Such was the origin of discriminations. Sure of a certain amount of traffic at high rates, which would contribute its full share to the payment of fixed charges, each railroad strove to secure additional traffic at lower rates which would little more than pay operating expenses. This reduction was first made in favor of articles of low value, like coal, stone, or lumber, which could not be moved at all at high rates, but which could furnish a large business at low rates. Here it was an unmixed benefit to the public. The reduction was next applied in favor of long-distance traffic; and here also it was a good thing in principle, though sometimes overdone in practice. Under the old system of equal mileage rates, where the charge was made proportional to the distance, it would have cost something like a dollar a bushel to get wheat from the Mississippi Valley to the seaboard; a price which would have been simply prohibitory to the growth of the Western States.
There were special circumstances which led the railroads to give the long-distance traffic more than its due share of favor. A great deal of this traffic had the benefit of competition, either between several lines of railroad, or between rail and water routes. The reductions in rates were made most rapidly where such competition was most active—that is, at the large cities. The result was a system which favored cities at the expense of the country—by no means a good thing. But this was not the worst. In any period of active railroad competition large shippers were almost always given lower rates than small shippers. Amid the constant variation of rates, unscrupulous men gained advantages at the expense of more honorable men. Secret favors were generally given to those who least needed or least deserved them. The railroad agents forgot their obligations to the public as common carriers. Too often they were ready to sacrifice even the permanent interests of the stockholders themselves in the lawless struggle for competitive business.
It must not be forgotten that railroad competition did some things for the country which nothing else could possibly have done. It taught our railroad men to handle a large business cheaply. It taught them to make money at rates which would have seemed suicidal to the easy-going managers who were not under any such stimulus. The rapid reductions of charge, in other countries as well as America, have been made in the stress of railroad wars. But, while railroad competition has been in some respects a beneficent force, it can not be trusted to act unchecked. To the business community regularity and publicity of rates are more important than mere average cheapness. Business can adjust itself to high rates easier than to fluctuating ones. And railroad competition of necessity makes rates fluctuate. It tends to bring them down to the level of operating expenses, regardless of fixed charges. If it acts everywhere, as in the case of the New York Central and West Shore, it leaves little or nothing to pay fixed charges,
