Evening star., 1926-10-14
DENIES CANAL CUT
RAILROAD HAULS
Testimony Before |. C. C.
Held of Utmost Importance
to FinanCierS.

BY the Associated Press.
NEW YORK. October IA pic
ture of the troubles Of the Chicago
Milwaukee and st. Paul Railroad which
lefutes the popular idea that Panama
Canal competition is the root of the
difficulty is presented by James y.
Ford, secretary-treaSurer of the
Spokane, Wash. Chamber Of Com
merce. In a letter written by Mr..
Ford, he cites the verbatim testimony
Of Mark W. Potter, a receiver UI the
st. Paul system, before the Interstate
Commerce Commission in New York
July .. Mr.. Potter moi, only said the
Panama Canal had been overeTnpha-
sized as an explanation of the ad
versity Of Northern lines, but that the
effect of the canal had been to de-
velop the Pacific Coast as a whole.
The striking testimony given by
Mr.. Potter was not generally pub
Iished. it's Significance not having been
understood by the reporters who COW
cred the hearing for the Associated
Press and New York newspapers For
Years the intermOuntain region has
been conterding for lower rates based
upon the lesser mileage involved as
compared with coast cities. The argu-
mentS from the inter-mountain terri
tory We're combatted by the claim that
the Panama Canal competition made
necessary the apparent discrimination
in favor of the longer haul to the
coast.
When Mr.. Potter, replying TO a di-
rect question, unequivocally support
ed the denial by the intermOuntain
points that Panama Canal competi-
ton was n reasonable bar to their
dema ndS for rate structure based
on the length of haul, the forces led
by the Spokane chamber and their
associates in other cities Of the region
were highly elated. Disappointment
at the failure of reporters to grasp
the meaning of this evidence resulted
in Mr. Ford's making a statement
calling attention to the Potter testi-
lnCnY.
Answer Held Important.
The question and answer which
strikingly brought out the informa-
tion regarded as Of highest impOr-
tance to the financial transportation
world We're as follows:
@. Do you believe that the con
struction and operation Of the Pan
ANA Canal has tended to diminish
the traffic and revenue Of the st. Paul
Railroad SYSTEM"
''Nir. Potter. ! think the Panama
Canal as an explanation of adversely
Of the northern lines has been very
greatly overemphasiZed. | am not at
all convinced that the northern lines,
or any northern line, including the St
Paul. would be better off today If the
Panama Canal had not been CON
structed. l do not think the st. Paul
would have been better off You can
see business that is moving through
the canal and YOU can reason that
the roads would have it If the canal
were not there. But perhaps the bust
ness would not be there or perhaps
other business would not be there.
haven't any doubt but that the effect
of the Panama Canal has been to de-
velop the coast as a whole. promote
the prosperity of the coast, and
think by and large the railroads have
been compensated through benefits
from the canal which quite take care
Of any debts.
Shock Felt After War.
"There have been times. Of course,
when the carriers have felt a shock
would put it that way. During the w0r
there was no business through the
canal. There. was demand for ships
for the transatlantic trade all over
the world We all know the prices
10 winch bottoms went. JheN could
not afford to use them in interocean
service through the canal. They went
to Europe and other places. The re-
suit was that all the business went
to the railroads.
when the war was over and the
depression set in. almost overnight the
prices of steamships went to the dogs.
Almost overnight YOU could buy a
steamship for p per cent of what YOU
could have bought it for the day be-
fore. The result of that was that
vessels could be bought to put into
this canal service from coast to coast
and vessels were available that had
no other business. and they rushed out