The Washington times., 1915-06-23
COMMODITIES CLAUSE RULE

The Supreme Court in a case in
volving the Delaware, Lackawanna
and Western railroad and it's coal
handling subsidiary corporation, has
broadly construed tho commodities
clause of the Dolliver- Hepburn act
to mean what it says. That law
was passed as means to correcting
abuses in transportation and indus
try which had grown very serious.
The Roosevelt Administration made
a long and determined fight for the
commodities clause, which ever
since its adoption has been the SUBJ
ject Of variety of constructions.
At one time it was believed to have
been almost destroyed by court de-
cisions; but the Lackawanna case
reinstates it, with the backing of an
unanimous court.
While the Pennsylvania coal
region has witnessed the most seri-
Gus results of the unduly intimate
relationship between transportation
and industry, yet those results have
been observable in other sections
and fields of enterprise. The effort
to divorce transportation from pro-
ductiop was necessitated unless the
coal business of the nation were TO
become in large part tributary to
the railroads. For many years, in
all parts of the country, the rail-
road interests have been gathering
in the mines. Just as the railroads
measure of control increased, the
opportunity for the independent to
compete successfully was diminish
ed, because the railroads authority
over both production and transpor-
tation, over car supplies, and the
like, gave it advantages that the
independent could not match if they
should chance to be used against
him.
Vast amounts Of capital have
been invested in the railroads coal
properties, and the readjustment to
the new rule might have been made
difficult. The courts decision seems,
however, to point the way to ac-
complishing readjustment with the
least difficulty. The railroad may
continue mining coal, but must abb
solutely disassociate itself from in
Iterest in the coal before arsporta-
tion begins. In other words, there
must be a sale--and the court is
fide contract whose provistns shall
be bona fde one-before the coal
is transported. The company may
not sell through an agent so ham
pered and restricted "as to make
him a puppet subject to the control
of the coal company" The
court intimates that the railroad
company will be permitted to sell
its entire product to one buyer if it
chooses; but it must do so by bona
fide contract whose provision shall
not be in restraint of trade. But
aside from being required to pay
according to the contract, this buyer
must be absolutely free; and, of
course, this means that he must
have precisely the same terms from
the railroad company, as to rates,
car supplies, and other facilities, as
any other buyer or producing seller.
1t would appear'that the decision will
open up a good many new questions
involving the exact relationships
that may subsist between buyers of
railroad coal. These will have to be
handled as they arise; it is better to
take this course than the rigorous
one of compelling the railroads to
sell their coal properties outright,
possibly at serious sacrifice, GER
tainly with the result of throwing a
great many such properties on the
market and greatly disturbing
financial conditions.
It's impossible to figure why
white ribboners should object to a