The sun., 1916-11-24
First Witness Before New
lands Commission
Blames Legislation.
CARRIER FACILITIES
NEAR A BREAKDOWN
Companies at Mercy of Poll
ticians - Investors
Frightened Off.

WASHINGTON, Nov. 23.-rhe Joint COM
mission Of Congres-the Newlands
ACKNOWLEDGEMENTS TO investigate
the railway situation In this country and
also the question Of Government owner
ship, started in to take testimony to-
day At tho Capitol. and at the very
outset heard IN exposition Of the de-
plorable condition to which the railway
transportation Of the country has been
brought by the present system Of regu-
iation by State as we'll as Federal au-
thorities.
IN accordance with the programme
mapped out by the committee listening
70 The railroads side frst. A. n Thorn.
general counsel of the Southern Rail-
way and spokesman for the railway
executives advisory committee. was the
nrst to take the stand to-day. He will
continue his testimony tomorrow.
II was made apparent that the big
point which the railroads are 10 make
In this investigation through the testi-
mony Of railroad presidents and others
n the fact that the transportation IA
cilities of this country have been
brought almost to the verge Of a break
down. chiefly through the impairment
Of railway credit, which has made II i'm
possible for them to Increase their plant
In proportion to the normal increase Of
the countryis business.
Roads at Mercy Of Politicians.
! To corrective rather than construc-
|, tive regulation MIR. Thorn attributed most
|. Of the evils of the situation In which the
. railroad industry now finds itself. The
corrective regulation INDUCED In by the
State and Federal commissions to
which the railroads are now subject had
. placed them more or less at the mercy
! Vestors.
I 1t was Of moro interest to the u
: try. he c%ontended. that It should have
adequate facilities to transport Its busi-
! ness than that rates should be lowered.
I The whole system Of public regulation
! Of privately owned railroads. he said.
must give way TO Government ownership
unless a way WAS found OF attracting
the money OF the investors. He issued
. to the relief Of the roads with legislation
that would mean a Capitalization OF
! control and less ~harassing from poll
tician there would be no adequate IA
. cilities for moving the of the
. country.
! In beginning his testimony to-day Mr.
I Thorn reviewed t~wenty-nine years OF
!, railway regulation. pointing to the fact
that the railroads had been built tc
, meet national needs upon private in,
itiative."
Welcomed by the PubIIc.
They were welcomed by the public
said Mr.. Thorn. ''ln the beginning there
was no limitation put upon their powers
as to charges. They were so welcome
that they were given Inducements by
way of subsidies. land grants. &c. The
result was that II created in the mind
OF the man who invested his means In a
! railroad that II was like any other pri.
vate investment. The investment was
not only welcomed but urged by the
. public.
1 Tho effect was to create In the mind.
. OF the investor the idea that he could
J use the railroads as his private prop.
!. erty. We now know that was erroneous
: The railroad managers. believing tina
they were dealing with private property
managed their holdings like any other
private property. They sold at different
prices-whOiesale and re,ail--one prlc,
to one customer and another to another
dinerent prices to different localities
Then followed the demand that dlscrimi.
nation cease. and there sprung I'D tn,
notion Of public duty"
Mr.. Thorn said 1t had been urged tina
he duty OF the railroad to the publ,
had been ascribed to the fact that the,
obtained grants OF rights OF way undel
the power OF eminent domain.
Risht In Use and O~wnership.
II do not accept that idea" he said
The foundation OF the public right is no
IN the bestowal of eminent domain.
is because OF the possession OF a powe
and agency In the railroad that is 3
great that it may control the destinies o
the country. The very possession OF
power 10 great implies a public right Il
Its use n ownership
But investors still cling to the idea O
private ownership. iT the opinion of MI
Thorn, and there arose the conflict an,
In public won. Victory rame to tn
side OF public conception OF tho publi
character Of these instrumentaiities O
commerce" said he. IAN the terms i'm
posed by the victors upon the vanquishe,
were correction and punishment."H
Right there Mr.. Thorn believes IN
pubic has been wrong. He believes IN
time has come when the policy OF IN
Government should be a constructiy
n e Instead Of trying to do nothing tx
cept punish the railroads and disciplIn
them h Government ought 10 stem 4
and correct some OF the Inequalities un
der which the roads are trying to operat
and In that way aid the OF IN
country by aiding In supplying the IA
ciIities for commerce. The speaker de
clared the past Fences or crimes of rail
road management had no place In IN
present hearing.
Bank Retaliation Il Cited
"The regulation OF banks Of the coun
try has been a constructive one," said IN
speaker. while the railroad regularly
policy has been part OF a destructiy,
plan--destructive Of abuses. The ques
tion before you Is whether the policy o
correction shall continue or whethe
some other policy shall be applied
whether a policy Of helpfulness shall no
be introduced"
Speaking for tho railway executive
Mr. Thom said that any policy he nigh
propose would have TO be Judged b
the standard OF public interest.
the public interest requires sufficIen
taciitles on reasonable terms he con
tinued. "lf II should come To a choic
oetween having the facilities or hayin
niaher charges the public interest woul
eull bs In having the facilities.
I would have YOU recall that tn
controversy OF last September had 10 d
with the retention OF facilities. Th
public interest was aroused at that tim
over the threatening cutting on or SUI
pension OF the facilities. read i'm tina
incident tho value the public puts o
Q transportation facilities withou
thought OF charges.
now commerce In this countr
y retarded BY lack Of cara. The publ