upon the claim that Iowa rates were lower than those of adjoining States; but the shippers asserted, and it was conceded by the petitioners, that the Illinois rates, upon which the railroads depended for their main argument, were not lived up to in the majority of cases, nor were they in any other State with which a comparison of rates was asked by the petitioners; while all the roads charged the maximum rates on local business in Iowa. Moreover, Iowa's prosperity could not be gauged by that of any other State. The Board ordered the filing by the railroads of duly authenticated tariffs of rates, including classifications, in force in Michigan, Wisconsin, Illinois, Minnesota, and the Dakotas, under which business had been done; also all interstate tariffs bearing upon the question. After considerable delay, the railroads complied, and a final hearing was held on Dec. 27, 1894. The majority of the Board held that the petitioners did not establish the truth of their allegations that the rates were inadequate aud unremunerative, and refused to revise the schedule. Commissioner Dey filed a dissenting opinion, holding that the local business of Iowa did not bear its proportion of the cost of operation and that local rates should be advanced. (See Report, 1894, p. 184.) The hearings in this case were marked by a spirit of forbearance and courtesy which evidenced a growth of conservatism toward railroad matters. The majority of the shippers present were jobbers and manufacturers. It was noticeable that the farming-class took but little interest in the matter.

CHAPTER III.

DISCRIMINATION.

THE new law, in its position upon the question of discrimination, was a radical departure from the original law and the interpretation put upon it by the Commission. The old law prohibited unjust discrimination, but recognized that there could be such a thing as just discrimination. The new law, on the other hand, insisted upon absolute equality. That the Board interpreted the law in this way, though it was out of harmony with their former rulings, was shown in a case filed soon after the statute went into effect. It was charged by complainants that they were obliged to pay a higher rate on goods shipped from Keokuk and consigned to Moravia over the Keokuk and Western than was charged from Keokuk to Moravia over the Keokuk and Western on goods consigned to points beyond Moravia on the Chicago, Milwaukee, and St. Paul. The Keokuk and Western replied that the lower rate was in the nature of a through rate; that the Chicago, Milwaukee, and St. Paul charged them full local rates from Moravia to points along their line, and refused to prorate; and that a lower rate to Moravia was necessary in order to hold the business. The Commissioners held that the rate was not a joint rate, for this required the consent of both parties, and the State had not granted

1 Report, 1888, p. 739, Merrill & Company vs. K. & W. Ry.

the authority to require joint rates. It was evident that the Moravia merchants were charged more for the consignment of freight, "the same distance over the same line of road," than the merchants beyond Moravia were charged, which was prohibited by Sect. 24 of the Act. The Commissioners said:

"This fact is declared to be prima facie evidence of unjust discrimination, and competition is especially declared to be no excuse for the difference. The effect, and we believe the design and declared purpose, of the framers of the law in cases of this kind, was to exclude the Keokuk and Western from points beyond Moravia, unless they were willing to make the same rates to everybody at Moravia or points nearer Keokuk. The intent of the law seemed to be to exclude competition, and give the business to the railroad and the distributing centres that were the nearest, and could perform the service at the lowest cost. If Ottumwa was the most accessible point, Keokuk must be shut out of the country, unless all the business on the Keokuk and Western was done at the lowest rate given on less. It is not the province of this Board to criticise the law, nor to determine whether excluding competition as it does is for the best interest of the public. We can only say that, in our judgment, the law does this, and that the differential in the rates is prohibited by the provisions of the law."

An interesting case of alleged discrimination was filed April 26, 1889, by the Diamond Jo line of steamers against the Chicago, Burlington, and Quincy Railroad Company.1 The line of steamers had been plying since 1879 between St. Paul, Minneapolis, and St. Louis, and had transferred freight from one point to another in Iowa to connect with various railroads for shipment to the interior. The complaint alleged that prior to March

1 Report, 1889, p. 1074.

30, 1889, the bills for back charges on freight consigned from points on the river to points in the interior had been paid by the respondent upon delivery of the goods by the Diamond Jo Company at Burlington. On the day mentioned, complainant was notified that no more consignments would be accepted unless these charges were paid in advance, and since then respondent had several times refused consignments offered. The complainant asserted that the refusal to receive and forward its freight, while performing the service for other carriers, was a discrimination. The railroads defended

its action thus:

"The rates made by the boats between St. Louis and Burlington, added to the very low rates current from Burlington to stations in Iowa, have the effect of reducing our interstate rates, both from St. Louis and from Chicago. We know of no reason why we should be expected to form a line of transportation with the boats, against our own interests, or why we should be expected to advance money on shipments delivered us by them, or forward the property unless prepaid."

The Commissioners sustained the complaint, and ordered the Chicago, Burlington, and Quincy to treat all carriers alike. At a rehearing of the case upon July 30, the respondents set forth the plea that the Commission had no jurisdiction, because all of the shipments were of an interstate character; that shipments which originated and terminated within the State, but passed out of the State in transit, were under the exclusive control of Congress; that the Diamond Jo line of steamers touched the State of Illinois in passing, and plied upon a navigable stream over which Congress had exclusive jurisdiction. They admitted that there

was discrimination in their refusal to receive freight, but denied that it was unjust or unlawful. Advanced charges were lawful, and a lawful act could not be an unlawful discrimination. As to the first question, concerning the interstate character of the shipment, the Commissioners were governed by the law creating them, which in its first section declared that the Act applied to "shipments of property made from any point within the State to any point within the State, whether the transportation of the same shall be wholly within this State, or partly within this State and an adjoining State or States." Moreover, there was no attempt on the part of the Commissioners to control the shipment while in transit, but merely to see that discrimination was not practised after it had been delivered within the State. for shipment. The Commissioners declined to reverse their original decision.

A case of discrimination, involving to some extent the question of interstate shipments, was filed with the Board May 8, 1890.1 It was a complaint of Burlington shippers against the Burlington, Cedar Rapids, and Northern Railroad, that the latter was charging a less rate in the aggregate for shipments from St. Louis to points on its lines in Iowa than was charged over the same line to the same places for shipments from Burlington. The Commissioners held:

"That the interstate rates in force on the line of respondent, and lines with which it has joint traffic arrangements, are unjustly discriminating against Iowa's interest, and in favor of shippers outside of the State; rates that in the aggregate are much lower on the long haul than on the short, by which St.

1 Report, 1890, p. 869.