The Bridgeport evening farmer., 1911-06-06

ing. We appreciate the part that Connecticut corporations have taken in the development of the State and in advancing along the great indus trial highway. Connecticut has always been very considerate of these large enterprises and will continue to be so, but having adopted in this State the doctrine of natural monopolies, its corrollary that of supervision and control, is imperatively required.
 Some feeble minded and subservient followers of that creed that declares for untrammeled license of conduct on the part of our public service cor porations, are heard to say that if commission should be established to regulate the conduct of the business | men in their stores and factories. That bill which has been laid aside. unsponSored and unwept, known as the Court of Commerce Bill, was erect ed upon this crude and false idea. and with the purpose of affording a sop to a passing fancy for a general regulation of human conduct. It has been discovered however, that the demand for regulation of these agencies with -theirylarge and special privileges granted by the peo- pie of the State. is not a passing fan
 
 portant department in our State Gov ernment.
 The basic distinction between public service corporations and other busi- ness interests in respect to the ne- cessity of State regulation lies in the fact that not only Public Service Cor porations are chartered with large and exclusive powers not permitted to individuals or private interests but they are protected from that compe- tition to which all other business in- tereStS are subjected.
 By the repeal of the General Rail- road Laws in 1895. and declaring in favor of a Railroad monopoly: in the forbidding parallel trolley line exten- sions:, in giving to gas, water and electric light companies exclusive ter ritorial privileges. and in the placing of the burden of proof upon any inde- pendent telephone company to prove public convenience and necessity be- fore offering competition to the South ern New England Telephone Com pany. the State has definitely adopted the policy of perpetuating and pro- tecting these monopolies.
 The proper balance between the forces of personal greed and public right in the operation of these agen- cies can only be produced by apply ing either the natural law of compe- tion, or the artificial law of regula- tion
 We have discarded the former as a matter of State policy, and upon the theory that it will be productive of are necessarily brought face to face with the law of regulation.
 The minority bill provides such reg ulation by clothing the Commission with suitable powers to grant redress of wrongs. The majority bills make but a feeble pretense at regulation, but limit the function of the Commis- sions to that of polite recommends tion which these corporations may heed or not as they see fit.
 Tho appreciate the political princi- pie that prompts the minority bill, one must pause to reflect upon the implied contract relation that exists between the State of Connecticut and a quasi public corporation chartered to serve the public in the varied ca pacities as travellers, or shippers, or consumers.
 The public service corporation is organized for twofold purpose namely, to serve a public use and to earn a fair return on the investment of it's shareholders.
 In return for its franchise which. as the case may be may involve the right to condemn and take private property. or to occupy the public streets with tracks or poles or water mains other fixtures, such corpo- ration promises the State that it will furnish reasonable service to the pub lie, and that its rates or charges will be reasonable, having reference to a fair and just return upon it's actual investment
 Every dollar in excess of such req Sonable amount of profit upon an hon. est capitalization of the public enter prise in question, belongs to the pub- lie. and 1t is for that reason that the State should enforce this implied con- tract so that reasonable service being secured. the rates for that service should be made to conform to the two requirements stated, namely, that which will admit of proper service and just return only upon the in vestment
 When We hear interested persons claiming that the public is not con- cerned with the question of stock wa terng of public service corporations we can hardly listen with patience to such clap-trap. It requires but little reflection to appreciate the fact that the greater the amount of capital stock issue. the greater must be the stock dividend earnings and such earnings must come from the public.
 It is human nature for managers of such corporations to seek to pay divi- dends upon all of such stock holdings to win the plaudits of Its members. and as all of such dividends must come from the pockets of the public that is served. it is obvious that the public have. in fact. q vital concern in having the capitalization an hon. est one.
 All that I have outlined is accom- plished by the minority bill. We have substituted for the provisions of the original bill, known as the business mems measure. relating to such stock watering. a criminal statute under which severe penalties may be im- posed in criminal prosecution for this species of fraud that injures both tho innnnant investnr and tladiranal1<