Kansas City journal., 1898-03-09
Tho Foolish Raid on Kansas Rail-
roads.

able explanation Of the reduced hours of
work at the Santa Fe shops is the fear Of
an extra session Of the legislature and a
raid on the railroad interests Of the state.
There is nothing to be gained by this sort
of knitting of the railroads and there is no
public clamor for such legislation at this
time. yet the fear of it is kept alive by
the governor. When the railroads were
paying dividends on an excessive capital
consisting largely Of water, the demand
for legislation reducing charges was prac-
tically universal, but competition and the
stress of the times brought down charges
and they are now too low to produce a
dividend on valuation on the basis Of
reproduction Of the property.
The railroads Of Kansas are paying high
er taxes and lower rates Of profit than
any other business interest In the state.
Stockholders have been waiting for re-
turns on their investment SO long that
many Of them regard the outlook as hope
less. 1t has pushed the managers hard
to pay interest on their bonded debt Mean
time rates on shipments in and out Of
Kansas are lower than in nearly any other
Western state, and materially lower than
In Iowa, with its maximum rate schedules
reducing charges on freight carried from
one town to another within the state and
forcing an advance on charges from
towns in the state to towns outside the
state, and the reverse. Rates from To-
peka to Chicago are about on a par with
rates from Des Moines to Chicago. So
long as such conditions stand there will
be an increasing tendency for land values
in Kansas to approach those in Iowa, not
withstanding the nearness of Iowa to the
markets of the world. The fundamental
thing in the rate question as related to
maximum legislative regulation is the
fact that the legislature can regulate in
side the state alone; it has no authority
or power when state lines are crossed. 1t
cannot touch rates from Chicago, st.
Louis. Galveston or Kansas City to any
Kansas town, or the rates from any Kan
sas town to any of these cities of other
states. And more than 80 per cent Of all
Kansas railroad business is of this inter-
state class. and less than 10 per cent is
exclusively within the state II the legis-
lature reduces rates within the state 1t
can reduce charges on less than one-tenth
of the railroad business of Kansas ship
pers, but the railroads will eventually
make themselves even, as they have done
in Iowa. by raising charges proportionate-
ly on business in and out. increasing rates
on over 80 per cent to compensate on losses
ON less than 10 per cent.
There Ii not railroad man in Kansas
who Is not interested In this proposed raid
on the Kansas roads to satisfy the hobby
Of Governor Leedy. Every employe Of the
shops in this city will be affected. The
fear Of legislative tinkering with rates
has caused the Santa Fe to retrench in
order to meet the threatened injury and
the shop employees in this city have al
ready felt the consequences of the deter
mined purpose of demagogues to loot the
railroads Of the state for the supposed
benefit Of the producers and shippers. who
will be positively damaged and not bene-
fitted by such legislation as the crude
craftsmanship Of Governor Leedy has at
tempted to force upon q reluctant legis-
laturs.
Nebraska Freight Law Invalid.
From the Chicago Tribune.
From the Chicago Tribune.
The supreme court Of the United States
has at last given decision in the Nebras-
ka maximum freight rate case, which was
argued last May. William ]. Bryan ap-
peared before the court at that time and
made an elaborate and, as the result
proves. an unsuccessful argument in sup
port Of the railroad law which the court
has decided Is unconstitutional.
Five years ago the Nebraska legis-
lature enacted law regulating the rates
on local freights-on business done exclus-
lively within the state. The roads which
were affected attacked the validity OF the
law on several grounds. the principal one
being that the rates fixed by it were un-
reasonably low, and that therefore the
state was seeking to deprive them Of their
property without due process of law"
Two years ago Justice Brewer, sitting in
the circuit court. enjoined the state officials
from attempting to enforce the law on the
ground that the proposed change in rates
was too great. He estimated that the re-
duction In freight rates would be almost %
per cent. He deemed such q reduction un-
reasonable.
At the same time the Justice stated that
no rule had been laid down by the supreme
court by which the reasonableness Of rates
should be Observation-Disclosures the basis
of computation should be what It had cost
to build q road or what 1t would cost to
duplicate 1t now. In his argument before
the supreme court Mr.. Bryan contended
that the latter basis was the one to be
adopted.
The supreme court holds that the law Is
contrary to the constitution in that 1t au-
thorizes 1.-The taking Of property without
due process OF law" That Is, it holds that
the maximum rates provided for in the law
are unreasonably low.
There is no doubt the rates fixed were
too low. The Populists controlled the Ne
braska legislature in 1893 and they jumped
at a chance to hit the railroads hard. But
| they overdid the business, and this partic-
ular law, like so many others the Populists
have enacted, could not stand a judicial
test.
Significant Language.