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Mark, your first three points are accurate. (I'm puzzled by your reference to not putting "market share on the table" in the context of general rate increases.) Switching charges generally had nothing to do with the type of rates for line haul. If an industry was open to reciprocal switching and the origin or destination carrier absorbed, then the shipper paid only the line-haul rate, through or combination. If the industry was closed, then a switch charge would apply inaddition to the applicable line-haul rate(s). The rate bureaus operated under an explicit grant of antitrust immunity to foster an integrated national railroad network. The immunity was a quid pro quo for very tight governmental service and rate regulation. So, while the railroads could sit in a smoke-filled room and agree to up rates, the ICC had the final say if a shipper complained. But the tempering of excessive competitive zeal was a very real function, as well. Remember history ... the Interstate Commerce Act of 1887 was as much for the benefit of the railroads as it was for the Grangers. The railroads wanted public rates, enforceable by law, with no secret rebates. The rate bureaus fostered rate floors, and a very elaborate process was put in place to vet proposals to reduce rates. Justification was required; bureau staff reviewed and made recommendations for approval or disapproval based on precedent and competitive analysis; controversial proposals went to committees of carriers for debate and vote, often after shipper hearings. Most carriers followed these procedures most of the time, even though each carrier had the unrestrained right of independent action before, during or after these proceedings. Pricing discipline was seen as a distinct virtue. Clearly, large railroads had the power in the bureaus. And it was exercised, in committee and by independent action if needed. And the power was wielded wisely and unwisely. I mentioned the Southern Railway favorably earlier in the thread, for they did their homework and priced intelligently, by and large. Others seemed almost oblivious to the external world of trucks and barges and logistics. I continue to be amazed that for the period 1958 to 1980 the railroads had antitrust immunity for rate-making in an atmosphere of substantial deregulation, yet managed collectively to botch pricing. Organizational myopia and inertia were and are potent factors. On second thought, I shouldn't be amazed.
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