Evening star. [volume] (Washington, D.C.) 1854-1972, 1908-03-17

companies, railroads and industrial cor
porations with an aggregate 'capitaliZa-
ton of more than twelve hundred million
dollars
Concentration Of Money.
Speaking of the great stores of money
in New York in connection with various
industrial institutions Mr. La Toilette
continued:
With this enormous concentration OF
business 1t is possible to create artificially
periods Of prosperity and periods Of pan
tc. Prices can be lowered or advanced
at the will of the system" When the
farmer must move his crops a scarcity OF
money may be created and the prices low
cred. When the crop passes into thu
control of the Spectator an artificial
stringency may be relieved and prices ad
vanced. and the illegitimate profit raked
off the agricultural industry may be peck
eted in Wall street.
IF an effort is made make any one
of these great interests obey the law. II
spiracy to destroy whoever may be re-
sponSible for the undert aking.''
He severely criticised the provision Of
the Aldrfch blu by which railroad bonds
circulation, and charged that it was a
scheme to defeat legislation which might
lower railroad rates.
LAS a common carrier said Mr.. La Fol-
lette. "the railway company is entitled
to charge sufficiently high rates to pay
operating expenses and a reasonably fair
return upon the fair value Of the proper
ty which II uses for the convenience Of
the public. This is the standard, and the
only standard, by which to measure rea-
sonable rates. To secure the application
of this standard to the railway rates of
the country has been the object of a
struggle extending over many years The
courts have sanctioned 1t. The inter
state commerce commission has urged it
upon the attention Of Congress. and COM
mon justice to the public interest
demands it. Tried by this stand
ard. if railway company has gross
~ capt. allied its property, 1t cannot
rightfully impose upon the public trans
portation charge to pay any return or diy-
idend upon this fictitious capitalization
1t does not signify that the public has not
yet been able to secure the application
or this standard to the rates Of the coun-
try. Its cause is just. and it's defeat
from year to year has been accomplished
only through the powerful influences
which the great transportation companies
or the country and those interested in
the1r securities have been able to sue
cessfully exert in preventing legislation
An Astonishing Proposition.
To-day We are confronted with the as
tonishfng proposition that Congress shall
hold out legislative inducement for the
eXaction Of transportation charges which
snail net continuous per cent divi-
dend on railway capitalization. 1t is
idle to say that this measure is limited
IN its scope: that it has reference sim
ply TO limited issue Of railway bonds
as security. He is blind indeed who
does not see the ultimate effect of a
proposition which. directly or Indirectly
causes standard for the payment Of 4
liked dividend upon railway capitaliza-
inn uy1Y nr<1
property. The certain effect of this ac-
ton by Congress Is to stimulate every
railway company within the purview of
this statute to maintain the position of
its bonds within the favor class, and
every other railway company to qualify
at the earliest possible moment for ad-
mission to the favored class. 1t is plain
sir. as the MONDAY SUD that the direct
effect of this proposition will be to ad
vance railway rate charges. and that it
will identify the government with
maintenance of rates in all cases where
it has accepted railway bonds for cur
rency circulation"
He insisted that the interstate COM
merce commission is not empowered TO
ascertain the value of the physical prop
erty Of the railway companies of the
country. and strongly favored such a
valuation as the only means for fixing
railroad rates.
When once the government invites
the national banks OF the country to in
vest in them for the patriotic purpose
of averting financial disaster, those rail
road bonds will become sacred paper"
he said. The good faith Of the coun-
try will be pledged to defeat any legis-
lation that suggests disturbance Of the
per cent dividend upon the stocks.
The senator from Rhode Island will be
heard in solmen warning. We will be
told that the bonds were bought by the
banks not to make money. but 10 be
held in readiness to protect the credit
and commerce Of the country; that bond
markets are easily disturbed: that such
security Is delicate and sensitive: that
legislation menacing dividends even upon
grossly watered stocks would alarm the
holders Of these bonds and force them
upon a falling market at great sacrifice
possibly producing panic and leaving the
banks but partially prepared to take out
emergency currency.
Gould any plan have been devised
which would be more effective in block
ing the way Of legislation for valuation
of the physica, properties Of railways
and defeating the final reduction of rates
TO a just and reasonable basis?"