The record-union., 1892-03-23
THE RAILROAD COMMISSION.
James Rea's Reply to Traffic Manager
]. S. Leeds.
Duties of the Commission Defined
California Freight Rates
Discussed.

missionerS on Monday President Rea
read the following paper, in answer to the
documents filed with the board by Man
ager j. S. Leeds of the Traffic Associa-
ton:
J. S. Leeds, Manager of the Traffic
Association of California having ad-
dressed to the Board of Railroad Com
missioners a communication upon the
subject of the freight rates OF transporta-
ton companies within the jurisdiction OF
the board, and said communication hav-
ing been placed on. file, and the matter
contained therein having been duly con-
sidered, it is ordered that the following
conclusions be filed and made a part of
the records Of this commission:
The Commissioners agree with that
portion of Mr.. Leeds communication
which declares that the Commissioners
have the power and that it is their duty TO
establish rates of freights and fares within
their jurisdiction. The language of the
Constitution upon this point is clear and
unmistakable. Section y of Article XII.
Of the Constitution declares that: said
Commissioners shall have power and it
shall be their duty TO establish rates of
charges for the transportation of pasSen-
gers and freight by railroad or other
transportation companies and publish the
same from time to time with such changes
IS they may make" This sentence from
the organic law would seem to be suscept-
ible OF but one construction, and that the
one which the Commissioners concur
With Mr.. Leeds in placing upon 1t. 1t
vas the evident purpose OF the trainers
of the Constitution to go beyond the pro-
visions of the statutes of lS77-7S creating
commissioners of Transportation and de
lining their powers and duties and inn
pose upon it powers and duties which the
commissioners Of Transportation did not
possess. 1t is not upon the existence Of
these powers and duties that we disagree
With Mr.. Leeds, but upon The time, eX-
lent and manner of their exercise.
a consideration Of the whole of Section
. of Article XII. OF the Constitution will
show to any unbiased mind that the
Board of Railroad Commissioners is es-
sentially judicial body; that while it is
The creation and the servant of the people
of California, it is so in the same senSe
and to the same extent that the courts of
the State are the servants of the people.
Every sentence and every intendment of
the Constitution fayors this view of the
position and powers OF the commission
and forbids any other attitude on the part
Of its members than that of impartial ar
D hiterS between the transportation compa-
nieS on the one side and the producers
aud shippers of produce on the other.
The very section of the Constitution
which declares it the power and duty of
treights and fares provides that such
rates, when established, shall have the
effect of judgment in a court of law.
If the conclusions OF the Commission
ers are to have such an effect it is evident
hat in their deliberations which result
iii those conclusions they should occupy
the position of judicial ;impartiality.s 1t
IS not 10 be understood, however, that
The commission claims that the proper
exercise of its judicial functions requires
ii TO sit still in its office and always await
complaints of burdensome freight or fare
charges or of unjust Determinations be-
4Feen shippers or commodities or locali-
les on the part of transportation COM
panies. Neither this commission nor the
commissions OF the past have taken this
TieW OF their powers or duties, or of the
manner of their exercise. On the con-
1rary, every commission since the Con-
stitution was adopted has, upon its as
sumption OF Office, established and en-
forced schedules Of freights and fares,
which schedules they have from time to
lIme revised and amended as the facts
showing such revision proper have been
brought to their attention. It is not
Gained by this commission that the
schedules either of the past commissions
or of its own have been models Of wis
dom or of equity in the solution of the
asst and tangled problem of transporta-
,lon tariffs for the great State of Califor-
ria. 1t is beyond all reason to expect
that they could be so.
This commission, upon its assump-
ton of Office, found itself face to face
with duty more delicate in its nature.
more welghty in its consequences and
more intricate in its details than that i'm
posed upon any other department of the
State. 1t was the duty OF adjusting trans
portation tariffs. The magnitude and
delicacy of this duty may be estimated
tNCn NO 70 ,Nfx -
standpoint of the producers, and second,
from that of the transportation compa-
MES. Viewed from the first standpoint.
1t Will be seen that every industry in the
state OF California must be affected either
directly or indirectly, by the transporta-
ton tariffs OF produce and persons. These
tariffs form portion of the warp and
wool OF the whole industrial system of
the State, and the ultimate prices and
profits of all products depend upon them
For the last quarter of a century the in
dustrlal system has been growing and
spreading, and with and as a part of its
development has also grown and spread
The system of transportation, which
forms the main medium between the
heldS and factories of California and the
markets for their produce. 1t must be
manifest that, viewed from the stand
point of the producer. the transportation
tariffs should be revised with caution.
anu anu W1Il
the probable effect of each change upon
every industry in the State in view.
From the standpoint of the transportation
companies the same conclusion is at
tanned. The transportation companies of
California are themselves foremost among
Its industries. Their property is spread
over its surface from boundary to bound
airy. They have invested a vast amount
or capital: they consume a large guam
tlty of produce: they employ regularly
an army OF people, and distribute an
nuaily an immense sum of money
through the communities of the State.
In the consideration of the problem of
freights and fares account must be taken
OF this capital invested, this produce con-
sumed, this labor employed and this
money expended, and the commission
ought only TO make such reduction of
their charges as shall leave 10 them fair
1etlIrn upon their investment To do
otherwise, TO attempt to act arbitrarily.
0 undertake horizontal reductions or
sweeping reVISlonS without reference 10
these principles would only react iniuri-
ousiy upon the industries of the State
and bring the officials attempting it into
E EeH-merlted contempt and disgrace
This commission, upon lis entry on its
clliclai service, received from it prede-
cessor the records of the service of past
COMMISSIONS under the Constitution and
q the commissioners of Transportation
oefore the new Constitution was framed.
i found the schedule Of freights and
1ares fixed by the former commission in
1Deratlon. 1t became possessed of the
cata from which that schedule had hean
repaired. 1t assumed then, as ii asserts
slow, that it had the power and that it
- as lis duty to establish schedule of
transportation rates, and to the best of its
lien information and ability it estab-
.}shed such schedule. From time 10
eli fh.f F3F1lo f.ls
mis- commission has made changes in its
-atails as cnrnnlaintS have hnan laid hn