The Cairo bulletin., 1907-05-31
URGES FEDERAL CONTROL
Concluded from First Page)

lating roads to destroy property with
out just compensation or without due
process of law.
| AS a matter of course, we shall pun
ish any criminal whom We can con
Wet under the law; but we have no in
| tention OF confounding the innocent
many and the guilty few by any i'll
judged and swe ping scheme of ven
geance. Our aim is primarily to pre-
vent these abuses in the future
! Wherever evil doors can be, they shall
| be, brought to Justice; and no Grim
! inal high or low, whom we can reach
| viii receive immunity But the rights
Of innocent investors should not be
ieoDarded by legislation or executive
action; we eaDction no legislation
which would fall heavily on them, in
stead of on the original wrongdoers
or b neficiaries of the wrong
Rumors Of Water" Mot Supported.
There has been much wild talk as
! to the extent Of the overcapitalization
Of our railroads The census reports
on the commercial value of the rail
roads Of the country, together with
the reports made To the interstate
commerce commission by the railr-
Dads on their cost Of construction,
fond to show that as a whole the
railroad property Of the country Is
worth as much ais the securities III u,
resenting ii, and that in the consensus
Loo opinion Of investors the total value
of stocks and bonds II greater han
their total face value Notwithstanding
the water that has been inject d tn
particular places
The huge value Of terminals, the
immense expenditures in recent years
IN double tracking, improving grades,
foadbeds and structures, have brought
the total investments to a point where
the opinion that the real value Il
greater than the face value is prob
ably true, No general statement sach
an this can be accepted as having
more than q general value; there are
many exceptions; but the evidence
seems ample that the great mass Of
our railroad securities rest upon safe
and solid foundations; If they fail in
any degree to command complete pub
Tic confidence, ii ID because isolated
OF unc0nscionable stock
watering and Kindred oiferses arouse
which naturally extends to
all other corporate securities SO long
as similar practices are possible and
the tendency % resort to thsm is I'M
by law.
Wants a Physical Valuation.
Ample provision should he made by
congress to enable the Interstate com
merce commission. by the employment
Of snlfIcis mt force Of experts, no I'M
dertake the physical valuation Of each
and any read in the country. when
ever and 50 soon as in the opinion of
the commission such valuation ot
amy road would be Of valae to the
c6mmission III It's work There are
some roads as to which
1t would be an advantage, from tn
Of business of the commits
sion, to have such a physical valua5
tion ..as. soon las. possible
ifiAa the pttHat letfit be understood
thar pB1 zeal TalIation As no panacea
II iHi litl sufficient measurement OF q
lRtes bat Hit Mill be ultimately ne ded
&s aneessentfal Instrument in admins
rative supervision. Il win be of use
to the commission in connection with
the duty of determining the reason
ableness Of futur capt 'alization, both
ais one element to enable such a BODY
to come to a right conclusion in the
matter. and also as an element to be
placed before tn investing public, 20
enable this public In its turn to reach
a conclusion; though Of course capital
ization must be determined in large
by future needs rather than
past Investment. How important
physical valuation will prove as one
of the factors tc assist in fixing
rates i am not able TO Judge;
but that it will be of a certain import
ance can be safely assumed because
of the opinions of tn interstate com
merce commission and of the courts.
and because of the recent action of
the Northern Pacific railroad in ad
yaucing such a physical valuation as
decisive on its side in rate contrO-
versy. Such valuation would neces-
sarily help to protect tn railroads
against the making of inadequate and
unjust rates, AND would therefore be
as imnortan from the standpoint of
the protection of the railroads as from
the standpoint Of the protection Of thc
public. and Of course 1t is nee ssary
TO the enduring prosperity and DE
velopment OF the country that the rail
roads shall yield reasonable profits TO
investors.
The effect of such valuation and
supervision OF securities can not be
retroactive Existing securities should
BE- tested by the laws in existence at
tho time Of their isue. This nation
would no more tnjure securities which
have become an important part Of the
rational wealth than it would con
slider a proposition 10 repudiate the