The San Francisco call., 1904-06-09
CORPORATIONS AND THE PUBLIC.

Gates Af public ownership and operation of public uti
ties 1t has been often said that if the Government
does ownership of the property of corpora
tons the corporations will the Government that
shallow thinkers have to assume it to be true.
1t is time to call bill of particulars. What great
of legislation, Federal State, have the corpora
tons secured that have been of injury to the
people? The beginning of the kind of legislation COM
planned of the Credit Mobier of Congress. In
the original Pacific Railroad bill the Government re-
tanned a first mortgage lien upon the bonds which it
issued for the construction of the roads The Credit Mo-
bier secured legislation that first lien into
second mortgage freeing the credit of the roads that
they borrowed private capital secured by lien senior
to that of the Government.
When the roads were finished and the country was
getting the benefit of them this matter became pot-
cal issue. 1t drove Oakes Ames. James Brooks and
Colfax of public life 1t entered into Presiden
tia campaigns. 1t threshed out the stump and
in the press But the end the United States back
every dollar of its loan with good interest The second
mortgage bonds of the United States the Central Pa
cihc road amounted $2s,oooooo. To get the money
for construction that sold by the corporation
for $18ooo,ooo. But the Government finally paid
S67oooooo for of $25oooooo and the corpora
ton paid back $4o,oooooo than it got for the
bonds.
Did the people suffer any loss in that transactionl
The corporation lost heavily. Had borrowed $4,000
of private capital the high of interest which it
the debt a much reduced But it had to stand
the loss of S7oooooo discount the bonds and pay high
interest $25,ooo,ooo. 1t losing investment for
the corporation but good for the treasury of the
United States. So it about that in the first
action which politicians said proved that corporation
owned the Government the Government made money
and the corporation lost
Since then there no law of Congress that can
be honestly said to have put the Government in the
power of corporations worked the disadvantage of
the people. On the other hand have the interstate
commerce law, which the broades assertion of the
command of transportation corporations by the Govern
ment; and the Sherman antitrust law, which extends
the principle to all manufactures and commerce.
The courts have responded clearly and closely the
spirit of such legislation, and have the highest ju
dica decisions in every brought by direction of
President Roosevelt up that which dissolves the
road merger.
So, far the Federal Government is concerned,
there total lack Of evidence that the corporations
control it. The pessimists and advocates of public
ownership therefore driven back upon State egis
ation for proof of their jeremiads Where is it?
Take State, for example. The great ques-
ton that for years kept politics in a the
taxation of the railroads. The Federal decision
in the San Mateo vtated the of rail
road property. Every clear-headed layman. to say
nothing of lawyers knew the assessment was legally
void The railroad did just ndividuals>do when sub
ject illegal 1t fought payment in the
courts and Then of its motion it asked the
Legislature to give the necessary authority for retro
active assessment and openly introduced its bill for
that purpose. Immediately this denounced as
railroad and bill representing the nti-corpo
ration party substituted for it and passed When
the assessment was made the discovery resulted
that the road would have paid much larger in
under its bill than it did under the anti-ra
road substitute. So that incident closed But while it
vital issue it put evidence prove that
the corporation owned the State The fact is that our
Legislatures have shown vgor than wisdom in
demonstrating their virtue and independence of corpo-
rate control
questions corporations have to resist mere
cinch bills and what in England called Parlia-
mentary fund in doing it. Under the English system
however has arisen method superior to any so far
reached here The great fnanciers railroad builders
members of Parliament If they legislation
they ask for frame and give for it. 1t
will be that this the greatest publicity for
such legislation and its purpose Here methods of
party management practically outlaw the presidents of
corporations from public life The only instance which
recall in which one has been sent to Congress was
the election of Governor Stanford to the Senate while
he was president of the Southern Pacific.
1t is quite worth while to give study the sug
gestion that of outlawry be rescinded and
that men the head Of great be permitted TO
appear as legislators 1t might take all the strain out
of the relation of corporations the public If Gould
Hartman Ripley or Rockefeller to stand I'D in the
House Senate and give for against egis
lation they would be brought face to face with the
people, instead of being suspected of staying the back
ground and inspiring covert advocacy opposition in
regard to proposed legislation.