Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1881-01-22
RAILROAD REGULATION.
The Protection of the Inalienable
Rights Of Citizens, the True
Function and Foundation of
Republican Government.
The Regulation or Control of Private
Property Inseparable from its
Ownership.
The Classification of Railroad Freights
Ably Discussed and Fully
Explained.
An Able, Elaborate and Original Pre-
sentation of the Question of the
Relation of Railroads to
the Government.
The Influences that Determine Rates
and the Business Principles which
Actuate Railroad Managers.
Letter of Ex GovernorLeland Stanford,
President of the G. p. R. r. Co.,
fn 1a
of Commerce.
The Influences that Determine Rates
and the Business Principles which
Actuate Railroad Managers.

TO tne New OfR Cnamber
of Commerce.
The Chamber OF Commerce of the city of New
York recently addressed communication to a large
number of prominent citizens, presumably well
informed upon the subject requesting response to
series of interrogatories calculated to secure ex-
preston OF the opinions of those addressed up n
the question OF the true policy of the Government
in the matter OF the regulation of freghts and fares
upon railway lines of transportation The follow
President of the Central Pacific Railroad Company.
The sub-headngs in the letter are those Of this
journal
san FRANCISCO, January 20, 1881.
Charles S. Smith, Jackson s. Shultz, b. B. .Shey-
man, +. B. Thur6er and C. C. Dodge, a Special
Committee on Transportation Of the Nep York
Chamber Of Commerce.
GENTLEMEN: 1 have received from you several
documents, among others a list of questions
pertaining to railroads and railroad matters !:
also Judge Blacks answer to these questions
rately and specifically, but will, in general man
ner, endeayor to substantially cover the essen
tial points of ALL The general scope of your ques
tions goes to the control to greater less extent
of property which the stockholders in railroad COM
panies believe to be OF right their own. Here it is
pertinent it to me, to call attention to the
principles upon which our Government is founded.
They are laid down in that great Bill of Rights
known as the Declaration of Independence There
it is clearly enunciated that governments nsti
tuted to secure the people in their inaenabe
rights-lfe, liberty and the pursuit OF happiness.
This was new departure in government, and in di-
rect antagonism to that theory of government which
was based upon the Divine right Of kings-to gov
ern to control, and to arbitrarily fix burdens upon
the people for their own personal aggrandizement.
The "rights of sovereignty" is phrase common
throughout all our law-boeks, but if the origin of
these "rights" be closely scanned, they will be
found to be almost invariably in conflict with the
fundamental idea of our Government. Tariffs and
the supervision of commerce and trade originated
in a barbarous age and were the direct offspring of
robbery and rapine enforced by the hand OF might.
The Question Of Ownership Is in Control.
II the question of the control of railroads were to
be treated purely from legal standpoint should
have nothing to say because is stare decSiS The
essence of ownership is in control. The value of
property consists in its the rents and profits
to be derived. In the celebrated " Granger cases."
SO called, the use the profits and the control were
declared to be the subject OF legislation. The pin
cipe in these cases, especially enunciated in the
Warehouse case was that the right of the Legisa-
ture to control the and the benefits OF the prop
erty OF private individuals in connection with their
own personal services, to be determined by the
nature OF the business or the number OF people with
whom the business might be transacted
To sustain these decisions there was violent as.
sumption of fact. 1t does follow that the ware
houseman necessarily does business with large num-
Der of people. A single individual might tax to
the utmost the capacity OF the warehouse-and, in.
deed, of several To Illustrate one citizen of Cali
fornia, from single crop, had forty thousand tons
of wheat This would have filled eight warehouses
of a capacity of five thousand tons each and under
the decisions in the case referred to this farmer
might have had appropriated to his benefit these
eight warehouses, and the personal services of
those engaged in attending to the business
In such case, If one or more individuals may use
the property and appropriate the services Of or
more persons, there is limit to which the POWER
NAV be exercised over all kinds OF business. Then
where is the harmony between decision of the
Courts sustaining this doctrine and the fundamental
principles OF Government, to which allusion has
before been made? These decisions sustain Judge
Blacks assertion but there can be denying that
they most fragrant violation of the principles
OF free government, and entirely in harmony
with that theory OF government which rests its
foundation might and asserts the divine right of
kings. The idea Of our system of government was
that men should be free, Independent and self-re-
liant that every man should depend upon himself
for his success in life. The establishment of COM
missions of espionage, the appointment of officers
to inquire into to regulate mems business affairs
and the attempt of the Government to n axe con-
tracts for individuals all tend to destroy this nde
pendence, and are departures which should be care
fully considered. 1t was never intended that this
should be paterDal government, yet does it not
begin to assume that form when it is claimed that it
should fix the terms OF contracts between independ
ent parties, by attempts at regulating the rates
shippers shall pay and carriers shall receive for
their services But proceed to treat the subject
in its potico-economic aspects.
Do the States Create the Railroads
In your first interrogatory you seem to beg the
whole question. and assume that railroads are
public highways and common carriers and derive
their franchise and existence from the public"
do not think that the assumption is proper. Cor
porations formed, believe, throughout all the
States OF Union under general incorporation
laws. and they formed by the individual incor-
porators. The property of the incorporation is con-
.rihu cd htt tba hold .bo
creates the corporation its property than it Gre
ates joint partnership between individuals or the
partne- ship property take it that there is a wide
nisapprehension as to what the State does for the
various railroad corporations There is an idea that
the State confers franchise of value. This,
presume, grows out OF the ideas associated
with and derived from that species of cor.
poration, now nearly obsolete, created by
special Acts of the Legislature before
the existence of general incorporation laws,
and which was necessarily monopoly. To incor-
poratons created in this way there were granted of
course franchises supposed to be of value, but to
the modern corporation the State gives nothing but
the right to exist The corporation obtains nothing
which cannot be had by any set of individuals who
choose to associate themselves together, as a corpo-
ration, for the same purp and all it costs in the
State OF California to create such a corporation,
with the privilege OF paraeling every mile of rail
road in the State, is the mere fee for filing the
articles OF incorporation amounting to about s1o)
II thing has greater value than it can be had for
at any time BY anybody | am unable to perceive it.
The Right OF Eminent Domain.
Many have the impression that there is right OF
eminent domain attaching to this railroad corpora
ton which is Of value. To this say that the right
of eminent domain is exercised by the railroad
company, but by the State, in whom only exists
this power, and is exercised upon the theory that
the investment by the railroad incorporators Of
their time and private property is of character
highly beneficial to the public. The State does not