Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-04-19

10 Ills company, ana tndt the
that such facts had been shown in evil
dence was without foundat ton.
Mr.. Carmack wanted to know whether
the witness was sure that the rebates had
not been given or merely sure that
they had not been shown in evidence.
II am satisfied he replied, that there
is no truth whatever that rebates were paid
as charged"
has the power to fix railroad rates, and he
believed that an act empowering commits
sion 20 fix rates long as they are not
coniiscatory would be held to be constitu-
tonal. He did not think it would be right
legal to have the commission declare
that a railroad company should not earn
more than per cent or any other rate OF
interest.
A Commission to Fix Rates.
Senator Clamp questioned the witness
carefully as to the probable legality of
various plans for empowering commission
to fix rates
Mr. Morawetz believed that a court in
declaring what rate is unreasonable would
determine what rate would be reasonable,
and in that way the railroads would. he be-
ncved, be guided by the decision of the
court in the future and that it would
charge the rate declared to be reasonable.
He felt sure that they would follow that
course.
The definate fixing of rates by commits
sion he said. would make 1t impossible for
the ROADS TO give any elaSJClty TO the rates
to meet changing conditions.
Mr. Clapp asked what objection the
courts would see to have the interstate
commerce commission decide these cases,
and to have the powers of prosecutor
lodged i'm some other t -bunal.
He replied that he thought that would
only cause delay as the verdict of the com
mission could not be final, but would have
to be passed on by a court
During the hearing a photographer came
into the committee room with his comera
and ut o'clock Chairman Elkins said that
If member of the committee objected
the committee would be photographed.
Objection was made and the committee
adjourned for luncheon.
Reasonableness of Rates.
When the committee reassembled at 2
o'clock Senator Carmack questioned the
witness:
II want to ask you what is the difference
between an unreasonably low or confs-
catory rate and an unreasonably high or
extortionate rate Is not any rate above
distinctly reasonable rate extortionate?"
1T Is very difficult to say, replied the
witness. But the courts have undertaken
to state what an unreasonable rate is
Between the extremes of a confiscatory
and an eXtOrtionate rate. he said. there
might be any one of dozen rates that
could be considered reasonable.
Speaking of differentials given to different
ports by railroads. Mr.. Morawetz said that
an advantage for one port over another.
Congress Is prohibited by the Constitu-
ton from doing the same thing by law.
Congress could appropriate money for the
improvement of a harbor and in that way
give that port an advantage but Con-
gresS could not. through a commission,
fix rates that would give one port advan-
tages over another. That would be in vio-
latiOn of the Constitution.
If Congress should regulate the rates it
would have to see, not only that the rates
should not be too high and extortionate,
but also that they should not be too low
not only to avoid making them confiscatory
but to avoid giving one port advantage
over another.
country" Mr.. Morawetz said strictly ac-
cording to distance the result would be to
destroy three-quarters of the industry of
this country, and in that way this whole
question would be settled"
You don't believe in settling them that
way?' queried Mr.. Carmack
l do not replied the witness.
IF Congress should pass law making
the rate on grain from Chicago to New
York - cents and from Chicago to Balti-
more Il cents, would that be violation
of the provisions of the Constitution o.
asked Mr.. Carmack.
IF you should amend that question" he
replied. "and make the rate to LIVERPOOL
l would say yes it would be a violation.
stopping at the seaport towns there would
then be the question of the difference in
cost of getting the freight through the ports
and there would be Il difference in ocean
rates. But if the rates were direct to Liver
pool then ii would be clear that the three
cents difference in favor of New York
would be equivalent to a direct bounty in
favor OF shipping by New York"