service is a proper element to be taken into account, but deny that this difference is equal to the disparity in rates. The complainants insist that the difference in rates for carloads and less quantities should be measured by the commercial profit on the goods of the jobber who ships in small quantities or commercial packages to retailers throughout the country. And it was urged that a retailer who buys. directly from a seaboard jobber or manufacturer instead of an interior jobber, saves an intermediate profit which may inure to the benefit of the consumer.

The theory of an adjustment of rates to preserve a commercial profit to manufacturers and jobbers in all cases, if accepted as a necessary rule under the law, and generally applied, would be far reaching in its consequences, and clothe common carriers with a new function, to equalize at their own expense the net results of business operations, without regard to location or the conditions of handling and carriage. In many instances the work of the carrier would have to be done at less than cost, and in some for nothing. Such a rule is not admissible, therefore, as one of general application, and is not essential to the case of the complainants.

And the question at issue is not restricted to jobbers and manufacturers in any one locality or district of country. These are dispersed widely, and traffic is drawn from various quarters and all sources of supply. As classifications and rates must be general an injurious effect in some cases and to some interests is unavoidable, but so long as in the main they are satisfactory the rule applies that the good of the greater number is paramount.

The differences in classification of car-loads of one kind of freight to one destination, and less quantities of different kinds to various destinations, are based on the well-known fact of a difference in the cost of service by the carrier. This fact, and the extent of the difference, were probably never so fully demonstrated by tests on different roads, and at different points, as in these cases. Exact average differences, or the difference upon any particular kind of traffic, have not been shown, and perhaps are not possible, but approximately the difference in cost of transportation as shown by testi

mony ranges from 47 per cent. to 100 per cent., exclusive of handling, loading and delivering, less than car-load freights and transfers en route, and the average difference in earnings per car from an average load of car-load freight and an average load of less than car-load freight is not far from 100 per cent. These averages are varied in both directions by differing conditions and volume of business at different points, but the facts show in a general way substantial grounds for a difference in classification.

In the German classification, of which evidence was given, freight is classified in two principal classes, car-loads and less than car-loads. Different rates are charged on goods of different values shipped in car-loads of 20,000 pounds, of which there are three general classes, and a lower charge is made on goods of the third class carried over 60 miles. There are also special car-load rates for goods not belonging in the first, second and third car-load classes for quantities of 10,000 pounds, and a rate three mills lower per ton per mile for quantities of 20,000 pounds. Articles embraced in the first three car-load classes, when carried in quantities of 10,000 pounds, are charged a higher rate per ton per mile, the differences being 2 mills for the first class, 6 mills for the second class and 1 cent for the third. In the less than carload class all goods are comprised without distinction as to value (except that bulky articles have an extra charge), and for this class the highest rate per ton per mile is charged, being 4.5 cents. The difference between the highest rate of car-load freight and the rate on all articles of less than carload freight is 2 cents per ton per mile, or 80 per cent., and the lowest car-load class is one-fifth of the rate for less than car-loads.

The rates under the German classification are very much higher than under the official classification in question. For example, on an assumed basis of 1,000 miles, the highest German rate (less than car-loads) is 4.5 cents per ton per mile, or $2.25 per hundred pounds. The highest official classification rate (some articles, however, taking higher percentages of that rate) is 1.5 cents per ton per mile, or 75 cents per hundred pounds. The lowest German car-load

distant jobbers to a disadvantage in choice of markets, and compels them to purchase from near jobbers, and that to enable seaboard jobbers to continue their business and compete with interior jobbers what is called the commercial package, and not a car-load, should be the unit of classification and rate.

On the part of the respondents it is claimed that cost of service is an important and acknowledged element in rate. making, and the argument to sustain the present classification is based almost entirely upon the difference in cost of service shown by the evidence between car-loads usually hauled long distances to one consignee, and smaller quantities from different consignors to different consignees to be delivered at many stations.

Mr. Dey, one of the Railroad Commissioners of the State of Iowa, who appeared generally in behalf of the States west of the Mississippi river, made an elaborate argument against the contention of the complainants. Among other considerations he presented the following:

"The car-load rate in States west of the Mississippi has, ever since the advent of the railway, been the unit of measurement in all classes of goods and all manufactured articles, as well as in the products of the soil; in fact, in everything that is or can be dealt in largely enough to require the full capacity of a car. The law was not intended to interfere with the classifications of freight, or the reasonable difference between car-load and less than car-load rates; provided the same classification applies alike to all shippers, and that all shippers are on equal terms entitled to car-load rates in everything they desire to ship. The Western Classification, that took effect December 19, 1887, and was adopted by sixty-four different railway companies, representing 77,000 miles of railroad, contains 660 articles in the car-load classification in which the rates per hundred pounds are less than in small lots. This classification is but a continuation of that in use when railways were new, representing the growth of business, and varied from time to time as experience dictated; but the car-load has always been recognized as entitled to a lower rate than the less than car-load.

"The reasons for the car-load rate are: First, the cost of service is less; second, the risk to the carrier is less; third, the time the cars are in use is less; fourth, the unloading is usually done by the consignee.

"The reduction in the differences between car-loads and less than car-loads on the part of the lines west of Chicago, was not made on any principle announced by the railroad managers of these lines, but was in the nature of a compromise between the Chicago jobbers and the interior jobbers west of the Mississippi river, and all subsequent changes made in the Western Classification have been in the direction of restoring it to its old status. Neither Chicago nor New York is the initial or starting point of all freight shipments. The car-load rate is essentially a manufacturers' rate, and originated from the necessities of manufacturers. The articles showing the smallest percentage of difference between car-load and less than car-load rates compose ninety to ninety-five per cent. of the whole tonnage, while all the other articles combined compose the other five to ten per cent.

"Under the old system of making rates, the rates from manufacturing points to a few of the large distributing centres of the country were ridiculously low as compared with the rates to the smaller distributive centres, and the real ground of the complaining parties is that they are no longer able, as jobbers, to distribute traffic over territory which they were able to do under the old system of rates.

"Such articles as plows, wagons, general agricultural implements, starch, paper, axle grease, vinegar, soap, western packed canned goods, tubs, pails and washboards, corn, syrups and pickles, are manufactured not only at Chicago and New York, but at a number of points in the West widely scattered; and what right has the jobber of the former cities to complain if, by reason of the nearness of the manufacturers, the jobbers of the latter cities are enabled to obtain these manufactured goods at as cheap or cheaper freight than they? The articles of wooden ware, under which is comprised tubs, pails and washboards, plows and wagons, on which the largest percentage of difference between car-load and less than car-load rates exist, are first class in less than

car-loads, and fourth class and class A in car-loads. These articles can only be loaded into cars in anything like car weights by experts in loading and packing, at considerable pains and in extra-size cars. Fifteen to twenty thousand pounds may thus be loaded in a car. Of the same class of goods in the ordinary course of delivery, in broken and assorted lots at the freight station, not more than one-third of the above amount of weight can be loaded in a car by the ordinary warehouseman.

"In respect to the following items from the seaboard: Sugar, sugar syrups, raisins, rice, coffee, Baltimore packed canned goods, and salt fish, all of which, except raisins, show the smallest percentage of difference between car-load and less than car-load rates, the ground is taken that the difference in rates between car-loads and less than car-loads is not unjust or excessive. As an illustration, ten cars of miscellaneous freight billed from Chicago to Ottumwa, in September, 1885, contained on an average 7,920 pounds per car. Ten straight car-loads of groceries taken from the same month contained on an average 24,237 pounds per car.

"There is nothing in the claim that the small shipper or retailer is oppressed in the discrimination of rates. If the retailer is charged the full difference between less than carload and car-load rates by the local jobber, then the New York jobber is not shut out of competition. If the difference in freight is allowed to the small buyer or retailer, he can not complain that he is oppressed.

"The fact that the less than car-load lots take nearly four times as many cars to carry the tonnage is not answered by the claim that cars go empty for the return produce, and the railway may as cheaply haul the partially loaded car as the empty car. For the year ending June 30, 1886, the tonnage crossing the Mississippi river into Iowa by rail was, eastbound, 4,216,878 tons; west-bound, 3,263,228 tons. The freight crossing the Missouri river by rail from and to the State of Iowa was, east-bound, 1,215,433 tons; west-bound, 1,426,292 tons. For the year ending June 30, 1887, the tonnage crossing the Mississippi river into Iowa was, eastbound 4,411,544 tons; west-bound, 3,601,566 tons. Missouri