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people, is also, if entirely unrestrained, an element of danger; that it has already acquired such power and influence as to be "practically beyond the common law obligation;" that "in our day the common carrier has encountered in England as well as in this country a new power, unknown to its founders, practically too strong for the ordinary private remedies."*
Even in those States where the rights of the people have not been secured by constitutional reservations or timely provision by general statutes, it is becoming a serious question whether the right to restrain the growing and threatening power of great corporations does not by virtue of their very nature, and by reason of the public necessity, inhere in the State. Nor is this discussion confined to that portion of the great public suffering from supposed or real grievances inflicted by the corporations. This opinion, so shadowy and ill defined in the public mind, is finding strong and logical utterance through able and distinguished jurists.
Says a forcible writer in the American Law Review, (vol. 8, page 191) in speaking of the Dartmouth College decision, that bulwork of corporate power, for so many years considered impregnable:
"Any decision in any ordinary case ought to stand; and when a decision has stood for fifty years, even to question it lightly and without sufficient consideration, is injurious and censurable, as tending to unsettle an entire system of jurisprudence. But constitutional decisions which take from the political department of government powers and prerogatives usually belonging to it, and which legislation cannot remedy, stand on a different footing from ordinary precedents involving questions of private rights. Fifty years is a short period in the history of a nation living under a constitution intended to be perpetual. The consequences of the Dartmouth College case are beginning to press heavily on great communities, and the pressure we believe, will increase rather than diminish. It involves questions of political power, political necessity, it may yet be of political safety, and the case will not be let alone, however wise it might be to do so."
Corporate power may never so far threaten the liberties of the people as to require the re-opening of this question in the Supreme Court of the United States; but if that condition of things should indeed come, then it is safe to asume that the decision of that court, made in the infancy of the nation, when the great quasi public corporations of the present not only had no existence but had
*Chief Justice Ryan. Opinion in case of the Attorney-General vs. the C. & N. W., and the C., M. & St. P. R'y. Co's., p. 43, Appendix to Commissioners' Report for 1874.
not yet been conceived of, will be so far modified as to afford such protection as shall be found just and necessary. For while it is a cardinal principle of our government that there shall be as little interference with the natural freedom of the citizen, whether in an individual or associate capacity, as is compatible with public security, it is a fundamental principle of all human governments that the great ends of government shall not fail-that the public safety shall be paramount.
Your Commissioners believe that in this, as in most matters of great public concern, there is safety in conservatism; but they cannot close their eyes to the existing facts, nor will they conceal the conviction that the present railroad controversy in this country will not, indeed cannot, cease until the public are, in general terms, satisfied with the conduct of railway corporations, or have found adequate protection for the public interests in new constitutional and statutory provisions. It is useless to undertake to contract the consideration of this subject to the limits of a single State. The conditions which govern in one locality must eventually govern in all. As judicial decisions are had, establishing the right of control, they will characterize legislative enactments. And if charters heretofore granted by State governments without reserving the power to alter, amend or repeal, are to be held irrevocable, other measures will be resorted to for the purpose of enforcing such prerogatives as cannot be surrendered by the people without a sacrifice of sovreignty. An illustration of this tendency is found in a provision of the new constitution of the State of Missouri, which reads as follows:
"SECTION 22. No railroad corporation in existence at the time of the adoption of this constitution shall have the benefit of any future legislation except on condition of complete acceptance of all provisions of this constitution applicable to railroads."
Cases have arisen, and doubtless yet others will arise, in which communities, moved by a sense of injury, and yet wanting in a knowledge of proper remedies, have resorted and will resort to such means as subsequent events and a greater enlightenment will show to have been ill-chosen, perhaps prejudicial to both public and corporate interests. Still it cannot be denied that the American people have ever been distinguished for their love of justice and their moderation in dealing with the rights of others.
We think it unquestionable that justice is the aim of the public
in this controversy. Hitherto they have occasionally failed of the mark because have they contended with the darkness which has surrounded the whole subject of railway company transactions, and the business of railway transportation.
Let the railway companies on their part open their affairs to the clear light of heaven, and the State on its part, through competent and properly authorized agents, make a full and thorough investigation of the whole subject involved in the controversy, and the solution will be made without great difficulty, and to their mutual satisfaction as well as common advantage.
In the opinion of your Commissioners, such an investigation should have preceded all legislation putting arbitrary restrictions upon rates of fare and freight. The law of 1874 was a stroke in the dark. It might be far from just to say that it was prompted, as has been charged, by anything like a spirit of retaliation for the short-sighted and unwarrantable acts of railway corporations, but it is certain that the restrictions it imposed were based upon insufficient data. This was so manifest to all unprejudiced minds that the fact of its passage gave occasion for dissent from the friends of judicious restriction, and for effective denunciation from the corporations and all persons opposed to legislative interference. Moreover, by showing a degree of unreasonableness and unwarrantable haste, it has temporarily unsettled public confidence in the coolness and fair-mindedness of the American legislator, and thus affected to some extent the credit of our people in the great money markets of the world.
On the other hand, it is no less true that the railroad corporations and their over-zealous friends have in some cases largely contributed to the foreign distrust of American railroad securities by extraordinary misrepresentations of the character of the communities held responsible for restrictive legislation. Seeking to make the law obnoxious at home, they have compromised the character of a whole people abroad. The attempt has even been made to hold the few States in which there has been recent legislative restriction responsible for the depressed condition of the railroad interest in the whole country. Charges so unfounded have necessarily recoiled upon their authors and aggravated the evils from which they already suffered.
What is wanted now is an end to all misrepresentations on both sides, and an honest effort to get a right understanding of the issues involved, and an agreement upon the means best calculated to secure the manifest rights of the public without unnecessary interferance with the freedom of the corporations.
It is upon this principle that your Commissioners have prosecuted their inquiries; seeking to determine the minimum of interference on the part of the State that would answer the demands of public security, rather than the maximum that could be imposed without absolute ruin to the corporations.
It was strictly in accord with this principle of action that their first report, was drafted, a reference to which will show, that in the suggestion and discussion of the methods of governmental interference they proceeded in logical order from the simplest to those more radical and sweeping, finally laying down, as the result of their inquiry, the following general conclusions:
"The only form of railway control likely to prove successful under present conditions, is the legislative, supplemented by direct supervision; the legislature laying down general rules of action, but leaving the application and enforcement of those rules to a commission. A judicious application of this method requires
"1. A determination, by the commissioners, of the actual cash value of each railroad; such value not to be greater than the actual cost thereof, and the valuation subject to legislative revision. “2. An annual determination of the gross and net earnings of each company, from the reports of companies, by actual inspection of books and affairs, and by all other practicable methods.
"3. A division of roads into two classes: the first class including all roads paying a reasonable compensation on valuation, and the second class including all other roads.
"4. A maximum of rates of fare and freight for roeds ascertained to belong to the first class; such maximum being subject to legislative revision.
"5. No restriction of earnings upon roads of second class, except by way of remedying unjust discriminations.
"6. A prohibition of unjust discriminations and unreasonable or excessive rates on all roads: any person complaining of discrimination or extortionate charges having the right of appeal to the board of commissioners, under such rules as to evidence of facts as the commissioners may determine; the board determining the fact of discrimination on evidence and notice to both sides, and its conclusions to be prima facie evidence as to fact of discrimination, or of unreasonable charges.
"7. Additional police regulations, especially as to running connections and the passage of freight from one road to another.
"8. Limited power of the commissioners to require repair of
roads, improvement of roads of rolling stock, and increased accommodations for passenger travel.
"9. Full and complete publicity of rates of fare and freight. "10. Publicity of all important contracts and agreements between railway companies, and of their business transactions generally.
11. Greater uniformity and completeness of accounts, as well as greater fullness and frequency of reports.
"12. Adequate penalties for the falsification or concealment of earnings and expenditures, or other facts.
"13. Efficient means for the prompt enforcement of all provisions of the law, at the expense of the State."
It is proper for us to add that that report, with the conclusions embraced, was a carefully considered statement of the results of much observation of railways and railway management in this country and in all the countries of Europe, supplemented by a year's laborious official investigation.
RESULTS OF PUBLIC INQUIRY.
It is worthy of note in connection with the reiteration of these conclusions, announced a year ago, that almost every where, the public judgment is pointing in the same general direction-towards moderation and due caution in dealing with the complex question of railway transportation so as to promote the best interests of both people and corporations. People and governments are beginning to appreciate the wisdom of moving slowly and carefully in a matter of so great importance.
RECENT ACTION OF STATES.
Missouri has recently taken extreme ground, committing the mistakes of Illinois, Minnesota and Wisconsin, by enacting a law in advance of sufficient data, prescribing rates of fare and freight quite identical with those fixed by the "Potter-law," and imposing like penalties. The law also provides for the appointment and subsequent election of three commissioners, the full term of office being six years.
Besides the duties imposed upon the board by the laws of this State, the commissioners are to examine the roads as often as they deem necessary. If they judge any part of a road unsafe, they may order repairs and require reduced speed of trains. A refusal to