which prevailed at the time were such as to warrant attack. Corruption of political units; wastefulness and mismanagement through "rings, construction companies, fast freight lines, etc.; fluctuations and discriminations in rates, due to fierce rate wars-all these things and more were rife. These rate wars, affecting as they did, competitive points alone, tended to produce inequalities in rates, the tariffs from non-competitive local points remaining virtually unchanged in the face of falling grain prices.

The growing importance of the east-bound grain traffic has already been mentioned, and perhaps some illustrative statistics will make the significance of this matter more clear. In the first place the greatly increased production of cereals in four typical Granger states should be noticed:

PRODUCTION OF WHEAT AND CORN: 1850, 1860, 1870.1

Now down to about 1856 virtually all the surplus grain of the western states went to market by way of the lakes and the Erie canal or down the Mississippi river; but by the year 1873 it was estimated that about 67 per cent. of that which was shipped east went by rail over the trunk lines.2 More than this, nearly 50 per cent. of the entire east-bound traffic of the four main lines out of Chicago was made up of cereals, and nearly 45 per cent. consisted of animals and animal products. The

1 Report of Sen. Select Committee on Transp. Routes to the Seaboard, 1874. Appendix, p. 202.

Rept. on Transp. Routes to the Seaboard. p. 24.

Ibid., p. 15.

by lake.

Bread stuffs made 90 per cent of the freight shipped east

following statistics indicate the movement of such shipments over a series of years:*

SHIPMENTS OF GRAIN EAST FROM CHICAGO BY RAIL, 1865–72.

Further statistics might be presented to show that the proportion of the total shipment which went by rail was also increased.

Thus, the grain traffic of the railroads was great, and the rates upon that traffic were of increasingly vital importance to the West.

Illinois led off in the attack upon railway corporations. In revising her constitution in 1870 she incorporated a clause providing that the legislature should enact laws regulating railways, and in 1871 an act was passed which prescribed maximum railway rates and forbade discrimination. In the same year a railroad and warehouse commission was established, which, in 1873 was given power to make a schedule of reasonable maximum rates, the law of 1871 being repealed. The Granger movement proper, however, dates from the Farmers' Antimonopoly Convention held at Des Moines, Ia., on August 13, 1873, when it was formally resolved to curb corporations and to agitate for a maximum rate law. Iowa passed such a law in 1874, and Wisconsin and Minnesota followed suit.

THE GRANGER AGITATION REACHES CONGRESS: 1869

So widespread and vitally important a subject could not but find expression in Congress, and during the Seventies hostility to railway corporations was necessary in successful political

Taken from ibid., append., pp. 29, 33.

candidates in the West. On December 20, 1869, Mr. Williams (Ind.) introduced a resolution touching the constitutional power of Congress to regulate for the protection of the agricultural interests of the Northwest the charges for freight and passengers upon railways; this resolution, by reason of its place among the earliest expressions in Congress of those conditions which led to the Granger activity concerning railways, and the light it throws on the causes for that activity, is worthy of quotation: "Whereas"-the preamble runs-"it is the duty of the Congress of the United States to afford protection to all the industrial, manufacturing, and mechanical interests of the country equally; and whereas by the construction and consolidation of extensive lines of railway, extending from the seaboard to the agricultural States of the West, and extending through two or more States; and whereas such railway companies by their consolidation have become such giant monopolies as to control the entire lines of transportation from the producing States of the West to the Eastern markets; and whereas by the regulation of freight traffics on their lines of railways they have adopted such exorbitant, oppressive and unequal rates for the transportation of the agricultural and other productions of the West as to consume in charges for transit more than one-third of their entire value, while the manufacturing interests of the East are protected by a tariff thereby discriminating against the agricultural and other productions of the West, compelled to seek a market at the seaboard; and whereas by the eighth section of the Constitution of the United States it is provided ... that Congress shall have the power to regulate commerce with foreign nations and among the several States; and whereas doubts may exist whether under the Constitution Congress has the power to regulate and limit the rates of freight on lines of railways passing and extending through two or more States; Therefore, Resolved, That the Judiciary Committee be instructed to inquire into the constitutional power of Congress to legislate, or to enact such laws as shall protect the great agricultural and other producing in

*Cong. Globe, 1869-70, pp. 239, 868.

terests of the West, by limiting the rates of tariff on such productions from the West to the sea-board . .

In a word, this resolution, charging the trunk lines with consolidation and monopoly leading to exorbitant and unequal rates on agricultural produce bound for the sea-board, asks that doubt be cleared up as to the power of Congress to regulate rates under the commerce clause. It is full of sectionalism and complains that the protective tariff discriminates against the West as compared with the East.

DEBATE ON EXTORTIONATE RATES IN THE EAST-BOUND GRAIN TRAFFIC

6

At this same session, a debate concerning government control of railways occurred in the House, which was deeply tinged with the newly arisen western activity against railways. Mr. Williams (Ind.) began by stating that his plea was for the unrepresented laboring agriculturists of the West and that he spoke in anticipation of a great battle which, ere long, would be fought between labor and combined monopolies. Within the last five years the four great railways from New York and Philadelphia west had combined, and then absolutely controlled the carrying trade for six months of the year. These "railway kings," these "blood-sucking vampires," whose motto was "submission to our extortionate charges, or your wheat, oats, and corn may rot in your granaries without a market,'-should this "licensed larceny" be longer tolerated on the plea that eminent domain lay in the states and that Congress had no power over rates under the constitution?

He believed that Congress could regulate railway rates, railways being clearly the avenues for the interchange of commodities and persons among states which constitutes the "commerce" of the constitution. This power, too, gave to Congress the right to charter and incorporate the channels through which interstate commerce should pass. As a last resort he was in favor of chartering a great national freight highway and if necessary to give it aid, believing that the enormous charges imposed by

Ibid., p. 868 ft.

which prevailed at the time were such as to warrant attack. Corruption of political units; wastefulness and mismanagement through "rings," construction companies, fast freight lines, etc.; fluctuations and discriminations in rates, due to fierce rate wars-all these things and more were rife. These rate wars, affecting as they did, competitive points alone, tended to produce inequalities in rates, the tariffs from non-competitive local points remaining virtually unchanged in the face of falling grain prices.

The growing importance of the east-bound grain traffic has already been mentioned, and perhaps some illustrative statistics will make the significance of this matter more clear. In the first place the greatly increased production of cereals in four typical Granger states should be noticed:

PRODUCTION OF WHEAT AND CORN: 1850, 1860, 1870. 1

1

Now down to about 1856 virtually all the surplus grain of the western states went to market by way of the lakes and the Erie canal or down the Mississippi river; but by the year 1873 it was estimated that about 67 per cent. of that which was shipped east went by rail over the trunk lines.2 More than this, nearly 50 per cent. of the entire east-bound traffic of the four main lines out of Chicago was made up of cereals, and nearly 45 per cent. consisted of animals and animal products. The

1 Report of Sen. Select Committee on Transp. Routes to the Seaboard, 1874. Appendix, p. 202.

Rept. on Transp. Routes to the Seaboard, p. 24.

3 Ibid., p. 15. Bread stuffs made 90 per cent of the freight shipped east by lake.