The Washington herald., 1907-08-25
Enforcement of the Rebate Tau


Congressman Samuel w Mccall. Of
Massachusetts. like Senator Foraker. is a
consistent critic Of the railroad rate bill
partly on the ground that the new legis-
lation was wholly unnecessary in order to
prevent rate discrimination by means OF
rebates OF secret tariffs TO favored ship
pers. Mr.. Mccall asks, in recent ad-
dress, Why were not old laws enforced
rather than new ones demanded?"
Some light Is thrown on this question
by H. 7. Newcomb. Of this city. In an
article on Rebates in the August num-
Der Of the Yale Review. Mr.. Newcomb
says there has been no time since 1857
the date Of the enactment Of the inter
state commerce law, when the practice Of
rebatng could not have been stopped by
an intelligent and energetic desire TO
punish the violation Of that law. Yet th
record Of prosecutions shows that for
eighteen years there was no vigorous
effort 10 detect and punish devIations
from the published rate schedules. Mr.
NeWcomb says the record discloses two
principal phenomena OF great signif-
canoe. These are (irsO the notorious and
almost open violation of the law against
rebates, and (second) The reluctance OF
the authorities TO punish the offenders"
Prior to 1906 there were but seventeen
convictions for violations OF the interstate
commerce law. and the total fines I'm
posed amounted TO $16.S76. while the gov
eminent failed in sixty-two indictments
out OF seventy-nine. But IN 1905 there was
a new deal. Prosecutions were initiated
with vigor. and up TO March OF this
year seventeen corporations and nineteen
individuals had been found guilty, and
total fines imposed amounting to s5S6 125.
Since that date there have been several
other convictions, including that Of the
Standard OIL Company OF Indiana. upoD
which fine of $29.24OOOO was imposed
Notwithstanding the omission Of an i'm
prisonment penalty from the Elkins law.
two defendants were sentenced 10 i'm
prisonment under a section Of the revised
statutes which penalties any consniracv
10 commit an offense against the United
States. Under this section. as Mr.. New
comb points out, it has been possible
for two decades to put some prominent
man IN JAIL Tor rebating
President Roosevelt, Of course. was. and
Is the motive force behind these later
prosecutions, which were all initiated
under Old laws. Thanks to his vigorous
and Intelligent prosecution Of offenders
the rebate evil has largely disappeared.
But II should be said that the state Of the
law as interpreted by the Supreme Court.
Is much better to-day than it was during
the earlier years Of Interstate commerce
legislation. It is now possible 70 compel
corporations 10 give discriminating evil
dence, whereas formerly II was practj-
caIly impossible 10 obtain the evidence
necessary TO convict Moreover the FL
kins law authorized the use Of the in
Junction TO restrain the granting OF re-
bates. a weapon that was Of doubtful
legality prior 10 the enactment OF that
law. Finally, the present interstate COM
merce law. as amended last year, per-
nlits such supervision by the commission
over the accounts OF railroads as viii
tend to make the giving Of rebates ex-
ceedingly difficult without detection.
Surely the strengthening Of the old Jaws
SO as 10 make them more efficacious to
prevent rate determinations is justilable.
Mr.. Newcomb suggests that possibly one
reason for the past reluctance of the
authorities TO punish rate offenders is
that rebates TO large shippers may, after
AL have been rough approximation TO