Evening star., 1947-05-12
South WinsFight
For Equal Rates
On Glass Freight
Supreme Court Books
Authority of ICC on
Tariff Order, II
By the Associated Pes,


The Supreme Court today up
held, 7 to 2, an Interstate Com
merce Commission order raising
railroad freight rates 10 per cent
in the North and East and low
ering them 10 per cent in the
South and as far west as the
Rockies.
The commission ordered the
changes after officials of Southern
States complained that higher rate!
in their region gave Northern manu-
facturers competitive advantages.
Affected are so-called class rates
These apply principally to manu-
factured articles
Justice Douglas wrote the court:
decision. It was read by Justice
Burton in the absence of Justice
Douglas, who has been i'll with q
cold. Justices jackson and Frank
furter wrote dissents.
Further Uniformity Planned.
The commission in May, 1945
found the freight rate structure dis
eliminated against the South on
almost all manufactured articles and
ordered the changes as the first step
toward equalizing rates. The order
was the result of litigation initiated
by the Southern Governors Confer
ence.
The commission planned as a sec
ond step to work out national uni
formity in the classification OF
freight, and a greater degree of ma
tional uniformity in the class freight
rate structure" Glass rates apply to
about 4 per cent of all rail freight
traffic and yield about 6 per cent OF
freight revenue.
Southern officials hailed the ICC
order as one which would permit
Southern industry to breathe freely
for the first time In history"
Nine Northern States, Governors
of the six New England States, and
80 railroads, however, challenged
the ICC action as arbitrary. They
said it was not based on facts and
upset principles of rate-making
which had been used for many gen.
erations.
Lost In Special Court.
The chaIengers first presented
their case before special three
Judge Fedral court in Utica, N. Y.
That court upheld the ICC. The
challengers then appealed to the
Supreme Court. Actual change in
class rates was deferred pending the
high tribunals decision.
The nine States opposing the in
crease were New York, Delaware,
Indiana, Maryland, Michigan, New
Jersey, Ohio. Wisconsin and Penn
sylvania. .-......
A similar suit filed by the State
of Georgia and its former Governor,
Ellis Arnall, is now in the hands
of special master, Llyod K. Gar
rison.
Georgia charged 10 Southern and
Western railroads had conspired and
combined to fix freight rates dis
criminatory against the South, in
violation of the antitrust laws.
Decision Still Pending.
The Supreme Court appointed
Mr.. Garrison to gather facts, hear
testimony of all parties interested.
and made report and recommended
tion to the justices. The report and
recommendations are not expected
to be- ready for presentation during
the present court term, which ends
in June.
Justice Douglas wrote % 600
woM opinion in upholding the COM
missions action.
He said there is abundant evidence
to support the commissions findings
of discrimination among the ter
ritories.
Further, he said the commission is
correct In its finding that there is
prejudice against the Southern
region.
Strong Case Acknowledged.
Justice Douglas said the record
before the commission made out a
strong case for an inference that
natural disadvantages alone ARE not
responsible for the retarded Develop
ment of the South and the West,
land that the discriminatory rate
structure has also played part"
Where the result of rate is not
clearly shown to be conf1scatory but
it's precise effect must await opera
tions under it" Justice Douglas
stated, "the Supreme Court has re-
fused Tin the past) to set it aside
despite grave doubts as to its con-
sequences.
The reasons for following a like
course are equally simpelling here"
The majority said the commits
sion's recent action in granting a
Nation wide increase in all freight
rates did not affect the case de-
cided today,
No Opinion On General Increase.
Justice Douglas put it this way:
This is a proceeding to eliminate
territorial rate differences not iusti-
fed by territorial conditions The
general rate increase recently
granted by the commission was a
revenue proceeding. Revenue ad-
justments can be and are superim-
posed on such rates structures as
exist The fact that revenue adjust
ments may produce lack of uni
fornity in rates is not inconsistent
with the decision in the present
case"
Justice Douglas said the order
granting the general rate increase
actually was not before the court for
consideration and the court init
mated no opinion concerning 1t.
Whether the general rate increase
will require adjustments in the new
permanent uniform scale which
awaits the new uniform classiflca-
ton is a question for the commission
when the new classification is
ready" Justice Douglas added.
Col. Peterson Sufe
CAPETOWN. May 10 pa mes
sage yesterday from Salisbury, Rho