The Oregon daily journal., February 12, 1908, Page 16, Image 16

THE OREGON ' DAILY JOURNAI, PORTLAND. , WEDNESDAY- EVENING. FEBRUARY , 12...1B03.' -
18
f0 HUMAN REASON FOR
ADVANCE IN LUMBER
RATE
Counsel for Defendants Assert in Brief to Railroad Com
j - mission Increase Made Simply Because Industry
; ' Could Afford to Pay More Mill Business Stifled.
, I la ali th hearings and arguments on
the lumber nti cum in the Paclfie
' northwest, the railroads, It U said, have
tailed to produce any facta or figures
t Juatlfy tan increase or me xreigm
rates on lumber. It baa been ahown by
the counsel for the lumber manufeo-
turera that the ratea have been advanced
himnlv because, in the opinion or rrar
fie Director Btubbs and General Freight
'i Aaent R. B. Mlllsr, the lumoenna in
flu.trr could afford to pay higher ratea
j A brief on behalf of complalnante haa
. ' been aerred upon tha defendants at-
mnn L.umDer Mingii
' f.-iiiomt v.ilav Lumber company,
t Falls City Lumber company, Curtlea
Lumber company Charlea K, fipauldhig
v togging company, Bootn-Kelly Lumbar
company. J. H. Chambere, It M. Par-
- Via and Cur an Broa againai tne aouin
era pacific company and Oregon . Cali-
, fernia Railroad company in the fight of
ih lumbermen before tha Interstate
commerce comSnlaalon to cancel the ad
vance of the common rough lumber rate
' ' from 11.10 to f I per ton from Willam
ette valley mllla to Ban Francisco ana
bay points.
' ' Volley of Sandbagging.
' Teal A Minor, attorneys for the com
" plalnanta, have submitted In their brief
- an extraordinary showing of the facts
from the lumber menufacturere' stand
1 point The brief haa 111 pages bris
tling with data, figures, statistics, llius-
tratlone and argumenta to prove that
, the "railroad traffic department of the
Harrlman lines Is not justified on any
ground Whatsoever In the advancing of
lumber-carrying rates xrom whicth
Oregon to 8an Francisco, snd that the
railroad's policy In tols respect is sim-
fly a continuation of the ancient fal
ser of charging "all the traffic will
luwr v
It la ahown that Uie advance In rates
' has completely eliminated Interior Ore-
go lumber products from the Califor
nia market, depriving that market of
the competition that formerly existed;
that there haa not been a single Ban
Francisco order for lumber received by
the complainant mills since the advance
In rail ratea waa put into effect; that
tha rate amounts to a confiscation of
the lumbermen a properties, as iney
Cannot operate mills and operate and
t dispose of their products at tha present
cost of rail carriage.
Vew Bate Btlflsa Basinets.
It is alleged thatprior to 1818 the lum
ber Industry In the Willamette valley dis
- trict. and in which the mllla of the cora-
filalnanta are principally situated, waa
Imlted. and that praotlcally no lumber
- that there were large quantities of
. standing timber In said district, and
that about the year 188 the defendant
companies, desiring to Induce invest
ments by others in the timber indus
try In said district, put into effect the
11.10 per ton rate; and at the "same time
encouraged the Investment Of capital In
, and the development of the lumber In
. d us try In that portion of tha state, and
' that the manufacturers had every rea
son to believe their businss would be
secure by the retention of tha $8.10 rate
or a lower rate.
The claims of ' the lumbermen are
summed up in the following:
First Prior to 1892 there waa sub
stantially no lumber industry in the
Willamette valley. '
, Second Growing out of the necessi
ties of the carrier. Its officers sought
out and Induced others, including some
of the complainants in this case, to In
terest themselves In the lumber busi
ness and to Invest in- this Industry.
: Third At that time, and for some
time therealter, there was a unity of
purpose and a unity of effort between
the carrier and manufacturer.
- Fourth The character - of the timber
Snd lta a 'aptabillty for all commercial
tines was - problematical, and that all
the chances, so far as respects the In
vestments in the mill industry are con
cerned, were taken by the men making
the Investments.
; Fifth It was recognised that owing
to the larre percentage of low grade
. lumber, it waa essential for the success
of the Industry tJiat a market be found
for Its common lumber, and that the
chief market therefor was San Fran
cisco, and that rates must be based on
competitive conditions or failure would
inevitably result. -
' wo Orders Beeeived.
J Sixth Based on the foregoing facts,
rates were established in 1899 aa set
- put In the complaint The Investments
.were made, not only on the continuance
of these rates and good faith of the
carrier, but - also because the necessi.
"ties of the case would demand rates on
- the lines above indicated or the Indus
.. try could not succeed. All this waa
known to the carrier.
Seventh The rate in question applies
so tne lowest grade or a low-grade com
of their changes In the classification of
lumber products, and by limiting the
quantity and qualities of lumber that
may be moved en the old 18.10 rate.
When the 11.10 rate and scale was
Installed it applied to all lumber, green
ana Klin anea, ana me minimum w..
80,000 pounds. In August ml,. Its ap
plication was limited to green lumber,
and on May 10, 1904. to "green common
rough fir lath and lumber." Tne nrsi
change threw everything except green
lumber under the 15 rate, ana me nx
chance limited the rate to green com
mon rougn Or lumber. These changes
were in effect real and substantial ad
vances In rates and were so considered.
Tn h. maantlma tha minimum was In-
creased on all classes so that tha actual
average loading, taking the month pf
February 1907. as illustrative, was iv
ooo pounds per car. inn in mihi in
creased the carload earning very large
ly- ..
Tears among airusnii
Mr Taal. in hla a ran men t to the In
terstate commerce commission, mib
"Wi hava minted at length from Mr.
Miller's testimony, for on It this ad
vanm must ne justified or under the
rulings of this commission u cannot
at.nri we nreaent no analysis Of It
here, but submit that under no rules of
vidanca can tne mere ODinion ox a wit
ness, unsubstantiated by the faota neo
easary to enable Its weight or reliabil
ity to De leatea sna veniiea, urn uwn u
establiahlng a prima facie case. 'He
thinks lumber can stand a higher rate.'
lie never has regarded the rata as re
munerative.' Is the lire or a great in
dustry, estsbilshed aa the witness states
this to have been, to be Jeopardised on
what a railroad official thlnka It can
stand, or on his views aa to what la re
munerative, without a aingle funda
mental fact on which this commission
can base its findings and lta opinion r
Ountlnr from the evidence .of rail
road men affirming the high ability of
General Manager c 11. Maranam, wno
originally put in the 88.10 rate, and
testimony of the aama railroaders es
tabliahlng the fact of the railroad's
great prosperity under Markhara'e ad
ministration, counsel for the lumber
men say:
Enormous (frowtn la Business.
"We have already referred to the con
dition this road waa In when Mr. Mark
ham took charae. It waa down at the
heels, physically and financially, and on
him was Imposed the task of resuscitat
ing it of making it self-sustaining. This
Involved a radical departure from for
mer methods. It required a broad, high
minded man. one who understood con
ditions and who, while peeking revenue.
also recognisea tne limitations ox me
traffic and Its ability to pay. The
times and the road required a man who
could originate and create business.
The man waa found in Mr. Markham,
who. after a too brief stay In Oregon,
became sreneral manager of the South
ern Pacific railway, and shortly there-
after retired from railroad wonk
modlty.
" Eighth After the establishment of
mis business the traffic or the carrier
Increased largely In every direction, and
its Income Increased in like ratio. ' '
' Ninth- When the rate was taken out
In January, 1904, the lumber business
collapsed, and when it was restored in
May, 1904, the business revived.
. Tenth Since the rate was taken out
An April 18, 1907, months before the
financial panic, not a single order has
been , received by Willamette valley
mills for the product In question from
; San Francisco markets, and the lumber
v wnicn formerly moved on tne old rate
tias been piling up in the yards of the
iiutwi em lava n iiuuuk use xv v xvs kit id
class of tha lumber the mills cannot be
' Derated successfully.
Eleventh The reason given by the
rarrier ror me advance in April. iU7
was tha advance in charters from coast
points, and charters have long since
ranen to normal rates.
4 Twelfth The cost of manufacturin
r M the Willamette valley has increase
r ateadllv since 1898.
It Is alleged by the complainants that
. ma capital stock or tne rauroaa com
- pany grossly exceeds, as to the publio
and as a basis zor rates, tne actual
value of the cost of construction and
equipment and the stocks - and bonds
or said companies are much in excess
of the value of all the property of de
fendants devoted to the public- use.
i ' Steal Haw ICaron.
: ' It is also shown that in recent years
the railroads have effected important
.advances over the old rate by reason
"Accordlna- to the reports in 1897 the
total revenue of the Oregon & California
Railroad company waa 11,418,037, or
about $1,180 per mile, and lta receipts
over operating expenaes on a low scale
were but $111,101.
"Thus from no shipments of lumber
from this district in 1897 the business
steadily grew until In 1907 it furnished
for long hauls 11,870 cars of lumber,
without taking into consideration other
foreat products. .With the growth of
the industry came the development Mr.
Markham foresaw. In 1906 the earn
ings of the Oregon & California rail
road had grown to 85,886,188, an in
crease of more than boo per cent over
1897, and the earnings per mue naa
rrown In 10 years irom xi.iso a mue
o $8,868 per mile, a result Mr." Mark
ham might well be proud of.
"Before the 'merger' this company
considered the lumber traffio so desir
able that It would make no Joint rates
with the Union Pacific system, and car
ried lumber of all klnda from Portland
to Denver on a basis or s.7i mms per
ton per mile, and from Eugene on a
basis of 8.93 mills per ton per mile,
crossing not one, but three great moun
tain ranges. This was not traffic they
had to carry, but was traffic they want
ed. They made no rates permitting it
to move In any other direction.
X, umber the Money Getter.
On the average rate to Bay points of
13.68 they show in nearly every caae
greater earnings per car than the other
commodities, and on the $5 rate, which
under Jooth old and new tariff applied to
all lumber other than rough common fir,
the earnings are much greater. On thla
basis this low grade traffic is paying
relatively more than It should pay, and
If a proper relation Is to be maintained
then a reduction, not an advance, Is In
order.
"The $3.10 rate and scale Is a rea
sonable rate. It Is not an abnormally
low rate, either In Itself or relatively. It
Is a rate under which the traffio will
move and under a higher rate It will not
move."
Testimony of R. A. Booth is quoted
embodying the history of the lumber
manufacturing industry In the upper
Willamette valley from its beginning.
The industry was developed largely for
the benefit of the Oregon & California
Railroad company, and under lta dicta
tion as to the markets that were to be
sought and created, in the south and
southwest via the Southern Pacific
lines and later via Portland to eastern
territory. Mr. Booth said:
"Prior to 1896 we were operating In
soft pine lumber at Grants Pass in the
southern part of the state. In 1896 a
Mr. Jones brought a letter of introduc
tion from the railroad people, asking us
to look over his plant that he was then
attempting to operate or getting ready
to operate at Saginaw. We declined at
first, but upon another similar request
we looked Into It and after conferring
with the purchasing agent In Oregon
and the manager of the Oregon lines,
made a lease of what is known as the
Saginaw plant for 12 months, for the
purpose of seeing what could be done
with fir in the market and to ascertain
its qualities.
Boy Additional Plant.
"About a year later we purchased the
plant becoming convinced that fir was
a good commercial product, and we de
sired to increase our operations."
The timber seemed the most available
resource at hand out of which to de
velop traffic, not only that traffic re
sulting directly from the manufacture
of timber, but that necessarily follow
ing the installing of the Dlants the em
ployment of thousands ' of people and
ine general Deneziceni erreci or tne
Rheumatism
. Do you want to get rid
of it I if so, tate vv. Junes
Nervine -modified as di
rected in pampljlet around
DOtue. in aaamon 10 mo
direct curative properties
it has a soothing effect up
on the nervous system by;
which the rheumatic
pains are controlled, and
rest and sleep assured.
It has made many cures
of this painful disease,
some of tnem after years
of suffering. If it will
cure others whv not you.
If your case is compli
cated, write us for advice,
it costs you nothing ana
may save you prolonged
suffering.
"1 was so erippled. that X could
scarcely walk. After caving my shoes)
on for an hour or two I oould manage
to walk, by suffering the pain. Then
I began to have pains all through
my system. My doctor told me I had
an acute attack of Inflammatory
rheumatism. I read about Dr. Miles
Nervine, bought a bottle and I com
Boanced to get better from the start
and for the past six months hava
scarcely any pain, and am able to
walk as wau as ever."
JA8. H. SANDERS,
P. O. Box (, Rockaway, N. J.
Your drtiogla sails Dr. mhos' Nerv
ine, and we authorise him to return
prios of first bottle (only) If It falls
to benefit you.
Mile. Medical Co., Elkhart. Ind
Inanmretlon of a treat Industry. On
their own initiative, as early as 1896
thla waa taken uo with Mr. Booth by
representatives of the railroad company.
At their suggestion he and his associ
ates ventured on leasing a mill enter-
rise that was then about to ran ax
riniw in Ina county. Oreaon. Even
than tha mm marc Lai DOSSlbllltles of the
timber were not realised, and doubt was
expressed to Mr. Booth by the manager
of the Oregon A California railroad In
Oregon as to its utility generally for
commercial purpose The growth and
davaionment of the business was slow
and waa largely experimental. By 1898
Mr. Booth became convinced u unuw
proper conditions the , business would
prove successful. During this period all
the chances of direct loss were taken
by those testing the possibilities of the
business. It waa well known from the
start that the timber In the valley ran
a very large percentage ef low grade
and tnat a market would have to be
found for thla product M otherwise the
Industry would be doomed to failure. It
was conceded that San Francisco waa
this market ,
uetauing nis eipwitn wim u.
railroad company, Mr. Bootn conunuea:
"They asked us to develop a trade
In Arisona, then competitive with the
Santa Fa A large amount of our early
business went into that territory, on
about an $11 per ton rate. We culti
vated that territory until tha rate was
withdrawn. - -
' Develop Vvw Trade.
"TP. win than aaked to develop a
business in tho mining region of In
terior California and were given low
rates, for tho purpose of developing a
trade there as against the local products
which gave no ran naui.
"We had an extensive business there
In proportion to our output We were
tola after rates were adjusted that it
was desirable to the railroads that our
eastern business should come via Port
land; that they preferred that territory
to be developed, because of their ability
to place cars better, because they could
draw large supplies from connecting
lines and which, added to their own
equipments, would enable them to better
accommodate us. ..
The building of the Oregon Sc. Call
fomia railroad waa aided oy a munlfl
cent land a-rant from the general gov
ernment and was the first road of any
importance built in Oregon. Much of
thla a-rant waa in the timber section
It waa considered of but little value
and furnished no trarno or any amount.
In 1896 the total gross earnings of the
Oregon line of the system was $1,564,-
X22 in 1897 11.426.037. and the percent
age of operating expenses to such lim
ited earnlnas were necessarily high. At
that time one through train and one
local to Roseburg waa sufficient to care
for the passenger traffic, and one
through freight train every other day
to care for the freight
In 1901 the Booth-Kelley company
shipped east 368 cars, south 3,438 cars;
in 1902, 1,295 cars east, 3,231 south; in
1903, 831 east 2.440 south; In 1904. 671
east, 2,676 south; In 1905, 1.825 east
2.083 south; in 1906, 1,675 east 2,225
aouth; In the first 10 months of 1907,
1,129 east 1,119 south. N
Shipments south fell off because Of
lack of rolling stock. There were plenty
of orders for lumber, but no cars.
These figures show the growth and
variation of the lumber movement from
these mills, according to conditions Im
posed by the railroad company, under
the old rates, and while the road waa
being transformed from a moribund in
stitution to a flourishing and valuable
property.
Scoring the apparent lack of human
feeling in a railroad corporation for its
heartless attempt to ruin these indus
tries, counsel for the lumbermen say:
"Those representing the railroads af
fect to believe that, the just Indigna
tion which is voiced In every quarter, is
but the noisy clamor of the demagogue
or politician.
"It may be that the people of Ore-
fon are unduly exercised; it may be
hat there Is no real -Justification for
the resentment they feel, but it does
not tend to allay this feeling, when
they appear before the tribunal created
by law to pass upon the justice of their
claims, to be met at the threshold of a
caae with technical objections to the
Introduction of testimony on the
grounds that it Is all Irrelevant and
Immaterial'; that "any contract, even
If one were made, could have no effect.'
Of course not. The fact that these men
spent their money, built their plants,
created a business on the strength of
promises expressed or implied, is of no
consequence. It is wholly Irrelevant
Even if they In good faith believed they
were carrying out a contract, it matters
not. It is void. What boots "ft If some
have the savings of a lifetime at staka
it is immaterial."
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hjgPKF FRANK L. SMITH MEAT CO,
SPECIALS FOR WEDNESDAY AND THURSDAY
I PORK 10c
Each day we offer 5,000 lbs.
jof the freshest and sweetest
Oregon grain-fed Pig Pork
for 10c per pound. You
'don't care for pork in the
summer; eat It now, at the
proper season, when it is at
its best. ' , ' , "
SAUSAGE 12c
Each hour we will make up
200 pounds of Pork Sausage
I2c per pound. Smith's
Sausages are all clean .and
fresh, and above all things,
absolutely pure. Nothing but
meat and seasoning in Smith
BEEF 3c TO 12J$c
Soup Meat
Beef for Boiling
Ribs of Beef to bake
Roasts of Beef
Prime Rib Roast Beef. .... .10$
lhe best in the land.
Sirloin Steak, extra choice. . 1W
Small Porterhouse Steaks 12
Small "T"-Bone Steaks. . .12
3
5$
6$
8
I sausage,' ribthins: else.
Sec that you come to the right entrancesee that Smith's flm is over th rionr. Th- mart. n
both sides of Smith's have no connection whatever with the firm. They do not carry Smith's Meats.
AT SMITH'S. YOU GET YOUR MEAT VyEIQHED ON iONes? SCALES
Attend BARGAIN SALES, CLEARANCE SALES
SHAM or any other SALES when you can buy
FIRST-CLASS SUITS FOR m
OF US AT
There are dozens of styles to choose fron--every wan
ed size and all the NEW fabrics. Some of these idcrj
deal fabrics and patterns are shown in uptown store:
at $20.00.
WHEN YOU SEE IT IN OUR AD IT'S SO
3d and Oak
1 st and Yamhi
i
517 Lumber Exchange Building, Second and Stark TtiephoM Mdn 3314
INQUIRED ABOUT THE BUTTE BOYS
Mr. Louis Henderson "of Portland Wrote to Goldfield for Information Concerning This Company's Mining Property. : j
Will Have No Cause to Regret Investing in Butte Boys
Mr.Louis Henderson of ' Portland had his attention attracted to the Butte Boys Consolidated Mining company's
property in Goldfield, Nevada, and to make sure of the company's standing and the prospects of its mine, wrote a letter to the
Wood-Sullivan Hardware company asking for information. The Sullivan of this firm is not the celebrated Larry that migrated
to Goldfield from Portland, but, on the contrary, is one of the substantial business men of Nevada's famous mining camp.
The letter. was written several weeks ago and so satisfied was Mr, Henderson when he received his reply that he permitted it to
be copied. It was written by the secretary of the company, Mr.' E. H. Barieu, and is as follows:
' Office of
WOOD-SULLIVAN COMPANY
Dealers in .
HARDWARE, TINNING AND PLUMBING
238 MAIN STREET
Goldfield. Nev.. Feb. 1, 1908.
Mr. Louis Henderson, 'Portland. Or.
Dear Sir: Your inquiry concerning Butte Boys Consolidated mines has been
referred to me for answer, .and while my reply is personal I think it is a fair one.
They have, spent considerable money in developing their property, and we have
sold them a large quantity of hardware for which they paid spot cash, and they
have at no. time desired credit on any of their purchases.
Their property is about eight miles northeast of Goldfield, in an excellent
locality, and they are down about .300 feet. They have received some very good
assays at different depths, and 1 consider the management, as far as the mine here
is concerned, in very good hands. Mr. G. W. Bever is the man I refer to. Person
ally I don1 1. think you will have any cause to regret investing in Butte Boys. I
have some stock and feel that 1 have made a good investment.
' Very Truly Yours ,
' E. H. BARIEU, Secretary.
OIK KB. BBTEB DEPARTED TOB OOZiX7IZLB OW SATUSDAT.
Within a tew days we may have some news from the camp. When
It comes we will publish it In the newspapers, whatever It may be. Wa
believe, however, that '
TB3S TZnr CEWT STOCK OAHBOT I.AST MITCH KOVOEB.
The mine la NOT a prospect now. IT IS A MINE. Its : ors Is upon
the dump. It is FREE MILLING ORE. It requires no smelting- or cyan
lding. we will save all that, and . .
WX XOBBSTliT BEXXBTB THAT 0VB46 FBET 01 BOCZ WTLX,
AVEXAOB 925 TO TRB TOB.
We ean treat It for-43, mining- Included. The rest will be profit, and
It requires but little figuring- to sum up the tremendous richness of our
property. Truth is, It will be only measured bv the capacity of our ma
chinery to mill the rock and produce the bullion, and that will ba In
creased from time to time as the stockholders may decide. In fact, thla
is a stockholders' company. Every holder of a share has a vote In say-:
ins who shall be its manager, so that no one has a deed to tha Job or a
lease on the position longer, than the stockholders may decree. ,
OVM HOT Z8 IB OOtDTOlB, THB 0&3ATE8T 0OIS HEsTOrO
OAXT OB SABTK.
And It is not a small fry proposition. We own 10J acres. , That, I,
more than Ave claims. We are working- only ONh of them. It has
nroven Itself Immensely valuable. We belleva tha nthsr pyiitr mr; inmt
aa rich. We have leased 16 acres to another, dorfipany, and, while yet I
prugpsui, jv si y en every promise or. a greai proaucer. JUVery snare Or
Butte Boys stock covers all this ground, the possibilities of which are
oeyona our compreaensian.
"WtOTXT ABB X.0S8," THE WXOEtT X30WV ICAOASEbTB,
In lta February number, reports that "Goldfield produced during tha
year 1907, 111,600,000 In gold, and paid in profits $6,616,874." - That's
going some! In fact It's a hurricane! "The camp," the same magazine
aays, "Is five years old and has produced 136,000,000! The value of its
gold Increased from 19,278,600 In 1906, to 114,704,658 In 19071" How's
tnatr jfeopia. living outsiae oi uoianeia cannot comprehend the magni
tude of this production. If a man were to labor S50 years, 313 dayseach
1 year, at $ 100 per day, he would earn 10,955,00.0, or $845,000 less 'than
ftoldfield save to the world last year. Tha annual out nut of th Haai-.r...
Homestake mine In South Dakota, with ore averaging only $2.65 per ton,
Is $6,000,000. That mine pays a dividend of ( per cent quarterly on a
capitalisation or .i,vuu,uuv. ine numeiui i. ire. roinin
as the Butte Boys Is, and who knows tnat we may not
liomestake over In Nevada?
g ore, exactly
have another
SHARES TEN CENTS EACH AJ PRESENT.
-, ''''-. i-. ...... "a. ..:'... 1 . " '
Purchasers may pay. 25 per cent down and 25 per cent per month, if they so desire. No discount for cash.
WE REPEAT IT OVER AGAIN-i-GOLD FIELD IS THE GREATEST MINING CAMP ON EARTH t
THE BUTTE BOYS CONSOLIDATED MINING CO.
617 LUMBER EXCHANGE BUILDING SECOND AND STARK STS PORTLAND, OR. - PHONE MAIN 5514.