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About The commoner. (Lincoln, Neb.) 1901-1923 | View Entire Issue (Dec. 1, 1905)
it 'WMBWff 'IW "HR.'WMWS'IW!-' ww yji -g- - DECEMBER 11905 The Commoner. RAILROAD EMPLOYES AND RATE LEGISLATION Tho Commoner presents another Interview with the gentleman who, having had wide ex perience in railroad affairs, has written for the benefit of Commoner readers several interesting replies to the points sought to be made by repre sentatives of the railroads. Asked by The Commoner to say something with respect to the delegation that waited upon the president November 1G, this gentleman said: The press dispatches of November 14 tell of u protest being filed with President Roosevelt against the proposed railroad rate legislation, by a delegation apparently representing the railroad employes. On November 16 it was discovered that not one of the twenty-three who called upon the president represented his organization in an official capacity, not one of them having been selected by the order or organization he claimed to represent. Not one of them, tho dispatches say, represented anybody but himself. President Roosevelt, it is said, was greatly angered when ho learned of the deception. This instance of misrepresentation and duplicity shows to what extent the railroad propaganda will go to accom plish its purpose.- Notwithstanding the bogus character of this delegation, their arguments have gone before the public and should bo analyzed. In presenting their objections they said: Railroad rate legislation logically means the lowering of rates, which will be followed by a lessening of the earning power of rail roads, and consequently the eventual reduc tion of the wages of railroad employes. The same plea is made when tariff legislation is proposed. Corporate greed cannot be regulated without injuring the workingman, therefore the public must bear the burdens. The workingman is always held up between the people and jus tice. It is the "stand pat" and "let well enough alone" policy brought down to date. The interstate commerce commission, in its seventh report, answered this plea as follows: . The only way in which tho law directly operates to limit railway profits is by pre venting the exaction of unjust charges and undue partiality in transportation facilities. This claim, then, must rest upon the proposi tion that the law,.by prohibiting the infliction of wrongs, works injury to railway prosperity. Such a plea' against the working of a statute is anomolous. It must have been very embarassing to the president to listen to such twaddle as their spokes man gave vent to, as it is a bore to any intelli gent man to .read it. Here is their statement: Why have the railroad interests, in par ticular, been selected for this attack? Why is not the interstate commerce commission or some other commission, to be clothed with the same absolute authority to fix the maxi mum prices on bef, pork, oil, clothing, butter and eggs in fact everything which one has ' to buy every day. It seems to us that such a step would be infinitely more reasonable than the proposed move on railroad rates. As Mr. D. M. Parry used this same argument at Chicago in his speech against railroad rate regulation, we suspect it was not original with this delegation. What similarity can there be be tween commodity prices in the fixing of which world-wide competition is a most potent and controlling factor, and railroad rates in the fix ing of which there is no competition whatever at but one station out of ten? One railroad sta tion in ten in the United States has two or more competing lines, whjle the other nine are at the absolute mercy of the railroads. Were a town dependent upon one merchant who controlled ab solutely the articles mentioned what would be the result? There would be no limit upon the extortion of that merchant. Tho residents of that town would without hesitation invoke the aid of the governmental authorities to place a limit upon the greed and power of that merchant, and the government would prove recreant in its duty did it not fix a reasonable limit upon him. Suppose again that this merchant would charge the rich man 15 cents a pound for beef and charge the poor man 25 cents a pound for the same quality and quantity of beef? That is the essential difference between railroad rates and commodity prices. The natural and necessary monopoly that railroads .have take them entirely out of a comparison with ordinary business ven tures. All other public service corporations, such as street railways, gas and electric light ing companies, water companies, telephone and telegraph companies, are naturally and neces sarily monopolistic in their nature, and for that reason are and should bo. under public regula tion. Originally, railroads in England were re quired to admit to their lines the cars and loco motives of other carrying companies, and the tolls they were permitted to charge wero pro scribed by public authority, just as had been ' done with turnpikes, canals and other public high ways. The introduction of steam as a motive power revolutionized conditions and compelled a change. It was readily recognized that a rail road must bo, to some extent, a monopoly, be cause the highest degree of efllciency would be attained by committing tho work of transporta tion to but one carrier. That was sixty-five years ago, and yet this delegation has not yet grasped the fact. The element of monopoly in railroad transportation was made the subject of inquiry by a parliamentary committee in 1840. The com mittee reported that "monopoly upon each line was inevitable; that a single management of each railway was expedient, and that those changed conditions made necessary the protection of the public interests." The railroadB of England aro under very close restrictions more so than is proposed by tho Esch-Townsend bill. When the prices of commodities depend upon the whim of monopoly, such as is now the case with certain trust controlled products, cither pub lic regulation of prices or the dissolution of the monopoly, will become necessary. Were these railroad men employed by the tru3t that controls the necessaries of life they would cry out against public regulation for the same reason that they now object to the regulation of the railroad mo nopolies. Were they otherwise employed they would line up with the suffering public, just as they would now do were the circumstances of employment changed. But there is one very great evil in railroad rate discrimination that will never appear in a monopoly of the neces saries of life, and that is the practice of making low rates to the rich and powerful and at the same time charging high rates to the poor and weak. This policy is indefensible and intolerable it is simply atrocious. Railroad competition is rapidly being eliminated by consolidations, mer gers and other illegal methods. What competi tion there has been in the past tended to press down and down the rates at competing points, while at non-competing points tho depression was upon business instead of rates. The inevitable result was that the strong were unjustly and il legally strengthened at the expense of the weak. It made the rich richer and the poor poorer. We' need not go further than the admissions of rail road managers themselves to show that the transportation business of this. country is honey combed with unjust and criminal discriminations. Formerly it was thought that competition in railroad transportation would operate precisely as it does in other lines of business. Experience has shown that this idea of railroad competi tion was erroneous; that it cannot be compared with competition in the channels of commerce in general; that there are no such tests of the value of railroad service as can fix tho limit down to which rates may go without inevitable loss to the carrier In the aggregate; that it may carry some classes of business at losing rates, yet make profits upon its whole operations. There is and- can be no rule of rate-making. A merchant knows precisely what an article' can be sold for to yield a profit, but no railroad manager or railroad expert can or ever will be able to de termine when" a certain rate passes below tho exact cost of carrying an article. On January 1, 1900, the railroads in what is hnown as ofllcial classification territory, which roughly described embraces that part of tho United States lying east of a line drawn from Chicago to St. Louis, thence to Cairo, 111., and north of the Ohio and Potomac rivers, promul gated a new classification of articles which made 824 changes, out of which 818 were advances which averaged 35.5 per cent, and the remain ing six were reductions. In referring to this wholesale advance in rates the interstate com merce commission, in its fourteenth report said: The chairman of the classification com mltteo testified, in substance, that tho rail- ways for which the committee stood, deter mined that they must increase their revenues and instructed tho classification committee to make changes In the classification for that purpose. Acting upon these instructions, those articles which it was thought could best bear tho increase were arbitrarily selected and advanced into higher classes. There was litllo or no consideration as to whether they ought to bo advanced or re duced in comparison with othor nrtlcloa of tho samo claBU. Tho only question was whothcr they could stand tho advance. The railway witnesses all agreod in this, that tho moving and only purpose in tho greater part of those changes was to obtain more rovonuo by advancing rates. It was not claimed that thoso carriers wero In any un usual need of rovonuo. Indeed, not for yoars had traffic been so heavy or gross receipts as largo as then. Confounding tho regulation of railroad rates with the regulation of commodity prices by this delegation displays a woeful lack of knowledge as to the functions of a railroad and its rela tions to the public. In 1880 a nelect committee on Interstate commerco wan appointed by tho United States senate to Investigate and report upon the railroad question, and upon the Investi gation and report of this committee the act to regulate commerco was baaed. In their report the committee said: As a common carrier and as the priv ileged manager of tho business of transporta tion upon a public highway, the relations and obligations of tho railroad to the com munity and to the governmental authority aro essentially different from those of tho ordinary corporation which does not enjoy similar exclusive privileges or perform a public function. The only reason for the existence of railroad corporations Is that they might undertake a duty which the state was unable or unwilling to perform. In the performance of this duty, private capital was invested, for the use of which it was proper that due return should bo made. It was also, necessary to provide In somo way ' for the expenses of maintenance and opera tion. As the most convenient and equitable method of raising whatever amount should be needed for these purposes, such corpora tions have been authorized to collect these amounts from the persons making use of the facilities for transportation afforded by the railroad; or, in other words, to place this burden, which must in some way ho borne by the people, upon passengers and freight transported instead of upon the property of the entire community, as other taxes aro com monly "ivied. By granting railroad corpora tions authority to thus levy a tax upon com merce, even with the express or Implied reservation that their charges should bo reasonable, they were necebsarlly given a monopoly of this right, at least bo far as their own highways were concerned, and the fact that such a corporation is in the nature of a monopoly Is a stronger and broader reason why it should be subject to the control and regulation of tho state, and widely ex tends the jurisdiction of the state in that respect. ' And as the agents of tho state in supplying the community with facil ities for transportation, the railroad corpora tion necessarily rests under the same obliga tion to deal fairly and equitably with all its citizens, without favoritism or discrimina tion, as the state itself. In its sixth report the Interstate commerce commission said: : Tho railroad exists by virtue of authority proceeding from the state, and' thus differs in Us essential nature from every other form of private enterprise. The carrier Is Invested with extraordinary powers which are dele gated by the sovereign, and thereby performs a governmental function. So far from being a private possession, it differs from every species of property and Is in no sense a commodity. Tho railroad, there fore, can rightfully do nothing which the state Itself might not do if it performed this public service through its qwn agents Instead of delegating it to corporations It has created. Again In its twelfth report the commission said : While railway transportation in this country is carried on by private capital, it Is essentially a governmental function. This appears from the necessary conditions of rail road construction. It is a universal. maxim that private property can not be taken for private uses, but only for public use. Yet no railroad can be built without the appro priation of private property. ?T '. S' tiMemit ,'..