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About The Conservative (Nebraska City, Neb.) 1898-1902 | View Entire Issue (May 4, 1899)
, ,1 < l * ' f * 1 , 1.1 - . * - 4 Cbc Conservative KAllWAY ECONOMICS. " ( Written far TIIK CONSKHVATIVK by James Denton Hancock , of Franklin , Pennsylvania ) . I have read and re-rend with the greatest pleasure and profit "Railway Economics. " I regard it as the most concise , clear and comprehensive expo sition of the problems involved in the management of railroads which I have ever heard or seen. It rightly rises to the dignity of a work upon economics , which should not only be in the hands of every railway officer and employee , but it should bo read and taught by every newspaper especially country newspapers and by every teacher and clergyman in the United States. A chief object of instruction in a country like ours , the government of which is based on general suffrage , should be to teach the teachers. For this work "Rail way Economics" is peculiarly adapted ; and surely a system of transportation in which is invested capital to the amount of $11,000,000,000 , which has brought every person and every commodity in our vast continent into close connection with each other , which has doubled the productive power of labor , and cheap ened the necessaries and luxuries of life to all consumers , is a worthy subject of study by intelligent and patriotic citi zens of the country. Competition. Even a careless reader of the book must perceive that the most serious problems of railway operation grow out of competition. It is the old , old strug gle for existence and the survival of the fittest , which commenced and will only end with time. m Tin's struggle has a double aspect. On the one hand it has been the incen tive and excuse for the exercise of the direst passions of man , has overwhelmed all obstacles in its ruthless career , and by the destruction of the monuments and instrumentalities of civilization has often set back progress forages. On the other , when controlled by justice , and inspired by the reciprocal regard for the rights of our fellows enjoined by the Prince of Peace , it has proved the greatest element of individual and na tional advancement. In either case "from the ashes of our dead ambitions a loftier manhood has been evolved. " Individual Rattles. Before society was organized the nor mal condition of men was that of pri vate war. When society was established private wars ceased , and the necessity for the reign of justice was recognized. With the advent of Christianity , came the highest principle of civilization , the binding obligation to pay due regard to the rights of others. Justice was en forced in two ways ; by prevention through injunctions and police regula tion , and by recompense for and punish ment of wrongs inflicted. Through the enforcement of these principles , peace has been proved to bo consistent with competition ; while competition exists , peace has become the normal condition , and competition has been largely stripped of its destructive character. The author of "Railway Economics" seems to have been inspired by this thought. Ho has shown that unneces sary competition creates waste and eventually adds to the burdens of the public ; that discrimination is not neces sarily unjust , but is an essential element of success in the railroad business , as it is in every other line of business ; that intense competition between in dividuals , places and commodities is the most potent cause of unjust discrimination , by controlling rates of transportation and by forcing unreason ably low rates at competing points , etc. , at the expense of unreasonably high rates at non-competing points , etc. ; that competition among the public , had in many cases subjected railroad compan ies to unjust taxation which had either to be charged back to the public in higher rates , or by which were pre vented extensions and improvements necessary to public accommodation and development of the country. Ail Example. In my own experience I know a good illustration of the effect of this competi tion forced upon railroads. Three rail roads centered in a city in which existed a plant limited to one line of manufac ture. The owners of this plant owned a number of other plants located in differ ent competing cities. Here were several railroads competing for the same busi ness. If one refused the rates offered , another was ready to take it. If they all refused , the owners of the plant could remove the business to other places and the city in question be left to moulder with the dry rot. Of course the railroads took the business at the rates offered , and the loss was in part made up by unjust charges to other persons and commodities. Under well-regulated any govern ment , such conditions are intolerable. They build up the few at the expense of the many ; they make legitimate busi ness impossible. That receptacle of wisdom , the common law , has provided that upon public instrumentalities like railroads , rates should be reasonable and that there should be no unjust discrim ination ; but the limitations of the con stitution prevented the enforcement of this rule as to interstate commerce with out statutory authority , and it was in interstate commerce that the evil most prevailed , and through it , under the complications of business , it was im practicable to enforce it in those states where the common law did prevail. Out of this condition grew the interstate commerce law. In recognition of the extreme com plexity of the transportation business in its economic relations , the law in its original conception was intended princi pally to prevent unjust discrimination and unreasonable rates. It has been somewhat the fashion to deride the value of this law. I think that those who thus deride have no proper concep tion of the great work it has accom plished under unfavorable conditions. It has required a publication of rates , and has thus given the shipper a knowl edge of his rights. It has secured fre quent statements by transportation com panies of the condition of their property and business , and has thus given stock holders a knowledge of their investments. It has led to scientific classifications of commodities in reference to rates. In many cases it has prevented unreason able rates and unjiist discriminations , and has been a standing menace to dis honest shippers and railway officers. From a medley of rates , conditions and rules in which confusion was unbounded and darkness was impenetrable , it has done much to transform transportation into a scientific system of business. Finally through the decisions of the commission , more than all other instru mentalities combined , it has educated both railway employees and the public upon the intricate problems in which transportation is involved ; and I doubt whether , without it , we would have had this valuable volume of Professor New- comb. Non-Pooling Provisions. The unfavorable conditions above mentioned are the outgrowth of a clause forced into the interstate commerce law forbidding railway pools , either of business or profits , followed by the anti trust law forbidding all combinations and agreements between corporations relating to the joint handling of their business. The effect of these laws has been practically to invalidate all ar rangements between railroad compan ies by which it was possible to alleviate the barbarous conditions resulting from the extreme exercise of economic laws ; and we are in the anomalous situation in which the transporting companies are forbidden the use of unreasonable rates and unjust discrimination , while by the same laws they are deprived of the power to prevent such rates and discrim inations by the use of the only means possible for that purpose , to-wit : com promise and agreement. Contrary to the whole trend of civilization , contrary to our highest ideals of ultimate social order , these laws have decreed perpet ual war among railroad companies. Inevitably economic lawc prevail over statutory enactment. In places served by many railroads and as to commodi ties produced in many places , where competition is intense , the laws against discrimination and unreasonable rates are evaded ; the railroad lines instead of aiding , are thus forced into an attitude hostile to the commission , and to a con-