November 10, 1917 



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It lias been geneially Urmwn iimoii}; liiiMbcniieii tliMt Kxamiiier 

 Fred Eseli of tlie Interstate C'omnieree Commission lias been at 

 work for some months on a proposeil scheme for the reelassilieation 

 of hiinbcr with regard to shijiping rates. His work is nearing com- 

 plotioii and the plan is ready for submission to the eommission, 

 where it will bo duly considered. It may be adopted or rejected, 

 or modified, but, at any event it will come up for discussion before 

 that body. From advance proof sheets H.^kdwood REfORD is able to 

 present a summary of the rejiort. 



All kinds of forest products which figure in interstate commerce 

 are considered. Several classes are segregated for the purpose of 

 fixing rates. First is lumber which takes one rate. The items 

 which are classed as lumber are specified at great length, item by 

 item. The ne.xt class includes items which take a rate o per cent 

 above lumber; the next class takes a rate 10 per cent higher than 

 lumber; the next 15 per cent higher, and the next 20 per cent. 

 Millvvork from the Pacific coast comes under a special class and is 

 discussed at great length. 



The matter of maxinnim and iniiiimuni carlu.'ids comes in for 

 thorough consideration. In the introduction of his report, Mr. 

 Escli presents a summary which covers the ground in a general 

 wa.v, but further on in the report he enters fully into particulars 

 covering all phases of the subject. He takes up specifically the 

 danger, as some see it, that discrimination will be shown between 

 softwoods and hardwoods in fixing rates. 



Mr. Eseh 's summary or synopsis of the report follows: 



I suggest two alternative conclusions and indicate ni.v preference for the 

 second. The first alternative is based upon the present practice of the 

 carriers of providing a single carload niininiuni weight in councctiim with 

 the rates on lumber. The second presents a plan of dicrercnt rates for 

 different minima weights, whicli is an elaboration of a similar plan that 

 W.1S roughly outlined in the tentative conclusions submitte<l upon the argu- 

 ment and shortl.v before argument last Decelnber. 



The first alternative now suggested presents a lumber list in which 

 are given the commodit.v descriptions which is proposed for uniform adop- 

 tion in all tariffs and which it is desirable to have adopted, no matter 

 which alternative is adopted with respect to the ratings. This lumber 

 list also shows the ratings suggested In the first alternative. The first 

 alternative is based almost entirely upon differences in the loading per 

 unit of space of the various commodities covered by the report. Com- 

 modities are given lumber rates or rates stated in percentages over lum- 

 ber rates, in accordance with the comparative loading per unit of space 

 of lumber and the commodity involved, as disclosed by the record in the 

 case. 



In connection with the first alternative considerable discussion is de- 

 voted in the suggested report to the question of whether or not value 

 should be considered as a classification factor, and the conclusion is 

 reached that with respect to the commodities involved, value may be al- 

 most entirely disregarded. In this respect the discussion of the first 

 alternative prepares the way for the conclusions reached in the second 

 alternative. 



The original plan of different rates for different minima which was 

 suggested in the tentative conclusions submitted at the time of the argu- 

 ment provided a set of carload minima weights, disassociated from cars 

 of an.v particular size, to be applied in connection with the movement of 

 lumber in oars of all descriptions. It is recognized in the rcpitrt now' sub- 

 mitted that the vital objection against that plan is that the equipment of 

 carriers includes cars of varying capacit.v so that the weight wtiich it is 

 possible to load is dependent upon the size of the car furnished. 



The plan now proposed is for a different set of minima for each par- 

 ticular size of car. .\ table is given of different minima for different size 

 cars, wherein it is proposed that the pre-sent rates on lumber should be 

 applied as base rates on loads of 19,500 pounds in cars of 1.:100 cul)lc feet 

 capacity, on loads of 45,000 pounds in cars of o.OOO cubic feet capacity 

 and on loads of 67.000 pounds in cars of 4. .500 cubic feet capacity, with 

 like variations for cars of intermediate capacities. It is also suggested 

 that it may be advisable to provide a different set of minima and rates 

 for movement of lumber and lumber products on flat cars. 



The report proper is contained in the first thirty pages and the re- 

 maining 41 pages constitute appendices referred to in the text, .\mong 

 the appendices of particular interest is appendix IS which discusses the 

 effect upon the revenues of the carriers of a plan for different rates for 

 different minima such as is suggested in the report. In this appendix an 

 attempt is made to show, by using hypothetical cases, that the decrease 

 in the carriers' i;pvenues resulting from the lower rates which would be 

 applied to lumber and lumber products, due to the incentive shippers 



—18b— 



would linvc under thi' |dan of different rates for different minima to load 

 heavily and theretiy secure lower rates, would be more than overcome by 

 the saving in transportation costs due to the fewer cars which would be 



neideil I ove the same volume of freight. 



r.iciKic Coast JIii.i. Wuiiic 



It is proposed In the report to apply the adoption of the first or the 

 secimd alternative, which ever is adopted, uniformly throughout the coun- 

 try, with one exception. This exception is with regard to mllhvork. which 

 t4'rm i.s used to cover sash, doors and related cnminodlties, from the 

 I'acific Coast. In the first alternative the rate relationship of millwork 

 to lumber that is suggested for the country at large Is lumber rates plus 

 20 jier cent, but it Is suggested that from the raclflc Coast millwork 

 should take lumber rates plus 15 per cent. This exception is due to the 

 difference in the relative loading per unit of space of millwork and lumber 

 from the Taciflc Coast, a.s compared with millwork and lumber from the 

 country at large. By that is meant that lumber from the north I'acific 

 Coast will load, for purpose of illustration, say oO.OOO pounds and mill- 

 work from that part of the coast will load 4:{,000 pounils. whereas lum- 

 ber from the country at large may load 45,000 pounds and millwork from 

 other seeUons than tlie Pacific Coast only ofl.OOO pounds. The rate rela- 

 tionship is different lietween these rates, which accounts for the difference 

 in rating suggested. 



In connection with the second alternative it is pointeil out that further 

 evidence is desired before the iilan proposed may be applied and a list of 

 questions is given indicating what further facts sbould be ascertained 

 before such a plan is put into form. It is stated, however, in the report 

 that the evidence as to the second alternative is full enough to warrant 

 a determination at this time as to whether or not (he fundamental idea 

 therein contained is correct and is practicable of application. 



Similar plans of different cars for different minima are referred to in 

 appendixes 11 and 12, the first being taken from the brief submitted for 

 the Southern Hardwood Traffic Association, Spoke Manufacturers' As- 

 sociation, National Implement and Vehicle .\ssociation. Hickory Products 

 .\ssoeiation. Rim Manufacturers' Association and Hub .Manufacturers' As- 

 sociation ; and the second being contained in a letter addressed to a niera- 

 lier of the commission by the vice president of a transcontinental line. 

 (This reference is to Mr. Worthington of the Great Northern Railroad.) 



Counsel for Mississippi valley and Wisconsin millwork interests con- 

 tended that the relationship of millwork to lumber should be the same 

 from the Pacific Coast as in other parts of the country. Millwork now 

 takes one cent over the lumber rate from the Pacific Coast to Chicago. 

 The 15 per cent plan would make the difference SVa cents under my first 

 alternative. Under the second alternative, if the same relative loading 

 is maintained as between millwork and lumber that has been maintained 

 in the past and upon which the rate relationship of lumber plus 15 per cent 

 as the basis, the same rate relationship would result, but if Pacific Coast 

 shippers should find it possible to load their millwork heavier their rate 

 relationship would be more favorable to that extent. However, the rate 

 relationship of sash and door manufacturers on the Mississippi River 

 would be l)etter than lumber plus 20 per cent, whicb would be just as 

 though loaded heavier. . 



The second plan also gives the Pacific Coast manufacturer the advantage 

 of mixing his millwork with lumber and it is possible that he may employ 

 it in such a way as to secure upon mixed carload the same loading and 

 the same rate as on lumber. 



Regarding the fear of certain branches of the lumber industry that a 

 plan of rates based on uniform «iinimum carload weights would be dis- 

 criminatory against one branch or preferential toward another. I feel .sure 

 that the second alternative now suggested would be fair to all parties. 



.\ppendix 7 goes into a full discussion of facts regarding agricultural 

 implement and vehicle material, .\ppendix S takes up veneer and build-up 

 wood and the question raised in the record whether veneer less than % of 

 an inch thick should pay a higher rate than veneer more than % inch 

 thick. The conclusion is that there should be no difference of rates made 

 by the thickness of veneer. Appendix 9 covers the millwork question. 



The Lumber List 

 Mr. Esch 's list of lumber and items which take rates from to 

 20 per cent higher is of great length and if published in full would 

 fill three or four solid pages of Hardwood Record. It is possible, 

 however, to shorten it considerably by grouping items instead of 

 giving each its particular mention, and that is done in the follow- 

 ing paragraphs, by segregating items taking rates higher than lum- 

 ber, and considering all other as lumber. 



Lumber R.-vte Plus 20 Per Cent 



The following items and groups of items take the lumber rate 

 plus 20 per cent: 



.\stragals, balusters, balustrade work, bases, column ; beads, angle, 

 corner, cornice ; blinds, brackets, cornice ; caps, column ; casing, door and 

 window, panel ; ceiling, panel ; columns, solid or hollow ; cresting, doors, 



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