Rate Revision

Last week the Interstate Commerce Commission made drastic changes in the U. S. railway rate system--a structure as vitally important as it is complex. Two reports, appearing simultaneously, revised the class rates* in the East and in the West, added some $52,000,000 to the future annual revenues of the railroads. The new rates go into effect Nov. 1, 1930.

West. The Western revision, which applies only to Western Trunk Line Territory (bounded by Lake Michigan, Canada, the Rockies, Southern Kansas and Missouri), is in general a straight upward revision that will mean $12,000,000 more annual revenue to the Western trunk lines. Rates on certain agricultural commodities, however, were not raised. This is a negative application of the famed Hoch-Smith Resolution, whose positive application-- which would mean actual lowering of present rates on farm products--was held unconstitutional in a recent U. S. Supreme Court decision. The Western rate structure has long been in need of revision.

East. The Eastern revision applies to "Official Territory" (east of the Mississippi and north of the Ohio, including New England). Its purpose: to remove rate discriminations between population centres and producing areas. Most fundamental changes are those made in Trunk Line Territory (which mainly includes New York, New Jersey, Pennsylvania, West Virginia). The rate system that has prevailed there for 54 years is overthrown in favor of a more consistent and harmonious system based chiefly on distance. The rest of Official Territory already has this distance basis, which is the basis used by the I. C. C. in all its general rate revisions. Though by no means all the changes are upward, the Eastern roads will probably see $40,000,000 increase in their annual revenues.

Authors. No cry of "Author! Author!" went up on the appearance of the I. C. C.'s reports. Yet such a cry might well have resounded, for the reports are of first importance to industry. Evidence of this is the fact that the I. C. C.'s biggest guns were selected to write them. Rotund Frank McManamy, once an engineer on the Pere Marquette, now Chairman of the I. C. C., wrote the Western report. Author of the vital Eastern report is Joseph Bartlett Eastman, in many ways the outstanding member of the Commission. As Justices Oliver Wendell Holmes and Louis D. Brandeis are to the Supreme Court, so Commissioner Eastman is to the I. C. C.: a constant liberal dissenter from the conclusions of his conservative colleagues. He is said to carry more railroad statistics in his head than any other man in the U. S. His dissenting opinions are famed in railroad circles where he has much prestige, especially in New England. Remarkable is it that he should be well thought of by railroad men, for his views are often "radical." He believes in government operation of the railways, for instance, and he has strongly urged legislation to curb the power of railroad holding companies. Son of a Presbyterian minister, he was graduated from Amherst in 1904. He owns no automobile; hence walks to work. President Wilson appointed him to the I. C. C., in 1918, and he was reappointed by President Harding. When he came up for reappointment last December, certain Senators objected to him because he did not always agree with his colleagues. Perhaps because of this objection, President Hoover reappointed him for six years more.

*Class rates apply to commodities having high unit value and moving in limited quantities (canned goods, automobiles, hats) as opposed to such bulk commodities as coal, ore, grain.

This file is automatically generated by a robot program, so reader's discretion is required.