Out of a total of 50,000 refrigerator cars,[[272]] about 15,000 are owned by the railroad lines. These earn, it is claimed, about 40 cents a day, while the cars owned by the Armours and other private car-lines earn or receive on the average 60 cents to $1 or more per day from the mileage payments alone.
The owners of the Beef Trust cars make enormous shipments of their own, and have gained control of a vast amount of other business by offering a share of the mileage receipts and other inducements to large shippers of fruit, vegetables and dairy products, etc. With prodigious masses of traffic in their hands which they could divert to any line they chose, they have compelled the railroads to fix rates as they dictated,[[273]] collect their icing charges for them, delay the cars of disobedient or protesting shippers, blacklist them, shut off their credit, carry on a system of espionage upon the business of their competitors, use their power over railroads and shippers to drive their rivals out of business,[[274]] and even make exclusive contracts prohibiting the use of any other refrigerators on the lines of the contracting railroads. In some cases the railroads pay the car-lines commissions of 10 to 12½ percent of the freight rate in addition to the mileage on the cars loaded or empty.[[275]] Certain repairs on the private cars are also made by the railroads.[[276]] Annual passes are also granted to owners of private cars in order that their officers and agents may travel with the goods, watch the car, and look out for the care and disposal of the contents.[[277]] A wholesale firm which owned but one car made three members respectively president, vice-president and general manager of their little car company and got annual passes for all three members on the railroads on the strength of that one car.[[278]]
One result of the exclusive contracts is that “charges for refrigeration have been enormously and unreasonably increased.”[[279]] The Interstate Commerce Commission says that “under the operation of these exclusive contracts the cost of icing to the shipper (some shippers) has been advanced from 50 to 150 percent and that the charges in most cases are utterly unreasonable.[[280]] At first the railroads made no charge for icing. Gradually the practice of making small charges for ice was introduced, but the charges did not go much if any beyond the cost of the service. They were very mild compared to the present refrigeration taxes. The charges made by the railroads and even by the Armour Car-Line before it secured the exclusive contracts, range from ½ to ⅙ of the present Armour icing charges. From the Pacific to Duluth over the Northern Pacific or the Great Northern, which still own and operate their own refrigerator cars, the icing charge on a carload of fruit is $25, while the Armour charge by the Southern lines is $107 per car. From Rochester to Cincinnati railroads using their own refrigerator cars charge $5 for icing. For the same distance and time the Trust charges $35. The icing charge for a Pennsylvania car from Silver Creek, N. Y. to Chicago, 500 miles, is $7.75 to $10; the Trust’s ice charge is $25 from Lawton, Michigan, to Chicago, 120 miles. The icing charge under the exclusive contract with the Armour lines is $45 on a car of pineapples from Mobile to Cincinnati, against $12.50 from New Orleans to Cincinnati over the Illinois Central. In 1898 the Armour charge for ice from Michigan to Boston was $20 per car. In 1904 its charge was $55 a car for the same service over the same route. The icing charge on an independent refrigerator car from Chautauqua, N. Y., to Chicago, 550 miles, is $10, against $84 in the Trust cars from Gibson to Chicago, 522 miles. In 1902, before the exclusive contract with the Pere Marquette Railroad, the icing charge from Mattawan, Mich., to Duluth was $7.50, while the present refrigerator charge between the same points in the same Armour cars is $45. On shipments of strawberries, etc., from the South, the Armour icing charges are $45 a car, against $10 to $15 over roads that have not yet capitulated to the Beef Combine. The Armour icing charge on strawberries from Tennessee to Chicago is $84, against $30 on the Illinois Central and $15 actual cost.[[281]] From many points on the Pere Marquette Railroad in Michigan to Chicago where the railroad charge for refrigeration used to be $6 a car, the rate under the Armour contract has been increased 416 percent.[[282]] In the Duluth case above mentioned the increase was 500 percent. This, however, is more than the average.
From the great vegetable growing regions of Mississippi and Alabama to Cincinnati the charge for ice was $27 before the exclusive contracts were made. Afterward the price was raised to $60 and a little later to $75.
In the summer of 1903 John Leverone of Cincinnati received 24 cars of pineapples from Cuba. Ten cars came by the Illinois Central via New Orleans with an icing charge of $11.37 a car. Fourteen carloads came on Trust cars via Mobile, 100 miles nearer Cincinnati, with icing charges of $45 a car.
Even when shipments are made in railroad refrigerators from regions the Trust claims as its own peculiar territory, the full Trust charges are collected and paid over to the Trust.
For example, in August, 1904, Coyne Bros. of Chicago received an Illinois Central refrigerator car loaded with melons from Poseyville, Indiana. The freight was $39 and the icing charge $45. The Illinois Central icing charge for that distance was $10. Coyne Bros. went to the manager of the railroad refrigerator service and found that the road had an arrangement by which the Trust was to be paid at Trust rates on all shipments from the melon region, whatever cars were used. If the firm refused to pay the charge they would be boycotted or taken off the credit list.
August 11, 1904, Coyne Bros. received a Louisville and Nashville car loaded with melons from Epworth, Indiana. On the bill were two charges for icing, one was the railroad charge of $14 and the other the Trust charge of $45. The firm asked if they were expected to pay both charges. The railroad then erased the $14 item. The firm refused to pay the $45 Trust charge for a service worth no more than the railroad charge of $14, and the railroad took them off the credit list. Mr. Urion, attorney for the Armour folks, came to Coyne Bros. and told their manager that they must pay the ice charges or else everything shipped to them must be prepaid. The firm found that shipments to them from the Michigan grape region were cut off. They sent their own man to load the cars, but the railroad agent refused to bill them. “I have my instructions from Armour’s man here,” he said, “and I must follow them.”
On a car of melons from Carlisle, Ind., to Mr. Scales of Chicago, the freight was $35 and the icing charge $50, representing 20 tons of ice. There was no re-icing, and the car bunkers would not hold more than 6 tons of ice, so that there was a clear overcharge of $35 for refrigeration.
J. D. Mead & Co. of Boston were charged $99.90 by the Armour lines for icing on a car of peaches from Missouri. This is a startling sum for a service that the railroads used to perform free of charge. On another car of peaches from Maryland, the charge was $64 for icing. As the car bunkers would not hold more than 4 to 6 tons and only one re-icing was necessary between Cumberland and Boston, the firm protested vigorously. They were told that the bill was a “trial bill.”