United States. Congress. Senate. Committee on Inte.

Regulation of railway rates : Hearings before the Committee on Interstate Commerce, United States Senate, in special session, pursuant to Senate Resolution No. 288, Fifty-eighth Congress, third session, April 17, 1905- online

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Online LibraryUnited States. Congress. Senate. Committee on InteRegulation of railway rates : Hearings before the Committee on Interstate Commerce, United States Senate, in special session, pursuant to Senate Resolution No. 288, Fifty-eighth Congress, third session, April 17, 1905- → online text (page 76 of 123)
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If the means are not adequate or are inoperative, make them oper-
ative by some more well-defined plan or method ; provide means for
their speedy enforcement. That is my idea of this question; and I
think the rate-making power should be left as it is.

Senator Culi.om. You come here from Pennsylvania, you say?

Mr. Keee. I come here from Pennsylvania, as a shipper.

Senator Cullom. You are in the coal business ?

Mr. Kerk. In the coal business.

Senator CuLLoar. Did you come down on your own account?

Mr. Kerr. On my own account.

Senator Cullom. To give expression to your views before the com-
mittee ?

Mr. Keer. Yes, sir; on my own account. It is true that the mat-
ter has been discussed among us up there who are interested in this
problem, and it seemed of importance enough for me to say that I
would come down and give my views.

Senator Cullom. What is the general feeling in reference to the
matter in your section of the State?

Mr. Kerr. So far as rates are concerned ?

Senator Cullom. On this general question of giving the Commis-
sion the power to make rates under certain circumstances.

Mr. Kerr. So far as I know about it — I only know of those who
are concerned in it as originators of products to be shipped — ^they
do not believe that the rate-making power should be put in the hands
of the Government.

Senator Cullom. That class of people agree with you ?

Mr. Keek. They do. There are always some who have grievances,
and always will have. I do not recall any just now, but I have no
doubt that, as has been indicated here to-day, there are sentimental
organizations of one kind and another in the State of Pennsylvania
the individual members of which are not much interested in this
problem and see great cause for grievance, and that might impress
a body like this with its power and influence. But the facts are that
the producers of tonnage, the people who are concerned in it, who are
affected by it, are not in favor of the rate-making power being put
in the hands of any different body from that whim now exercises it.

Senator Cullom. You are disposed to stand by the law as it is ?

Mr. Kerr. We feel that that is best. ,^

Senator Cullom. Are there no rebates in your section ?



TWENTY-FIKST DAY. 81

Mr. ICerr. Xo. I speak of the coal business because I know all
about that. There are no rebates paid to coal shippers in our region
that I know of, and I do not think there are any.

Senator Cullom. Are there any unjust discriminations between in-
dividuals or localities in your section?

Mr. Kerr. There has been some complaint in that direction on the
line of the Pennsylvania Eailroad — complaints of discrimination
on the car question, the distribution of cars, percentages. There is
more or less of that. There is none on the New York Central, where
most of my tonnage originates. The cars are distributed on a per-
centage basis, and I think all the shippers would testify, if they were
here, that there were times when all of us complained of not getting
cars enough. But, take it as a whole, at the end of the year we have
been as fairly treated as we could expect. But the railroads have
been very short of equipment, both of cars and of motive power to
move those cars after they were loaded; and we have all suffered
seriously from the inabality of the railroad to move the tonnage we
have provided for shipment.

Senator Foraker. You produce and ship something over 6,000,000
tons annually?

Mr. Kehr."' Yes, sir; about 6,000,000.

Senator Foraker. Do you send any of that to the Western States?

Mr. Kerr. No, sir.

Senator Foraker. You do not ship to Chicago?

Mr. Kerr. "\Ye have no rate that would allow us to ship to Chicago.

Senator Foraker. Nothing goes west ; all goes east ?

]Mr. Kerr. All our coal goes east; we are in the Allegheny Moun-
tains.

Senator Foraker. And you do not complain that the rates are too
high, or about rebates or discriminations ?

Mr. Kerr. We do not want rebates. I feel that if there were re-
bates allowed there would be an uncertainty in jny business that I
could not afford to have in it; because if I got rebates, somebody
else might get more than I did, and put me at a disadvantage with-
out my knowledge, and therefore injure and hurt and retard my
business. But if you have one fixed rate for all alike, we know where
we are at, and can guide ourselves accordingly.

While it is true to-day that there are sections where we deliver our
coal and feel that the rate is too high, and the price that we are able
to obtain for our product will not justify that rate, yet that is the
condition we will have to accept; and we will await such time as
the rate can be adjusted to meet our conditions. We are brought in
contact with the southern fields, as I indicated a while ago, and the
rate to tidewater there is $1.35, while with us the rate to Philadelphia
is $1.20. Their haul is longer than ours. If there was a rate per
ton per mile, ours would be much less; and that is a very severe
competition for us in New England, because of their low water rates
and their low cost of production.

Senator Foraker. Do you export coal ?

Mr. Kerr. We export coal to Cuba only.

Senator Foraker. Only to Cuba ?

Mr. Kerr. We send coal to Philadelphia, and by a vessel to New
England — Boston and Fall Eiver and Portland.
21 D— 05 M 6



82 TWENTY-PIEST DAY.

Senator Foraker. Transportation to Cuba belongs in our coast-
wise trade, of course ?

Mr. Kerr. Yes, sir.

Senator Foraker. We have not any outside competition. That is
all.

STATEMENT OF MR. F. L. MITCHELL.

Mr. Mitchell. My name is F. L. Mitchell, of the Mitchell & Lewis
Company, better known as the Mitchell Wagon Company, of Racine,
Wis., manufacturers of wagons. I will only take a few minutes of
your time, gentlemen, because I realize the necessity of your getting
throvigh.

I want to preface my few remarks with the statement that 1 believe
the passage of the Cullom bill and its amendments, with the Elkins
law as passed, were good things — ^good for shippers, good for every-
one, and especially good, as I believe from my personal knowledge,
for the railroad companies. But from a manufacturer's standpoint
I believe it is, to say the least, unnecessary at the present time to pass
any further laws bearing on the railway-rate question, or to give
the power of fixing rates to the Interstate Commerce Commission
or to any other commission that may be appointed.

I want to make one exception to that statement, and that is as to
the private car and the private side track or terminal facilities prop-
osition, as it may be termed. 1 believe both of them, and especially
the terminal side-track matter, could be made of great injustice to
the shippers — to the manufacturers — and would be the means of
giving some undue preference over others. That, I think, is readily
appreciated.

The city of Racine, where my company is located, is some 63 miles
north of Chicago, and about 23 miles south of Milwaukee.

Senator Foraker. You are right on the lake, are you not?

Mr. Mitchell. We are right on the lake; yes, sir. We manufac-
ture farm and spring wagons — farm wagons especially; they are
our main product. We do solely an interstate business. We get all
our freight from States outside of our own.

Senator Foraker. What is the amount of that business, if you can
tell us?

Mr. Mitchell. Our out-freight is in the neighborhood of 1,000
cars annually. The in-freight is about the same, I should say.

Senator Clapp. And you ship all over the country ?

Mr. Mitchell. Yes, sir; we ship to nearly every State of the
Union, with the exception of, possibly, the States of Maine, New
Hampshire, and Vermont, up in the northeast corner.

I will not go into the details of our business, but I will simply say
that the Mitchell & Lewis Company has been organized now for some-
thing over fifty years. Of course it stands to reason that I have not
been connected with the institution for that length of time, but I
know of the business that has been done by the company since the
interstate-commerce law went into effect and for some time before
that. I know of that personally, and I know that our company has
never had to ask the assistance of the Interstate Commerce Commis-
sion in the regulation of any of our rates ; and I know, further, that
there is no one institution m the city of Racine, which is composed



TWENTY-FIEST DAY.



83



almost entirely of manufacturing interests, that ever brought an
action or made a complaint to the Commission of any unjust rates.

Senator Culloji. You have always gotten along without it?

Mr. Mitchell. We have always "gotten along without it, Senator ;
yes, sir. We have always arranged our own rates with the railroads,
and have found, as a rule, that they are willing to meet us on any
reasonable proposition. We have not always been able to get all we
ask, and we never expect to ; but there are changes and complications
constantly coming up in a business of that nature.

For instance, Ave use a large quantity of lumber and wood stock in
wagons, and the producing centers for that class of material are con-
stantly changing. Those rates have to be arranged to meet the condi-
tions. I could cite particular instances, but I do not think it is
necessary, unless you desire to have them brought out.

The railroads and the shippers or the manufacturers are in touch
with each other, and I have found by experience that the traffic men
of the railroads sometimes know the needs of the manufacturers
better than the manufacturers themselves; and they have adjusted
certain rates unsolicited on the part of the manufacturers. I do not
mean to say that this has been done by any secret rebates or under-
hand means of any kind ; it has been done by open tariff.

The question that comes to me is whether the railroad companies
would be as ready and willing to grant those concessions if the power
to fix rates were taken away from them and given to a commission. I
believe not.

We hear it said that there is a popular demand for railway legis-
lation. That is supposed to be so in the State of Wisconsin.

Senator Culloji. According to the A'ote there, it is so, is it not'i

Mr. Mitchell. According to the vote it would seem so, Senator,
surely ; but I think it does not come from the business men — I think
it does not come from the men who are posted. I was just going to
say that if that is so I believe such a demand comes from a misunder-
standing of the conditions as they exist in the making of the average
rates of the country. I believe that that popular sentiment has been
worked up by holding up a few shining examples; and the holding
of those examples has worked to the detriment of the other business
interests of our State.

Senator Cullom. Have you any of those shining examples in mind ? '

Mr. Mitchell. They are public property, I think, Senator. I do
not believe it is necessary to cite instances, unless you wish .me to.

Senator Cttllom. Oh, no ; it is not necessary.

JMr. Mitcheix. I think we all know what concerns are meant. They
are not competitors of ours ; I will say that.

Senator Cullom. Are they business men ?

jAfr. Mitchell. I should "think they were. I think they are first-
class business men.

Senator Cullom. The reason I make that inquiry is because we have
heard a good many business men from different parts of the countrj',
and T have almost forgotton if we have ever heard anybody who com-
plained of the railroads or favored additional legislation.

Mr. MiTCHEiJL. Yes. WeU, I understand that you want all of the
different ideas on this thing. If I had not understood that, of course
I should not have asked to appear before the committee, t supposed



84



TWENTY-FIBST DAY.



that 3'ou wished to have the manufacturers and the shippers express
themselves, whether they were coming here with a complaint or not.

Now, there may have been cases of injustice, and it is natural that
there should be with such a vast business as is being handled. But
with the private sidetrack and the private car proposition eliminated,
as I believe they will be, I am willing to take my chances with the
railroads, working under the present Taws, and subject to investiga-
tion by the Interstate Commerce Commission, acting under the pow-
ers given them iii the present laws.

Gentlemen, that is all of my statement.

STATEMENT OF MR. EDWIN SMEDLEY.

Mr. Smedley. My name is Edwin Smedley. I reside in Dubuque,
Iowa. I am general manager of the Smedley Manufacturing Com-
pany, of Dubuque.

Senator Forakek. What is your business?

Mr. Smedley. We are manufacturers of steam-pumping and power-
pumping machinery, fire apparatus, and waterworks supplies gen-
erally.

Senator Clapp. What is your output and tonnage?

Mr. Smedley. Approximately, 5,000 tons a year. A great many
of our shipments are not made in carloads. They go in less than car-
loads, excepting in cases of complete waterworks plants, where we
run sometimes as high as 30 or 40 carloads of pipes and machinery,
building material, and so oni

Senator Clapp. Is the pump business, quite an industry at Dubuque ?

Mr. Smedley. Yes, sir.

Senator Clapp. Are there a number of concerns th§re?

Mr. Smedley. Yes, sir.

Senator Kean. That is the home of Senator Allison, is it not ?

Mr. Smedley. Yes, sir ; the home of Senator Allison and Colonel
Henderson.

Senator Cullom. Go ahead and say what you wish to say.

Mr. Smedley. I had intended to read a statement to you, but I will
not do so ; I do not think it necessary for so many of us to go into
railway statistics. I think you have had enough of that. It does
not make a great deal of difference to us what it costs to build these
railroads or what their revenues are or what their profits are. The
main thing with us as shippers is, Are we getting fair treatment?
And I am instructed by my company and urged by my friends who
ate manufacturers — not a lot of sentimental fello'^s or sentimental
organizations; not a gang of men who have not a dollar invested
and are ready to howl for a 1-cent stamp rate on a car of stuff, if pos-
sible—to say that we are. It is simply a question with us whether or
not we are getting fair treatment at the hands of the railwaj's ; and I
am here, gentlemen, for the purpose of saying to you that for twenty-
five years we have not had a single serious grievance, not one serious
complaint. Little matters have come up, but they have always been
readily, promptly, and cheerfully adjusted by the railway officials;
and we have never been under the necessity of calling into requisition
the railway commission, nor do we believe a railway commission is
necessary at all. As manufacturers we would rather deal directly
with the railway companies.



TWENTY-FIRST DAY. 85

Senator Forakek. Have you any complaints to make before us of
discriminations against you by the railroads in the prosecution of
your business?

Mr. Smedlet. None whatever.

Senator Foraker. Let me call your attention to a statement made
yesterday by the governor of your State, Governor Cummins. Being
asked a question which seemed to him to call for a definition of the
discriminations he had been talking about, he made this answer :

Dubuqne wants to send pumps, we will say. to a point 50 miles away, in Wis-
consin. Now. it costs the Dubuque manufacturer a little more to produce his
article than it does the Chicago manufacturer, because he is farther away from
the raw material. He has had to put his raw material into Dubuque. He goes
to this point and he finds that there is the same rate on pumps from Chicago,
200 miles away, that there is from Dubuque, while the Chicago manufacturer
can produce his article a little cheaper. That is the discrimination I complain
of.

^^Hiat have you to say about that?

Mr. Smedley. I do not know; I do not know of the existence of
anything of that kind. I am under the impression that the Governor
is visionary on that point.

Senator Foraker. Does the governor manufacture pumps?

Mr. SiiEDLEY. No, sir; and I do not think he ever shipped any-
thing or ever manufactured anything. I heard him yesterday.

Senator Foraker. You were here, were you, when he spoke of that ?

Mr. Smedlet. Yes, sir.

Senator Newlands. Is there anybody else there who manufactures
pumps, at Dubuque?

Mr. Sjiedlet. Y'es, sir; but not the same type. Ours are steam
and power pumps. The other pump manufacturers there manu-
facture hand pvimps and wind pumps.

Senator Newlands. Do you know about their business ?

Mr. Sjeedley. Yes, sir.

Senator Newlands. Could you say, then, that what the governor
states is not a fact as to their business ?

Mr. Smedley. I say 1 do not know of anything of the kind; I
doubt it.

Senator Foraker. You are in a situation to know about it if any
such thing existed, are you not?

Mr. Smedley. I am personally acquainted, in fact very friendly
indeed and hobnob a good deal with, the manager of the A. Y''. Mc-
Donald & Morrison Manufacturing Company. We are within a
stone's throw of each other, and we are together daily, and I have
never heard a single complaint from Mr. Morrison.

Senator Foraker. How long have you been in business there ?

Mr. Smedley. About twenty-five years.

Senator Foraker. Wliat amount of business do you do per annum ?

Mr. Smedley. Do you mean in dollars and cents?

Senator For.4ker. Yes.

Mr. Smedley. About $150,000 in the steam-pump line; that is,
outside of waterworks contracts.

Sometimes one of our waterworks contracts amounts to that much
alone; but that is the output from the machines in steam-pump
matters.

Senator Foraker. "VMiere do you ship your pumps to? "Where do
you sell them ?



86 TWENTY-FIEST DAY.

« Mr. Smedley. The last shipment — I will not say the last shipment —
but a recent shipment was made to Hai-ning, China. We ship all
over this coTintry.

Senator Forakee. You ship all over this country?

Mr. Smedley. Yes, sir.

Senator Forakee. Using all the different railway routes?

Mr. Smebley. All the different railways that run to Dubuque.

Senator Forakee. Do you sell any of your product up in Wis-
consin, 50 miles away from Dubuque? I mean, have you trade up in
that direction?

Mr. Smedley. Yes; we ship in Wisconsin. We put in a water-
works plant in the town of Cassville, Wis., not long ago — a complete
plant, building, reservoir, pipe line, machinery, and everything.

Senator Forakee. Where you put in a waterworks plant you have
to ship material, and all that sort of thing, I suppose?

Mr. Smedley. Yes, sir.

Senator Foeakee. Now, as to this other concern you speak about,
with the president of which you are so well acquainted — what amount
of business does it do annually, if you know ?

Mr. Smedley. I can not say positively, but I am satisfied that it is
fully ten times as much as ours. It is a much larger concern.

Senator Foeakee. And you have never heard of their making any
complaint ?

Mr. Smedley. Not a single word.

Senator Foeakee. Are you satisfied with the reasonableness of
your rates?

Mr. Smedley. Quite satisfied.

Senator Foeakee. Have you any complaints on account of rebates ?

Mr. Smedley. We never had a rebate. We have never asked for
nor accepted nor talked to the railroad companies about rebates.

Senator Foeakee. We were told by the Governor yesterday that
for some reason or other the manufacturing industries of Iowa have
not flourished as he seems to think they should have flourished.
What is your judgment on that question?

Mr. Smedley. It is my opinion, gentlemen, that every manufac-
turing plant that has been a failure in the State of Iowa, as I have
known of them, has failed almost entirely by reason of mismanage-
ment, and not from the fault of a railroad company or any other
person than themselves. When we started our plant we bought land
enough on which to build a large plant ; and lying between that and
the railway tracks was a waste country that was overflowed a portion
of the time by the rise of the river. We asked the railroad company
to help us, to give us a side track. We stated that we had gone into
the suburbs in order to have more room, better facilities, and we
told them that we needed a side track. The railroad company built a
track through that waste land at its own expense to supply us. We
were able to load and unload cars in our own yard. Since that time
the Chicago and Great Western Eailway Company have built through
Dubuque and touched our ground. That gives us two lines now.
But most of our material — that is, coal, for instance — comes to us on
the Illinois Central Eailway. We have no trouble whatever in get-
ting switching done. There is a nominal switching charge for each
car transferred from one line to this one that has the side track, and
we think it extremely reasonable, because they bring that car to us



TWENTY-FIRST DAY. 87

for less than one-tenth what we can carry it across with our own
teams for. We have no reason to complain at all.

Senator Foeakee. Mr. E. P. Bacon, who made a statement to the
committee a few days ago, put in evidence a petition addressed to
Congress which is signed by numerous trade associations, and I find
among these signers a number from Iowa — one the Dubuque Shippers'
Association, W. B. Martin, Dubuque, Iowa. The complaint to which
that name is signed is one in which it is set out that they protest
against unreasonable and extortionate rates and against discrimina-
tions. Can you tell us anything as to what moved that association to
join in such a memorial to Congress?

Mr. Smedley. I never heard of it.

Senator Fokakee. Do you know W. B. Martin ?

Mr. Smedley. I do not know him, and I have been in Dubuque for
thirty- four years.

Senator Fobakeb. What is the population of Dubuque ?

Mr. SsiEDLEY. The population of Dubuque, according to statistics,
is 36,000.

Senator Foeakee. And you have been in it ever since it was how
large a place ?

Mr. Smedley. When I went there Dubuque had only 18,000 in-
habitants.

Senator Fobakee. And now it has 36,000 ?

Mr. Smedley. Thirty-six thousand.

Senator Foeakee. And you do not know W. B. Martin ?

Mr. Smedley. I do not know him.

Senator Foeakee. And you do not know the Dubuque Shippers'
Association ?

Mr. Smedley. I do not even know of that society. There are a
good many visionary or sentimental societies around in these days,
of course. Our office was flooded with a lot of literature a little
while ago, and, in fact, that led to my coming here ; we were flooded
with circular letters from Des Moines.

Senator Foeakee. The name of the Des Moines Commercial Ex-
change is signed by A. C. Hutchins. Do you know anything about
that?

Mr. Smedley. That was the name; yes, sir.

Senator Foeakee. What is this Des Moines Commercial Ex-
change ? Can you tell us something of the character of that organi-
zation ?

Mr. SifEDLEY. God knows ; I do not.

Senator Foeakee. The Oskaloosa Commercial Club, Charles Ru-
ber, Oskaloosa, Iowa — can you tell us anything about that?

Mr. Smedley. I do not know much about Oskaloosa, but I assume
that it is after the same order of institution.

Senator Foeakee. Well, this is rather interesting. Chariton, Nox-
all Club — ^AValter C. Gookin, Chariton, Iowa.

Mr. SaiEDLEY. I do not know him.

Senator Foeakee. The Cedar Eapids Commercial Club, A. N.
Palmer, Cedar Eapids — ^you do not know anything about that?

Mr. Sjiedley. I do not know anything about that.

Senator Foeakee. Here is another one you ought to know about.
The Iowa State Manufacturers' Association, A. C. Hutchins, Des



88 TWENTY-FIRST DAY.

Moines, Iowa, and W. W. Marsh, Waterloo, Iowa — do you know,
any of them ?

Mr. Smedi-ey. That is the one that flooded our office with printed
matter and circular letters. That is the name of the society and the
name of the man.

Senator Foeakee. They seem to have been so anxious to sign that
they signed it twice.

Mr. Smedley. I doubt very much its existence, further than it may
be in some office somewhere.

Senator Foeakee. The Iowa Grain Dealers' Association and George
A. Wells, Des Moines, Iowa — do you know anything about that?

Mr. Smedley. I do not know anything about that.

Senator Foeakee. The Corn Belt Meat Producers' Association of
Iowa, G. W. Maher, Fort Dodge, Iowa, and I<>ederic Larrabee, Fort
Dodge, Iowa ?

Mr. Smedley. I do not know. I am not very well acquainted there,
although I have been in Fort Dodge a good deal.

Senator Newlands. How far is Fort Dodge from you?

Mr. Smedley. Approximately 200 miles to the west.



Online LibraryUnited States. Congress. Senate. Committee on InteRegulation of railway rates : Hearings before the Committee on Interstate Commerce, United States Senate, in special session, pursuant to Senate Resolution No. 288, Fifty-eighth Congress, third session, April 17, 1905- → online text (page 76 of 123)