Jasper County Democrat, Volume 19, Number 22, Rensselaer, Jasper County, 14 June 1916 — Origin of the Rebate. [ARTICLE]

Origin of the Rebate.

The I nion Pacific and Central Pacific railroads were joined at Ogden. | Utah, in the year IS&9, thereby' forming the first transcontinental' railway system. Prior to this junction there were two routes to the pacific cohst, the first via the isthmus and the Panama railroad, and the ■! second, around Cape Horn, the time involved being anyw here ttorn y 0 to 15v days. j With the inauguration of this transcontinental route. Union Pacific put in lorce two sets of rates, one for those shippers practically dependent on the hew system tor transportation. the other appreciably lower for those who had previously shipped by one of the former routes and to whom it was therefore necessary to offer special inducements. It can readily be seen that the small shipper suffered greatly because of this differentiation and was necessarily put to a great disadvantage when figuring against his larger and more fortunate competitor. Special rates were also accorded the larger shippers whereby they were allowed to reship part of their original through shipments from the coast back into the interior at a lower -cost than that for which the small shippepr actually on the coast could forward his interior consignments.

Such were the time and origin of pernicious rebates, which in the same period attained their worst and most offensive form. The mode of procedure followed in the matter of goods carried for the Standard Oil company offers . a specific instance which brings out clearly the true viciousness of the old rebating system. The Standard Oil company was

allowed a rebate not only on its own shipments, biit in on the shipments of all competitors, thereby creating what practically meant a monopoly and certainly reducing to a minimum the possibilities of any successful competition.—Odd Lot Review.