Evening star. [volume] (Washington, D.C.) 1854-1972, 1899-09-12
The Claim Of the. Commercial Gable
Company.
WESTERN UNION A MONOPOLY
Its Franchise Derived From the
Spanish Government.
CONG RESS TO ECID E

An important question which undoubted-
ly will be brought to the attention of Con-
gress at its coming session relates to the
extension of the Geographic facilities OF
Cuba At present the cable connections
between that island and the United States
are controlled absolutely by the Western
Union Telegraph Company. That corpora
ton enjoys a monopoly in this important
respect through an exclusive grant obtain
ed from the former Spanish government in
the island This grant was obtained about
thirty years ago, and the Western Union
Company has done all the telegraph BUSH
ness Of the island ever since. That the
business has been most lucrative is evil
denced by the recent boast of one of the
leading spirits in the enterprise that the
Cuban cable has been the most profitable
cable line ever constructed. That such is
the case may be readily accepted as fact
when the high rates are considered. Until
comparatively recently the tolls were S4
for message of ten words between Ha-
vana and New York, and So for messages
of a similar length between New York and
other points in Cuba.
Since the appearance in the field of
possible competitor the company has re-
dUced it's Cuban telegraph tolls one-half.
but even with this concession they may be
re reasonably regarded eXtortionate when
the shortness of the line between the
United States is concerned and comparison
is made with rates charged for its land ser
vice and the rates charged by other cable
companies over much longer distances.
Commercial Cable Company's Effort.
Just after the close of the Spanish war
the Commercial Cable Company, better
known as the Postal Telegraph Company,
made an effort to share in this business by
extending its lines to the coast of Cuba 1t
purchased property there and made ar
rangements for the establishment of ca
BILE landing station The United States
military authorities being then in control of
the island, application was made in due
form to the War Department for permis-
sion to land its cable On Cuban territory
The application received favorable consid-
Grafton, and would undoubtedly have been
rented but for the determined opposition
OF the Western Union Company.
During the consideration of the question
Congress passed the act prohibiting the
granting Of franchises in Cuba. The West
ern Union Company filed a formal protest
against the landing of the cable of the
Commercial Company, with the result that
the matter was referred to the Attorney
General for an opinion as to the pJwers of
the Secretary Of War in the premises. The
Attorney General rendered an elaborate
opinion reviewing the question in all its
aspects, and held that under existing condi-
lions of government in Cuba the Secretary
of War had No authority to grant the de-
sired landing privilege. Secretary Alser.
who was at the head of the War Depart
ment at the time, accepted this opinion
binding upon the department, and notified
the Commercial Company in effect that it
could not land its cable in Cuba.
Has Not Abandoned the Field.
There has been no material change in the
situation in the meant me, far the
War Department Is concerned, and so far
as known Secretary Root has given no in
dcation of a purpose to reopen the case
The Commercial Company has not aban
doned the field by any means, however, and
there is every prospect that determined
effort will be made to secure legislation
which will enable the company to acc M
plsh its purpose. In the hope Of pTocur ng
a reconsideration Of it's application by the
executive, the company has, however, filed
with the Secretary OF War formal state
ment of its side of the controversy. AT en-
ton Is called to the advantages accrulng to
the government by the proposed cont act
with the Commercial Company. viii h
asked no aid from the government, but on
the other hand bound itself TO place the
cable at the service of the government, al
lowing it to fix its own rates for transmIs-
sion Of official messages. Another clause
in the contract provided that the United
States at any time it desired might take the
title to the cable, paying the company the
appraised value OF the line.
The company argued that the Western
mon Company has no rights in the prem
ises beyond the franchise granted by the
be illegal, on the ground that it was OBJ
tained through misrepresentation. 1t was
also claimed that the franchise was no
more binding upon the United States gov
eminent than other similar Spanish grants,
one OF which, relating to the carriage of
slaughtered animals, after an existence of
nearly two hundred years. has been abro-
gated by the United States since its mill
tary occupation of Cuba
The Secretary of Wars Power.
biz,
of their claim that the Secretary of War
has full powers to grant the permit to land
the cable in Cuba, the statement of the
Commercial Company says, in part:
Whatever the power of the Secretary of
War may be in time of war, this is time
of peace, and in time of peace wherever the
American flag floats there law prevails and
not arbitrary power.
IF our proposed cable were about to dis
turb the peace or create monopoly, or in
terfere with trade or obstruct navigation,
the government might legally forbid it, but,
inasmuch this cable will destroy the
monopoly and will aid trade and will .tacili-
tate commerce, We deny the legality Of pro-
hibition by the government against the
cable being laid. In your letter you refer to
the act of Congress which prohibits the eX-
ecutive department from making grants in
Cuba. But that act does not prohibit a
cable, which We propose to lay withou any
grant whatsoever. The act was passed to
limit the power of the Secretary of War
and not to increase it.
I'VE have accepted in writing the post
read act of Congress of 1866. BY so doing
we are authorized by the terms of the act
to lay our cable under all navigable waters
OF the United States. The act controls the
United States government everywhere 1t
binds the United States government when
ever and wherever the government rs in
control of navigable waters. If such CON
troll is temporary this act of Congress an
plies and continues, so long the control
continues" - -