The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1906-09-13
STUBS COMES BACK.
Replies to Balie Waggenerss Recent
Letter.

! NHdRk6IlEE ;
/ lenge to produce the opinion of law
yer that the federal charter law could
/ be enforced, but comes back with a
| counter challenge to the effect that
/ say that the congress has not the pow
| er to compel a railroad corporation to
1 take out a federal charter.
The following IS Mr.. Stubbs' letter:
| THE federal charter for corporations
| engaged in interstate commerce seems
/ to have struck a tender spot in the
| hearts Of the corporation attorneys
| One of them used a column and half
| of the Kansas City Star Sunday morn
! ing trying to convince the public that
| such a law would be unconstitutional.
! He referred to Webster, Marsh all,
/ Taney and other eminent lawyers, but
! failed to quote one single line from
any one of them to prove his case. He
was tremendously wrought up about
/ the Santa Fe railway and asked II
Stubbs proposed to conhscate that
property.
His pathetic appeal for the widows
and orphans who own the Santa F'e
stock his outburst of indignation at
the thought of Stubbs deceiving tn e
! people, and his dramatic finish in dis
! cussing the possibility of Stubs being
elected United States senator when he
exclaimed, Think Of it, spirits OF the
immortal dead, save us from such
humiliation would not be surprising
if it came from some cheap. pettifog-
/ ging lawyer. A man who claims to be
a great constitutional attorney. presi-
dent of a national bank and knows
that a federal law such as is proposed
along the same general lines as the
1 national banking law. insofar as the
issue of stock and the assets Of the
corporation are concerned, would not
and could not confscate property,
! places himself and the vast interests
| which he represents in a ridiculous,
! pettifogging and trifing attitude with
reference to one of the most important
ryf4 hafn ha
/ The widows and orphans who own
| stock in the Santa Fe under federal law
| would have the very same protection
| that stockholders in a bank would have
| under similar conditions. They would
/ be asked to reduce the amount of the
capital stock of the corporation until the
/ intrinsic value of the property over and
above all liabilities was equal to the par
! value of the stock. Not one dollars
/ worth of property would be destroyed.
Every stockholder would own exactly
the same proportion of the whole prop
erty and the whole property WouM have
exactly the same physical power to earn
dividends and the same actual value.
The net result would be the water
squeezed out of the stock and a federal
instead of state charter.
IF the federal charter is preferred by
the corporations. as their attorney rep
resents. then the only possible objection
is the release Of the water from their
stock
This is a plain business proposition.
There is nothing profound or mysterious
or very complicated about it. The Unit
ed states constitution is plain, positive
and direct. 1t states that congress has
the power to regulate commerce among
the several states and the further pow
er to provide for the common defense
and general welfare Of the United
States and also states that congress
can make any laws necessary and proper
for carrying into execution the forego-
ing powers
Now if the federal charter is sneces-
sary and proper in regulating COM
| merce among the several states, and
will promote the general welfare or
the people of the United States, the
CONGRESS has unlimited power to COM
pel all corporations engaged in inter
state commerce to take out federal
| charters. Does 1t require a profound
constitutional lawyer, or corporation
| attorney to determine whether or not
a federal law that would take from a
| corporation the right to issue unlim-
tied millions of bonds or stocks for the
/ purpose of buying up all OF Its COM
petitors and thereby destroy cOmpetl-
ton in transportation, in steel, in oil or
/ any other commodity, is necessary and
| proper in regulating commerce?
Cannot the ordinary business man,
banker or farmer understand Whether
| or not it is necessary and proper and
| whether or not 1t Will promote the
general welfare for these same cor
| DOratfOnS to issue ana Q1Vl0G up among
| the promoters of the scheme million
or so millions or 500 million dollars of
| stock, which does not represent any
| value whatever, that has entered into
! the cost or construction OF the prop
| erty and then increase the price of the
4 commodity pay dividends on this wa
! tered stock and finally unload it on the
| widows and orphans and then appeal
| to the public in their behalf?
| "A safe sound, conservative remedy
/ that has the advantage OF having had
! thorough practical test in our national
| banking system is available
"A national bank cannot issue stock
| in excess of its valid assets; 1t cannot
| increase its capital stock and buy out
its competitor without the consent OF
the federal government. II opeys the
law and the law is wise and intended
| to protect public interest and promote
the public welfare. The same kind Of a
law would control corporations engaged
| in interstate commerce as perfectly and
| completely as the national bank is now
| controlled
"a federal charter providing that all
| stocks, bonds and securities be issued
| under the direction and supervision OF
the government and that the par value
of the capital stock shall not exceed the
actual value of the property in excess
of al liabilities and providing further
that no stocks or bonds shall De issued
for the purpose Of buying or controlling
a property that Is engaged In competl-
ton with the corporation, without the
| consent OF the government anu pFOfiu-
ing further against all rebates, favors
and Determinations of every kind, with
/ a final provision that for the violation
of the terms of the charter it shall be
revoked and receiver appointed to op-
crate the property would place the cor
porations of this country on a sound,
| satisfactory basis where the govern
nlent could exercise over them the con-
troll that the United States constitution
coutemplates. I hereby challenge any
corporation attorney to furnish the
| name Of any constitutional lawyer with
| a national reputation. whose interests
ara not identified with the corporations,
who will state over his own signature
that congress has not the power under
- 80.