The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1908-11-29
Oregon Short Line Official Pre-
sents Question From Rail
road Point of View.
SETS FORTH LAW OF
PROFIT AVERAGING
States Relations That Exist Be-
tween Producer and Trans
pOrtatiOn Companies.

J. A. Reeves, general freight agent
for the Oregon Short Line, in COM
munication to The Tribune, enters IL
discussion Of freight rate charges,
and presents data in support Of the
position OF the railroads in the matter.
Mr. Reeves makes a prehensive pre-
sentation of the subject. He states
that the present tariffs in the inter-
mountain country is the result of years
of negotiation among groups of ship
pers and groups of railroads; The re-
suit OF compromise among varying
views and interests, md no tariff will
continue to meet the changing necessi-
ties of commerce for any length OF
time. While not wishing TO be. under
stood AS claiming perfection for the
basis, Mr.. Reeves was willing TO go
on record as saying that, all conditions
considered, it is ms fair and detensble
as Will be found anywhere. This ap'
plies to the territory of the Oregon
Short Line. Beyond the limits of that
line reciprocal arrangements of some
sort have to be made with other lines.
After enumerating the many and
manifold industries established and
prospering In this region and by rail.
road rates doing a 1ourishinG business
in other territories. Mr.. Reeves states
that the railroads realize their business
partnership with the community. "We
know our serious problem is to con-
tribute our share toward making con-
ditions here such as will render profit
ablo the immense productiveness of
the country served by us; that we
know we cannot make money unless
the producers along the line make
money. Not all that we would like
to do has been done. Much yet re-
maips.'
AS to Criticism
Mr.. Reeves expresses the belief that
much of the criticism directed toward
railroads is based on entire mlscon-
ception of facts and conditions. He
cites section 4 Of the Interstate com.
merce law, which authorizes less
charge for longer than for shorter
distances, which is supported by the
commission and the courts. Mr..
Reeves continues his argument on the
principle Of profit averagiDg-a world"
wide law-and gives numerous Illus
trations of this principle. One quota
tion will prove the basis of his argu-
ment:
"The Utah sugar factory he says,
Hsells its product at a small profit at
Chicago, at a. larger profit In Nebraska,
and at the largest profit at home in
Utah. Sugar factories the world
over arc operated on the same plan.
1t is the only plan on which they
could be operated on any large scale.
"And so do all manufacturers
average profits. \ small business can
be done at the higher returns yielded
depend upon the extent of the market.
This having been supplied, it is pos
sibe 10 reach out and contest competi-
tive fields with rival concerns at Z re-
duced rate of profit, which would not
pay were it made the measure of all
the business DONE
On Hauling Ore.
Mr. Reeves proceeds, aud thus shows
that a railroad company hauls q car
OF low grade ore cheaper than it will
haul car of high-grade ore of the
same weight for the same distance. 1t
shrinks its profits TO enable the low.
hauling is the same, and the profit to
the railroad is different.
railroad company hauls busi-
ness into markets subject to water
competition for less than it will haul
the same tonnage a less distance to
markets not subject to water compe-
tition. 1t makes the rate necessary 10
meet the competition of the cheaper
carrier, or to equalize the producer in
its own line with some other producer
served by the cheaper carrier. 1t
does this. not because it desires 10,
but because it must if it and the pro-
ducer served by it are to hold their
share OF the business their"
In conclusion Mr.. Reeves says they
are glad at all times to confer with
patrons regarding rate matters.