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The tide in the continent's business affairs turned soon after the new men took the helm. The long depression ended, prices rose, farmers met mortgage payments, factory chimneys smoked once more, traffic multiplied. The first result of the improved conditions was the easing of the tension in railway relations. There was no longer a life-and-death necessity for rate-cutting and traffic-stealing.
They looked upon it as an outrage, an affront, a deliberate slap in the face for an established, vested, and prodigal support of the newspaper press. What the devil did The Patriot mean by it; The Patriot which sorely needed just their class of reputable patronage, and, after sundry contortions of rate-cutting, truckling, and offers of news items to back the advertising, was beginning to get it?
It had been said in the papers for some time that rate-cutting was going on in San Francisco, and this made me hurry down not to lose the opportunity. The morning after my arrival I walked into an office in Kearney Street and said briefly, "What are you doing to New York?" The clerk said in a business way, "Seventy-two dollars." I laughed a little and looked at him straight without speaking.
The fares were usually twenty shillings cabin and five shillings steerage, though the intense rivalry of opposing companies sometimes brought reckless rate-cutting. In 1829, for instance, each of the two companies had one boat which carried and boarded cabin passengers for seven and six-pence, while deck passengers who found themselves in food were crowded in for a shilling.
"There will be a differential of sixpence a bushel on wheat over my route. That talks down fifty lighthouses." "But it makes no allowance for rate-cutting by the big men on the present routes. Further, if the Canadian Government are not with you on this scheme, they'll be against you. There are a dozen ways in which you might be frozen out.
By such means the available business of a region might be fairly divided among the roads entering it, without resort to competitive rate-cutting and its consequent evils. The passage of the law was looked upon with much hostility on the part of the railroad interests.
From these rates the South Improvement Company was to receive substantial rebates, amounting to forty or fifty per cent. on crude oil and twenty-five to forty-five per cent. on refined. On their side the railroads were promised the entire freight business of the Company, each to have an assured proportion of the traffic, with freedom from rate-cutting competition.
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