The daily morning journal and courier., 1907-06-22

curb them with wisdom and without prejudice. with equity and without pas sion. Never was it more desirable, and for the welfare of the whole people, that their representatives should avoid demagoguery, rise above class pander- ing and be influenced neither by a vim dictlve spirit nor an unfair desire for political advantage.
 It was too much to hope that such problem as this could be approached with perfect wisdom and fairness. The railroads in many cases had been con trolled by operators whose attitude to- ward the public had been very far from what they hoped the public's attitude would be toward them. They had fur nished good ground for passion, preju- dice and unfairness to flourish in when the public or the publios representa- tiVes should at last set about the regu- lation of the railway situation. In view of all that has been done and has been omitted by railway managers, 1t is per- haps not surprising that there has come Into the field of railroad legislation and regulation, much vindictiveness, unfairness and haste. It is perhaps, not to be wondered at that there has fin some quarters been disposition to get action, first of all, and discuss the jus tica and wisdom of the action after ward; to show results, to make exam ples of wrong-doers, to meet arbitrary and unfair practices, with arbitrary and unjust legislation,
 Indeed, I believe the historian of some future day will, while recognizing the evils of some phases of the rail- road management in our time, see that | those evils were almost the inevitable result of this hurried development, this , enormous growth. Such historian will recognize that the railways passed ] through an evolution that had no pre- cedence to guide 1t; that the evils now complained of were mainly the inevita- ble results of the necessities that rail way managers were under, It will be taken into account that law-makers had forced the railway systems to de- velop under false theory that rail-
 ways con be controlled and regulated
 by competition, although in their econ onic nature we are even now beginning
 to see that they must ecessarlly be 1 largely monopolistic.
 The historian will see, believe that
 in the main, what is bad in our present railway system has been natural and inevitable result of environment and legislation. He will see, too, (that the attempts to regulate although some
 tines crude, sometimes vindictive and predatory, sometimes harsh and un- 1 fair, will have been on the whole, work ing toward a situation in which right principles, more clearly understood, and correct commercial ethics, more gen. erally perceived, came into more dom- 1 inant control He will see that both leg- islation and the public attitude were af-
 ter all about all that might have been reasonably expected considering what
 the public had encountered.
 At the present moment, however, we are in the very midst of the dilemma.
 The holders of railway securities had i been profoundly shocked at the possi- Utilities which the future unfolds to them. If legislatures can. without in- quiry or opportunity for protest, re- drce to any point that politician | feels is personally desirable to him, the rate railway may charge for its ser- vices, then the term security is no | longer to be applied to the obligation of railway company
 The overwhelming possibilities that might lie in unfair legislation were be- 1 ginning to be borne into the minds of l investors, and the timidlty which that understanding brought, was added to the worldwide money stringency which
 has already been mentioned.
 ] At the same time, a third factor of importance was evolved. The public had had it's mind infamed by thousand magazine broadsides on political and e mmercial graft. Many of these artl- cles had some foundation, but in many cases they were exaggerated or were
 used to point general conclusions that were not warranted by the development
 of specific facts, The public had had it's confidence shaken and it's suspicious
 aroused in regard to the integrity and
 good faith back of the actions of all
 men in positions of power and influence either in the field of politics or of l finance.
 1 On the other hand, railroad managers | had not always seen clearly their re- sponsibility as trustees for all the se- curity-holders whom they represented. | oko aJ bniv
 fiduciary responsibilities. While show l ing an all-encompassing genius for the development and management of the properties which they controlled, 1t
 was not, perhaps, unnatural that they
 created as their own, for without their genius and financial strength it would
 not have existed. Tn any event, prac-
 tices had grown up on the financial | side of the management of properties that were open to some of as sharp criticism as lay against the operating
 side. These practices had grown up
 from much the same causes as had the
 bad practices in operation. The devel-
 opment had been too rapid, the growth was too rank. It was impossible that | securities coulu be 'lssueu III all out coming stream where one million dol lars was the unit and a hundred mill lions not an extraordinary figure, with
 out some laxness developing. It was
 morally impossible that financial de-
 velopment so rapid could go on with
 out mistakes being made or practices 1 rowing up that would be open to crlM-
 oism. And so public, with It's sus-
 picions of everyone and everything all