502 



THE POPULAR SCIENCE MONTHLY. 



The eflfect of free competition in trade is to bring the greatest com- 

 petition to bear on those things in which there is the greatest trade. 

 Thus, there is the smallest margin of profit over the cost of production 

 on the necessaries of life, the next smallest on the common comforts, 

 and the largest on the luxuries. This effect is not caused by any de- 

 sign on the part of traders nor from any beneficent legislation on the 

 part of politicians. It results from the operation of natural laws of 

 trade. The operations of the same laws produce the same effect on 

 the rates of transportation. We find, as a rule, the lowest rates on 

 coal, wood, petroleum, iron, lumber, etc. ; the next lowest on flour, 

 grain, provisions, etc. ; we then have boots and shoes, cotton and 

 woolen goods, clothing, etc. ; and then a varying list of more costly 

 or perishable articles and luxuries which are consumed in decreasing 

 quantities. All the natural forces of competition which tend to reduce 

 the rates of transportation co-operate in producing this discrimination 

 in things which are moved in the largest quantities, and which arc, of 

 course, consumed in the largest amounts. The aim of the railroad 

 manager is to secure the traffic. To do this he must make lower rates 

 on cheap commodities, with those things which comprise the necessa- 

 ries of life. It results in distributing the charges for transportation 

 where they are most easily borne. Not only do the necessaries have 

 the lowest rates and the luxuries the highest, but the necessaries con- 

 sumed in the largest quantities have lower rates than those consumed 

 in smaller quantities. We consume more fuel than bread, and more 

 food than clothing, while the rates of transportation follow the oppo- 

 site order. 



This discrimination, though in favor of the necessaries and com- 

 mon comforts of life, is none the less a discrimination. It actually 

 results in favoring classes. Those who consume but the necessaries, 

 the day-laborers, are the most benefited ; the artisans who consume, in 

 addition to the necessaries, many of the comforts, the next ; and so on 

 as higher wages provide more of the comforts, and these merge into 

 the luxuries. But the objection is frequently raised that the things 

 having the lower rates are favored at the ex2)e?ise of the things required 

 to pay the higher rates. That articles at low rates should be carried 

 at the expense of things charged higher rates implies of necessity that 

 the lower rates are below the cost, that the service is performed by the 

 railroad at a loss. If the low-rate traffic is not carried at a loss — if the 

 profit be ever so small — it can not, of course, be at the expense of the 

 things paying higher rates. That the railroad should knowingly per- 

 form any part of its service at a loss is an absurdity, unless it be a 

 case of nourishing an infant industry, where a temporary loss is in- 

 curred to secure a future gain. Those, indeed, who have been most 

 forward in charging upon the railroads the fault of carrying part of 

 their traffic at the expense of another part, would be the last to asseit 

 that the railroads are in the habit of doing a considerable part of their 



