The times. [volume] (Richmond, Va.) 1890-1903, 1897-04-14
TUE RULE FOR FIXING FREIGHT
RATES.

Mr.. William J. Bryan appeared before
the Supreme Court OF the United states
some ten days back to argue in support
Of the constitutonality of an act OF the
Nebraska Legislature. providing that the
Railroad Commission Of that State might
prescribe the highest rates that the rail-
roads could charge. and make their regu-
lation binding upon the roads. lie laid
down. as the fundamental proposition 10
guide the commissioner in determining
what this rate should be. the following
proposition. lie said: "The present value
Of the roads, as measured by tho cost OF
reproduction, is the basis upon which
proht should be computed" and, when
asked by the Court II he meant that
"reasonableness in rates must be deter
mined by having regard TO the present
value OF the property, and not by having
regard to the amount of money put into
It.. wisely or unwisely' Nh Bryan
answered. "Yes; whatlt would cost 20 re-
produce it,"
The New York World has been possibly
the most active Of all agents for spread
ing Populism among tie people. thus
presenting TO the co-Auy the dangerous
issues that now confront d., but even the
New York World is unable 10 accept TINS
proposition as sound political economy.
1t says:
1.-THE World must regard this as OK
IRENE and untonable ground. The cost OF
reproduction ina the case OF railroad is
subject 10 periodic change. A railroad for
which there WAS a legitimate public de-
mand, built with honesty and economy.
when the steel Trust held up tho price OF
rails. could have been reproduced for much
less money few weeks since. when the
trust went TO pieces and the price OF rails
dropped. Would IL 10 just 10 subject
road built under such circumstances. ana
perhaps barely able 10 pay ITS expenses
on the basis OF charges fixed accordingly
10 an arbitrary reduction by the Lcslsla-
turc to the basis OF cost Of reproduction
Temporarily established through the
breaking Of a rail trust?
il Mr.. Bryan's contention IS sound. why
should not a railroad bee permitted TO adj
vance It's charges whenever an increase in
the cost Of material. OF even of right OF
way, made IL impossible 10 reproduce the
road at anything like its original cost?
ones that Will not work both ways?
The Government. national or state or
both. ought in protection of the people TO
prevent discriminating or extortiona;e
rates. But the basis upon which the rea-
sonablencss Of charges shan be fixed
should IN justice include some regard for
the money honestly put into the construc-
tion and equipment of The road and also
the money required for us legitimate ope-
rating expenses
Most people think the ruling principles
that should determine the rates 10 he
charged by railroads are as stated by the
World. Tho bill I'm equity upon which
the recent traffic case that has created
such a stir. was heard by the Supreme
Court Of the United States. contained an
ayerment that the roads in the Traffic
Association had "doclrcd 70 fix or os-
tablish rates and prices for the carrying
OF froights based upon the cost OF con-
structing and maintaining their several
lines Of railroad" This is an expression
OF the Worlds view Of the case. but IL
s. Just as far from expressing the true
idea Of II as Mr.. Bryan's is.
The true principle upon which rates are
20 be adjusted IS that every article is TO
be charged what II Will bear. What It
will bear Is the lowest rate consistent
with a reasonable profit TO the road.
That is the economic law Of the case.
and every railroad. and every other bust
ness win come 10 be governed by IT, If
the road or the business IL left alone