Senator WALSH. No; I want the railroads.

Mr. TEAL. I can give you the last reports we had on that. This is westbound that I am speaking of.

Senator WALSH. Yes.

Mr. TEAL. It was estimated in the trial of the intermountain cases that from what is called transcontinental rate territory, which would be Missouri River and east, and possibly a little out of Colorado, that 3,000,000 tons moved to the Pacific coast via all-rail lines.

Senator WALSH. That would take in the whole Mississippi Valley?
Mr. TEAL. Yes; it would.

Senator WALSH. That would continue to go that way by rail?
Mr. TEAL. It would.

Senator WALSH. It would not be diverted to the canal?

Mr. TEAL. You want to know what goes coast to coast?
Senator WALSH. Yes.

Mr. TEAL. It is my recollection of that transcontinental traffic that not 20 per cent originates Pittsburgh and East. That is my recollection of it.

Senator CRAWFORD. Did not Prof. Johnson give about those figures? Mr. TEAL. I do not remember. I am only stating what my memory serves me from that trial.

Senator WALSH. Can you give us in tons about how large?

Mr. TEAL. Six hundred thousand tons would be 20 per cent of 3,000,000.

Senator WALSH. The other way?

Mr. TEAL. By water.

Senator WALSH. West to east.

Mr. TEAL. They never gave that.

Senator WALSH. Have you not any
Mr. TEAL. No, I have not.

idea?

Senator WALSH. Have you any idea about how much of that would be diverted to the canal route?

Mr. TEAL. Yes, I can give you a general idea. Now we are speaking of coast to coast?

Senator WALSH. Yes.

Mr. TEAL. There should be normally no lumber moved except by water, so that all the lumber should move by water.

Senator WALSH. How much would that be?

Mr. TEAL. Of course, we are now moving practically none. It would depend altogether I do not hardly see how I can estimate it

for

you.

Senator WALSH. I was trying to get in the first place the traffic that does exist that would be diverted.

Senator PAGE. There is none of lumber.

Senator WALSH. I understand there is none of lumber. So we will leave that out altogether. I was not asking about new traffic. We will take that up directly. I was asking about the traffic that now moves by rail and seeing what percentage of it would be diverted.

Mr. TEAL. It is a difficult question. I can give you my notion as to about the percentage of the traffic, but I could not give you the tonnage. I would think that much the larger percentage of the heavy commodities on coast to coast traffic, dependent upon the steamers furnishing refrigerator service, will move by the canal. That is my opinion about it, but it is utterly impossible to state what that would

be because we have never obtained any figures on the eastbound movement by rail.

Senator WALSH. Can you give us any kind of an idea about the development of new traffic, that is, commodities that do not move at all now from coast to coast?

Mr. TEAL. Yes, I think I could do that.

Senator WALSH. What would you say as to that?

Mr. TEAL. I would say that both in Washington and Oregon, and all of the Coast States, and in Idaho that if the normal development follows that should follow, and that now in course should continue, we will have a very large movement of not only dried fruits, but of canned fruits of all kinds as well. I think it is in that line of development more than any other, horticulture and agriculture -

Senator WALSH. Canned goods can move now by both rail and water, can they not?

Mr. TEAL. Yes.

Senator WALSH. So that if the development continues that material will move by rail and water. It has transportation facilities

now?

Mr. TEAL. Yes.

Senator WALSH. What I wanted to get, if I could, was those commodities that do not move at all now, the low grades of lumber, for instance, that do not move either by water or rail from coast to coast now.

Mr. TEAL. I see what you mean. I thought we had gone over that lumber business particularly. I did not want to repeat that. Senator WALSH. I appreciate that low grades of lumber will

move.

Mr. TEAL. That applies to low-grade commodities. It applies to other productions, such as low-grade fruits. To-day we are wasting 25 per cent of our fruits because we can not move them on the freight rates. It has to go by water. That waste is going to continue unless relief is furnished. I pointed out when I first started that we are a long way from the market. I think we are one of the few sections of the country where, at the present time, we are dependent simply upon the higher grades of one product and have to waste

the rest.

Senator WALSH. What kind of fruits do you waste now because you can not ship them either by rail or water?

Mr. TEAL. Large quantities of apples. I think it will average 20 to 25 per cent, so they tell me. They are left on the ground.

Senator WALSH. Can you tell us of any other commodities? Mr. TEAL. Lumber, of course, is another commodity in the same way. In fact, all our low-grade commodities. Hops are substantially the one grade. Wool can move by water if it is within the radius of water competition. The effect of the competition is felt back in Idaho. The development of our country is largely at the present time dependent on timber, but cultivated agricultural industries, the products of which are heavy commodities, and many of them low grades, so we are compelled to have cheap transportation or we can not secure development. It can not be done.

Senator PERKINS. Cement is a new industry, is it not?
Mr. TEAL. Yes; cement is a new industry.

Senator WALSH. Are we to understand you to assert that it will be possible to ship cement from the Pacific coast for consumption on the Atlantic seaboard?

Mr. TEAL. No; I do not believe so.

Senator PAGE. Would it be possible, in your opinion, to save this 25 per cent on apples by canning them if we had a much lower freight rate?

Mr. TEAL. Yes; I will say more, Senator, I think that will have to be done if that industry is going to be saved. You see, the difficulty is this: To get apples or any other agricultural product used largely it must be brought within the reach of the mass of the people. A few rich people can not support an industry. Apples must be sold so that people of moderate means can buy them. They can not buy them to-day.

Senator SIMMONS. Is it not possible to overstock the market with apples? I believe there is hardly a State in the South that is not largely engaged in the apple industry. I rather think the output of apples on the Atlantic coast is entirely equal to the demand and a little bit in excess of the demand. In my State every year they say they lose a large part of their apple crop because there does not seem to be any demand for it.

Mr. TEAL. I think that is probably true. I think that in a good many of these things, Senator, we have got to look out for these trade matters different from what they did when we were younger than we now are. We have to extend our trade relations.

Senator SIMMONS. You are talking about traffic that moves across the continent. Is it not a fact that there is no entirely reliable data from which you can ascertain exactly the amount of transcontinental traffic, either westbound or eastbound?

Mr. TEAL. No, sir; the data exists. I can not get it. There is reliable data. The railroads have it, of course. They know exactly what they are moving.

Senator SIMMONS. I have tried to get it.

Mr. TEAL. So have I. It must be apparant that they have the data.

Senator SIMMONS. There seems to be no reliable information lodged with the Interstate Commerce Commission.

Mr. TEAL. It is very difficult to get. I do not know why they make such a mystery of it. I see no reason for it.

Senator SIMMONS. In that condition your estimates are not satisfactory to yourself?

Mr. TEAL. No. The only statement that I made that is satisfactory, and it is only satisfactory because they stated it as a fact in answer to the commission, that there was in round numbers, I think, in 1910, 3,000,000 tons moved from transcontinental territory. They furnished these figures at that time. Otherwise I would not have known that.

Senator WALSH. You think 60 per cent of that will be diverted to the canal?

Mr. TEAL. Sixty per cent of that 3,000,000?

Senator WALSH. Yes.

Mr. TEAL. No; I do not think it will be 60 per cent.

Senator Walsh. You think not?

Mr. TEAL. I do not think so.

Senator WALSH. Mr. Dunn's estimate was two-thirds. If it is, how much do you figure they will be able to recoup on the back haul? Mr. TEAL. I think, as a matter of fact, from the best information I can get, excepting temporarily, the railroads, except in isolated cases, do not expect to be hurt by the operation of the Panama route. I am speaking now of the transcontinental railroads. They are the only ones that could be hurt very much. They expect the development and rates on the back haul will take care of them.

Senator WALSH. So they will gain more than they lose?
Mr. TEAL. Yes.

Senator WALSH. Is that your judgment about it?
Mr. TEAL. Yes.

Senator SIMMONS. It has got to be distributed by the railroads into the interior whether it is from the Atlantic coast, after having come around, or distributed from the Pacific coast, the place of its origin. I do not exactly see how the railroads are going to get a greater haul after they bring it around than they could get if they distributed it there.

Mr. TEAL. Do you mean by a greater haul a longer haul or a higher rate?

No, they will not get the long haul; get a shorter haul with a higher rate. development of the country that will I have talked with them personally. canal.

you are right. But they will They will get the benefit of the increase their density of traffic. They have no fear about the

Senator SIMMONS. You think they will get a shorter haul and a higher rate?

Mr. TEAL. Unquestionably the haul will be shorter. What I am saying is the result of conversations with railroad men. I mean the traffic officials themselves. I spoke to the president of a leading railroad in Chicago as I came through less than a week ago. I would not care to quote his name because he did not care to have it quoted. His is a north and south railroad. He expected his road would gain very largely by the operation of the canal.

Senator SIMMONS. If they gain as much on the short haul as they lose on the through haul, I do not see how the consumer is going to be profited much?

Mr. TEAL. Senator, if the increased revenue comes not from increased rates but from increased business, why would they not profit?

Senator SIMMONS. Of course, if there is an increased business that would be a different proposition.

Mr. TEAL. We do not assume, for instance, that Oregon, with 90,000 square miles, is only going to have 800,000 population forever. The territory in the West is very large.

Senator SIMMONS. Of course, where we have a canal or do not have a canal the railroad business is going to increase with the development of the country.

Mr. TEAL. Certainly.

Senator WALSH. I got the impression that there would be a tremendous amount of traffic moving that never did move before.

Mr. TEAL. There will be.

Senator WALSH. They will haul all that back.

Mr. TEAL. There will be.

Senator Simmons. There is not going to be any more traffic than there is a demand for the things that are transported, is there? Mr. TEAL. I imagine not.

These [indicating] are all-rail rates that may be of some service to you in connection with canned salmon to various points, from Portland, Oreg., by rail, ocean, lake-and-rail, via New York City, and the all-rail, lake-and-rail rates to some points. The exhibit will speak for itself.

The table of rates referred to is as follows:

Comparison of rates on canned salmon in carloads from Portland, Oreg., to various points via all-rail direct, ocean and rail, ocean, lake, and rail via New York City; also the all-rail lake and rail rates from New York City to same points.

Mr. TEAL. In connection with the fruit industry, if it is of any interest to the committee, and it may be-I do not want to burden the record-I will leave the measurements and the space that the fruit box takes up on a full load, the cubic feet it will occupy.

(The table referred to is as follows:)

FRUIT GROWERS' TRANSPORTATION LEAGUE,
Portland, Oreg.,

The understanding is that tolls will base upon ship's registered tonnage at $1.20 per ton of 100 cubic feet.

Have been advised that relation of registered tonnage to dead weight tonnage, or cubic tonnage, capacity of vessels will range materially, but that in the average cases, the tolls will apply upon approximately 60 per cent of the tonnage carried, where the ship is loaded to its capacity.

Where ship is not loaded to its full carrying capacity, the tolls applying against it will increase correspondingly, and to that extent become a higher charge against the freight itself.

To illustrate in the case of apples:

If the registered and cargo tonnage equalizes, $1.20 per 100 cubic feet will mean 48 cents per 40 cubic feet ton, or 2 cents per box per apples. Or if tonnage of 2,000 pounds at 48 cents per ton, this would mean approximately 1 cent per box.

Apples and other fruits, refrigerated, are handled upon cubic basis. The apple box itself (packed) measures 1.66 feet, or 24.1 boxes per 40 feet cubic measurement. But the sticking and stripping, to enable proper refrigeration and ventilation in cold chambers, adds to displacement of box, and increases it to 2 cubic feet, or 20 boxes per ton, or at 48 cents per cubic 40 feet ton, 2.4 cents per box apples.

The application on this and other Northwest traffic, of canal tolls, will therefore necessitate that the vessels be loaded to fullest capacity in order to get minimum canal toll application per unit of freight carried. It is manifest that with the tonnage

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