New-York tribune., 1907-07-30
NOT THE FAIREsT SOLUTION.

A contest between a railroad company and a
state is always an unequal contest, and that be-
tween North Carolina and the Southern Railway
has been adjusted temporarily, according to the
good old rule of might. If the Southern Rail-
way did not obey It's fare law the Legislature of
North Carolina could probably make it uncom-
Portable for the railway company, and so the
law is to be obeyed while the courts are deter
mining whether or not it Is just A settlement
Of the dispute was desirable and this was the
only settlement with which the North Carolina
authorities would be content AS President Fin
ley Of the Southern said In his letter TO THE
New York Tines:
We must continue to live in North Carolina
and must endeaVor to demean ourselves as
standing for law and order and even sometimes
SUFFERING injustice rather than to permit the
quiet and peace of the community to be dis
turbed on our account
We think that the agreement reached was
vastly better than continued pickering which
would inevitably reflect discredit upon some of
the courts drawn into the controversy; but we
feel that the North Carolina authorities were
more jealous Of their dignity than they were
jealous for justice. The fare law went on the
statute books without proper consideration.
There was no real attempt to ascertain whether
the rate would be remunerative to the railroads
or not. Now, by many rulings of the courts the
railroads are entitled to q judicial review Of
such a rate fixed by legislation 10 determine
whether not it Is confscatory. Under the
decision of Judge Prtchard neither railroad nor
passengers would suffer financially during the
judicial review. Under the agreement forced by
the state the low rate goes into effect and If it
proves conhscatory the railroad loses the differ
ence between two and quarter cents q mile and
Its present fare. The one was a practical ar
rangement that safeguarded the interests OF
every eOu8ly Tlppdiuo cOurt action Tho
other puts the railroad company in the way Of
sustaining recoverable losses while the case
is awaiting adjudication. In forcing this result
it seems to US that North Carolina has aban-
doned that position of impartlality. which ought
TO characterize every effort at state regulation Of
rates. 1t puts itself into an attitude Of hos
tlty TO the railroads, for, If 1t were as impair
hal as the fair regulation Of rates demands, it
would prefer an arrangement by which there
was no possibility Of loss to either railroads
or passengers to one that contained possibility
Of serious loss to the railroads
The settlement in the North Carolina case
seems to US fraught with dangers. If 1t becomes
a precedent any law that q demagogic Iegis-
lature puts upon the statute books goes into I'M
mediate effect, and from the evils Of its opera
tions. however irremediable, public service cor
poration cannot escape pending an appeal to the
courts. No inferior court, ct least no inferior
federal court, may stay its effect Only the Su-
preme Court Of the United States can relieve
the corporation. This may IN many cases result
in heavy losses, while the procedure followed
by Judge Pritchard, and by Judge Lacombe In
the gas case, guarantees to the public all its
rights under a law If it proves constitutional
and at the same time protects the corporation.
The success OF the whole policy of state regula-
ton, whether by legislative enactment or by
commission, depends upon public reputation for
good faith. The state must live up TO the diff
cult ideal Of impartialIty. If the state in its
regulation seems too tender toward capital in
vested IN public service the people will not be
satisfied. If the state gains a reputation for
pursuing public service corporations with dem
agogic arts capital will be shy and the develop
ment Of public utilities will languish. There
fore, it seems to US that North Cardinals attl-
tude is unfortunate. It's rate regulators seem
to care less for the fairness Of the rates than
for the applause of the multitude The agree
ment reached there, if 1t is to be precedent sug-
gests contingencies IN which the courts Will be
temporarily unable to protect property rights.