Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-06-08
DECISION IN RATE
CASE FAR REACHING
Railroad Men Believe Verdict
on Fruit Shipments viii
affect Other Lines.

Every railroad, shipper, merchant and
consumer in the United States may be
affected to some degree by the decision
OF the United States Supreme Court in
the deciduous fruit case. This was the
opinion of many expert railroad men
expressed here yesterday. Members of
the Interstate Commerce Commission,
although some of them declare that it
will not near sc drastic a change, ADMIT
that the decision Will alice the rate
making policies of the commiSSlC..
The Interstate Commerce Commission
is empowered by the interstate COM
merce act to TX rail rates IN the interest
OF the public, put it is alleged that the
commission has been exercising this
right in the light OF the Hoch-Smlth
farm relief" resolution. The commits
sion reduced freight rates on deciduous
fruits from California under this farm
relief plan, although it had found a
short time before that the rates were
reasonable"
Special Condition Cited.
The commission, however, issued
subsequent ruling to the effect that a
condition existed in the Southern Cali
fornia fruit Industry which justified
reduction in rates. The court noIds that
the passage OF the hoch-Smith resolu-
ton, on which this policy was based,
was interpreted by the commission as
q law whereas the resolution in no way
altered the law dealing with rate
making. The court overruled the COM
mission and directed the lower court TO
set aside the commissions order.
The court holds that the Hoch-Smith
resolution does not give authority to do
anything which the commission could
not do under the interstate commerce
act. The main purpose of the reSolu-
ton is to aid the farmer and it Is in
tended that wherever it is possible to
do so in a lawful manner, the commits
sion shall accord farm products lower
rates; these rates are not to be made
arbitrarily but under the new process
governing rate-making in general.
The commission is now engaged in a
very extensive rate structure inveStiga
ton. This was instituted by direction
of the Hoch-Smith resolution. 1t deals
with such commodities as iron, steel,
grain petroleum, live stock, furniture,
sand and gravel and non-ferrous metals.
The Supreme Courts decision will not
halt the progress of these inquiries but
it may change the basis on which rates
on these products are established.
This court decision, according to rail-
road men, means that the commission
can only follow It's policy of favoring
industries in depressed condition by
lowering freight rates up to a certain
point. Frank McManan1y, chairman of
the Interstate Commerce Commission,
sees nothing in the decision which
might affect the rate structure inVesti-
cation, but he admits the commission
has not yet given its future action in
the matter thorough consideration.
Hoch's Opinion.
Representative Hoch believes the de-
cision still leaves the duty to the COM
mission of revising the freight rate
structure as rapidly as possible with
view to equalizing the freight burden
on farm products. He adds, however,
"the decision does not seem entirely
clear as to the power of the commission
to order in any case decreasing rates
because Of the depressed condition Of
the industry affected"
Representatives of industries other
than farming have made vigorous pro-
tests against the policy of restricting
freight readjustments to farm products.
Gov George H. Dern of Utah, says the
Western miner and farm owner are "in
the same boat" He says that each Is
receiving pre-war prices for what he
sells and is paying nearly double pre-
war prices for what he buys. Gov. Dern
protests against any proposal to shift
the burden of freight rates on agricul-
tural products to mine and smelter
products.
fCopyrisht. 1900