The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1905-11-02
RICHARD OLNEY ON
RATE REGULATION
CONSERVATIVE DEMOCRATIC
VIEW OF THE SITUATION.
A Belief Expressed that Government
Regulation Would Be Step Toward
Government Ownership, Which MI.
Olney Finds Objectionable.

New York-The reply of the con-
servatlve wing of the democratic party |
to w. J.. Bryan IS recent open letter to
the president on railroad rate legisla- |
tion is contained in an article by Rich |
North American Review. In what is !,
practically his first public utterance in
two years, Cleveland IS ex-secretary Of |
state. presents his final Judgment |
against the. proposed legislation, in the
form Of brief, covering not only the
law, but the public policy involved in
the agitation. The following are some
OF the salient features of Mr.. Olney's |
argument:
The Importance Of the rate-making
power is not to be considered simply
IN its relation to the carrier The most
important bearing Of the power is upon
the. public interests the carrier serves.
1t IS a matter Of common knowledge
OF which the courts take cognizance
without proof-that the great carriers
OF the present day are the railroads. 1t
IS equally matter of common knowledge
that the rates charged by the railroads
| affect all classes Of the community;
that they determine very largely the
outcome OF all private enterprises, and
that upon. them hinges only too often
the material wellbNng, if not the very
existence, of towns and cities and sea-
| ports and large sections of the country.
Surely power, the exercise of which
is fraught with such consequences, is
not to be classed legally or practically
with the power of determining the 'cnp
quality of teas. The latter may well
pc delegated to an executive officer or
board. But to delegate the former, the
ultimate rate-making power for rail
roads, to such an officer or board. would
be surrender by the legislature of one
OF It's most important functions. -
AS to Government Regulation.
In discussing the effects of govern
ney says:
1.-The situation to be anticipated then
is that railroads, private properties and
representing private investments aggre-
eating billions of dollars-will find
themselves. controlled in the vital mat
ter, Of their charges; not by their pri-
vate owner, but by two public boards
and the other of national interests,
and both antagonistic to the interests
of the private owners concerned. The
two boards will aim at the lowest pos
sible rates, each in behalf of the partic-
ular business under it's charge, and will
therefore be in constant rivalry with
4 each other in the endeavor to extort
l from the carrier the best service at the
/ smallest cost. Under these conditions
anything like skilful, just, reasonable or
stable ratemaking becomes impossible.
! A situation is created intolerable alike
to the carriers and to the public, and
the sure outcome-unless the whole
scheme of government rate making be
abandoned-is government ownership.
Government Ownership of Railroads.
Government ownership of all rail
/ roads is obviously the goal toward
which some of the government rate
! welcoming it. and not working for it,
! profess not to fear it and claim that it
:, would at all events be an Improvement
upon the present statute. Both point to
existing instances of government owner
ship of railroads-the one claiming that
the results to the public are distinctly
favorable, the other that they are al
declared. But when government owner
' ship of the railroads of the country il
: seriously considered our dual politica
e system is at once seen to present prob
S lens of the gravest character. The few
$ and comparatively qniim1portant rail
roads that are, wholly interstate
may be properly ignored. Every
: gagged in both kinds of transporta
a tion.-in transportation that begins ant
n ends in a single state, and in transpor
e tation that passes beyond state lines
: Hence, if government ownership OF rail
. roads be regarded as the inevitable Sc
quence Of government rate making
d the first question is, which govern
e ment is it that is to own the railroad
S the state or the United States.
= Railways Likened to Highways.
:. "The significance and Importance o
r, the inquiry,''- continues Mr.. Olney, ear
d apparent if we remember that the rail
u road is only one species OF highway
u and that what is true of railroads mus
i be true of ordinary highways. The Ju
: risdiction of the national government
IS must be the same in both cases. If it i
e competent for the national government
( under the commerce clause to own AM
l. operate all the great railroads of tn
II country it must be also competent TO
IA it to own or control and operate all tn
u great highways Of the country.
~ eff it is by any possibility true tina
= the national government has bee
granted any such powers-that as re
= spects every road or street in the coun
~ munication, the national government
=, may at its option take complete pos
session and control, may direct tn
-" modes of it's construction. it's grades, tn
. sort of vehicle by which it may be use
~ may, in short, assume it's entire man
" agement and operation in all the mos
:, minute details-nothing could be NOR
~ revolutionary in practicc--nothing NOR
ie contradictory of the views customaril
held. 1t is necessary to consider mos
carefully, therefore, whether the pow
ers in question are actually conferre
on the national government-it bein
conceded, as it must be, that the powe
can be deduced, if at all, only from tn
g commerce clause of the constitutions
'e In summing ND the opposition to tn
/ proposed legislation, Mr.. Olney reache
1t the following conclusions.
lie 'Ours is a government in both stat
and nation by political parties and t
political rate making for railroads
rate making by politicians animated b
partizan motives and working for pal
titan ends--the objections Of economi
a and business character and on the scor
d Of public policy generally are as OK
IS vious as they should prove inseparabl'
,e tssThe purpose of the present pape
of is to POINT out that, beside such obIet
tions, railroad making by the ne
tional government presents legal an
" constitutional difficulties OF the mos
1 serious character. It raises issue
- between the several states and TIL
~ United States; which have not bee
~ fully and finally passed upon by tn
IN national supreme court, and which,
=. submitted to that tribunal half or eve
= quarter of century ago, would /
all human probability have been dt
termined adversely to the Jurisdictio
t3l of the general government. -