THE NEBRASKA INDEPENDENT
DECEMBER i, 1902.
FREIGHT RATES
Wewspapera Lambasting thm Railroads for
Increasing Freight Itat, bat Over
look Vita! PrlnclpU
It must be evident to any person
who has given the subject any serious
thought, that the proposed. Increase in
freight rates is right and proper when
viewed from tie standpoint of private
ownership of the railroads. Under
private ownership the theory is to
charge the value of the service ren
dered without regard to the cost
in other words, "all that the traffic
will bear." That is the theory which
prevails in all private businesses. If
values of wheat and corn and land
and numerous other things have risen,
why should not values in freight rates
go up to correspond? There seems
to be no good reason why they should
not, if we accept the private owner
ship theory as correct.
Socialists, who confuse the ideas of
value and cost, might not grasp the
Idea at once, but populists will un
derstand it. Under public ownership
of the railroads, freight rates would
be based on the cost of the service
rendered and not on the value of such
service as is the custom today under
private ownership. The distinction is
well shown in J. L. Cowles' "A Gen
eral Freight and Passenger Post" (G.
P. Putnam's Sons, N. Y.).
"In speed, in accommodation, in
ease and comfort of travel," says Mr.
Cowles, "the gain to the public from
the improvements made in the rail
roads in the last half century has been
wonderful, but the transportation tax
levied on the traveler today is very
generally as high as it was at the
commencement of the railroad era, and
it is full half as high per mile as was
the charge on the old stage lines, al
tliough the cost to the railroad, where
the transportation tax Is such that the
People can use railway trains up to
Jieir capacity, is not a fiftieth as
aiuch as by stage.
"On the main stem, the fare from
New Haven to New York today (18941
is $1.50, the same as in 1849, but from
most of the stations west of New
Haven the fare for the round trip to
New York is from ten to twenty cents
higher. From Bridgeport the increase
for the round trip is thirty cents, from
Hartford ten cents. From Boston, the
traveler of 1850 could make a trip to
and from New York, over the three
or more short lines of the route via
Springfield and New Haven, for one
dollar less than today over the con
solidated through line. . . . And yet
the cost of running a railroad train,
hauled by modern coal-burning en
gines over the consolidated steel track
of today is far less than it was over
the short iron roads, with the slow,
wood-burning engines of 1850."
What is true of -passenger rates is
true in slightly less degree of freight
rates. The principal idea is to change
a little less than what the goods could
be transported by wagon for, without
ar.y regard to what the service costs
the company. In some places in Ne
braska fair wages have been made
wagon-freighting goods for a trifle
less than railroad - freights, but of
course no permanent business could
be attempted in that line, because, af
ter the teams and wrfgons are all fitted
out and the businesl begun regularly,
the railroads would reduce rates just
enough to crush their slower moving
r'val.
' The Independent sees little to be
gained by cursing the railroads be
cause they expect lo increase their
earnings by raising rates. It is time
wasted. Why not instead insist upon
, public-owned railroads hauling freight
and passengers at cost of the service
rendered?
The San Francisco Chronicle says:
It is evident that the railroad offi
cials of the country have virtually de
termined in their own minds that there
shall be a general increase of freight
rates, and Second Vice President Paul
Morton of the Santa Fe has been se
lected to break the news to the coun
try. In this proposed movement we
see tne results of the general railroad
consolidation which has been taking
place and which makes possible a
policy which would have been impos
sible without it. Nevertheless, the
time has long passed when railroad
corporations could claim the right to
tax the traffic of the country at their
own discretion, and a proposal to in
crease the taxation by railroad cor
porations Is as legitimate a subject for
public discussion as a proposal to in
crease taxation by government. The
Question of what constitutes a "rea
sonable rate" for transportation is suf
ficiently difficult when confined to one
commodity between two points. When
considered in connection with a pro
posal to make a general increase It in
volves the preliminary determination
of the capital upon which, upon the
average, it is "reasonable" that a road
should earn revenue. This, again,
brings up the question of the method
of valuation, which has vexed the
courts for many years that is, whe
ther the "value" of a road shall be
taken at its book cost of construction,
its "book cost" less losses by bad
judgment or speculation, the cost of
reproduction, its probable future earn
I" cmcitv, or some combination of
all.thes? elements.
Without discussing this most com
plex of subjects, there is one thing
which may be taken for granted: So
long as the net income of a railroad
system steadily increases the roads
can .only justify themselves to the
public by a complete expose, which
it is in their power to make, but
which cannot be made by any outsid
er, of their financial history and con
dition and by affirmatively showing
that stockholders' monev. actually in
vested and prudently administered, is !
not prouucine lor its owners surh a
revenue as a competent and impartial
judge would call "reasonable." We
are convinced that this cannot h Anno.
Railroad accounts are notoriously jug
gled by placing the cost of better
ments m sinning expenses. From
the standpoint of the financier this
may be commendable, as showing con
servative management and financial
strength. It may be also claimed that
by this method the "water" in the
stock is gradually squeezed out by
ine introduction of hard coin. That,
however, is only taking from the public
money which it ought not to pay and
placing it where it may pay unearned
dividends to stockholders in the fu
ture. It is a device well calculated to
deceive the public as to the real earn
ing or a railroad.
Taking Mr. Morton's own road as
an example, it is now regularly pay
ing all interest on its bonds. 5 npr
cent dividends on it3 preferred stock,
and 4 per cent on its common stock
of $102,000,000, which, on its reorgan
ized basis, may be safely assumed to
be largely Water. The net finrninfR
of the system have been regularly in-'
creasing from $15,860,217 in 1899 to
$25,703,234 in 1901. There was an in
crease over this in 1902. The Southern
Pacific company's returns show nn
equally uniform increase, whirh thv
seek to keep down by charging bet
terments to expenses. While these
conditions continue an increase of
freights rates would be robbery.
And the MinneaDolis Ti trips rnm.
ments as follows:
Railway officials do not
proposed increase in freight rates and
naturally feel called unon tn mairo
some defense or to offer some explana
tion. The latest and most widely used ex
planation (?) is to the effect that when
the leading western railway compa
nies were found out in their evasion
or disobedience of the law that re
quires all freight rates to be open and
published, or, rather, forbids the giv
ing of special rates to one man that
are not available to another there
were many secret tariffs in existence,
that they were compelled to publish
these secret tariffs, that this publi
cation made them common property
and in effect the ruling rates, that it
is proposed to withdraw all these sec
ret tariffs evasion or disobedience of
the law being no longer possible
and to issue new ones that shall con
trol generally.
"Granting that all this is true
wherein is the justice of raising the
rates to the basis of January 1 of this
year when it is patent to everyone
that all the railways under the opera
tion of the lower or secret tariffs are
making more money than ever before
are spending more in betterments than
ever was dreamed of, feel justified in
increasing their obligations by many
millions, do not hesitate in some in
stances to water t-heir stock enor
mously, knowing that high dividends
can still be paid on the increased ag
gregate? Wherein is the public service with
which these roads are charged con
served by railway managers whose
sole purpose seems to ho tn muto aii
- - " uii
the hay possible while the sun of
prosperity shines?
When prosperity's sun is rlnnrlpH nr
sets we will be told, as aforetime, that
rates must be raised or at least kept
as high as the traffic will bear be
cause Of the chanced rnnriitlnna fo
tightness of money and the reduction
in snipments.
Once in a while, inad
of the plutocratic daili
' ' v v l l
what comes very nearly hpint- tho
truth. The New York Mail and Ex
press, m commenting unon an artir-lp
in this paper, says: "It needed no su
preme court decision to tell
silver dollars are a full legal tender,
out a sKepticai Michigan man seems
to have required a revelation from
that quarter to satisfy him." That is
a stagger towards the truth, but Is
partially false after all. Silver dol
lars are not a legal tender when "it
is otherwise provided in the contract." !
lilllwiMniiwIii -UTil.limiiilrn
Cornstalk Disease Pd
19
am
K9
Which is Now Killing
Hundreds of Cattle in
Many Localities of the
Corn Belt.
mer, why do you
let your Stock die. and abandon vnnr ctnplr fipldei whan rpliaf is at hand.
simply because you have no confidence in us or our remedy? You al
low the idea to control your mind that this stalk disease cannot be pre
vented. This is a sad mistake of yours. If you are losing stock in the
stalk fields, just drop us a card and we will come and prove to you that
we can check the disease at once; if we cannot we do not want your
money. Remedy is fed with their salt Price $10 a pail, which will
protect 60 head for the season.
And hundreds of
people who have
had nerve enough
to try our remedy
are rejoicing today.
Not one dissatisfied
m n in all our long
list. Neighbor far-
do
EADDRESSi
Kit
National Cornstalk Remedy Go,,
RAMGE BUILDING, OMAHA, NEB.
WHAT IS YOUR REMEDY FOR THE TRUSTS?
The Independent, during the next six months, desires to receive and print the views of ten
thousand people regarding the cause and cur.- for the trust evil, state vour iders pointedly. Tell
the whole story in n t more than two hundred words. Write plain, 'what causes tiusts tar fT,
freight discr minations, or what? What is the remedy free trade, tariff for revenue, protection,
government ownership, popul sm, socialism, single lax, or Jeffersonian democracy? Give your idea ,
13 WEEKS' EDUCATIONAL SUBSCRIPTION. io CENTS.
Enclose a silver dime with your manuscript, get The Independent on trial 13 weeks, and
study this subject.
Box 2431. THE INDEPENDENT. Lincoln, Nebraska.
Tha Great Remedy
, For Cornstalk Disease
In Cattle and Hordes
It disolves. neutralizes and deetrovs the nnisnn fmm cmnt nr Ana.
' J 1 " v ... . w v ""V
prevents all animals from becoming affected by it. For particulars write
E. E. BRUCE & CO.,
Sole Agents for U. 5. A.
OriAHA, NEB.
A
Holiday
This bill of staple Groceries securely packed by our ex
pert shippers and delivered to your railroad station upon re
ceipt of 10 dollars in draft, express or money order. Every
article guaranteed to be of standard grade or vour money
back. You are perfectly safe in sending a house like ours
your money. We have been in business over 11 years and
today sell more goods than any three stores in Lincoln. Call
on us when in the city. Write any bank in Lincoln or to this
paper if in doubt. Stop paying exorbitant prices for grocer
ies. Let us save you 25 per cent.
70 lbs Best Granulated Sugar $1.00-W3 Pay Freight
CHRISTMAS COMBINATION.
70 lbs. best granulated sugar... $100
6 10c pkgs. best soda 50
2 lbs. best baking powder..... 50
6 pkgs. best corn starch 50
4 lbs. best Japan tea 2 00
25 bars laundry soap 1 00
2 lbs. purest pepper 50
2 gallons best vinegar 50
10c pkgs. gloss starch 50
6 lbs. choice prunes.
6 lbs. choice rice....
4 lbs. choice raisins.
4
3 pkgs. Rising Sun stove polish.
3 10c cans lye ,
2 lbs. Mocha and Java coffee. . . .
50
50
50
lbs. choice peaches 50
25
25
50
$10 00
All the above order packed as stated
and delivered to any railroad station
in the northwest for $10.00.
Write for a complete price list. We sell evprvtr,;
10 distinct stores under one roof.
FARMERS GROCERY COMPANY
Largest retail distributors of groceries in the west
226-228-230-232-234-236 North I Oth Street, Lincoln, Nebraska.
