Evening star. [volume] (Washington, D.C.) 1854-1972, 1910-04-29

which, as I have shown you, the law has
declared, and the Supreme Court or the
United States here declares. Is, fnvloiapiy
and inalienably, our constitutional r1gnt
and privilege. 1t may be true that II was
within the power of Congress to have
limited the right of the company In It's
original charter to mortgage its property.
but it is doubtful whether the courts
would have sustained limitation that
would have absolutely deprived the COM
pany of the right of seif-defense involved
in the power to issue evidences OF dept
Be that as II may. Congress did not see
proper TO reserve such an indispensable
power. and cannot now. sixty years after
the original grant. undertake to alter or
amend the companys contracts by aoridg-
ing its power to liQuidate or protect them.
The Fourth Corner Stone.
And lastly. gentlemen OF the committee,
the Supreme Court In this decision hav-
ing first laid down for our guidance the
method to be employed Judicial investi-
gation) to ascertain what is reasonable
in any given case; and. secondly, the
measure of the element OF reasonable
ness. to wit. the actual value OF the
money invested in the business: and.
thirdly, the right invariably vested in the
employer to the use and enjoyment of
the property employed unless and until
deprived thereof by due process OF law.
comes finally to the fourth corner stone or
the ediflce and tells us why it is illegal
and unconstitutional to deprive the en-
ployer of the use Of the property en-
ployed: For that ''in so far as the COM
pany Is thus deprived while other persons
are permitted to receive reasonable profits
upon their invested capital, the company
is deprived OF that equal protection of
the laws irrevocably guaranteed to all.
for which glorious definition, the consum
mate flower of this modern magma char
ia, let us all with one consent whatever
be our differences, devoutly thank God!
II you will kindly indulge me a mo-
ment longer before closing this illuminat-
ed page, will ask you to note the quail
Acation in the last clause upon their in
vested capital" the reasonable profits of
which the company cannot be deprived.
are the fruits. then, Of their actual in
vestment-not of their capital stock as
here commended: not of their outstanding
bonds as here insisted. Manifestly, not
at all; the qualification is broader than
any such narrow, meaningless, incense
quential, illogical limitation.
Gentlemen Of the committee, it is not
only broader. but deeper than that. 1t is
comprehensive enough to cover the entire
investment for all 1t is worth. Every
thing. it cannot be too often said, Of
value the company has accumulated and
acquired and employed in the conduct of
it's business; everything-real and per-
sonal-tangible and intangible. great and
small. 1t Is clear, therefore, is it not,
that whether or not the stock was legally
issued. or the bonds legally issued, or
the certificates of.indebtedness legally is
sued. is simply moot question; at best
an academic question: without any earth
ly bearing upon the reasonableness of the
company's rates or its right to now issue
refunding bonds to liquidate it's existing
liabilities of any kind, SO long as the
total amount put into circulation does
not exceed the actual value of the prop
erty upon which it is based.
Cannot Dispute Facts.
A man who can successfully dispute
that proposition has legal genius enough
to drive a coach and four through the
multiplication table. If there be any
such intellectual juggler alive. let him be
produced. even though the Supreme Court
Of the United States fees in terror be-
fore his prowess.
Otherwise, Mr.. Chairman, let us con-
slider as finally disposed the flimsy and
frenzied-I say it with great respect for
the integrity Of its source sources
criticism that has been here and else
where so freely INDUCED in about the in
iquity of capitaliZing betterments. deriv-
ed from profits OF otherwise. or of CAPT.
talizing in securities-property that the
court here says and has over and over
again said elsewhere. has already been
in effect capitalized by operation of law.
Mr.. ey-Betterments-
Mr.. Goldsborough-Yes. betterments;
why not? Why, your bill or resolution
here is unconsciously founded upon the
theory that they ought to be capitalized,
for it provides that it may be in the fu
ture. If SO, why not in the past?
To put the case concretely, what does
the decision leave of the alleged wrong
and outrage imputed to this company for
daring to desire to issue bonds to cover
property, physical property, mind you,
permanently invested in its plant? Are
we not, by this reasoning Of the court,
purged of that imputed contempt? The
Supreme Court in this case unequivocally
declares, does it not. that surplus so de-
voted is invested capital. and the COM
pany is entitled to receive reasonable re-
turns upon ii just as fully as though Ii
were represented by security capitaliza-
ton, and there can be no good reason
tai. legally invested with full earning
power. should not be represented by Sc
curity capitalization for its full and just
value.
Mr. Rothermel-We are all very much
interested in Mr.. Goldsboroughs argu-
ment but evidently he is not going to
get through with 1t in time for Mr..
Hazleton to close tonight. Mr.. Colds
borough has been speaking for an hour
and a half. l do not want to draw the
limit on him. and suggest adjournment
to another day.
day night. when Mr.. Goldsboro will con-
clude and Mr.. Hazleton will close the
argument.
INSTITUTE OF BANKING