The Ely miner., 1911-09-22
70 cor EXPRESS RATES.
Attorney General Says Companies
Make Too Much Money.

st. Paul. = The Minnesota attorney
general, in brief filed with the rail
road and warehouse commission in
the case of the state against Wells
Fargo & Co.. express, asked for the
adoption of graduated scale of ex
press rates in Minnesota which would
result in reduction of about z pei
cent in the gross earnings of the com
pany.
He presented tentative scale which
he said was not sufficient, but he asked
that the commission use it as a work
ing basis to determine what the sched
ules should be to reduce rates appre
ciably, yet allow the company to real
ize reasonable profit. He said that
a still greater reduction than he rec
ommended could be made without de
priving the company of reasonable re
turns.
Shows How "MeIon" Was Cut.
Mr.. Simpsons brief completes the
states case, which was brought be
fore the railroad and warehouse com
mission last April, when Wells, Fargo
& Co. was cited to appear and show
cause why it's rates should not be re-
duced. At that time experts of the
state who had examined the books OF
the company presented figures show.
ing receipts in this state for period
of months and also estimating the cost
of the service.
Mr.. Simpson said these figures
showed that exorbitant rates were be-
ing charged. He cited the fact that
in 1909 Wells, Fargo G. Co. had Great
ed such a surplus in the twenty-seven
years of its existence that 1t was able
to pay a dividend of 80 per cent on
a capitalization of $8.0O0,000. He said
that not more than $5,000,000 Of this
capitalization had been paid up and
that the enormous dividend not only
gave the stockholders their yearly re
turn of 10 per cent, but also returned
to them three times what they orig
inally paid for their stock yet left In
company increased it's capital to $24,
100000. He said this incident was
only sample of what the other com
panies had done. The brief continues
Two Big Profits Paid.
1T has been shown in this investi
cation that the express company has
been paying to the railroad companies
for the express privilege percentage
of the gross revenues greatly in ex
cess of reasonable remuneration
The rights of the public never have
been taken into consideration by
either the express companies or the
railroads in fixing the amount to be
paid by the former to the latter. We
have situation of two thriving cor
porations obtaining profit for doing
"a business that in the very nature OF
things could as we'll be done by one
corporation, and the public pays two
enormous profits where only one
would be necessary.
"The only difference of opinion there
can be is to the amount of reduc
tion that should be ordered. That 9
reduction is necessary cannot be dis
puted. The state has prepared a new
graduate scale which in a large meas
ure would cure the present defects
The present local maximum distance
rates divide the distances of one tt
$40 miles into nineteen classes, the
charges ranging from 40 cents for dis
tances not exceeding thirty miles t6
$1.70 for distances between $40 and
400 miles.
There is one popularity about this
scale. For instance, the rate per 10(
pounds for distances between thirty
and forty-five miles is 45 cents, but
this rate is not used by the company
Instead, the next higher rate, that oi
so cents, is paid. 1t would be just al
reasonable to provide that a package
going for distance between thirty
and forty-five miles should take the
next lower rate as to provide that i,
should take the next higher rate. This
discrepancy exists because the Accent
rate is given in the company's sched
ule while it is not given in its tariff
columns"
Mr Simpson cited an example t.
show the effect of the reduction he
proposed. Under the present sched
ule, where the rate is 40 cents for 10(
pounds for a given distance, a 65
pound package would have to pay the
Accent rate. The attorney generals
scale would make the rate of this 65
pound package 25 cents. or reduction
of Is cents.