EFFECTS OF RAILROAD RATE-MAKING 1 93 



to build a pulp- and paper-mill in Denver and use the raw materials of 

 that section to manufacture paper for the newspapers that circulate in 

 that region. In this way the great expense of shipping this commodity 

 a thousand miles might be avoided. Plans were under way when the 

 attention of one of the railroads was called to the matter, and the officials 

 of the road informed the promoters that if a paper-mill was built in 

 Denver, and thereby the shipment of paper from Wisconsin interfered 

 with, the railroads would kill the enterprise at any cost to themselves. 

 This they could do by lowering the freight rate on paper from the East. 

 The promoters were greatly discouraged, but, as the freight rate was 

 so high, they decided to build the mill. Plenty of timber was available 

 in the near-by mountains. Coal mines were in active operation within 

 twenty miles of Denver. There was every reason why the mill should 

 succeed and the great expense of hauling paper i,ooo miles from Wis- 

 consin be saved. The rate on incoming paper had been $1.55 a hun- 

 dred, and the complaints about the high rate had been one of the leading 

 causes that had led to the erection of the mill. As soon as the mill went 

 into operation, the railroads reduced the rate on incoming paper to $0.25 

 a hundred. It is not surprising that the mill went into bankruptcy.' 



The following table of rates from eastern points to Denver, and also 

 from eastern points to the Pacific coast, shows very clearly how the devel- 

 opment of a city as a manufacturing and jobbing center may be checked 

 by the adjustment of freight rates. This table is compiled from testi- 

 mony given by witnesses before the Industrial Commission in 1901, and 

 represents the rates in force at that time. Though there have been 

 changes since, the figures are still valuable as showing the influence of 

 freight rates on the industrial growth of Denver. The most striking 

 feature of this table is the great discrimination against Denver and 

 in favor of San Francisco. It is hard to understand why the freight 

 rate for hauling boots and shoes from Chicago to San Francisco 

 should be less than the charge for hauling them to Denver, 1,200 

 miles nearer. Why the rate from Denver to San Francisco should be 

 more than the rate from Chicago to San Francisco is still more incom- 

 prehensible ! This is an open violation of the long-and-short-haul clause 



■ Report of the Industrial Commission, Vol. IV, p. 264; ibid. Vol. IX, p. 287. 



