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STATE OF NEW YORK:
OFFICE OF THE BOARD OF RAILROAD COMMISSIONERS,
ALBANY, January 11, 1892. To the Honorable the Legislature of the State of New York:
Chapter 565 of the Laws of 1890 requires the Board of Railroad Commissioners to report to the Legislature on or before the second Monday in January in each year. In conformity with this statute the Board submits its Ninth Annual Report.
GENERAL SITUATION. The general condition of railroad business for the year last past throughout the country may be said to have been, on the whole, satisfactory. At the present writing the reports received indicate an unusually, if not phenomenally, prosperous season, due to the abundant crops and the increased and increasing demands from abroad. No general railroad wars have occurred within the past twelve months. Of late years the wide discussion of the “railroad problem,” so-called, together with State and national supervision, has led to a better understanding of the relations of railroads to each other, to the public, and of the public to railroads. There appears to be less disposition upon the part of these corporations to disregard their obligations to the public, and less disposition upon the part of legislatures, particularly in the eastern States, to engage in hasty legislation.
The great associations into which the railroads have formed themselves to mitigate the evils of destructive competition and to co-operate with each other in through shipments of freight still continue. The Interstate Commerce Railway Association has been superseded by the Western Traffic Association, comprising the great railway lines west of the Mississippi, and west of a line drawn between St. Louis and Chicago. The Central Traffic Association comprises a large number of those between the eastern limits of the Western Traffic Association and the western limits of the Trunk Line Association. The Trunk Line Association comprises the group of railroads running to the eastern cities, New York, Boston, Philadelphia and Baltimore.
The difficulties of maintaining stable rates as between competitive lines still exist. The prohibition of "pooling” in the Interstate Commerce Act has rendered it extremely difficult for railroad companies to enforce as against each other the failure to maintain competitive rates at agreed figures, particularly where one road deems that it is not obtaining its fair proportion of competitive traffic. The Trunk Line Association, as pointed out in previous reports of this Board, makes to the less favorably situated of its members concessions termed “differentials." Although there is no way of enforcing the maintenance of these rates, they have in fact been fairly well maintained throughout the year between the trunk lines, experience having demonstrated the expediency of this policy.
The difficulty, however, of maintaining these rates throughout the country, together with the “long and short haul" clause of the Interstate Commerce Act, has stimulated the tendency, already existing, to consolidation, or rather to the absorption of the weaker lines by the stronger. As pointed out in previous reports of the Board this has gone on, and is still going on. Numerous cases could be cited within the last year. The most conspicuous case in the State of New York is the permanent lease of the Rome, Watertown and Ogdensburg by the New York Central and Hudson River Railroad Company, which went into effect on March 14, 1891.
As has been frequently pointed out in the reports of this Board heretofore, railroads have been built, not only in this State but throughout the country, for the mere sake of getting "through business; built on lines where there was no necessity for them and without regard for public interest. In many cases they have been and are rapidly being absorbed by other companies, after some years of destructive competition. The idea is gaining ground rapidly that a railroad should not be permitted to be built