to build a new large ice plant at Chattanooga, and in order to induce them to do so we had to make a five-year contract with them. I mention that to show the utter impracticability of leaving the question open of who is to handle the business until it moves; to show you how necessary it is that it must be arranged for, not only one year in advance, but sometimes for several years in advance, to supply ice and to acquire the necessary equipment. The importance of the ice supply, I think, is frequently overlooked. It is sometimes even more difficult to get the ice than it is to get the cars, and at times after we have gotten the ice in store it is not used. On three different occasions last year we had our houses burned and had to ship ice in there from other places. What is known as the San Pedro road, Senator Clark's road, is now building from Salt Lake City to Los Angeles, and is to be finished some time during the season, nobody knows just when. They tendered us a contract, and we made an exclusive contract with them for three years, and we are now building out in the desert an ice house and manufacturing plant that will cost us $75,000. I do not know whether we will have a single car over that road this year or not. Section 5 of the Stevens bill may be construed as fixing the rentals for the use of refrigerator cars or, if the railroads may desire to so construe it, makes it mandatory on them to pay only a certain rental at the present rate paid by one railroad to another for the use of cars, which is 20 cents per car per day. There is no distinction made between flat, coal, box, and refrigerator cars, All are on the same basis. The reason is that this is merely an arbitrary rental or per diem fixed between the railroads on a reciprocal basis for settlement of balances in the interchange of cars, so that at the end of certain periods they may strike a balance with the other roads as to the number of cars interchanged, and it is not regarded by the railroads themselves as an adequate compensation even for box cars, and would be ruinously low for refrigerator cars. If the number of cars exchanged between two roads were equal, no mileage or balance at all need be paid. If then, the power is given the railroads or it is made mandatory on them to pay to the private car companies as rental for the cars which they rent from them, only 20 cents a day, or any reciprocal rate they saw fit to fix, it is plain that the railroads might be prevented by law from paying even a just rental for private cars, which I assume is not the intention of the framers of the bill.

In conclusion I desire to emphasize the point that, as I understand it, the present law in the most sweeping way forbids discrimination by any device-through car lines or in any other way. I, however, think it is wrong to make private car companies, of which there are between 200 and 300 (some having only a few cars), common carriers, as they are not engaged in transportation, or to undertake to make refrigeration, which is a local service and at best only an incident to interstate traffic, subject to regulation.

Mr. Urion is here, and will dwell at length on the constitutional and legal phases.

There are a great many bona fide contracts in force between the railways and car companies, in all sections of the country, which run. for various terms-up to seven years at least-which, together with numerous patents owned by these companies on the combination ventilator refrigerator cars, have a direct bearing on any legislation as a whole, and particularly any clause fixing mileage or rental to be paid

the car companies by the roads, which of course does not effect the shippers or the public.

Mr. STEVENS. Will you inform us first what is the relation between the Armour Car Line Company and Armour & Co., or the different divisions of the business known as the Armour business?

Mr. ROBBINS. Armour & Co. are a corporation. The Armour Car Lines are a separate corporation. The same individuals, to a large extent, own the stock of both companies.

Mr. STEVENS. What lines of business do Armour & Co. do?

Mr. ROBBINS. Armour & Co., generally speaking, engage in the packing-house business-the slaughtering and marketing of meats. Mr. STEVENS. They do considerable other collateral business, do they not?

Our

Mr. ROBBINS. I think only things incidental to it. We do a limited business, for instance, in butter, eggs, and poultry. Poultry, in particular, is a natural adjunct of the packing-house business. branch houses sell poultry and meat to the same local butchers. Mr. STEVENS. And eggs?

Mr. ROBBINS. And eggs.

Mr. STEVENS. Now, you spoke of the canning business. How much of that does Armour & Co. do?

Mr. ROBBINS. We do a business in canned meats, in particular, and as incidental to that we put up soups and pork and beans with tomato

sauce.

Mr. STEVENS. And mince-meat?

Mr. ROBBINS. And mince-meat and sausage, of course, as a part of the packing-house business.

Mr. STEVENS. Now, how much vegetable business do you do?

Mr. ROBBINS. Since May, 1904, we do not do any vegetable or produce business. Before that we did deal in vegetables, particularly apples and potatoes, to a limited extent.

Mr. STEVENS. Have you been dealing in potatoes any in the State of Michigan within the last fall and winter?

Mr. ROBBINS. No, sir; I understand not.

Mr. STEVENS. You have furnished refrigerator cars for carrying vegetables in and out of Michigan this last fall and winter?

Mr. ROBBINS. To some extent; but we have no contract with the railroad affecting the winter or potato business. If we have some cars to spare and the railroad wants them we furnish some as a convenience to both parties, but we are under no obligations to furnish them. Neither are they under any obligation to take our cars, particularly.

Mr. STEVENS. Then the Armour Company, or the Armour Car Lines Company, have not solicited consignments of potatoes from the Michigan market this last fall?

Mr. ROBBINS. No, sir.

Mr. STEVENS. Have you solicited consignments of vegetables in the Kansas City market this last fall and winter?

Mr. ROBBINS. I am informed not. I can not answer that question as a whole, but in May, 1904, the policy was decided on of retiring from the vegetable and produce business, and to the best of my knowledge and belief that has been carried out. As I say, we have bought a few products for our own use.

Mr. STEVENS. Some person informed us that a circular was sent out by some of the Armour interests to the Kansas City markets this fall

or winter soliciting vegetables and fruits to be sold on commission in Kansas City. Do you know anything about that?

Mr. ROBBINS. Mr. Chairman, was not that an offer to take apples, in particular, on cold storage?

Mr. STEVENS. That is what I wanted to find out.

Mr. ROBBINS. I think we may have done that, not being interested in the property except as warehousemen.

Mr. STEVENS. Have you or not advertised in trade papers in the month of January last, either the Armour Packing Company or Armour & Co., and in that advertisement stated, "We handle fruits and produce for our patrons?"

Mr. ROBBINS. I am not aware of any such advertisement. The only way I know of is that we have solicited some business on storage for the account and benefit of the owner, without having any ownership in the products.

Mr. STEVENS. Then you handled them on commission, in that way? Mr. ROBBINS. On the storage basis; on storage basis.

Mr. STEVENS. And not on the commission basis, for selling? Mr. ROBBINS. I do not think we sold any. I do not think we handled them except as warehouse men.

Mr. STEVENS. Now, if a circular did appear, or an advertisement did. appear, of the Armour Packing Company or Armour & Co., containing this statement, "We handle fruit and produce for our patrons," what would that mean to the producers or to the trade? What would that signify? How would the trade understand these words "We handle fruit and produce for our patrons?"

Mr. ROBBINS. The inference would be there that we handled it on commission.

Mr. STEVENS. Yes. So that if that be true, if the Armour Company or the Armour Packing Company have advertised in that way, they would be in the commission business, would they not?

Mr. ROBBINS. I think the inference would be that the purpose was to handle it on commission. But so far as I know, the only thing that has been done is the offer to handle the stuff on storage, which we have always done.

Mr. STEVENS. Then this may be true; this statement that has been made to us may be true.

Mr. ROBBINS. It might be. I could not specifically deny it unless I investigated it, but I know that that general order was issued, and, as far as I know, it has been lived up to.

Mr. STEVENS. Now, if that be true, then the fruits and produce that would come into the Kansas City market over, for example, the Frisco line, which has an exclusive contract with you, would necessarily come in your cars, would it not?

Mr. ROBBINS. No, sir; our exclusive contract with the Frisco system simply covers strawberries and peaches.

Mr. STEVENS. It does not cover other fruit?

Mr. ROBBINS. Not apples or potatoes or any other kind of produce. Of course we never have handled, directly or indirectly, any shipments of fruit or strawberries, and those fruit shipments you speak of would probably not go in our cars at all.

Mr. STEVENS. They might or might not go in your cars?

Mr. ROBBINS. They might occasionally pick up one of our cars that was going back to Kansas City and ship their goods in it. But that

would not be done at our request or to our profit. The car would earn the same amount of money whether it came back empty or loaded with that produce.

Mr. STEVENS. That is, under your mileage contract with the railroad?

Mr. ROBBINS. Yes, sir.

Mr. STEVENS. At what date did you or the Armour interests send out a circular to their branches advising a discontinuance of the fruit and produce business?

Mr. ROBBINS. I think the first circular was issued in May, 1904. Mr. STEVENS. Was not some business done in that line after that? Mr. ROBBINS. I do not think there was. But there was some question came up on the subject, and I think the order was reissued some time in September.

Mr. STEVENS. There was another order issued in September?
Mr. ROBBINS. The order, I think, was reissued in September.

Mr. STEVENS. So that in all probability some business was done between May and September?

Mr. ROBBINS. I do not know that there was, but I might say in that connection that we have in the employ of the various Armour companies some 33,000 men, and we have several hundred branch houses, and I am sorry to say that sometimes men do not obey an order the first time it is given. If any was handled at all, it did not come to my attention, and I know that the head of the company issued a formal order to go out of that business entirely.

Mr. STEVENS. That order is in force now?

Mr. ROBBINS. Yes; and if there is anything of that kind being done, it is contrary to orders, and would be immediately stopped. I do not think it is being done.

Mr. STEVENS. Is there any complaint now against the Armour interests dealing in fruit or vegetables, before the Interstate Commerce Commission, in or out of Michigan, and engaged in rebating on that business?

Mr. ROBBINS. I do not quite catch your question.

Mr. STEVENS. Is there any complaint against you now, or against the Armour interests-any of the Armour interests-before the Interstate Commerce Commission to the effect that you are engaged in rebating in the Michigan vegetable business?

Mr. ROBBINS. No, sir; I do not think there is.

Mr. STEVENS. Is there any complaint before the Interstate Commerce Commission

Mr. ROBBINS (interrupting). There was a case brought before the Interstate Commerce Commission, and the Commission have made a suggestion. I can not say that they have made a decision, and they certainly have not made any order. They have made a suggestion merely that the railroads and ourselves should get together and see if we can not find some way to make lower rates. That is the only thing that I know of that is pending or unsettled in regard to our Michigan

matters.

Mr. STEVENS. It is a question of lower rates?

Mr. ROBBINS. Yes, sir.

Mr. STEVENS. On that point you remember the testimony of Mr. Ferguson respecting the rates in and out of Michigan before you had your exclusive contract?

Mr. ROBBINS. In a general way I do.

Mr. STEVENS. As I recall it, the testimony showed that the rates were increased after the exclusive contracts were made-the rates for icing, I mean.

Mr. ROBBINS. The refrigeration rate was increased, and I think that I have covered that point in my statement.

Mr. STEVENS. Yes; in your statement.

Mr. ROBBINS. I think I have stated why that increase was made. We did a little business in Michigan produce at that time. After our rates were increased our net revenue was not increased.

Mr. STEVENS. Why?

Mr. ROBBINS. The increase was due to the change of the rule on the part of the railroad.

Mr. STEVENS. What rule?

Mr. ROBBINS. Of the Pere Marquette, particularly.

Mr. STEVENS. I say, what rule?

Mr. ROBBINS. They previously furnished free ice. They either paid us for the ice or furnished it themselves. They changed that rule and decided thereafter to do as the roads everywhere else in the country did, to let the ice be furnished at the expense of the shipper. That caused a difference of expense to us, so that we increased our rate correspondingly and correspondingly only.

Mr. STEVENS. Is that the rule all over the country?

Mr. ROBBINS. That the shipper stands the expense of the ice?
Mr. STEVENS. Yes.

Mr. ROBBINS. Yes, sir; I think it is, universally. I do not know of anywhere where there is any other rule-that is, as to fruits and berries.

Mr. STEVENS. That is why I asked you.

Mr. ROBBINS. Yes, sir; as to fruits and berries.

Mr. STEVENS. How is it as to eggs and dairy products?

Mr. ROBBINS. In most cases the classification provides that on the articles classed as, I think it is, second class, and which will include butter, eggs, and poultry, the railroads shall furnish the ice. Mr. STEVENS. And it is included in the rate?

Mr. ROBBINS. In the rate; yes, sir.

Mr. STEVENS. Yes.

Mr. ROBBINS. The rate is very much higher than on most of the other articles.

Mr. STEVENS. Why could not that be done as to perishable fruits and berries?

Mr. ROBBINS. I am not here to answer from the railroad standpoint, but I suppose by advancing the freight rate correspondingly it could be made to do it. We then, under our practices of handling fruits and berries, would charge less refrigeration and the railroad would charge a higher rate.

Mr. STEVENS. There is no business reason why it should not be done, is there?

Mr. ROBBINS. It is a varying and fluctuating item and I do not think it would be practicable to include it in the rate.

Mr. STEVENS. Do you think that rate would be lower on the average by making the charges that you do?

Mr. ROBBINS. Yes, sir; I do.