FREIGHT RATES AND MANUFACTURES IN COLORADO 43 



willing to make a difference between the rate on the raw material and the 

 manufactured product. He thought that if coal, coke and iron were 

 abundant in the state the policy of the railroads toward manufactures 

 might be changed. His road was not willing to haul in everything needed 

 in manufacture and thereby allow manufactures to develop in the state 

 by keeping up the price of the finished article. 



In 1882, the Colorado Coal and Iron Company began the manufac- 

 ture of nails. Immediately thereafter, the Union Pacific lowered the 

 rate on nails from the Missouri River. Prior to their manufacture in 

 Colorado, the rate had been $i . 25; it was reduced to one dollar as soon 

 as the Coal and Iron Company began to turn out this product. There 

 was likewise a lowering of the rate on everything the company turned 

 out as soon as they began the process of manufacture. Mr. Shelby of 

 the Union Pacific testified that this lowering of the rates was true. He 

 said there had been some "isolated cases." 1 In the spring of 1884 a 

 large territory was opened up to the Coal and Iron Company on account 

 of a change in the freight rates which allowed the company to compete 

 with the eastern dealers in the country north and west of Denver. The 

 company was able in January, 1885, to ship its products to George- 

 town, Central City, Idaho Springs, Erie, Greeley, Boulder and other 

 points which were inaccessible to it ten months previous to the beginning 

 of the year 1885. The iron ore used by the company in this manufac- 

 ture was a Colorado product which came from the mines at Calumet 

 and Villa Grove. 2 Mr. Hughes stated that the Union Pacific had 

 formerly had a rate from the Missouri River to Salt Lake that was the 

 same as the rate from Denver to Salt Lake, but when the new pool was 

 formed and the rates restored, the Rio Grande had obtained a con- 

 cession that the rates from Colorado points to Salt Lake should be 

 something like 70 per cent, of the rates from the Missouri River to 

 Utah. In consequence of this, the Colorado Coal and Iron Company 

 was selling nails all over Utah and doing the entire business there. After 

 this pool went into operation, the rate on nails from the Missouri River 

 to Utah was $1 . 50 while from Pueblo, it was ninety cents. 3 



1 Ibid., p. 223. * Ibid., pp. 218, 219. 3 Ibid., pp. 191, 193. 



