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About The commoner. (Lincoln, Neb.) 1901-1923 | View Entire Issue (Nov. 17, 1905)
- tv i - y- y -- y )Wwt.y-wH)ryw-Trt nw- py T 8 The Commoner. ,"' VOLUMES, NUMBERS FORAKER'S CHALLENGE IS ACCEPTED As Senator Foraker is a member of the com-" mitteo on interstate commerce, ho will havo a voice and a vote in framing a bill for the regula tion of railroad rates, and for that reason his utterances arc of great public interest. In a re cent interview given wide publicity by the press, he issued a reply to Secretary Taft's speech at Akron, which is also a reply to President Roose velt's speeches. Among other things Senator Foraker said: There is no reason whatever why, if h. . any locality thinks it is discriminated against or any shipper thinks he is discriminated against, application should not bo forthwith made for relief, and relief secured if the charge can be sustained, for the court is by the statute expressly invested with full jur isdiction to entertain the complaint and ad minister a complete remedy. This statute has been in force ever since the 19th day of February, 1903. If Secretary Taft or any body else will tell me wherein this remedy is deficient, or tell me in what manner a bet ter remedy can be provided by conferring the rate-making power on the interstate commerce commission, wo shall then have reached the point where glittering generali ties can bo dismissed and intelligent discus sion may commence. This challenge being general The Commoner, through a gentleman who has had wide exper ience in railroad affairs, will attempt to show wherein the statute of .February 19, 1903, does not provide a sufficient remedy, and wherein' the conferring of the rate-making power upon the in terstate commerce commission will provide a practical remedy. Tho gentleman to whom The Commoner re fers has several times been quoted on this im portant subject, and the reply he makes to Sen ator Fdraker's challenge should be carefully read by every one desiring to be accurately informed on the subject of railway rate regulation. Replying to the Foraker challenge this gen tleman says: . . . " fa- THE PRESENT LAW no T?fl,rst thing is to lcw " wnat remedy the frnm0fwbP1Jary ,19, 193' Provides. We quote from that act as follows: Section 3. That whenever the interstate commerce commission shall havo rer-nable ground for belief that any common carrier is engaged in the carriage ot passengers or freight traffic between given points at less than the published rates on file, or to commit ting any discriminations forbidden by law a petition may be presented alleging such facts to tho circuit court of the United States sitting in equity having jurisdiction ' whereupon it shall be the duty of the court summarily to inquire into the circumstances and upon being satisfied of the truth of the allegations of said petition said court shall enforce an observance of the published tariffs or direct and require a discontinu ance of such discrimination by proper or ders writs and process subject to tne light of appeal as now provided by law: THE OLD LAW Wherein does this boasted remedy surpass in efficiency that provided in the act, to regulate commerce as amended March 2, 1889, section 16, which is substantially as follows: T1iat .wJlenever any common carrier shall violate or refuse or neglect to obey or perform any lawful order ' of the commission it a .11 be lawful for tho commission to apply m a summary X S Vyc?ettitlou' t0 the circuit 'court of the united States sitting in equity al leging such violation or disobedience and said court shall proceed t hear and determine the matter and if it bo made to appear to such court that- sion iiaB Ueen violated ,. obeyed it shall be lawful for such court to issue a writ of injunction or other proper .process to restrain such common carrier from further continuing such violation or disobedience of such order of said commission, and enjoying obedienco to tho same. tw- '?"" ,,- - :. The original act contemplated a hearing by .. tbeucommission, and a decision'.- order 'In th? event, of refusal to comply with its orders the courts were to .enforce them. The law of February 19, 1903, makes it the duty of the court to hear tho case instead of tho commission, and then enforce its decision. So far as results are concerned neither law has provided a practical remedy, and results are what we want. THE FATAL ERROR ' The fatal error in both these laws is that the order or decision does not become effective until it has been affirmed .by every superior court in the land. Tho almost Interminable de lays defeat the remedy. Not only that, but knowing that relief can not be secured readily many wrongs are endured rather than attempt to secure it, and none knows this so well as the railroads. That is why they object to having the rate-making power conferred upon tho com mission. When the fact . is realized that the question of rates is not one of law, it becomes at once clearly apparent .why the effort of con gress to provide a method of securing' relief through the courts is a failure. In its eighth annual report, page 6, the commission refers to a supreme court decision in the Reagan vs. Far mers Loan & Trust company case, in which the court distinctly stated that Judicial interference with schedule rates prescribed by the legislature, or the commis sion is confined to restraining a regulation of rates unjust and un reasonable to the carrier such as to work practical destruction to rights of property and that prescribing charges for carriers is held to be a legislative or mlnfsterial duty rather than a judicial function. A CONVINCING DECISION In the fourth report of the commission, com mencing at page 13, will be found a learned and convincing discussion of this 3ubject, expressed substantially as follows: . A very common assumption Is that. the ':. question of reasonableness or rates is one . of lav, and that the decisions of-the commission- must be subject to review by the . courts. In order that tho question of rates should be one of law it is essential that 'there , be some clear and definite rules whereby ' rates can I 3 made; rules obligatory upon the carrier as well as upon the tribunals that regulate them, and which may be enforced against the carriers as well as in their favor If such rules existed, stockholders might have them enforceu against the action of the di rectors, or other officers, in fixing the rates. But every person familiar with the subject of transportation by rail is perfectly aware that there are no such rules. No managing ' officer claims that they exist, and not one undertakes to regulate his action in the de termination of rates by fixed, definite, un changeable principles such as constitute rules of law. On the contrary, every step leading to the establishment of the rates that shall be chargeJ begins and ends in the exercise of discretionary authority. Rates are never measured exclusively by either the weight bulk or cost of the article, nor by valuo to the -owner in having it transported; and if all of these and other considerations bearing SM SWef l arG taken int0 account in the fixing of rates, as they always are, there hownm!;Un f ,by W,hidl lt can be detenS v Zf lmportance sllll De attached to any one, or any combination of them. The fhf 8hPi n r2;te-malinS is a classification of the articles offered for carriage, and arrant ing them into classes which are to bear dif ferent rates In making this classification all the considerations that can properly bear upon it are to be taken into account In every classification, therefore, articles whose value b very great in proportion to the bulk ' or weight are classed high in the expect tion that the rates imposed upon them wU pay not merely the .cost of transDortnHm! and a fair profit, but wil I coWbuto ahS toward adequate remuneration for the car riago of such articles ns can not bear pro portionate charges. Thus the cost of EE Jlaro to the carrier itself is no more a con" trolling consideration than is thl value of ! the service to the owner of the propertv n ! any caurt were to undertakP m nV y question of reasonable 'rates ofHw sincation. It would necessarily undertiikA ' S ? in Jif ,lnPuence the actions of the carrier in classifying the articles, though it could only do this upon tho discovery f some positive rule or rules of action L as no railroad manager and no public 0S ever invested with authority has i vi 1 able to discover. A mere" statemW Iho case shows how impossible it is tha ,. tion of classification should be one of law QUESTIONS OF SOUND JUDGMENT siosaidf Bm rePrt the com An attempt is made to give authority in the courts to interfere by the suggestion that property or charter rights, or Doth, are in volved in the matter of fixing rates and that it is not possible the conclusions of' an administrative board should De final. This is an endeavor by the mere use of words to confer jurisdiction upon the courts where the substance is altogether wanting. Prop erty or contract rights are involved in these . cases precisely as they are il numerous other cases of the exercise of power under the police authority of the state, either by itself or by its municipalities. It is said . sometimes that the power may be exercised to such an extent that the property of the roads would in fact be confiscated, and most alarming pictures have been exhibited to the public of boards bent upon destruction. The effort has sometimes been made to - indicate a rule which' must constitute the minimum of reduction in all cases, by not making rates so low that the roaas could not pay interest and dividends, after maintain ing the road and paying running expenses. This comes nearer to a suggestion of a rule of law for these cases than any other that has come to the knowledge of the commis sion. But it is so far from Delng a rule of law that it is hot even a rule of policy, or a practical rule to which any name can bo given, and to which the carriers themselves or the public authorities can conform their action. To attempt .to consider the condi tion of- roads and their equipment, improve ments to be made and the 'innumerable ques tions that are involved in -running expenses, it is very obvious that there can' be no stand ard of expense which the dourts can act upon and apply, but that the whole field is one of judgment in the exercise of a reasonable discretion. Many roads rfever have and probably never will be able to pay their obligations and to pay dividends to thejr stockholders. Many have become bankrupt. ' fcut such roads are almost invariably operated J with benefit to the sections of country served, and man age to pay running expenses, and perhaps partly pay interest on present indebtedness. If the rule suggested is a correct, one and must be adhered to by public authorities, then it is entirely impossible tl;at those who operate these roads can prescribe excessive charges, since it is impossible to fix any . rates that would bring their revenue up to the point of enabling them to pay any divi dend, for the reason that their competitors would charge lower rates. But the rule sug gested would also be one under which ihoso roads would be entitled to charge, the most which cost the most, and also those built with money borrowed instead of with money of the-stockholders; the larger the debt the higher tho rates' that would be legal. But over and beyond all this the attempt to apply the rule suggested would be abso- lutely futile for the reason that. 'the rates pre- , scribed for one road would necessarily affect others that either directly or indirc 3tly came in competition with it. If, there.'ore, a court is to undertake to protect the one against its rates being so reduced as to. endanger the payment of its obligations, it must reach nut and restrain any regulation by the public authorities of tho rates of all competitors, ir respective of the question whether they also are or are not subject to the same risk. The commissions created 'by lay for the reg ulation of railway transportation do not deal with questions of classification or of rates as questions' of law, but as b;ejng what they necessarily ' arequestions of '.discretion and -1 sound judgment, ' 'j.' AN, $j)iyi)NISTRATIONi,iPUTY. . ! (jbngress hns been trving, jtq, saddle a leffis lativeor administrative, duty uwm the judiciary department, and has failed. The reUef sou&M has not been attaihod, which conclusively proves ijjt .. .i.j j.. Jjfaf''iiiit'nv-'AIL4'Jfcj:l