Show THE NEW LONG AND SHORT HAUL The railways have until February to decide what they going to do about the new long and short haul section of the Interstate Commerce We condense here the best analysis we have yet seen of the new and short haul It is abridged from an article in the Railway Age and gives ah impartial review of the vexed question as to why railways sometimes charge a higher rate for the same distance in certain cases than in The main difference between the section finally adopted by congress and that in the original Interstate Commerce act is that the original act made it for any common carrier to charge or receive any greater compensation in the aggregate for the jt transportation of passengers or of like kind of prop- v under substantially similar circumstances and for a shorter than for a longer distance over the same while the amended act strikes out the words under substantially similar circumstances 1 and and makes clearer the intention of congress that before a railway may charge a higher rate for a shorter haul it must get the express consent of the Until February 17 the roads may continue rates as they have After that they must not charge a higher rate for a shorter haul unless they first get the explicit authorization of the or invalidate law by While negatively it is clear that congress did not intend the railways to be absolutely prohibited from charging a rate for a shorter it is not clear when congress meant that this might be per- There was a strong feeling the existing of making rates but as to just what ought to be to it right lawmakers- did not feel entirely so they turned the job over to the Under the old law some guidance was given to the commission by the words under substantially similar circumstances ana They plainly implied that where circumstances and conditions were substantially dissimilar a higher a haul might properly be- The fact that these words were deliberately stricken out by the Mann-Elkins bill shows that som substantially dissimilar circumstances and conditions which the courts have held to justify non-observance of the long and short haul principle do not justify it in the opinion of But under just what cir the long and short principle may be regarded seems to be left by the if the fourth section be read to be determined entirely b the Most railway lawyers not that if the question is ever litigated the courts will hold that the commission has such unlimited discretion They contend that the has a property right in the beneficial use of its This includes the right to make any rate which is not unfairly or They argue that there are certain conditions in which the fixing of a higher rate for a shorter haul is neither unreasonable nor unfairly discriminatory- It follows that the right of a railway under such conditions to charge a higher rate for a shorter haul is a property right which cannot be taken If it be answered that the law does not absolutely take this right but gives the commission discretion to determine when it may be exercised it is that this does not cure the defect in the The commission is an administrative body of delegated Congress cannot confer on such a body authority without laying down the rule by which it is to be guided in exercising and the new long and short haul section gives no such On this theory the law cannot be upheld as constitutional unless it shall be read as a and it shall be held that in some other part of it congress has laid down the rule which is to guide the It is contended that if the rule is laid down anywhere it is the first which requires rates to be reasonable for the and in the third section which prohibits them from being unfairly Under this interpretation a railway which desires to disregard the long and short haul principle must first apply to the If the commission denies its application the road may appeal to the courts on the ground that t the adjustment of rates it proposes to make would not be unreasonable or unduly And if the court finds that this contention is it will nullify the commission's ruling just as in previous years it nullified its orders when the courts differed from it as to whether certain circumstances were dissimilar within the amendment of the original Interstate On theory the new long and short haul section differs from the corresponding part of the old law a great deal as that part of the new law giving the commission jurisdiction of rates in general from the one in the Hepburn Under the Hepburn act the commission had no control over the initiation of It could act with reference to a raise in rates after raise ha Under the new law it may restrain an advance until it has deter- mined whether it is Under the new law the railways are prohibited from disregarding the long and short principle without first having got the consent of the the railway cannot make an unreasonable or discriminatory adjustment and keep it in effect until sonie shipper and gets it The best example of lower rates for longer hauls made to meet water competition are found in the southeast and on the Pacific There has been nothing said or done to indicate that the commission will refuse to let the roads make lower rates from New York to San Francisco- for or from New York to New than to intermediate The law as it now stands not only gives the commission authority to say whether a lower rate may be made for a shorter but also authorizes it time to time to prescribe the extent to which such designated common carrier may be relieved from the operation of this The theory on which the railways have acted in the past has been that where water competition was controlling they could make any difference between the water rates and the rates for the longer and the shorter hauls that they liked so long as the rate for the longer haul was not positively and the rate for the shorter haul was not It is that the commission now has whether it had before or not the authority to limit the amount of the discrimination which may be made between the intermediate and the more distant One fact very commonly overlooked is that the railways of the United States do not encounter water competition from river and coastwise water lines Ocean steamships carry a large amount of grain from the Pacific coast around Cape Horn to There are times on the return trip when they can hardly get enough traffic for In they make very low rates from Europe to- the Pacific coast on many bulky One of these is which they carry in large quantities from To meet this competition the railways make a very substantially lower rate on cement shipped from and to the Pacific coast than to intermediate They could not make their present coast rates their If they were required to do so they would simply quit hauling cement to the 1 coast and the Belgian producer would get all the A good example of lower rates' for longer hauls made to meet both rail and Water competition that really covers the entire earth is afforded by the rates on ain and its Flour shipped from the United States to Liverpool meets there competition of heat and flour hauled there by rail and water from Russia and It must be laid down at a freight rate which will enable it to be sold at a producer to meet To enable the American k the competition in the markets of the world the rate on flour for export from Minneapolis to New York is made while the rate to interior points is higher to N. for it is 25 On economic grounds the justification for making lower rates for longer hauls as in these it is absolutely necessary in order to meet competition not only with coastwise steamships but with ocean steamships moving over all the waters of the seems The German state railways and other railways of Europe also make lower rates on export than on domestic the course of the railways of the United States in thus making rates has been the object of bitter criticism- It is an interesting question to what extent some of the roads will continue to make rates in this even if they get the of the commission and if not its that of the courts to do The western transcontinental lines are confronted by the fact that in a few years the Panama canal will be done and that then the coastwise steamships can make much lower rates between the Atlantic and Pacific coasts than The main prerequisite to a satisfactory settlement of the long and short haul question as well as of all other important railway questions is that the public shall get the railway's point of Persons without any special knowledge of railway affairs who discuss violations of the long and short haul principle usually talk as though they think the discriminations railway managers make between communities are willful and A little thinking would convince them this is not The railway manager is equally interested in the development of all the communities along his and he would rather get the same or a higher rate for a longer as for a shorter simply because the longer haul costs and because the practice of charging lower rates for longer hauls excites public It ought to be that when a lower rate is made for a longer haul there must be conditions beyond the control of the traffic manager which or even him to do and the public ought to study and understand these conditions before in any given case it condemns this method of On the other it is daily becoming clearer that railways cannot be managed solely according to the principles which their managers believe to be Railway managers ought to do all that they can to educate public so that the public will be able to form a fair and intelligent opinion of the effect on the public interest of the policies followed by the roads Where laws are passed which wantonly attack the constitutional rights of the railways they no doubt justified in litigating But if satisfactory relations are ever to be established between the railways and the the railway managements must which it would be recognize the fact that some thing right and desirable for them to do if the public could be made to see that they are right and desirable may wrong from the railway and public standpoint when the public persistently and condemns There are many discriminations in rates which railway men believe operate to the public good but which the public often ignorantly If the public cannot be convinced that such discriminations are it may be better to desist from making of provided the railway can so without reducing its profits below a fair The result of antagonizing public sentiment in regard to some matters of this kind is to provoke attacks on the railways which may in the long run cause them and 1 the public more loss than the railways and the public would suffer from the railways complying with some of the public's unreasonable |