!lar proportion of the export trade in
oil; transported through pine
ines nearly nine-tenths of the crude oil
4 the older fields in the Appalachian and
indiana fields, and sS per cent Of the
rude oil Of the Kansas and Indian Ter
itory fields. secured over IS per cent of
he sales of Illuminating oil TO retail
ealers throughout the country. and oh
aimed, in certain sections. as high ss 90
er cent of sucn sales
There are seyenty-fve small oil re-
nerIes, independent of the Standard but
hey consume only One-fifth as much
rude oil as does the trust, and fifteen Of
hese seventy-fve concerns are dependent
pom the trust for their supply Of crude
H. Outside Of the Texas and California
elds, there is only one competing pine
ne OF any ignlficance-the Pure OH
ompany-which handles about One-twen-
eth of the oil handled by 10000 miles OF
lines Two other important
ncs, however, are building from the
lcinity of Indian Territory TO the Gulf
Mexico. These independent companies. /
Is pointed out, are also ignoring the
tte law The capacity Of their lines is
nhted, and they fear the trust would
food them with oil so that they could ]
Of carry a supply for their patrons. ~.
re often stockholders. q
With the publication Of this report It Is
alieved the Department of Justice must
Ike notice at an early day of the viola
on of the rate law. II is not improbable c
lat the first test of the constitutionalitv {
the law may come under this provision. a
Basis of Power.
In his letter Of suhmittal, Commissioner j
NTH makes the following comment.
1t is of the utmost importance to in s.
cate clearly those fundamental facts q
lat form the basis Of the Standards q
'wer. The monopoly Of this concern has u
sver rested on ownership of the source
supply Of crude Oil Not over one a
xth of the total production of crude Ia
e country In 1905 came from wells own a
by the Standard interests 1t cannot Il
too strongly emphasized that its
owth and present power rest primarily
the control of transportation facilities h
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