The Idaho Springs siftings-news., 1920-09-21
Frnight Rates Are Ssi
Compared With Costs

In letter TO Representative John j.
Esch, chairman OF the House Commit
tee on Interstate and Foreign Com
merce, Julius Kruttschnitt. chairman
Of the Southern Pacific Company,
points out that in the last five years
the value of goods increased on an av-
erage Of $63 a ton, while freight
charges advanced only GO cents ton
In five years, he explains. the aver.
age value of freight carried by the
railroads increased from $56 to $40
ton. The cost of carrying this increas-
ed from 81 to $3.50, paid TO the rail-
roads. In 1914, he adds, 36 per cent
of the total cost of the goods was
spent for transportation. In 1919 only
"a per cent was spent.
"1n other words" Mr.. Kruttschnitt
writes, "only so cents out of $63, or 13
cents out of every dollar Of increase in
value of commodities in 1919 was caus-
I'd by increased freight charges. The
responsibility for the remaining $62 20
or 9S.7 cents out of every dollar, must
be sought elsewhere. 1t was not caus-
ed by freight rates"
Rates Lowest In History.
Comparison with transportation
charges in other countries shows that
in no other country Of the world is
transportation furnished at so low
cost as In the United States. Compar.
ed, too, with the cost of other goods
and services today, railroad transporta-
tion is the cheapest thing the public
buys. 1t is sold for less than the cost
Of production, considering all the ele-
ments of cost.
In statement on this subject to tht
New England Bankers Association
Walker D. Hines, Director General o
Railroads, said:
IT think it is a fair statement
that at the present time, despite
the increases which have taken
place in freight rates, ton of
steel or ton of coal, bushel of
wheat or the unit Of any other
commodity has to pay for trans
portation less percentage of the
price of that commodity than ever
before in the history of the coun-
try
Charges on Some Articles.
Before the war a suit of clothing
from one of the Chicago factories, sell.
Ing for $50 in retail shop, was car
ried from Chicago to Los Angeles fol-
161s cents. The suit of clothes now
retails at $50 or $50, but the freight
rate on that 2.265 mile haul has in.
creased only 51s cents, while the price |
of the goods has gone up 500 or $50.
The % cents does not cover all the
transportation cost in a suit of clothes
the transportation charge for carrying
the wool from the ranges and the
cloth to the clothing manufacturer ana
other minor carrying costs enter into
the consideration, but the final trans
portation charge is the principal one
and the other charges add only a few
cents more.
New England shoes are shipped
from Boston to Florida at a cost of less
than s 2-3 cents a pair This is an In
crease of only one cent over the pre-
war rate. The railroads also carry
beef from Chicago to New York for
charge of about two-thirds of a cent
pound. Typewriters are carried from
New York to st. Louis for &c cents. A
$50 phonograph is carried by freight
from New York to Atlanta for So S5
A grand piano is carried clear across
the continent for $50 and in carload
lots for $2S.
These are typical freight rates, and
they make it plain that American rail
roads give the lowest cost service in
the world.
Even with a very considerable I'm
crease in rates to make the roads self
supporting, transportation will still be
the cheapest thing the public buys