fore them to testify, not
one shipper testified voluntarily. On the contrary, they all insisted
upon being subpoenaed, hoping that the railroad managers would not
hold them responsible for any statement which they might be compelled to
make under such circumstances. The report of that committee stated that
the number of special contracts in force within the period of one year
on the New York Central and Hudson River Railroad alone was estimated
by the railroad people at 6,000. Mr. Depew, when he made the statement:
"In territories comparatively new, and with little responsibility on the
part of the managers to distant owners, they became in many cases very
arbitrary and exercised favoritism and discriminations, which led to
popular indignation and legislation," had probably not heard of this.
The committee's report further stated that these special rates conformed
to no system and varied without rule, that every application for a
special rate was judged by itself and with reference to its own peculiar
circumstances, and that it depended upon the judgment, or rather
caprice, of the officer to whom the application was made, whether and to
what extent a special rate should be granted. The reductions made to
privileged merchants often amounted to more than what would be a fair
profit to the dealer on the commodities shipped. The privileged dealer
was thus enabled to undersell his rivals and eventually force them out
of business or into bankruptcy. It was not at all uncommon for railroad
companies to allow discounts amounting to 50, 60, 70 and even 80 per
cent. of the regular rates. The New York Central gave a Utica dry-goods
merchant a special rate of 9 cents while the regular rate was 33 cents
on first-class freights. The lowest special rate granted at Syracuse was
as low as 20 per cent. of the regular tariff rate on first-class goods.
David Dows & Company and Jesse Hoyt & Company, by means of a grain rate
from 2-1/2 to 5 cents lower than those given to other firms, were
enabled to control in the winter of 1877 the grain trade of New York.
The railroad even extended its fostering aid to A. T. Stewart & Co.,
giving them a special rate "to build up and develop their business." The
testimony given by Mr. Goodman, assistant general freight agent of the
New York Central, in reference to the principle by which he was guided
in granting special rates, is of sufficient interest to be given a place
here:

Question. You made the rat