“Morton. I should think between $500,000 and $1,000,000 a year.”

By means of private cars, mileage payments, rebates, and control of rates, the big packers had advantages which enabled them to ruin the smaller packers all over the country. The Lincoln, Neb., Packing Company, for example, was “driven out of business,” the manager says, “by freight discrimination, rebates, and the private car. After doing a losing business for 5 or 6 years against these odds, the company closed down with a loss of 75 percent of the investment.” And this is a fair sample of what has happened to many, many of the competitors of the Beef Trust.

CHAPTER XIII.
IMPORTS AND EXPORTS.

The low rates in favor of foreign goods and of domestic goods intended for export amount to a serious discrimination. Paul Morton told the United States Industrial Commission that goods were carried from Hamburg to Denver for less than the rates from Chicago to Denver.[[113]] Complaint was made many years ago that the Pennsylvania Railroad and other roads charged lower rates, even 50 percent lower, on goods shipped in from foreign countries than on domestic traffic of the same sort. Investigation revealed in some cases a far greater difference than 50 percent.

At one time the rate on tin plate from Liverpool via Philadelphia and the Pennsylvania Railroad to Chicago was 24 cents a hundred, while the rate from Philadelphia over the same road was 28 cents.

In the Texas and Pacific Case the record showed that books, buttons, carpets, clothing, etc., were carried from England, via New Orleans to San Francisco for $1.07 a hundred, while the same articles of domestic manufacture paid $2.88 on the same trains from New Orleans to Frisco. Boots and shoes, cashmere, confectionery, cutlery, gloves, hats and caps, laces and linens, etc., took the same blanket rate of $1.07 from Liverpool and London to San Francisco, while similar American goods paid the railroads $3.70 a hundred from New Orleans to California. In some cases the railroads received only ⅙ as much for the transportation of foreign goods as for domestic goods. The Interstate Commission held that “any difference in charge between foreign and domestic traffic is unlawful,” and ordered the discrimination to cease, but after long litigation the United States Supreme Court decided that among the circumstances and conditions to be considered in judging rates are the conditions of ocean traffic and water competition to interior ports in the United States, etc., so that a carrier may be justified in making low rates to secure foreign freights which would otherwise go by competitive routes or not go at all.[[114]] The practical result appears to be that railroads may nullify the protective tariff and discriminate in favor of foreign shipments to any extent that is necessary to make them move, regardless of the question whether or no they ought to move under such conditions.

Foreign manufacturers cannot only ship their goods across the country more cheaply than our manufacturers can, or at least such of them as pay schedule rates, but can also get special rates on all raw materials they buy here and ship over our lines for export. For example, a Chicago miller pays 21 cents per one hundred lbs. to get either wheat or flour to New York, while the English miller can buy wheat in Chicago and take it to New York for 13 cents. In some cases the rate on flour has been as much as 11 cents more than the rate on wheat. Since 2 or 3 cents a hundred lbs. is a good profit, our millers cannot grind for export against the English millers.[[115]] The railroads turn down our millers and establish a protective tariff for free trade England, protecting her millers against competition.

American shippers take such advantage of the low export rates as they can, but sometimes these concessions are made to the shippers in one city and not to those of other cities; for example, the railroads carrying export flour from Minneapolis at a discount refused similar concessions to shippers at intermediate points.[[116]]

CHAPTER XIV.
LOCALITY DISCRIMINATIONS.

Discriminations between localities, though less pronounced in this period than in the first, were nevertheless multitudinous and vital.