The nonpartisan leader., 1916-10-12
Tie St eel rust
and axes
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Continued from page 4. 81
of the rates, because the rates were SO
excessive they froze out practically all
the Independent mining companies.
That proceeding proved to be failure,
because the steel trust billed the ore as
one continuous shipment from the mines
down to the lake shore, and in their ore
boats down to the ports on the lower
lakes at Chicago and Lake Erie. Hence
the point was made that our state COM
mission has no jurisdiction; that the
shipment was an interstate shipment.
The fact isand am telling what
1 know of my own knowledge that
within our statesi in the matter of rail-
road transportation Of the ore, it is
almost impossible for the independent
companies to operate They are at a
disadvantage"
Judge Gary, president Of the steel cor
poration, admitted few years ago
before the ways and means committee Of
congress that the steel corporation made
"a profit of IS cents ton for hauling
ore. The profit is probably not now so
great, as there has been slight reduc-
tion in rates by the interstate commerce
commission since then. But it is still
handsome revenue. The important part
OF it is that the maintaining OF these
high rates not only freezes out the. indie
pendent companies and makes an addi-
tional big profit for the steel trust in the
mining of ore, but that it results in the
I lowering of the value Of the ere in the
ground for taxation purposes.
A. { isss}ss IL ~ 3 Il -
TRUST REDUCES TAXES
BY HIGH FREIGHT CHARGE
The value of the ore in the ground is
reached by taking the value OF the ore
at the Lake Erie ports and subtracting
mining and transportation costs. So
!, that the higher the rates charged by the
railroads the less the ore is taxed in the
ground under the present Minnesota
system. It is true that Minnesota gets
return in taxes on the charges made by
the railroads for carrying orc, for it
levies a gross earning tax against rail-
roads, thus getting back part of what
it loses through lcssening of the value
Of the ore in the ground by high rates.
But most Of the haul Of the ore is by
boats on the lake, also owned by the
steel trust, SO that on a large part of the
excess freight charges the state of Min
nesota gets nothing, but at the same time
the taxation value Of the ore in the
ground is lessened.
The state tax commission in : 1914
found the value Of iron ore in the
ground was about 81 cents ton, on the
average. This figure was reached by an
elaborate process of subtracting from
the value Of the ore at the furnaces the
costs Of mining and transportation and
discounting the future value of the ore.
i The tax commission figured how long it
i would reasonably take to mine the vari-
Gus deposits at the present rate Of
mining, and considered that ore that
would mot sbe mined for a few years, or
for 10 to 20 years, was not worth today
in the ground as much as ore that would
be mined Immediately. The result of the
figuring was to place the value
on the ore in the ground at about 81
cents ton on the average. That is,
there were l,478, ,090, ,978 tons in the
ground, according to the commissions
surveys, and this was worth total Of
i s$543, ,678, ,682, or about 3 cents a tom
For taxation purposes half this value is
Continued on page 16.))
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