Rates in cents per hundredweight
| Class | |||
|---|---|---|---|
| 1 | E | ||
| From Dallas to Big Sandy, Texas | 101 miles | 44 | 13 |
| From Shreveport, La., to Crow, Texas. | 100 miles | 95 | 18 |
| From Houston to Renova, Texas | 103 miles | 45 | 14 |
| From Shreveport, La., to Angeline, Texas | 104 miles | 68 | 15 |
Stated in another way, sixty cents would carry one hundred pounds of first-class traffic some 160 miles out of Dallas into eastern Texas; while an equal rate out of Shreveport into the same Texas territory, west bound, was exacted for a haul of only fifty-five miles,—about one-third the distance.
The Commission decided upon the evidence by a bare majority that these Texas tariffs were unduly preferential; and ordered them to be so readjusted that the charges should be the same for equal distances from all three cities regardless of state lines. Concerning the minor point that it was lawful for a carrier to equalize conditions as between two competing places by imposing high local rates upon one point in order to offset the advantages as to inbound through rates enjoyed by the other, the Commission merely re-affirmed its belief that natural advantages of geographical location could not lawfully thus be nullified.[818]
The opinion rendered in this case is remarkable, less in its economic aspects, concerning which there seems not to have been any great diversity of view, than as regards the divergent views expressed as to the legal authority of the Commission to interfere in the matter at all. Was undue preference and advantage in the eyes of the law,—the decision being rendered under the third section of the act,—created by the set of circumstances above described? At this point the Commission divided, with no fewer than two concurring and two dissenting opinions added to the majority view. According to this last, not only was the power of Congress to legislate in such matters paramount, but it was also held that this supreme power to put an end to all forms of local discrimination,—even those created by the act of state authorities,—had been delegated by Congress to the Interstate Commerce Commission. And in such instances, wherein conflict arose between Federal and state authority, the only rational and possible course, it was held, was for the national government through its administrative agent "to assume its constitutional right to lead."
The three separate dissenting opinions are of interest as expressing the need of a definitive pronouncement upon this great question by the Supreme Court of the United States. Not alone as to whether Congress intended to delegate authority to the Commission to settle such issues, but even the right of Congress itself to pass upon them under the Federal constitution, were called in question by the members of this administrative board. Two dissenters were content to submit the matter to "the august tribunal of the people which is continually sitting" to choose between submitting to such grievances as an alternative for virtually legislating state authority out of existence. The third dissentient view was more thoroughgoing. It not only discovered, legally speaking, no undue discrimination in the circumstances. It pointed out that on reducing the Shreveport local tariff "we fix interstate rates by the Texas yardstick," whereby "the national government therefore leads by following." It concluded by affirming that the Commission "should confine itself within the four corners of the law of its creation, usurping neither the legislative function of the Congress nor the judicial power of the courts." From all of which it is clear, first, that the Supreme Court of the United States, having once clearly defined the jurisdiction of the Federal government in such matters, it may, in the second place, well be that further amendment of the Act to Regulate Commerce will be in order.
In conclusion, it is pertinent, apropos of the approaching completion of the Panama Canal and the intensified interest in a more complete utilization of our internal waterways, to discuss briefly the relation between railroads and carriers by boat. The most stupendous canal projects are being brought forward, in the expectation that they will not only provide for a vast amount of low-grade traffic in themselves, but also that through the forces of competition they will bring about a substantial lowering of charges by railway. The most ambitious of these enterprises is the plan for a "Lakes to the Gulf" ship canal, even comprehending the dream of a twenty-four foot channel down the course of the Mississippi. Another and more modest proposition, probably practicable, is the construction of a canal from Lake Erie to the Ohio river. Altogether it has been credibly estimated[819] that the entire scheme for internal improvements of this sort would call for an outlay of not less than $2,000,000,000. Before engaging in any experiments upon such a magnificent scale, it is certainly proper to enquire whether the results will be in any way commensurate with their cost.
The cost of water carriage, like that of transportation by rail, should at the outset be divided into two distinct parts; one of which varies more or less in proportion to the volume of traffic, while the other, concerned with fixed charges on the investment, maintenance and depreciation, is constant. The latter in other words bears little or no relation to the tonnage transported.[820] A careful distinction between these two great groups of expenditures is of fundamental importance in any comparison between rail and water carriage. The failure to so distinguish is responsible for much of the fallacious reasoning upon the subject both in and outside of the halls of Congress. It is indisputable that mere operating expenses are very much less by boat than by rail, especially when the economies of large craft can be had. The phenomenal development of commerce upon the Great Lakes, especially for the carriage of iron ore, coal and lumber, is due to this fact.[821] But, on the other hand, it is equally clear that the second great group of expenditures, particularly the fixed charges due to the enormous first cost of construction, are very much greater by artificial waterways than by rail. The balance between low operating costs and heavy fixed charges, of course, will be struck according to the nature of the particular enterprise. And canals, being entirely artificial, offer the least advantageous opportunity for realization of the economies incident to movement of freight by water.[822]
Improved riverways are economical by comparison with canals just in proportion to their lessened first cost; but, on the other hand, mere movement expenses, maintenance and depreciation are apt to be higher according to the strength of the current. In each instance everything depends upon first cost and the consequent burden of fixed charges. This point is almost totally neglected in popular discussion of the subject. Internal waterways being, without exception, public enterprises, the burden of interest charges is generally put aside as of no consequence. Naturally therefore, these being eliminated, the apparent economy of carriage by water is mirrored forth with great effect.[823]