The Waterbury Democrat., 1943-08-23

SOUTHERN TdIeS are nlgner IMAM
rates in the north, the New England
governors point out that, while
"class rates" are somewhat higher
in the south, due to favorable
southern commodity rates" and
other circumstances, the general
level of all rates in the south is less
than per cent higher than in the
north, whereas costs of railroad OPP
erationS are more than per cent
higher in the south than in the
north.
Existing Differences Required
Dealing with differences in par
ticular rates New England governors
point out that territorial differences
in the kinds of traffic predominant
ing in the two territories requires
existing differences in rates. "Class
rates. the brief states, ION high
grade commodities are necessarily
and properly higher in southern and
western territory than in official
territory because of differences in
territorial traffic consists, and the
resultant necessity of differing
distribution of the traffic burden
In no other way can southern and
western carriers afford southern and
western interests the favorable rates
on loW-grade commodities and the
favorable commodity rates on high
grade competitive traffic now apple
able" and, the brief adds, Territorial
differences in the relative propor--
tions of high grade and desirable
traffic necessarily justify differences
in territorial class rate levels on
high-grade commodities. In ter
ritory wherein the volume move
ment is of low-grade traits and
wherein the amount of high-grade
traffic is relatively slight, rates for
the high-grade traffic movement
must be higher than in territory
wherein the volume movement is of
high-grade and desirable traffic. In
both territories only relatively low
rates can be obtained for the move
ment of the low grade traffic. The
balance of the carriers revenues in
each instance must be secured from
the higher grade traffic. If there is
only relatively small volume OF
this type of traffic from which need
ed revenue can be secured, the rates
for movement must be relatively
high, Whreas, If there Is large VOL
ume of high-grade traffic, the rates
for the movement of such traffic
need not be so high because of the
volume"
Discussing specifically nationwide
uniformity of freight rates, the brief
says: although a serious objection
to the requiring of class rate uni
formity is inherent in the fact OF
regional differences in cast, regional
differences in traffic consist raise
and additional and quite as signifi-
cant an obstacle to the requirement
of mile -for-mile parity in class rate
levels. These two major types OF
differences in transportation condi-
lions both warrant existing territor-
ial class rate differences and effec-
lively prohibit the prescription of
class rates of nationwide uniformity
The Southern carriers may not prop
erly be forced to ignore these differ
ences by reducing the level of South
ern class rates; the carriers in Off
cial Territory may not properly be
authorized to increase their class
rates so long as transportation con-
ditions (including the important
condition of traffic consisD warrant
and justify the existing lower level
Uniform Freight Levels Opposed
The brief deals extensively with
the claims of certain southern in
terests that the existing freight rate
structure has impaired southern in
dustrial development. The brief
quotes from the testimony before
the commission, of c. E. Widdell,
who appeared for the Southern
States Industrial Council, to the
effect that.
1--WE are opposed to national
uniform rate levels. We favor re-
giOnal rate structures. 1t would
be a shortsighted policy on the
part of industry not to take into
account the financial effects upon
our transportation systems of any
lack of revenues, or any disturb
ance or redistribution of revenue
sources from one source, of traffic
as against another. represent
industries here that are diversified,
depending largely on commodity
rates, but we own and operate
small towns and villages, we Oper-
ate department stores and hard
ware stores that sell retail and
wholesale. In that respect, 1
might say that we are the South.
81 might say further at this
point, MIR. Chairman, that we do
not agree that the Southern Gov
ernors speak for industry as
whole in the south. have lived
in the solth, and been associated
intimately with industry in the
south for over 81 years, and l
think I correctly express the
sentiment of industry in the
SOUTH"
| The brief then points out that
present economic differences be-
| tween the South, North and west
existed long prior to the develop
ment of present territorial rate
structures and that those struc-
lures were developed to meet exist
ing economic conditions. THAT the
existing freight rate structure" the
brief asserts, "has not retarded
South industrial development is APP
parent from any fair consideration
of relative economic development
Southern industry during the past
two decades has observed an ex-
pansion which far exceeds, per-
centage- wise, the development IN
Oficial Territory. Southern industry
and the Southern and Western eco
Monies were much less adversely al
fected by the depression periods OF
193O-34 and 1898. No purpose Is tc
be served by reviewing the numer-
| OILS exhibits and pages OF teStl-