The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1933-06-09
OuyGOverumeut
How 1t Operates
BY William Brsckars
PROBLEM OF RAILROAD
RATES

L sion is going to have tough job
on its hands during the next few
years. Every one familiar with the
problems of the railroads is agreed
that the next several years constitute
period OF great REIMBURSEMENT, and
the companies that own the steam
horses are no exception. So, with the
railroads clamoring on the one hand
for more revenue and reduced oper-
ating expenses and the shippers de-
handing lower rates consonant with
new values of commodities and orga-
nized labor seeking a return to norm
al wages, the commissions situation
Is one not to be envied.
This question of rates Is one that
Is especially worrisome. The statutes
under which the commission operates
requires that the freight and passen-
ger rates be just and reasonable. That
means, of course. that both the ship
pers and the carriers must be con-
sidered. and It takes a good umpire
to satisfy the players on both teams.
The commission has a whole bag
full of powers to use In its jurisdic-
ton over railroad rates. And as one
who is decidedly not a rate expert. I
would say it needs all of the powers
and a handful of tricks besides. Its
own definition of its authority is COM
plicated beyond Einstein's theory.
1.-The commission has Jurisdiction"
It reads, upon complaint, or In a pro-
ceeding instituted upon its own initia-
tive. and after full hearing, to deter
mine and prescribe reasonable rates.
regulations and practices, including
minimum. and maximum and mini
mum, rates; and also minimum, and
maximum and minimum. proportional
rates to and from ports, and to award
reparations to injured shippers. +. 1t
is authorized to require carriers to
establish through routes and joint
rates, and II may act summarily in
itself establishing through routes
when, In its opinion. an emergency
exists"
Many more lines could be quoted
to show that the commission has pow
er to do the things it thinks best for
all of the interests served.
But to get down to cases: railroad
desires to Increase a rate which II
charges for transporting cobpipes
from St. Louis to Denver The law
requires that It must file the new
schedule of rates with the commits
sion, and If the commission gains an
intimation or has an idea about what
ought to be charged for hauling cob
pipes over that distance, 1t can sus
pend the schedule fled by the rail-
road. That means it Is imperative.
The purpose is to give the commission
chance to look into the reasonable
ness Of the proposed charge.
Congress, however, did not give per-
mission for an indefinite suspension
Of the rates in question. It prescribed
that the suspension could not be for
longer than $50 days, which seems
quite long enough for any investiga-
ton. Yet many investigations are not
completed in that time, and the Ques-
toned charge becomes operative. As
a counter-balance, the law provides
that while the rate may become op-
erative, the commission may require
the carriers involved to keep q sep
arate account of money received as
result of the increase until a de-
cision is had. If the commission
eventually denies the increase, then
the carriers have to refund the money
representing the increase that It has
collected.
It was back In 1910 that congress
expanded the commissions power to
give it Jurisdiction over every phase
of rate-making. The Mann-Elkins
act laid down a set of rules govern
Ing through routes and rates. switch
connections. long and short hauls
tproviding that there shall be no dis
elimination against the short hauls
In favor OF the traffic for long dis
tances). general freight classiications
and a host Of other matters. Then,
In 1917. and again In 1920 when the
power was given. Between these two
laws. there was very little left which
the railroads could call their own.
For example. If the commission con-
siders that conditions warrant 1t, an
order may be issued causing one car.
rier to transfer some Of its equip
ment to another for USE OF course,
the user pays rental. but the COM
missions order can hardly be defeated
II can tell a carrier when 1t has
enough equipment such as locomo-
tives. or it can say its supply of
rolling stock is insufficient and it must
buy more, and II can and does lay
down the rules under which ii may
sell bonds or other securities with
which to obtain funds for financing its
requirements.
In addition to all of these. the COM
mission was directed by the trans
portation act to prepare a plan for
consolidation as soon as possible of
all railroad properties in the United
States into a "a limited number of
systems" AT the same time. the rail-
roads are authorized to accomplish
such consultations Notwithstanding
the statutes prohibiting formation of
trusts"
The commission has prepared such
plan. II proposes to have only four
major rail systems In the eastern half
of the country. But the carriers have
not rushed in to sign up. They have
found a lot of things they do not
like about the program.
G. 1882. Western Newspaper Union.