The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-10-23
Plenty of Power to Afford Rail-
road Relief.


substantially 10 this effect:
rs II the general understanding among
bankers OF the country that this commits
sion has carte blanche 20 meet any situa-
tion or 10 maintain policy? We have
Constitution, and Congress has much
greater powers under tina; Constitution
than has this commission. The laws OF
this country must be obeyed and the com
mission itself must be obedient 10 the
law"
This declaration. which occurred in
the course OF examining II banker who
was offering testimony about the d.
ininishIng appeal OF railroad securities
to investors. seems TO Imply that the
commission has begun to entertain
doubts about its authority to consider
freight rates IN their relation to rail-
road credit. The astonishing feature OF
Commissioner CIEMESTs's remarks H.,
however, that they question not the
views of the bankers but views which
the commission Itself expressed as re-
Gently MS last July. when It rendered
bNA loaOi IA Nht WI vase AhlA - iVN
open agnin for further hearing.
One Of the fundamental assumptions
~ the Interstate Commerce Commits
sion for several years past has been
distinctly that the maintenance Of II
policy was lntrusted 10 1t by Congress,
mn mely, the policy Of providing public
transportation service by companies Of
private ownership. Some ideas set
forth by the commission In it's July de
clslon in the Eastern rate case were
hut repettlons OF notions previously
held regarding the public policy toward
the railroads which the commission
was charged with administering In
the July decision the following peril
nent observations were made, the
italics being ours:
The great burden Of creating these
avenues OF communication and transpor-
tation has been borne by private invest
ors. We cannot doubt that the
policy Of tHuitino and duthorfsinO the per-
tormdnce Of this public function by pri-
UoteIv ot0ned companies inrolrcs obliod-
tons on the part Of the public TO the oten-
ers Of these properties
What Is this hut TO say that the
mission extends to discharge OF the
public obligation denoted by the policy
so specifically stated? Moreover can
| Commissioner CLEMENTS and his as.
| Spnintns haNn DAMMIT Tint thiS
power is adequate to deal with the in
vestment position of railroad securities
in the present Juncture the point on
which greatest emphasis Is being laid
in the pending case? The commission
| is itself on record as recognizing that 2
very important element In determining
the reasonableness OF freight rates Is
the return on private capital invested
In public transportation.
We quote ngaln from the July de-
cslon OF the commission In the East
ern rate cnse:
THE public interest demands not only
the adequate maintenance OF existing rail-
roads. but a constant increase OF our
transportation facilities to keep pace with
the growth and requirements Of our COM
merce. IT, however, that development Is
to be accomplished with private capital IN
conformity with our traditions, nothing can
be more certain than that the facilities will
not be provided eXcep; under such a sys-
TEN of regulation as will reasonably per
init fair return Oh the money invested"
This should be enough To show that
the commission has been hitherto con
WINGED that its authority In regulating
rates reached 10 the consideration of
Investment return. which is the essen
tinl point at issue in the present pro.
ceedings. Moreover. the present case
differs from the case decided last July
only In respect 10 the status of rail
road investments in the situation which
the European war has created. Other
wise the two eases are Identical, ana In
Its July decision the commission said
the italics being again ours
THE proceeding before us may be de-
scribed az, In some sense n controversy
between the consuming public, which pay.
the rates, and the investor. who furnlshe,
the facilities for moving the freight ana
our duty Is 10 ascertain from the record
before us uhdt are their rcepcrttr,
rights"
There will be no quarrel with chair.
man CLEMENTs's discovery TINT the In,
terState Commerce Commission must
obey the law, hut there can be only
vast surprise ut any suggestion that
the law under which the commission
has been acting may not enable II Ia
meet the existing railroad situation OF
to maintain policy in reference tc
the railroads. Obedience TO the law
In the past has allowed the commission
to regard exactly the situation which
IL presented now and to meet II In nc
oordance with The maintenance OF a
we'll defined policy MS the commission