Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-06-25
SENATOR KNOX At YALE
Address Before the Graduating
Class of Law School.
BEFORE LARGE AUDIENCE
Development of Federal Power to Reg
ulate Commerce.
COMPLEX SYSTEM OF P0LITY
Attitude Of the State and National
Governments Defned-Constitu-
tional Rights Exploited.

Knox was one or the central HSureS Of
the graduating exercises a. Yale University
last night He addressed the graduating
classes of the law school on the subject.
The Development of the Federal Power
to Regulate Commerce" He said, in part:
There are questions before the Amert-
can people today of greater Importance
than those relating to the federal control
over commerce. That power was granted
chiefly a safeguard against commercial
hostilities and reprisals between the states.
1t remained practically dormant until COM
paratively recent years. 1t is now clearly
recognized a great affirmative and con-
structve power. not limited to composing
differences between state laws and sys-
TENS. but constitutionally capable of effec-
tive and fruitful development In a region
all it's own. In some respects it may be
said to be the greatest power lodged in the
general government. and the possibilities
of its application are co-extensive with the
possibilities of the expansion of the vast
subject to which it applies.
Nothing, therefore, is of more conSe-
qpence in our governmental affairs than an
accurate understanding of the scope of the
national and state powers in respect to
commerce and the activities related to
commerce. for no effective regulation is
possible in either sovereignty If the power
of the one could be usurped or INSTRUCTED
conceded. except by those who appear to
think the federal government con constitu-
donaily accomplish everything that seems
good for the people and are constantly
raising expectations upon this line which
cannot possibly be fulfilled.
Notwithstanding the complex system of
polity which prevails in this country the
American people have a complete and en-
tire system of government with all the
powers necessary to deal with every sub
ject and situation. All governmental au-
thority is Included In one or the other. or
In both. of the two sovereignties which
constitute the American system.
The fact that the state governments are
supreme In state affairs. and the national
government supreme in national affairs
does not result in the deduction that there
are any affairs which may escape govern
ment control.
The Constitutional Power.
The constitutional power of regulation
having been granted to the federal govern
ment in respect of subject naturally la
Bile to development and change, 1t can be
said its authors contemplated a correspond
Ing enlargement; not. be 1t observed, In the
power. but In It's application to the ex-
banding subject When congressional DOW
ers are applied to new conditions 1t ia not
as 1t sometimes seems to be an exten-
sion or expansion of the power, but an in
dication OF a change in or extension or
expansion of the subject upon which the
power operates. Neither the power to reeu-
late commerce nor the conception of its
scope has expanded beyond its definition
by the Supreme Court when first consId-
cred. nearly one hundred years ago. It
was then pronounced complete in itself
that 1t may be exercised to its utmost ex-
tent ana Acknowledges no limitations other
than are prescribed by the Constitution
The necessity to exercise the narfonar
power over commerce arises largely out Of
the FAILURE OF the states to regulate wisely
great corporations created by and under
the dominion of the states and engaged In
interstate commerce. That failure has led
to well-known abuses which affect inter-
state commerce. and thereby created the
necessity for the exercise Of federal regu-
latfon to prevent the abuse
The necessity for the exercise of federal
regulation almost always springs from
causes the states could have prevented
Combinations to Control Production.
The combinations to control the produc-,
ton. distribution and sale Of commodities
which were to be subjects Of interstate
commerce: the combinations between and
the mergers of interstate railroads de-
signed to bring under one control the trans
portation business of large areas of the
country the unjust determinations to
favored shippers and localities. both in the
carrying service and the rates charged
therefor: the secrecy surrounding the opera
, lions of corporations rendering service to
the public had utterly destroyed in many
localities. the ability of other persons and
concerns to engage in commercial compe-
tition with the favored ones who enioyed
such unfair and illegal advantages
A brief statement of how this situation
was dealt with by the national government
the theory upon which the government pro-
ceeded. and some observations upon certain
mischieyouS misconceptions as to the scope
of the powers that have been successfully
invoked to correct the evils have named
will not. / hope. be uniQtereSting nor nm
instructive.
First. the scope of existing laws was
tested through series of suits. These suits
had for their main purpose to determine
the effectiveness of existing statutes to
reach new types of combination to restrain
the free-play of the law of competition,
and new and subtle discriminatory devices
which had sprung from fertile and expert
enced minds instructed in the interpreta-
lions the courts had put upon the existing
laws.
The purposes for which this litigation
was undertaken were all accomplished. The
completeness Of the federal power over
commerce was reafirmed and declared to
evtend. among other things. to the holding
company.
Device Declared Illegal.
This device which had been successfully
employed to establish under one control the
| leading productive industries OF the country
was declared illegal when utilized to alb
SOrD competing systems OF interstate rail-
roads. and thereby we escaped a danger
| to our commerce. our government and our
! very liberties. the magnitude of which can
scarcely be grasped.
1t was likewise iudicially determined. that
a combination between a railroad company
and a shipper. to grant the latter an un-
lawful rebate which results in the estab-
| fishing of monopoly. is violation of the
Sherman act. and that a court of equity
| might restrain the guilty parties at the suit
| of the Attorney General of the United
| States. as well under that act. as under
the general Jurisdiction in equity. OF al
most equal Importance was the decision
| that the operations of a monopolistic COM
| bination within state may be so con-
nected with those between the states as to
bring the whole under the regulative power
| OF Congress.
Notwithstanding the success which at
| tended these suits. there was developed a
| number of serious defects and omissions
| in national legislation necessary to be cor
| rected, II the avenues of commerce were
| to be kept open to all upon the same terms.
| and If speedy and workable remedy for
! violations Of the law was to be placed in
| the hands Of the government itself to re-
| store the rule of freedom and equality In