the very earliest Statute of
Bread and Ale (1266) established such a sliding scale.]

The two most important questions, aside from that of an actual
extortionate rate (which has hardly ever been claimed) are that of
discrimination, and of the long-and-short-haul clause, which is really
a derivative of the former. We have found the principle against
discrimination time-honored in the common law; but modern statutes
wisely recognize that discrimination only exists when two persons
or two localities are given different rates _under equivalent
circumstances._ There has, therefore, been great dispute what these
words, "similar circumstances and conditions," in the Federal law may
mean. There is no doubt that actual differences in cost of service
make dissimilar conditions; but does geographical situation, such as
is recognized in the long-and-short-haul clause? or still more, the
amount of business offering, or the amount of possible competition?
Very early the Interstate Commerce Commission and our legislation got
to the point of recognizing competition by water; but the competition
of other railroads was a thing harder to recognize. Many people
think they have a right to a fairly equivalent service at a fairly
equivalent cost throughout the United States, and that they have
a right to all the advantages of their geographical position. The
farmers in Westchester County, about New York, thought they had
undoubted reason to complain when the rates on milk were made the same
from their farms to the city as from farms in Ohio; pointing out,
indeed, that they had bought their farms originally, and paid high
prices for the land, for the very reason of its geographical situation
close to a great market. Yet in our courts the economic rule has
usually prevailed; although no legislation, so far as I have found,
recognizes such differences, except under some vague expression such
as service or discrimination "under like or similar conditions."
Whether legislation will ever come to the point of recognizing the
railroad man's shibboleth, "charge what the traffic will bear," is
perhaps dubious. And the new Taft Act, in its long-and-short-haul
provision, takes a long step in the direction of geographical
uniformity and rigidity of rates.

A few examples of modern rate regulation may be given. In 1896 South
Carolina fixed a flat passenger rate of three and one-quarter cents
per mile. Both South Carolina and Virginia have empowered the