The times. [volume] (Richmond, Va.) 1890-1903, 1898-04-05
IGNORANCE IN HIGH PLACES.

states about a year ago BY Mr.. William
j.. Bryan. in support OF the act OF the
Nebraska Legislature. This act author
lied the railroad commissioner Of the
state TO name the highest rate the rail-
roads Of the State were TO be permitted
TO charge for freight transported within
the limits Of the State. The railroads at
tackled the law as repugnant to the four
teonth amendment of the Constitution OF
the United states. which forblds a state
TO deprive any person Of life. liberty or
property without due process OF NV.
in the course Of the argument Of the
case Mr.. Bryan contended that a road
than what would produce a reasonable
interest upon what the road could be
reproduced for. One OF the Justices asked
him &c no allowance was 10 be made for
money that had been spent. whether
wisely or Mwisely, in the construction OF
the road. and he replied that no allow
ance was to be made; that the cost Of re-
production now was the test.
We pointed out at the time that this
J Justice had no more conception Of the
true principle involved in the case than
Mr.. Bryan had. and that neither of them
had any more conception of it than a
horse. That the principle upon which
rates are to be adjusted is that the carrier
is to charge just what the freight will
bear. and that what the freight will bear
is the lowest charge consistent with a
reasonable profit to the carrier, because
carrying freight is nothing but the sale
Of transportation. and whoever has any
thing to sell. sells Il for the lowest price
consistent with n reasonable profit, be-
cause money is made by O great volume
Of sales at small profits, rather than by
| small sales at great profits, and tho bust
ness grows as the price falls. That this
lowest price may not be fixed in a day,
| a month or a year. but that tho law Of the
case, operating steadily and all the time,
will bring the charges down TO that point
| after awhile, If the carrier is not inter-
fered with by bungling public officers ex-
ecuting a m%isconceived law.
The Supreme Court decided the case a
few months back. and It adhered TO a
very foolish rule adopted by 1t contem-
poraneously with Chief Justice Waitc's
advent TO the bench. in which it held
that the public might regulate the charges
of all business that was affected by a
public interest. and that the rule in reg
ulating the freight charge should be that
il must be a reasonable charge.
The New York Evening Post, which is
conducted with great ability, in the main,
throws up its hat and a%pplauds this last
decision in the Nebraska case, maintain
ing, as it does. the old and foolish rule,
as a noteworthy curb upon the excuses
Of Populism and a wise and just rule in
itself. We cannot refrain from an ex-
preston Of surprise that a journal so
able as the Post IS should be misled into
a~pplauding this decision. The point in 1t
is that the judiciary is TO judge in every
case whether a particular rate is reason
able. But how can the judiciary do this
any more than a traffic manager a
The Post says:
If we ask how the Court undertakes
to determine what are and what are not
reasonable rates the answer is by the
same means that a perfectly just and
omnipotent ruler would decide such a
question. The cost Of the railroad. its
running expenses. the average returns
on similarly invested capital are all TO be
taken into account, and the Court then
decides whether the rate is fair or un-
fair
But we say that the ruler must not
only be just and omnipotent to fix the
rate at what it should be, but he must
be omniscient also. IL will not do TO
have the spirit Of fairness and power
alone. The party arranging the matter
must have knowledge also if he is 70 do
justice. Imagine a traffic manager asked
to give q rate upon a carload OF horses
from Richmond TO New York. He looks
over his table Of rates and finds no rate
for horses. He must make one. Now the
Court says it is to be done by referring
to the cost of the road. its running ex-
penses. the average return upon similarly
invested capital, etc, and when the traffic
manager has grappled with these ques-
lions q few hours, he binds his head up
with his handkerchief, and tries TO sleep
of his mental agony. The Court would
do the same thing unless it had omnis-
cience along with its justice and power.
The true theory is this; When the
traffic manager considers the case, he
asks what is there in the business? II
the shipment of horses TO New York
promises 10 grow into a considerable bus
mess. he puts the rate as low as possible,
so as to encourage it's growth. If there
are TO be no other shipments, he charges
all he thinks the shipper will pay. In
other words, he brings the case under the
all-prevailing aw Of supply and demand.
The Chesapeake and Ohio railroad brings
an immense tonnage from the West to the
seacoast. but it has 10 carry back a great
many empty cars. 1t will take freight for
these cars for almost nothing. But bring
ing freight TO the East II charges all hat
the freight will bear
This matter was admirably illustrated
by an interview we know OF between the
president Of a railroad and the traffic
manager since the Supreme Courts de-
oislon. 1t occurred almost literally as