Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1921-08-02
GEORGE p. WILSON
On Oifferential Rate Question

PEMOVAL of Il handicap that has cost
~ Philadelphia shippers hundreds of
thousands of dollars and n process of ad-
iusfmcnt that will as nearly as possible fix
shipping relationships between cities aud
regulate difPrcntinls to conform with the
law is seen by George Il. Wilson, commits.
SonPr of transportation of the Chamber Of
Commerce This comes as the climax of
years of development on the whole question
Of adjusting the whole question of rate diff
fcrentialS.
"A dircrential." explains Mr.. Wilson,
rs the measure of the difference in rates
between one point and another and is based
on the preference due one point over another
by virtue of distance or geographical posi-
tiOn. Thus Philadelphia. being nearer many
points south and west. should enjOy an ad-
vantage in rates over New York or Boston,
just as these cities will enjoy similar ad-
vantage by being closer to points north or
east.
Not Case Of Favored City"
"The diffcrcntial did not start on the
theory that one city should he favored over
another by certain number of cents in
rate. but il did find measure Of difference
between one city and another in advantages
of position which for practical reasons and
in the interest of fair play 1t was necessary
to reward by preferential rates.
THE differential is not thought of in
terms Of fixed rates. but as to what rate
of change between two cities will constitute
a fair principle.
''To throw light on the differentia Ques-
ton it would probably be well to have a
little background showing the steps that led
up to the present situation.
"Prior to the adoption OF the Interstate
Commerce Act. which became effective No
vember ! 1887, railroads did business on
basis which, while perfectly proper among
manufacturers and business men, could
f,ir 10, norrinrs hnpnuSp nf tho pnh1in
character Of their business.
They then worked on the basis. long
since recognized in business, of giving its
best rates and service t" preferred Gus
toners In applying this principle in rail
roads the large concern grew still larger
and the small one was rOntraWise kept from
getting larger.
How Competition Works
"It encouraged monopoly. While this
DriuCipr might be all right in other bust
ncSsrs railroads ns distributors were placed
ethicaly under the obligation of being nrlI-
tral Otherwise they are in danger of be
coming NutOcratic.
IF in competition between two business
concerns the other fellow, by reason Of n
superior aggregation of capital and brains,
can get business from the other fellow, he
is entitled to the reward which he gets
This is an accepted principle Of business.
But if he gets an advantage through dis
crimlnatOry rallrONu rate, thcn he Is nn-
fairly dealt with,
Before 1887 the railroads didn't publish
tariffs as they ar" now required. They
quoted rates on application, but that was
all The Interstate Commerce Act changed
that. 1t also stopped the practice of giving
lower rates to large shippers than to others,
which was ruled as unjust discrimination.
"Tnfortunatcly. the Act Of 1887 was not
strong 1t contained no penal clauses. Pro.
hibition of discriminatory rates could not
be- enforced
"Whrn Roosevelt became President the
Hepburn amendment to this act became a
law This made il a penal otfrnsr for the
railroads to give or the shipper to accept
preferred rates, each party being held
equally guilty.
Early Mistakes Reme,lied
"This cleared the atmosphere Of carller
conditions and made for reasonable corrpc-
ton Provision was made for appeal to the
Interstate Commerce Commission for relief
If the amendment happened for one reason
or another to put nn unjust burden on GER
tain points and an investigation would be
in order. The commission could then adjust
| these differences; or in the event that they
| did not an appeal could be made to the Fed
| eral courts and then up to the Supreme
Court.
"The railrOAd companies made their own
| rates. both before and after the net became
effective. They were filed thirty dnvs bpfrrc
| with the commission giving the public notice
| OF the changes proposed, 10 that opportunity y
would be afforded TO point out to the cam-