The Caucasian. (Clinton, N.C.) 188?-1913, 1898-03-24
TuE NEBRA~Kh NANIMJM FREIGHT
RATE DECISION.

TIE NIBEA~hA hANiht VI tEIl'ni
RATE DECISION.
Last week the Supreme Court OF the
United States handed down deCis-
ion in a case that had attracted wide
attention and deep interest. IL is
what Is known as the Nebraska Maxi
mum freight rate case.
In 1898 the Nebraska Legislature
passed n law fixing schedule Of max
imum freight rates and prohibiting
any railroad companies doing BUSH
ness in the State from charging a rate
higher than that fixed in the schedule
on freight shipped from one point in
the State to another point in the State.
The rate fixed by the Legislature
amounted to a reduction Of about 30
per cent. on the rate then being
charged by the roads.
Upon the passage of the law the rail-
roads ignoring and defying the State
courts, went before the Federal Cir
cult Court and sued out an injuDc-
tion against the State putting the
rate into force on the ground that they
could not only not earn a dividend on
such rates but they would actually lose
money. The case was heard before
the Circuit Court and on the facts pre-
scented by the State on one side and
the railroad companies on the other,
the Court made the injunction perma-
nent, with the proviso that at any
time IN the future when the amount
of the receipts of the road above what
was reasonable amount for expenses
should be sufficient to yield fair
profit to the road that then upon such
showing to the Court that the injunc-
ton would be dissolved and the rates
fixed by the State could go into force.
The State appealed from the decis-
ion of the Circuit Court to the Supreme
Court of the United States. The de-
cision just rendered by the Supreme
Court sustains the Circuit Court. The
Associated Press announcing the de-
cision of the Court stated that it was
great victory for the railroads. The
general public so far know moth
ing of the real purport of the decision
save the impression that they have
received through the Associated Press
dispatches. Hence there is considera-
bic public disappointment at the de-
cision.
We have just read carefully the de-
cision in full, and while we had hoped
that the Court would see its way clear
to over-rule the Circuit Court aud sus.
tain the Nebraska statute, yet, upon
reading carefully the decision, we find
nothing to warrant the railroads in
claiming an unusual victory or the
general public in feeling that it i:
hopeless to get any relief against op.
pressive freight and passenger rates
The Court did not say that the rates
charged by the railroads were not toe
high or that they were reasonable
The Court simply held that from the
facts placed before 1t that the railroa d.
the reduction of their rates was a.
great as 29'c per cent, and therefore
that reduction that great could mo-
be sustained. If this is true then the
court is right and the public has nj
cause to complain at its decision. II
seems that it was proven before the
Court that in the case of the Burling
ton Company that its gross receipts
for the year 1898, when this act wa.
passed, from local freights was $1,2i2,
1890, while its expenses incurred in
in the year 1898, the Company made a
clear profit of $30l2G9 on loca
freights. This is profit of abou,
24is per cent. Clearly this profit i:
too large and when the public i:
charged rates high enough to produc,
such a profit the rates charged are
therefore unreasonable and should bs
reduced. But the Legislature, wher
it reduced rates reduced them 29ls
per cent. Under this rate the gros:
receipts of this company would have
been 1915, 905.00, that is 3: s376,5l 90 les:
than it was receiving. Now, in al
much as the profits of the road were
1904 10000, it is clear that the road un
der the rate fixed by the Legislature
not only would not have made bott
ends meet but would have lost S62,
243.00 on the business of that year il
it's expense account was reasonable
From the evidence produced before
the Court the same state of affair:
would have existed with reference tC
every railroad in the State except two
1t was this showing that caused the
Court to hold that the rates fixed by
the Nebraska Legislature were unreas.
onably low.
This writer heard part of the argu-
ment in this important case. We did
not hear it all. We did not know
whether the attorneys for the State
presented any proof to the court to
show to what extent the stock of these
roads was watered and how much OF
their bonds represented speculative
and fictitious values only. We do not
know whether they presented any evil
dence to show that the salaries paid to
the officers of the road were too high
and that excessive amounts were used
for lobbying legislatures and influerc
ing political campaigns, or not. Sure =
ly evidence on these points should have
been presented to the Court, and il we