Commercial Road

“ And finally, another disadvantage, affecting important city interests, has been the increasing tendency toward the diversion of trade from established retail commercial concerns located in the central business district to enterprises newly founded in outer sections, often without the city boundaries. ”

“ The commercial travellers told me the same story. They are doing a great and increasing trade in the new cities that are springing up at the rate of one a day along the lines of railway construction. “But,” they said, “at present the traders, the farmers, the business men, have to be putting all the money they can make or borrow into the land, into building and into stock. ”

“ So long as business enterprise habitually ran its course within commercial traffic proper, apart from the industrial process as such, so long these recurring periods of depression and exaltation began and ended within the domain of commerce. (3*) The greatest field for business profits is now afforded, not by commercial traffic in the stricter sense, but by the industries engaged in producing goods and services for the market. ”

“ Such combinations were enormously profitable, because the business of the consolidated roads increased in a much larger proportion than did the cost of financing end operating the larger mileage; and after the combinations were made the owners of the consolidated road were precisely in the position of men who had obtained a certain strategic advantage in supplying a necessary service to their fellow-countrymen. ”

“ Good Roads and Commerce.—That good highways are almost as necessary as are railroads to the commercial development of a nation is recognized but, unlike the railroads, [Pg 8] the highways are not operated for direct profit and the responsibility of securing consideration of the demand for improvements is not centralized. ”

“ In the report it eventually issued, the Committee of 1811 said: "By the improvement of our roads, every branch of our agricultural, commercial and manufacturing industry would be materially benefitted. Every article brought to market would be diminished in price ”

“ There are a number of express companies in this country. The express business of the country, however, is controlled by six companies—the “Big Six.”
6. The express transportation (land) is wholly by railroads. The railroad companies, and men owning large or controlling interest in railroads, own a large majority of the “Big Six” stock capitalization.
7. For most of the express company stock owned by railroads, no cash consideration whatsoever was given. For the stock, a railroad company gave to some express company a monopoly of the express business on its line or system of lines of road. ”

“ Such provision for local traffic might indeed alter relative advantages in competition, and, by virtue of economic forces, those engaged in interstate trade and transportation might find it necessary to make read-justments extending from market to market through a wide sphere of influence ”

“ This ever-present incentive to widen the market carries with it a direct consequence. A market is a commercial area characterized by a prevalent equality of prices. Phenomenal development in this respect is characteristic of the United States. For many commodities the market is coextensive with the national domain. It is the chosen function of transportation agents, by rail and water, to ensure this result; to preserve an equality of prices, despite the variety of producing and consuming conditions. The railway is the agent by which the market is thus widened and rivalries are thus equalized. ”

“ To encourage the development of the industry, thereby creating a large volume of traffic, the railroads leading from the point where the traffic originates establish a commodity rate to other points, where the raw material can be used to advantage by the manufacturer. ”

“ Mercantile Exchange.—Important as is the manufacturing industry in the life of the city, it is only a part of the economic activity that is continually going on in its streets and buildings. The mercantile houses that carry on wholesale and retail trade, the towering office-buildings, and the railway and steamship terminals contain numerous groups of workers all engaged in the social task of supplying human wants, while streets and railways are avenues of traffic. The manufacture of goods is but a part of the process; distribution is as important as production. ”

“ Such a plan is to preserve a reasonable degree of competition and to maintain so far as practicable the existing routes and channels of trade and commerce. The desiderata are that the several systems shall be so arranged that the cost of transportation as between competing systems, and as related to the values of the properties, shall be approximately the same, so that these systems can employ uniform rates in the movement of competitive traffic, and can earn, under honest and efficient management, substantially the same rate of return upon the value of their respective properties. ”

“ Secondary or indirect forms of commercial competition in transportation, concerning, as has been said, not one but two distinct carriages of entirely different goods, needs to be in turn subdivided still further. ”

“ The keen-sighted business men who conduct these enterprises have already realised what the public has not, that all the world and his wife live on the road, and that the roads are indeed, as I have said, the nerves and sinews of the land. Very naturally then, they are striving to obtain the right to lay their lines along the roads, and so obtain the great profits that arise from place to place traffic. ”

“ While I am president of the Northern Mississippi Railroad, everything that is purchased by the road will be purchased in fair competition, and the concern which will give us the lowest price for the quality of goods we need will receive our order. That is a matter about which there must be left no possible room for misunderstanding. I trust I have made myself clear? ”

“ Trading, manufacturing, and railroad corporations are all engaged in the transaction of business with regard to articles of trade and commerce, each in its special sphere,-either in manufacturing or trading in commodities, or in their transportation by rail. ”

“ The farmer had one great Necessity—transportation. Transportation was in the hands of a monopoly—the railroad. The farmer was obliged to send his grain to market; the railroad, having Advantage on its side, demanded its price. ”

“ I already own a majority of the capital stock of the roads named, and intend to consolidate them in one company without any bonded indebtedness, with the intention of providing the public with a double-track road between Portland, Maine, and San Francisco, California, via Boston, New York, Buffalo, Detroit, Chicago, Kansas City, and Denver, with a branch to Galveston. This consolidated road will not be run with a view to profit beyond four or five per cent per annum above operating expenses. ”

“ Improvements in transportation which affect the longest and shortest roads to a market in an absolutely equal degree, as, for instance, the bridging of a river very near the market, leave rent unaffected. ”

“ Our commerce is great, and our trade extends to the corners of the earth,—the product of a hundred years. Our transportation system, with a capitalization which is the lowest in any civilized country in the world, with the lowest rates, and with the highest efficiency of service and ability to meet the demands of business, is second to none. ”

“ Traffic is educational. Imports influence the national life. We may import opium or Bibles, whiskey or bread-stuffs, locomotives or dancing pigs.
The sceptre held by Tyre and Venice is passing into our own hands. But trade, to-day, is a matter of the imagination, as well as of the stock-book. 11 needs a great imagination to handle the present-day problems of business and finance. ”

“ And, again: 'If this power to regulate commerce reaches the interior of a state, and may be there exercised, it must be capable of authorizing the sale of those articles which it introduces. Commerce is intercourse. One of its most ordinary ingredients is traffic. ”

“ Trade and industry have, also, completely changed in method, while thousands of men can carry on a business of their own to-day who, in the pre-railway epoch, must have been content to be little more than hewers of wood and drawers of water.
The economy in time, also, due to the speed at which the general merchandise traffic of the country is carried, has been of no less importance than the economy in cost of transport. ”

“ The tendency of commerce to connect one seat of population with another, to open roads, to seize on every physical advantage of transit between them, to create new centres of industry and traffic on the lines of communication, and by the union, not only of human labour and capacities, but of almost boundlessly diversified territorial resources thus effected, to increase the production and circulation of commodities, is too obvious to require illustration. ”

“ The triumphant march of commodity economy thus begins in most cases with magnificent constructions of modern transport, such as railway lines which cross primeval forests and tunnel through the mountains, telegraph wires which bridge the deserts, and ocean liners which call at the most outlying ports. ”

“ Now suppose a parallel road is built, and in order to secure some of this business offers to take it at twenty cents a ton. The old road must meet the reduction in order not to lose its business, even though the new figure does not leave it a fair profit on its investment; better a moderate profit than none at all. ”

“ Roads are literally the pathways not only of industry, but of social and national intercourse. Wherever a line of communication between men is formed, it renders commerce practicable; and, wherever commerce penetrates, it creates a civilization and leaves a history. ”

“ The train and station service, the general office and shop expenses, must all be kept up, though the freight and passengers carried dwindle to almost nothing; and the capital invested in the road is a total loss, unless the line is kept in operation and earns some income, even though it be small. This last influence, as we shall see later, is a most important and far-reaching one in its effect on industrial competition. ”

“ Advantages of Roadside Marketing.—From the standpoint of the producer or the operator of the roadside stand, there are certain advantages that have contributed to the growth of the movement. For example, there is no expense or time involved in delivering the products to a distant market, since the produce is sold by a member of the household, or by the operator’s employees in the larger types of markets. It is possible through such a market to build up a clientele of buyers who will return for further purchases. ”

“ Corporations were contending for the possession of the natural highway approaches to each growing city.47 Street-railway companies pushed their charters to passage at midnight sessions of boards of aldermen, seized streets in the night-time, and extended their metallic tentacles out into the fields of dazed farmers. ”

“ At the same hour the bridge itself is covered with land-vehicles of every sort moving in both directions, loaded with salable articles of every description; artisans of every name are coming and going; merchants of many nationalities step within the field of view; and porters and servants and errand-boys are running to and fro, all in some direct relation to the sale or purchase of those visible and tangible things called in Political Economy Commodities. ”

“ Not to stimulate new business at these points where traffic might be cultivated, even without rivals in the field, is little better than allowing it to escape over a competitor's line of rails, were they present. ”

“ These lines are all connected for freight purposes by a belt road, over which pass about 5000 freight cars daily. This belt road also does an enormous business for the stock-yards, and its convenient line is rapidly filling up with manufacturing establishments. As a consequence of these facilities the trade of the city in both wholesale and retail houses is good and increasing. ”

“ With a small road, on the other hand, depending upon the present traffic of a limited area, its rates must be immediately remunerative, and to meet the current expenses there is frequently required the practice of every temporary economy, even at the expense of the future value of the property. The small roads, unless the circumstances are exceptional, maintain the highest rates, and afford the poorest service. The interest of the great companies in the development of the districts from which they derive their revenue is in proportion to their size ”

“ These roads were unspeakably poor, sloughs of mire during the thaws of winter and spring and thick with dust in the summer, but bad as they were they carried considerable traffic and their use was constantly growing. Inland towns were beginning to grow up at the focusing points of the country roads, and the owners of general stores at such places derived large profits out of their position as middlemen between the farmers of the interior and the merchants at the nearest seaports. ”

“ Transportation is a factor in the cost of commodities scarcely second to that of their production, and weighs as heavily upon the consumer.
Our experience already has proven the great importance of having the competition between land carriage and water carriage fully developed, each acting as a protection to the public against the tendencies to monopoly which are inherent in the consolidation of wealth and power in the hands of vast corporations. ”