New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1909-12-02
MR. TAFT WOULD
RESTRAIN BANKS
THINKS THEY SPECU-
LATE TOO HUGH.
Framing Rcmedy az Message
Federal Supervision Of
Railroads.

rrrom -hs Tribune bureau
washington. Dec. The President
,.s become convinced that speculation
= -sn-oaa securities PLAYS far too i'm
-.-,ant a part in the affairs Of the banks
- the great commercial centres. and
,.pecially of New York city, and in the
narration of his annual message he is
,.-,,-ing 20 frame lamentations out
,r.nc legislation which. in addition 10
,s,nr added character and stability TO
abroad stocks and bonds, VIII tend 10
Minimize this evil
President Taft has learned 70 his own
stis.actou that many Of the New York
nsrts are deeply interested IN railway
ss-srities. So much 50 that the rise and
al ~ The market has become matter
- the utmost. ~ not vital. Importance 10
,sr- II Is his belief that the mainten-
,r,e of The stock market is far removed
am rhe legitimate functions of rational
,erss al least. and be hopes that he viii
!. able go point the way ana Congress
~s.u ba able o. perfect legislation which
,u IN large measure, obviate this con-
d.uon ~ affairs
Z Is io that end. m part. thar he is
s,ensiug 80 much time in framing his
recommeu5atiols dealing with IN. oues-
mn ~ federal control ~ the issue OF
railway stocks and bonds. and. indeed.
vis al tho questions pertaining 70 rail-
Ways
RAILROAD COMPETITION.
The President Is not insistent on leg
is.uon compelling railways - sell or
e-berufse dispose Of the securities q
comperng lines which they already hold.
As has been told IN these dispatches. nor
CO.. he even regard II as imperative.
uith tho amount of federal supervision
h. proposes. that The railroads should be
sbsoiEteIy prohibited from acquiring
frrtner securities OF competing lines,
Frovided-and on this he LAYS great en-
phasis-surh acquisition Is conducted
unisr the supervision of and with the
approval o- the Interstate Commerce
Commission. He believes tha:. apart
fr0n the control which the commission
would b. able 70 exercise under the leg
islation DO advocates. the element Of
competition should enter into tho man
Egsnent ~ railroads, but he Is not blind
o. the fat that circumstances may arise
IN which n would make for improved
service and more economical operation
fr q stronger and better managed road
O. absorb a smaller and Jess Cspably
operated property. despite the fact that
~ lesser property may be a competing
hBs For am inhexible prohibition
against the absorption by any read Of a
competing line. therefore. he would sub
sl-u;e qualified prohibition. making the
approval 2 the Interstate Commerce
| Commission essential 10 such absorption
TRAFFIC. AGREEMENTS.
s. too ga the matter OF Joint rates OF
traGic agreements. The President is
E-eay alive -0 the advantages which fire.
sssn;ly may accrue from such arrange
reI,s and he has no desire L" see en-
sr'ec legislation which would deprive the
slipper 10 th- benefit 10 be derived
nerefror.. Dr The other hand. he appre-
Gates that tle protection of the shipper
ION ext0rtiouate charges can bs ac-
e1lphshed only by ample supervision Of
sleI ioint agreerneuts by properly con-
s'-'u'ed federal authority ana such he
hsards Jhe Interstate Commerce Com
uEs5r
| la connection with this DoInt there
uus' De- intelligent distinction between
FAe rates 0r traftic agreements. on the
on hand. and pooling on the other. The
L0er Involves "a division o. profits from
'# business ~ certain territory or al
N1H the division by a prearranged
scheme - tre gross receipts whereas
''ai rates or traffic agreements involve
n srch division 4 business. but merely
c-nnite through rate that certain stip-
1-'ro f-sc-lans shall 60 20 -he several
''-as which furnish the transportation.
SUPERVISION OF RATES
Tie President is further disposed 20
ieio 10 ths urgent plea of the railroads
.ns; They 5e permitted TO initiate rates.
W be deems .f highly important that
'Aeit the Interstate Commerce Commits
''A oeerns rate 80 initiated excessive.
~ i-leec, -nduly low. it be clothed with
's'hority 20 suspend such rae tempo
-e-g and pending investigation.
lAat q rate may be uuduly bow may
novel idea 10 those wh0 have not
s'en ne subject careful study. but IL is.
Nlrse. TACT that a railroad might
--AF rate 50 loW as unduly to favor
ah class - shippers. for n" reason
' an inorfiuateiy low rate on one
-.sirarl11 would Inevitably mean an
uy high rate on another class %
as n order that the railroad might
b-'ak even"
~ PRESIDENT has expended much time
thought ou the section u MS mes
which deals with the subject OF
ao legislation. and he = looking
ward s.lrh runhdence 20 a cordIal and