New-York tribune., 1911-12-12
y Would Be Practically lmpoSSi-
ble At Present. President Taft'S
Commission Reports.
PUBLICITY FOR FINANCING
.uv Attempt to Scale Down Out
standing Securities Inexpedi-
ont - No Prohibition Of
Joint Stock Ownership.

- control. The commission SAYS tHal
- rublicitv for all railroad financing
-. most effective weapon against stock
.s-,,,r which the government has al lis
Command. .--.,.-..-.-
-.,sa hv u-aai6art T"ft go "o-ooerate
=, rr5T7 S-0T HadlCy They were Fred
- \. Juason, OF st. Louis; Frederick
e.-s-ss OF New York; Walter J.. Fisher
s..~stsry OF the Interior. and Balthasar IT,
,fs,.or q wemlo" of She Interstate No'"-
nercc Commission.
-. commission was created in 1910. when
49, senate refused TO accept q House
.-,,r5r,or. 20 tho pending railroad Dill
e-.,t.li-.- ,.st on future issues Of railroad
-,-.aos rs placed under the control OF
80 Interstate Commerce Commission
,,s-,. Of the Senate Democrats opposed IL
-, invasion Of state risht7. President
20 at the time told Republican leaders
80 the party was committed 90 such
r,sag,rs. but when it appeared Impossible
:, n7ss f. tic President agreed TO have
-. clause eliminated. with the understand
,,- that a commission 90 study the SUD
- ,po,,1d be allowed. This was done, and
-. commission began work in tho fall OF
vs6lev studied the problem abroad.
Taft coneurs in Recommendations
President Taft. in transmitting tho report
n Congress to-day, declared that he heart
~ roncurred in the recommendation.
The commissions principal conclusions
are
That any attempt by Congress 70 adopt
th. policy Of federal regulation 70 the
exclusion of state regulation would be
premature. 49,.
That for the present state authorities
should make 4 concerted effort to mar
monzs existing reaulrenents.
That Congress should prepare tor the
future by giving cons Iteration TO a feo-
srsl incorporation act which would per
NIT interstate rslroads to exchange tneir
state charters for national ones
The real value Of the stock certit1cate
oeoerds upon the manner IN which the
money has been invested. The con1r1ls'
son IS therefore Of the opinion that X
/, Tar more in1po-tsnt 70 ascertain just
vhst are the facts connected with the
issue Of securities and what IS actually
cone with whatever money has m tact
hssn realized from the stock which. IS
issued than merely 20 make sure that
the car value CT the stock was paid m
al the time Of issue.
The commission takes the ground that
Constitutional questions involving the scope
and extent Of federal authority arc unset
ted and viii remain so Tor some time. and
that while such a condition exists % super
inpcss federal regulation on state rcgu'a-
ton would add 20 the conflicts and COM
pIsxlues vh.ch IN tho public interest should
rsiAer 5e diminished than increased, II.
ss.S.
Unless the constitutional power OF Con-
fress % regulate securities or interstate
railroads is definitely established as being
exclusive OF state control e'ffer INC req
eral government and the states viii come
% a general uudersts udinE as 90 the prin-
cirles 90 boz adopted in the control or se-
cIrity issues o. tho railroad systems WI
he given the opportunity 70 exchange L-al'
state charters for federal ones
Until such exclusive jurisdiction can oo
established the creation or separate du-
i1i7istrat.re BODY suhiectinC the railroads
10 new system Of concurrent SUPERVISOR
,1 addition 90 the many old ones which
row exist does not seem just, eNpelent
pr economical
Publicity for Security Issues.
For the present the commission recon-
- rrrnds that complete publicity be required
20 surround all issues Of securities, and that
-, -. &c - .r, r,,e--
state Commerce commission a. fun state
ment OF the details ~ the ISSUE the par
poses for which tie proceeds arc 70 be
ussd, and aa accounting for the OK
Dtndlrurs Of such proceeds. II adds.
r--r 5a'' ah3l, owe, ot .e,,,-,-i 5 i.1 md t5e
expenditure OF the proceeds i- the matter
VI most impOrtance. lt Is the one thing
t,,,.- -H ,.. .II,, .so.Iat ~ f,,rls-
cn,aI thing which must serve as basis
Ao' .haieye, regulation may De oes'FaD'e
4. fuII glIaiic.-,. bo given We shall also
.IzzT ih5 fraucuIent creation Of debt IL
y we asgree or puDlclty, .alntr lHeu - W.
D,og'e sTy ra.. rrGt..fior stringent
law inadeguate'y enforced and secretly
s,sosd .s t9e worst th'us thar can 4e pos JOS
eo5- u, .,.,~-5 20 , y.,,l,, t.,. mo f9Yng7t.on
fact
m oeternni1ing me physlcai VaIue OF
49,, - ,l Iele'on 70 'Ie,, -,
49,, 49,. '..,t,., -
stter,ut 70 seal. down outs+sn5ino secu-
rites on the orourd tbat corsti+,,+ionsl
difficulties, public expedienoy and con
h-enoe in American railroad investments
would torhc Is.
Question Of Future REGULATION.
~., .,r.,........- s.,,- ,... -.r-..., s,-
,,.,-,,e., l.s- .....-. ~, co. .-5 -...,.
,o...--, ,.- -. t... -. 49, i.-
sued t.s+ Tho orl, question ~ real inn
ps-tauce t- whether - is desirable for Tie
federal government 20 regulate the iss,a of
future se,l~fties. and II so IN what ey,ert
and i'm ,ybs. ,.sr,,e. -rs, ,,,-,i.. -,,..
y. ions 1..ry..er .ol.--,,,.s .,-,sl,. -
o'o oe'"5-' 70.'l-e9 '-' e'.y oN'Siana-
oresti,, o. f.t,,-. rs,,,rs,.,,, s. D.. -.