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GEORGE W. BERGE, EDITOR AND PUBLISHER
Volume 18
Lincoln, Nebraska, August 3, 1905
Number 11
of Gorpbratibrit Benators
H. T. Newcomb, who is described as a& lawyer, economist and
Btatistician at Washington, D, C.," bias formulated a report containing
his views concerning government regulation of railways in foreign
' TViia ronnrt waa fnrthonmiTifr flt thfi rfiflliest of Senator
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. Foraker, who is a member of the senate's committee on interstate
commerce. ; ,
Many; of the statements made by this "economist" reveal the
'special. pleader straining hi3 mentality to discover arguments that
Will ylVHOC 1113 pUVYClXUl failUU. A Ul v v-
"where private management prevails decreases in rates go hand in
hand with greater financial success." It is plain that Economist
' Newconib would learn something that would deeply disappoint him
financial success comes another issue of preferred stock and high
f i i. j ; i. i- : .j ,1 ; ,1 a
ireigxit ami passenger raies axe reiaiucu tu yuj uiviucuuo.
"Stringent control tends to prevent reduction in rates," says
Economist Newcomb. "Without the ability to raise rates to their
lormer level, experiments in lowering rates m oraer to Duna up
traffic are not likely to be freely made." That sounds logical, and
therefore the people of this country must give a govemmentomm"is
sion the power to fix rates. - If the private owners refuse to lower
; rates ; the commission will gladly take the sorrowful task off their
.hands. . .- . - ' ' -.-
Jiconomist JNewcomb also lound mat freight rates are nigner in
European countries than in the United States. In European coun-
n
, Hies Hie u.iotajj.ci3 aic ouui it j. ixc xvjjl iiaui 10 lanvanj iiiirviiu u.
Therefore the Euronean rates are more like the American local
rates than like the rates for long hauls. But even this comparison is
misleading, tor m this country the average railroad extends through
four or five states, whereas in Europe the roads do not extend beyond
the borders of their resDective countries. The result is that in the
'. United States the average railroad derives a vast income from local
, rates in four or five states.
The people should be on their guard against deceptive statistics
prepared by capitalistic economists at the request of capitalistic
patrons. JSTo comparisons that are at all just can be instituted be
tween American freight rates and European freight rates. If, there-
lore, the advocate of gevernment control should retort that passenger
rate are lower in European ecu mries he 'might be instituting a com
pnrison, equally as delusive as the comprrisons of the capitalistic
special pleaders.
But the most remarkable passage in Economist Xewcomb's plea
remains to be quoted, lie writes: ' -.,
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uetei miuauuu ui. uuaiges. ijuw neigui cuaiges un luieruaiionai iramc unaer
Monetary League Protests
Against a Financial Plot
We publish in this issue, on another page a protest to congress
against the destruction of the silver dollar and the greenback; also
an article froiti the pen of Hon. -Thos. E. Watson upon this subject,
taken from a recent issue of Tom Watson's Magazine. We publish
his article in full because it goes right to the point. ,
At this time, when there are so many abuses to attract our atten
tion, we are likely to forget the great importance of the money, ques
tion. Just as soon as the people will permit it, congress will strike
all forms: of management , are frequently guaranteed by competition be- .
tween rival routes;1 But when the national desire to foster ; export trades
Is added the incentive to Increase shipments abroad becomes too strop".
' and, frequently,! results in Xhe establishment of unremunerative rate C '
constitute a burden on Internal traffic. Under general statervnersfcip,
.competition as a means of determining rates is abrogated.' ; With tha
withdrawal of competition as a force in determining rates, political press
ure on the part of certain classes becomes too strong an influence. In
.Germany, this datiger is especially conspicuous.
High rates, without general favorable financial results; more costly
management; the delegation of rate control to persons more amenable
to political influence than to : business necessity these are the most con
spicuous results of European governmental railway policy.
- To a great extent competition among the railways has ceased,
and, therefore, low rates are very infrequently guaranteed. What
. does the sly economist mean by the "national desire to foster
export trade"? Simply this: In order to permit American goods,
grain for instance, to compete in foreign countries with the goods of
those countries or goods from adjacent countries, it is essential that
transportation charges from interior points of the United States to
the seaboard should bo as low as possible. Economist Kewcomb
thinks this would constitute a great danger; If the government in
sisted on the required low rates, he argues, jjfcrei would be no profit
for the owners. It is at this point that the economist betrays the
fact that he is employing, the oldest of railway arguments. The
railway managers have long insisted that the rates should be as high
as the traffic will bear. They thus declare for a policy which favors
a limited amount of freight at high rates rather than a much larger
amount at low rates. The only question, therefore, so far as the
railroads are concerned, is whether it is better to make a large profit
from each pound or, ton of freight by carrying the limited amount, or
to make a smaller profit from each pound or ton by carrying a larger
amount. , .
But the public has the greater interest in this question. As
common carriers the railways are servants of the people. They
should be forced to adopt the policy of "the low rate on the greater
amount of traffic" because it would increase our foreign trade and
the whole people would reap the benefit.
The final argument is directed against state ownership. Tlie
perplexed economist points out that in Germany the danger from
political pressure is especially conspicuous. And yet in Germany
state ownership is a triumphant success. In another passage Econo
mist Kewcomb refers to the unfortunate experience of Italy, and
quotes President Iladley of Yale on this point. When the various
little states of Italy united, the government found itself confronted
by a peculiar phase of public ownership and decided to sell the rail-;
; ways- to private corporations as a temporary expedient. ' ' That this
was merely a temporary expedient is sufficiently illustrated by the
.fact that within the last year Italy has purchased its railways.
down the greenback and the silver dollar. In all probability this
will be undertaken at the next sitting of congress. It is the purpose
of the United States Monetary League to file a vigorous protest from
the people with every member of congress when that body convenes
next fall. ;
The Independent is glad to help make this protest as strong as
possible. Wo therefore ask every reader of The Independnt
who is. in' sympathy with the protest contained in this issue, to
write The Independent about it. We will forward all such letters
to the League or file them with' the members of congress from this
state. The people must make their influence felt upon congress or
else the greenback and the silver dollar will soon be things of the past.