Jasper County Democrat, Volume 23, Number 2, Rensselaer, Jasper County, 3 April 1920 — FREIGHT LEAST H. C. L. EXPENSE [ARTICLE]

FREIGHT LEAST H. C. L. EXPENSE

Director General Hines Says Railroad Transportation Costs Are Lowest in History. NOT CAUSE OF HIGH PRICES. Freight Advances Compared With Rise in Value of Goode—Transportation Cheapest Thing Public Buys. Charges on Some Articles. Data compiled from authoritative sources shows that railroad freight rates are the least factor In the coat of living. Although the proportion of the total cost of goods that can be charged to transportati6n is not known with statistical accuracy, it is estimated that the average transportation cost of things produced In this country is a very small percentage of their total cost to the consumer. Freight Cost 2.4 Per Cent of Total. In a letter to Representative John J. Esch, chairman of the House Committee on Interstate and Foreign Commerce, Julius Kruttschnltl chairman of the Southern Pacific Company, points out that in the last five years the value of goods increased on an average of SO3 a ton, while freight charges advanced only 60 cents a ton. In five years, he explains, the average value of freight carried by the railroads Increased from $56 to sll9 a ton. The cost of carrying this increased from $2 to $2.80, paid to the railroads. In 1914, be adds, 8.6 per cent of the total cost of the goods was spent for transportation. In 1919 only 2.4 per cent was spent. “In other words," Mr. Kruttschnitt writes, “only 80 cents out of $63, or 1.8 cents out of every dollar of increase in value of commodities In 1919 was caused by Increased freight charges. The responsibility for the remaining $62.20, or 98.7 cents out of every dollar, must

be sought elsewhere. It was not oMb ed by freight rates." Rates lowest In History. Comparison with transportation charges in other countries shows ths* in no other country. of the world in transportation furnished at so low * cost as tn the United States. Compaq ed, too, with the cost of other goods and services today, railroad transportation Is the cheapest thing the public, buys. It Is sold for less than the cos* of production, considering an the sle- ; ments of cost. In a statement on this subject to the New England Bankers' Association, Walker D. Hines, Director Oeneral eq Railroads, said: “I think it is a fair statement that at the present time, despite ' tho Increases which have taken place In freight rates, a ton of steel or a ton of coal, a bushel of wheat or the unit of any other | , commodity has to pay for trans- ' portntion n less percentage of the price of that commodity than ever before In tho history of the country.”

Charges on Some Articles. ■ Before the war a suit of clothing) from one of the Chicago factories, sell-; Ing for S3O In a retail shop, was carried from Chicago to Los Angeles for 16*4 cents. The suit of clothes now retails at SSO or SOO, but the freight rate on that 2,265 mile haul has Increased only 5*4 cents, while the price of tho goods has gone up S2O or S3O. The 22 cents does not cover all ths transportation cost in a suit of the transportation charge for carrying the wool from the ranges and the cloth to the clothing manufacturer and, other minor carrying costs enter Intel the consideration, but the final trane-' portatlon charge Is the principal one,and the other*charges add only a few: cents more. I New. England shoes are shipped from Boston to Florida nt a cost of less than 5 2-3 cents a pair. This Is an increase of only one cent over the prewar rate. The railroads also carry beef from Chicago to New York for a' charge of about two-thirds of a centl a pound. Typewriters are carried from New York to St. Ixiuls for 66 cents. A 1 $l5O phonograph Is carried by freight; from New York to Atlanta for $2.85. A grand piano is carried clear across the continent for $39 and in carload lots for S2B. । These are typical freight rates, and they make It plain that American railroads give the lowest cost service in the world. Even with a very considerable Increase !n rates to make the roads selfsupporting, transportation will still be the cheapest thing the public buys. ■