The Washington herald., 1921-05-02

even basis in his home city, while he would be
barred by this freight derentia. from all the ter
ritory east of Duluth no matter how near to him
To the extent Of $7.zo ton, the freight rate from
Pittsburgh to Chicago the Chicago fabrcaor is also
kept out of the territory between those cities.
In fact it is worse than this as the Duluth or
Chicago fabricator not only has to pay this plus
freight rate added to the price Of his steel material
but he has to include the transportation cost of his
own product to the place OF delivery In figures,
this works out that while Pittsburgh fabricator
pays, say $50 ton for his materal-his Chicago
competitor for exactly the same kind and quality
pays $3.50 and his Duluth competitor pays $63zo
In delivering to q customer east of Chicago on the
Pittsburgh route the Chcagoan must reckon another
freight charge of say $2so. making the total $500
while his Pittsburgh competitor, if the combined
short haul rates but equaled the through rate would
law down the same product at the same place at
cost to him of but $500 OF course this difference
is greater for Duluth, while Birmingham has q
fortunate situation Of purely arbitrary plus
freight differental of S..
The result Of this discrimination has been to
halt the growth Of the steel fabrcating industry in
the entire country outside the Pittsburgh zone and
to so congest there as to be positive detrment
to expansion and delivery such times especially,
as the war emergency, even of great prosperity.
1t also hampers the right economic spread of indus
try, tends to unduly increase prices to consumers
and runs counter to the productive trend which
regards transportation facilities and location of raw
material supplies quite controlling factors in the
location of all fabricating plants.
The movement to break the base price for steel
began at Duluth some three years ago. Near that
city are the great iron supplies and it is, also,
the most interior port Of the Great Lakes. The
coming there from the mines, has then to bear the
lake and rail transportation charge Pittsburgh.
But steel produced at the local mills, freed of this
transportation charge adds another charge of
Of freight rate back, but not paid, to the price
charged the Duluth fabricator 1t was real
lied that steel fabricatng enterprises would not
locate there under this handicap and that Minnesota
would lose all the economic advantage of its great
reserves and of the steel mills located there.
Birmingham, which also has ore beds nearby,
promptly joined in the movement But the actual
case before the Trade Commission was brought by
the Middle West fabricators who to the number of
400, joined in association for that pur-
pose. In this Birmingham, Ala, and Duluth,
Mimi, ntervened. Unless the findings of the COM
mission now accepted, the will go to
the courts with the commission as complainant.
The full importance of this decision is better
appreciated by statement made by Judge Gary
of the United States Steel Corporation to a member
of the commission. He said he hoped the commits
sion would take jurisdiction and believed it should
do so, adding that it would be found that the same
method in vogue in the steel industry of price fixing
would be found TO be duplicated, in whole in part,
in great majority of other basic industries. 1t is
believed that this is fact to sugar. packing
house products, lumber, canned goods and other
commodities.