CHAPTER XVII.

THE USE OF PRIVATE (COMMERCIAL) CARS ON RAILROADS AND OTHER ECONOMIC QUESTIONS OF PUBLIC INTEREST.

NOTE.-The writer in what he has to say seeks neither to favor nor condemn the use of private cars. His object is merely to explain the situation impartially as he understands it.

What are known as Private freight cars came into use at a time when the financial resources of the bulk of our railroads were extremely limited and their necessities great. So that they were glad to welcome this auxiliary force that added to their earning power without involving an immediate outlay for new cars. Their use is, and always has been, optional with the railway companies; there has never been any compulsion about it.

Private cars are owned by individuals and corporations, and are designed to meet the peculiar needs of carriage outside of the provisions that the railroad companies have been able to make for their accommodation.

The growth of the private car industry has been notable in its rapidity and extent.* Natur

*The Interstate Commerce Commission in one of its valuable reports states that there are- or were at the time of the reporttwo-hundred and forty independent private car companies. In

ally there are differences of opinion on the part of railroad owners, and managers and the public in regard to the wisdom of a divided ownership of railway cars. It is apparent, however, from the growth and magnitude of the business that it is not a question to be discussed superficially or in a passion, or decided hurriedly. An enterprise that has had such unexampled development must have had good reasons for its existence.

In reference to the agreements between railroad companies and the owners of private cars, it may be accepted as true, without question, that such agreements are in the main equitable; so far favorable to the public as the peculiar circumstances of the case permit. It is the duty of railroad officials to make the best arrangement possible for their company and the public and that they do this there can be no question. Or, if there has been an exception-as is claimed— it is to be treated as such and not made a determining factor in the disposition of the business as a whole. And in this connection it is apparent that in criticisms of corporate management there is too great a tendency to give isolated instances the force of general examples; to stampede public opinion. If a man goes to a doctor with a pimple on his face, the doctor does not proclaim that the whole man is necessarily diseased; but dexterously removing the disfigure

its report of December 15th 1902 it estimates the number of refrigerator, box, tank, stock, coal, flat, furniture, poultry, and unclassified private cars at 130,846.

ment bids the man go on his way rejoicing. Exaggerations in discussions affecting corporations, whether on the part of managers or the public, is to be deplored in the interests of a right solution of the myriad questions of a public nature concerning them. Too much bitterness is shown in the controversy; too many things are being said having the air of private rancor, of personal feeling. Sharp phrases are being coined on both sides without much regard to the facts, all having a tendency to prevent calm consideration and an equitable adjustment of the matter. From whatever point of view the railroad question is considered, it is never merely a question of silencing an opponent or influencing public opinion, but always of having the matter settled fairly, according to the rights of all concerned. The perpetuity of railway values and the interests of the public both require this.

In the use of Private cars it is to be noted that after the load of such a car has been discharged, the railroad company reserves the right to use the vehicle for purposes of its own traffic in so far as the car can be routed in the home direction. Except in such cases Private cars are not used when a railroad company has cars of its own available for its business.

The supervision and handling of Private cars differ somewhat from those owned by railroad companies. In some cases in connection with the use of refrigerator cars, the owner of the car indicates the route, or in other words, does not

furnish cars except under prior arrangement with the railroad company. This, however, is not the universal rule. The rate of compensation for Private cars, is a matter of current adjustment, dependent upon the needs of the service and the exigencies of business. It is claimed by those inimical to the use of such cars that if one railroad in a competitive system of roads, agrees upon a rate, say three-quarters of a cent per mile, all other roads are compelled to pay as much lest they be discriminated against by the owner of that particular class of cars. While this is perhaps true it is also true that every railroad company is interested in making the best rate possible. The handling of Refrigerator cars and the rate paid varies as in other things. Compensation at present is based on mileage; tomorrow it may be fixed on a per diem basis. There is nothing to prevent such change if the interests of the railroads and the public demand it.*

The compensation paid the owners of Private cars is a question of environment, in which each party to the transaction strives to make the best bargain he can. The practice of paying mileage on empty as well as loaded Private cars was the rule followed when railroads settled on the basis

*It has been intimated by authoritative sources that rebates have probably been paid shippers by the owners of private cars out of the excessive mileage they received from the railroad companies. This is however merely a suspicion; or, if such practice has occurred, it has been an isolated instance, and therefore not to be considered as a general practice.

of mileage for their own cars used in common by their connections.

It is claimed by critics that because Private cars-notably refrigerator and fruit cars-are mainly used for long hauls and on fast trains, excessive mileage is made and therefore the car has greater earning power than in the case of ordinary freight cars owned by railroads and exchanged in common between them. On the other hand, it is a fact that the high rate of speed at which the car is moved greatly increases the wear and tear, and therefore adds to the expense of the owner for its maintenance.*

The fact that Private cars must be kept in order by the owners must be remembered in any attempt to ascertain what is a reasonable price for the railroad company to pay for their use. In the case of cars owned and operated by railroads and exchanged in common between them, compensation, as is well known, was formerly based on mileage, but because under such arrangement, the cars often remained idle on side tracks awaiting return to the owner, the basis of compensation was changed to a per diem rate. This fact should also not be forgotten in considering the probable earning power of Private cars based on mileage. There is no incentive in such case, it is apparent, for railroads to hasten the movement of cars beyond what the convenience of business

*In corroboration of this the Interstate Commerce Commission gives the life of a refrigerator car as eight years, and that of a common box car as fifteen years.