Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1907-11-14

that there was no question of the
Iconstitutionality of the interstate COM
merce act involved.
IF such a question had arisen" he
said, Il would not be here, inasmuch
as | had part in the framing of the
act. 1t Is a question of the construc,
ton that we contend for, a construc-
tion of 1t which will eliminate all
doubt in respect to the power of the
commission in cases like this"
Mr.. Spooner pointed out that the
state may regulate its own corpora
tions, while the power of congress
over interstate commerce is supreme
ana conclusive.
The state fixed the amount Of can
ltal stock of a corporation; congress
! cannot. The state may repeal a cor
poration charter congress cannot.
| The state may require that no officer
or director shall. openly or secretly,
| nave any business dealings with the
corporations with which he is con-
nected. The federal government has
no such power, continued Mr. Spoon
er. Can it be assumed that congress
| has inquisitorial powers to regulate
the dividends Of state railroad corpor-
ations?"
The interstate commerce act. he
said, authorizes the commission to
elicit such Information as would aid
them in discharging their duties in
the enforcement of the act.
Taking one of the questions put Ia
Mr.. Hartman, as to whether he was
directly or indirectly interested in any
stocks that were bought between the
18th of July and the 18th of August,
1906, that appreciated. Mr.. Spooner
said:
let it be assumed that Mr.. Harri-
man had answered that question and
had stated that he owned stock that
was sold TO the company; Is that in
tersiate commerce? Is the question
that an agent or director has violated
his duty as a director in any sense in
terstate commerce? Is it not a matter
solely between the corporation, the
stockholders and himself?
could congress pass law prohib-
iting a director of a company from
dealing in stocks? 1t is inconceivable
that matter of trusteeship between a
private corporation and one of it's
body can be made the subject Of in
quisition by an administrative body Of
congress.
In the event of loss. could congress
have made restitution? Is IL not
state matter? The state could pun
ish, while congress and the commits
sion could not"
Senator Spooner closed by saying
that TO pillory man at the bar of
public opinion in order to attract the
attention of congress to the supposed
need of legislation is out OF the do
main of the interstate commerce COM
mission"
The final argument for the govern
ment was made by Frank b. Kellogg,
special counsel to the commission in
the Hartman case. He had not pro-
ceeded far when interrupted by Judge
Hough, who asked:
isn't 1t true, Mr. Kellogg, that
while the commission is not required
to limit the scope of its inquiry did
IL not, as matter Of fact limit its in
quiry I'm this case by a special order?"
"As to that, your honor" replied
the attorney. the authorities have
held that a congressional commission
need not limit itself TO the subject
matter OF a resolution of inquiry, but
may go as far as IL pleases, so long
as IL keeps within the power Of con-
gress to investigate"
Mr.. Kellogg said that for fifteen
years the interstate commerce COM
mission had been investigating mat
ters which were not clearly dedicated
to ii by congress. These investga-
tions and resultant recommendation
had borne fruit in the dissolution of
one vast illegal railroad merger in the
enactment of the safety appliance law,
the employers liability act, and lastly.
the abolition Of rebates.
Another reason for this inquiry is
to ascertain whether this stock was
sold 10 the Union Pacific in bona
fide way. what it's actual worth was
or whether it was sold for specula-
tion-by pool-or fraudulently The |
gentlemen on the other side are fond
OF saying these stocks were sold at
their market value. This means their |
value as quoted in Wall street who
makes that value? The very circle !
of men who pooled their money and |
bought stock in manner such as these |
become a proper subject OF inquiry in |
the question of rates 4
which the interstate commerce COM /
mission certainly has the right to reg I
ulate. In like manner we have a right |
to inquire IL the ten per cent divi- |
dend suddenly declared by the Union /
Pacific company was justified from /
the earnings or whether II was purely /
a speculative dividend to enable cer-
tain persons to manipulate stock and |
reap enormous profit.
one of these questions Mr.. Harri- /
man declined TO answer was as to |
or not a block of $40. 900 900 |
OF stock in the Santa Fe railroad was |
held by II. II. Rogers and II. c. |
Frick, two Union Pacific directors. |
Here is "a vital issue. Mr. Hartman /
admits that the Union Pacific has not /
the right to control the Santa Fe be- /
cause Il is the competing system, but !
your honor. what is the difference be-
tween the. company itself owning the |
stock and two directors owning IL and |
using Il to suppress competition? As /
a matter of fact there is no cOmpeti- |
ton between the Santa Fe and the |
Union Pacific. and all roads or eX-
which are constantly con- ,
.tructed stand jointly in the name of /
the Santa Fe and the Union Pacific.
Are We to leave the great western /
territory Of the United States depend
ent upon one man7 Is there to be no 4
between the Missouri |
river and the south Pacific coast2 Is /
congress impotent to prevent "A group |
OF men from controlling all the rail- /
roads OF the United States through the |
medium Of the stock ownership by di- !
rectors2 Is the interstate commerce |
to be prevented from In i
quiring into such vital matters as
these because Mr.. Hartman wills /
Il so?"
Mr. Kellogg declared that the peo-
nile Of the United States are vitality 4
interested in the solvency Of the great 1
railroads. The commission should not ]
be hampered. he declared, by the mar /
row rules OF common law In carrying !
out its investigation. He said u wss 1
purely within the province of the com 1
,,feqion 10 know how a common car I