Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1909-03-09
MISSOURI TWO CENT
FARE LAW DoWNED
Continued from mage

terstate rates are too high, congress
either acting alone or through COM
mission must make the corrections.
Recalls Gas Case.
"The supreme court during the pres
ent year in the case of City of New
York VS.. Consolidated Gas company of
| New York, decided that six per cent
was fair and right to be given to the
| owners upon the true valuation. Ny
opinion is that while a gas plant is in
| some respects different from a rail-
road. that railroad property, properly
built, and properly managed, should
over and above expenses make a re-
| turn of six per cent per annum. And
| considering all the evidence, the evil
| dence fairly shows that all of these
roads We're properly and economically
built and are being properly and econ
omically managed, and that after pay
| Ing the eXnenses for maintenance and
| operation, that there is less than six
| per cent OF returns, and not more than
three per cent upon any Of them and
as to some of them a deficit, taking
the property as above stated within
| the state of Missouri at it's fair valua-
ton. And this is so without reference
to bonds because in no case do the
| bonds bear six per cent interest But
| taking the bonds into consideration,
there is still not to exceed three per
cent returns, and many cases a deficit
| after considering all debts and credits,
upon the true valuation for the state
| business. There is no evidence that
an of the existing bonds were i'm
properly issued either as to amounts
or rates of interest In fixing the value
| the court has considered the evidence
| Of witnesses as to the stocks and
bonds outstanding, and the state
board for taking. purposes has valued
f1,NS.n .,N~r n,-ff Il
ings are not binding nor conclusive,
but they are persuasive. But indie
pendently of stocks and bonds, and
| independently of what the state board
has valued these properties for tax
| ing purposes, the evidence shows the
valuations to be as recited in the find
| ings of fact herewith filed. and to
which reference will be made in the
DEGREES.
1T is absolutely necessary that
| many trains, both passenger and
| freight, do both a local and interstate
business. Even the fast trains stop
ping at but few stations in the state
, stations. And the same is true as to
freight trains carrying freight both in
carload and less than carload lots
Valuation and Expenses Known.
1.-THE valuation of the roads has been
fixed by the court as shown by the
llllulllSS Oh laCl. Inc enLlre state ana
interstate earnings of each of the
roads within the state is known and
fixed to a certainty. The expenses are
known and fixed. To apportion these
eX enses, must be done according to
one of the two theories, and the cor
rect theory is that according to reve-
nue.. One theory or other must be APP
piled to both freight and passenger
expenses and the court should not
adopt the one theory as to part, and
the other theory as to another The
one theory is herful to the one side
and the other theory helpful to the
9th r side, the one theory to the one
side in freight. and the other theory to
the other side in passenger. But an
arbitrary splitting Of theories is il
lo~ical and unfair, and cannot be
recognized. The court has adopted
the revenue theory because a great
number of the best railroad experts of
the country. against very limited
number to the contrary have SO testi-
fed. Every court that has ever had
this question before it in so far as |
am advised by the briefs of counsel
and my own independent investiga-
ton has so held in the supreme court Of
the United States; in the two cases.
by two circuit judges of this circuit;
by three district judges of this circuit,
and by the supreme court of Florida,
State VS.. Atlantic Coast Line. And
Beals & Wyman on Railroad Rates
Regulation announces such as being
the. correct rule. The values of the
property within the state have been
fixed by the court. The entire earn
ings within the state, interstate and
state. freight, passenger, and miscel-
laneouS of each, have been fixed. The
entire expense is known, including the
extra cost of each. To ascertain
whether the result is profit and if so
what per cent or loss, is but prob
lem of primary arithmetic, as it shown
by Judge Van Devanter in Arkansas
Rate Cases There are other methods
equally simple the resultant figures of
course being the same. These occuDa-
tions show as to the commodities COW
cred by the freight rate statute of
1907, that two roads. the Hannibal &
ST. Louis. and the Burlington, allow
ing nothing for extra cost, there is a
deficit, and with all other companies
less than two per cent But with the
extra cost added, the' deficit for the
two companies is much greater, and
the other companies show deficit
Amounts to Confiscation.
The passenger earnings under the
two cent fare law Of 1907, allowing
no hing for extra cost over interstate
business gives no return whatever to
the Rock Island, ST Louis &, Hannibal
Kansas City. Clinton & Springfield
AMI the Great Western. The other
companies will have the following:
The st. Louis & San Francisco be-
tween three and four per cent: the
Santa Fe between four and five per
cent; the Kansas City Southern a
small fraction over two per cent the
M. X. & 7. between two and three per
cent: the Burlington between three
and four per cent. But all this is ar
rived at by allowing no extra cost Of
service. But to add the extra cost for
| freight and passenger, there is no
earnings over expenses. This is con-
| fiscation under the constitution.
1T being a Legislative act, and not
| a judicial one this court cannot fix
rates. 1t If could, two and one-half
cent passenger rates would be fixed for
the stronger roads. and three for the
others. But that is for the legislature
acting itself with experts, such as the
| state employed in these cases, or
through commission with like as
! sistance."
. Judge Mcpherson also says in the
decision: when the statutes in ques-
ton were enacted, it was believed bv
many that by reducing the fare there
would be much move travel. For a
| month or so this proved to be true But