The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1915-04-08

4
| transportation or virtually at cost, and
| thus the carrier would be denied the
| reasonable reward for its service att
er taking into account the entire traf-
| fic to which the rate applies, it must
be concluded that the state has ex-
ceeded its authority"
Broad as its power of regulation is,
said Mr.. Justice Hughes. the state
does not enjoy the freedom of an
owner" A railroad, as a carrier for
hire, "can not be required to carry
persons or goods gratuitously. The
case would not be altered by the as
sertion that the public interest de-
manded such carriage. In such
case it would be no answer to say
that the carrier obtains from its en-
tire business a return as to the suf-
ficiency of which it is not entitled to
complain
The action of the supreme court in
these two cases, the New York Even
ing Posts Washington correspondent
is convinced, is not a spasmodic up
rising, but the carrying-out of a care
fully developed plan for handling rate
questions which is to be followed in
all cases coming up hereafter. AS
evidence, the correspondent notes that
it was Justice Hughes who read the
two decisions, and ''it was he who laid
down the principle that the states
could regulate traffic within state
lines without necessarily interfering
with interstate commerce, as stated in
the Minnesota rate cases; seemingly he
has taken up the work begun in those
cases and carried it on with a logical
sequence" Railroad lawyers are said
to be still without a detailed chart
showing them how to value railroad
property for rate-making purposes,
and questions left undecided in the
Minnesota cases are still in doubt.
Yet certain important new points are
decided. For one thing, the court
now decides that each special rate
must bear it's just proportion of gen.
eral expenses, ''such as management
of the road, interest or return on the
capital invested in the shape of divi-
dends'' That is, explains this cor
respondent:
legislatures are not to be permit |
ted to shift all the general expenses |
on to wheat, because it is believed it |
would be a good public policy to build |
up Ignite coal business in a country |
of scant fuel, or free a passenger bust |
ness from all share of these general |
expenses. because the road probably |
senger traffic, in order to carry on a |
rich coal business. In other words, |
the 1eave-it-to-John' theory is not to |
be tolerated in rate-naking for favor |
lite commodities
Then there has been some progress
toward understanding what "confis-
cation" of railroad property means
AS we read:
I'm the North Dakota case particu-
larly, state officials contended that
rate is not confiscatory of a railroads
property, provided that a slight re-
Enumeration be allowed by a rate. For
instance, the supreme court of North
held that while a net profit of $500
on $4,000 business might not be
highly compensatory, it was remuner-
alive, and a rate that was remunera-
tive was not and could not be con-
fiscatory. That theory was put to
death by Justice Hughes opinion. 1t
was laid away with scarcelysa word"
Throughout Justice Hughes opin-
ions. several newspaper writer's note,
was found the phrase Substantial
compensation Though the justice
failed to fix it definitely, the New
York Sun declares that the meaning
Of this new rule of reason in state
-ate regulation is that railroad charges
can not "be reduced below point of
profitable yield which would require
the exercise of government compuI-
sion to maintain service for the /
public