New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1916-11-26
Unity and Self
Government tor
The Railroad
System of the
United States
By Charles Ferguson

an 1915 II 10 lNUtSttDutt tto ftt"'tN"
Of the business system TO the goUey1i-
ment IN the principal European coun-
tries. and Ia 19IE-f5 to communicate
his findings on this subject to Ameri-
can business communities.
DERHAPS Mr.. Vanderllp spoke
with a Tilt of exaggeration
- when he said the other day
that forty-two thousand miles of
American railroads are in the hands
of receivers. But the amount is
large, and the suggestion is obvious
that a general receivership for the
whole interstate transportation sys-
tenn might furnish the best possible
solution for the railroad problem.
| want to recommend that solu-
ton. Mr.. Newlands's committee
should consider the idea of turning
the Interstate Commerce Commits
sion into a general and permanent
receivership.
Some years ago Senator New
lands worked out an interesting plan
for general railroad consolidation
with a view to making the whole
system self-governing and public
purposed at one stroke-without
public or political Ownership
Judging by his exordium at the
opening Of his investigation, ne
seems to have forgotten his earlier
inspiration. He should be reminded.
He speaks now as if our choice
lay of necessity between public own
ership on a Prussian pattern and
the rule of private interests with
sitter check rein and curb bit. That
is a narrow and unimaginative view.
It lacks all SAVIOR of mental fertility.
1t has no tang of the soil of the
United States.
We should reflect that the solu-
ton of the railroad problem involves
pretty nearly everything else in the
business world-commits us to
theory that we shall have to stand
by, of the general relation of the
business system to the government.
Now, ! submit that, while it is
good deal better to Prussianize the
business system than to let it run
loose in orgies of anarchism, it is
nevertheless perfectly possible for
the United States to vastly outclass
the Prussian method by creating a
business system that is both autono-
nous and social.
We should begin with the rail
roads. We should embrace the idea
of complete unifcation. That is OBJ
vious. We should abandon the no
ton that the vast and intricate or
ganization thus formed can be eff
fectively directed by any Of its vital
processes-rate fixing, wages,
iinance-by any organ that lies ont
side the body of the system.
Thus, unless we are ready to adopt
the socialistic theory that election by
majority should supersede our pres
ent practice of contractual selection
in the control of the staple indus
tries, we ought to decide that the
Interstate Commerce Commission
must either get inside the railroad
system or get off the track.
The way to put the commission
inside the system is to turn it into
a general receivership by act of Con-
gress.
The receivership principle lies
conveniently at hand. Its main lines
of corporate recuperation are clearly
grooved in the habit of the law. 1t
suggests luminously that corpora
tons can be socialized by other
means than public purchase Of stock
holdings or Of the physical plant.
Stock holdings can be transmitted
in the twinkling of an eye into de-
bentures or certificates Of bonded
debt. at the figure of current market
quotations. The government under
writes the securities and stands
ready TO finance extensions, upkeep
and improvements.
The Interstate Commerce Commits
sion, upon undergoing this metamor-
phosis, should naturally reform and
enlarge it's personnel in such manner
as to furnish a well balanced execu-
tive on the most successful models
It's membership should perhaps be
recruited for the future not by Pres
idential appointment, but by some
kind of cooptation that would fur
nish promotion from the ranks Of
the railroad world.
The receivership idea, as legal
conception, may be described as the
principle of erecutiUc arbitration.
We have judicial arbitration to set
tie the question who is right and who
wrong in a legal controversy. The
occasion for receivership arises