The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1895-09-08


probably knows whom mean.
A general laugh greeted Mr.. Martin S
misnomer of the Iroquois Club, which in
terrupted him for minute. But he re-
covered and continued:
These working-men are representatives OF
labor and do not speak tor us, and l do not
propose to follow along the line of their argu-
mentS :
There is a great demand for this reduction
from those who have no direct interest in the
matter, such as political clubs, and the de-
mand is not as general as might appear. The
money-lenders are largely responsible for it.
La Rue-Yes, for the money-lender wants 10
be assured of the return OF the money he ad-
vances to the farmer. The merchant also de-
sires it because his prosperity largely depends
upon the farmer. So we have, in addition to
the farmer, the money-lender, the merchant
and the clubs. They have an interest IN these
reductions. And so have your stockholders
and bondholders an interest in trying to pre-
vent the reduction.
Martin-While this may be true, want to
recall to your attention the fact that the
Southern Pacific bond Indebtedness is less per
mile than that OF any other railroad IN the
United States
r La Rue-That, according to statement find
in the report of United States Commission OF
1888 of which Judge Patterson was chairman,
is not correct
Assistant General Manager Curtis-That was
a special committee appointed TO investigate
the affairs of the Central Pacific only.
Martin-It is very important that upon all
matters that bear upon this question the COM
mission should be accurate in its information:
We are governed by law and not by men. II
you should go outside of the law in determin-
ing the matter you would be violating the law.
l would like to call the attention OF the COM
mission to some points of law. 1t would not
matter if all the tribes were off the reservation
and dancing you would have to be governed
by the law and personal wishes must be lg-
nored.
Mr.. Martin then quoted from the State
constitution to show that the duties OF the
Railroad Commission are to establish the
rates on freights and fares to be charged
by transportation companies, and to hear
testimony, subpoena witnesses, and. other
wise act in the same manner as a court OF
record.
Then he quoted from the State statutes
to show that the commission can only act
on complaints which shall be presented to
it under oath and that decisions must be
in writing and the reasons therefor stated.
Continuing, he said:
You are bound by the testimony brought be-
fore YOU, and it must be under oath. Numerous
communications have been received, and some
OF them ANONYMOUS but only sworn testimony
must be considered. This resolution must be
considered in the nature OF complaint ana
the Southern Pacific's answer to the resolution
is the testimony given under oath. Not your
own wishes must be considered.
This commission can never be led or driven
comes your duty to consider everything that
has been offered by the Southern Pacific as well
as by other persons. But your decision, which
must be given in writing, must be based en-
urely on the testimony.
Is there any testimony that shows the need
of a reduction Not one particle. A conclu-
sion can be reached only on the evidence
sworn statements and testimony only-not on
arguments. You try the right of parties. You
are judge, jury and court. If you find there is
further evidence you require you should call
for it and in the presence OF the defendants IN
order that they may answer it. This should
not be proceeded with with undue haste. IL
you were judge or juror you would not
come into court with verdict written out in
advance, perhaps, several years ago.
1t may be said we are trying to put off the
time of this decision. What is the evidence in
favor of the adoption of the resolution? A
comparison of the rates of the Southern Pacific
and Illinois does not show that there is any
real difference. 1t only gives the amounts of
the rates without taking into consideration
the differences attending the construction,
maintenance and operation of the roads. A
mere comparison will not give true basis for
adjusting rates. You Will remember that there
are other roads which more nearly bear COM
parison with the Southern Pacific than the
Eastern roads; there are the Great Northern,
Union Pacific, Northern Pacific and Oregon
Railway and Navigation Company. These
roads show there are lower rates charged in
California than those they have. No roads
anywhere are more expensive to operate and
maintain than those in California.
La Rue-But your grain traffic is mostly over
the level roads in the valleys, which are less
costly to operate than those over the mount
aims, and the valley farmers should not be
made to bear part OF the burden OF maintain
ing the more expensive roads.
Martin-Let me read some figures on this
point from these statements made by Mr.. Cur
It's. eff the Illinois roads were under the same
expenses for operating their lines as the Sopth-
ern Pacific, il would mean decrease in their
revenue of So, 100000. If the Southern Pacific
enjoyed the rates for operating expenses paid
by the Eastern roads, it would save from
IS, SOC, 600 to sc, 900 900, and would have
been able to reduce the local freight rate in
1894 TO IL cents per ton per mile. II we had
the Iowa rates for fuel we should have been
able to return $500 900 to the grain-shippers,
and with Illinois prices for fuel $500, 900
could have been returned to them.o These
facts must accompany all comparisons OF
rates.
If we have not enough revenue to meet our
expenses now what are we going to do when it
is still further reduced? We must either be-
come bankrupt, or reduce some of our ex-
penses. Fuel cannot be reduced.
La Rue-Yes. it can. There is talk OF substi-
tuting oil for coal, and this will make reduc-
ton of go per cent in the cost of fuel.
Marun-That is only a probability of the
future. We cannot reduce the Indebtedness of
the company, and we have to meet the in
terest.
La Rue-Mr. Huntington does not seem to
have any fears about meeting the debts of the
company
Chairman La Rue then read from New
York dispatch published in THE CALL yes
terday, in which Mr.. Huntington is quoted
as saying:
'The Southern Pacific Railroad Com
pany is one of the best corporations in
America. Over $120, 000, 900 has been spent
in permanent way between San Francisco
and New Orleans. We are stronger now
than ever"
In explanation of this Mr.. Martin stated
that Mr.. Huntington was probably not
aware of what was going on here.
La Rue suggested that he thought he
was, and that probably he had been in
formed that the resolution under consider
alton had already been passed.
Mr.. Martin then continued:
What are reasonable rates2
The highest court in the land has decided
that rates must be such as to pay all operating
expenses, fixed charges and yield some return
to the stockholders; how much is not stated,
but they must yield something. When the
power of the State comes in to fix rates, it
comes to this point, ana then its powers are
suspended. To go beyond that would Be the
virtual confscation of the property of the COM
pany, which would be in contravention of the
constitution of the United States.
What does the evidence show in this case?
In 1894 the roads rates did not bring them
enough revenue TO pay the cost of operation
and fixed charges 1t was short about $780,
600, and for the first half of 1895 there was a
deficit in the receipts of the roads, as compared
to the operating expenses and fixed charges of