The Bridgeport times and evening farmer., 1920-08-06
SAYS NEW RATES WILL CUT HIGH
 COST IN TWO

on national scale is countenanced in an "economic principle" credited to former railroad administrator, Walker D. Hines, and flashed from Washington with the news of s1,2s9,- 800, 900 increase in milk and freight rates.
 The alleged principle" was ex- plained yesterday by Dr. Grover c. Huebner, assistant professor of com merce and transportation, Wharton School, University of Pennsylvania. Whereas, MT. Hines is reported to have said that a three to five-fo1d in crease in commodity prices is reflect ed over freight increases, and the railroad executives only bring the effect down to Hess than two-fold." Doctor Huebner declares that the increase in commodity prices should be virtually equal to the increase in freight rates.
 The tendency even would be to bring the increase below the freight increase, for the reason that the lat ter is given to enable the railroads to perfect their transportation faci1i- ties and so increase the supply of commodities, the prices of which at , present are soaring for lack of trans portation-
 Government agencies should be charged with protecting the public against the very sort of increase which is predicted, based on Mr. Hines principle" according to Doe tor Huebner.
 Will Check Soaring Prices
 As for the cost of living being enormously increased by the one and half billion revenue to be given the railroads out of the public's pockets there again is fallacy. The increase S simply a 1ong-term investment which in the long run-say two years | at the least-will check high prices and bring them nearer to normal. This is simply application Of the law of supply and demand which so long has been worked at the pub lies expense The supply of com Modfties depends largely on trans portation, and the railroads are bound to provide that transportation with fheir new allowance, and 50 increase the supply The coal situation is a noticeable-examp1e of this, although the increase is so late in arriving that the effects may not be felt very early in the winter, says Doctor Hueb- ner-
 In regard to MT. Hines indictment to the profteers, Doctor Huebner Said- "1t sometimes happens that an increase is put in more than once in the price of a commodity, but if it fs it is sheer profiteering and the gov ernment should take steps to prevent it It is not fair for middlemen to gouge the public three and four times for an increase which should be put in once by the shipper and not in- creased as the product goes along the line.
 Whoever pays the original price should charge the increase when he sels, and the matter should stop there. Unfortunately, when the wholesaler gets the product he some times remembers that freight rates have gone up 20 or 30 or 40 per cent. and adds that amount to the price he charges the retailer, and the retailer, alert to make a dishonest penny, puts the increase on to the price when it leaves his hands. This would natural ly increase the original advance three-fold, and other links in the chain between producer and con- sumer would increase it unfairly by the corresponding number of links.
 'The increase will hit low-class freight more than they will the fin ished. articles" said the transporta- ton authority. At first coal, grain hay. iron and bulky articles will in crease considerably in price. A bushel of what occupies considerable space and has weight. Suppose it cost &2.50. It is possible that an increase of 35 per cent. per 100 pounds would raise the price of busheI of wheat by an equal percentage of the freight rate.
 Finished articles. such as boots and shoes. would not be affected so seriously. A big case of boots and shoes could be shipped from Boston to St Louis and if the increased freightage was 40 per cent. per 10 pounds, by the time the box was Z opened and the individual pairs of boost and shoes were taken out and offered for sale the increase would be only q few cents on pair of shoes. unless there was profiteering.
 "Of course. the increase on raw
 material will have some effect on the prices of the finished articles Doctor Huebner explained the req son that the s1.5o0, 100000 increase covering freight and passenger rates is not only necessary. but is one of the greatest projections the public have against rising prices.
 '"rhe increase was necessary to per init the owners to bring their roads back into proper condition and to do all the things which were not done during the last three or four years" said he. Tt is absolutely clear that the improved transpc -tation that should result will. in &1ong run, tend to bring prices dos Tt may be two years, at least, before the effect is appreciabiy felt, but it should come.
 '~The coal supplied depends abso- Iutely on transportation. If the cars are not supplied, the mines do not produce. If coal were to advance 16U per cent, in price next winter, be- cause there hadn't been enough cars to keep production at a normal rate. it would be perfectly clear that the public was losing money by not pay ing the freight increases,
 ~An increase of 40 Der cent, in the rate shipments of coal, which would result in enabling the rail roads to supply ears with which to haul the coal, and thereby to increase the supply, is clearly preferable to Sxa nNN ir, 4 h.