The nonpartisan leader., 1921-01-24

[YSsgT7T7sTg7s7 WENTY years ago the American pub
IT, hE8l lie began to get tired of the high
|n1 IssSl handed methods and the extortionate
lNassNl ESSa charges of American railroads. The
INsssewssS INsse@w ssSa result was long fight that ended
c-=== c= in the creation of the interstate COM
merce commission and state railroad commissions
in various progressive states 49,.
The interstate commerce commission had juris-
diction over railroads operating in more than one
state; the state railroad commissions over opera
tions wholly within the state Both the interstate
commerce commission and the various state rail-
road commissions were given virtually the same
powers. They had authority to regulate railroad
rates and earnings in their own respective spheres.
The method followed was this: (1) A complaint
against unfair railroad rates could be made either
by shipper or by the commission itself; (2) a
physical valuation" of the railroads property was
then made, that is, the physical value of a rail-
roads shops, engines real estate, trackage, etc.,
was determined by competent engineers; (3) the
earnings of the railroad in question term of
years then studied to determine whether large
profits were being made on the basis of the physi-
cal valuation; az if profits proved to be extor-
tionate (as they generally were) railroad rates were
ordered reduced to an amount that would give
reasonable profit" generally to per cent, and
no more.
In the early years the railroad commissions of
nearly all states and the interstate commerce COM
mission saved millions of dollars to farmers and
other shippers by reducing extortionate railroad
rates. The voters had been so thoroughly aroused
by the public be damned attitude of the railroads
that they saw to it that honest who would pro-
tect the public chosen for the various commits
sions.
So promising was the work of the commissions
that the voters demanded that they be given power
to fix rates for other public utilities WE'LL includ-
ing telephone companies electric light companies,
water companies and the like and this step was
taken in a majority of the states. a>
THE PUBLIC FORGOT-BUT
NOT THE CORPORATIONS
But having obtained good law the interest of
the public slackened, it often does. The public
started to take an interest again in prlzefghts,
murders, divorces prohibition and other matters
and to forget the necessity of keeping good men in
the various railroad and public utility commissions
to protect their interests.
But the railroads, the light companies, the tele-
phone companies, the gas companies, the water
companies and the like did not forget. They work.
ed tirelessly, day and night, to get the var
Gus railroad and utility commissions that would
protect their interests rather than the publicand
they finally got them.
The various railroad commission and public util-
ity commission laws necessarily were double
instruments If a railroad company could be
PEELED to lower rates, because it making too
much profit, obviously it must be allowed to raise
rates if making profit or too small profit.
On hasty consideration might think that the
provision for a physical valuation by engineers
would serve to protect the public against any in
justice. But there ways Of killing cat
than by skinning it. Railroads and other public
utility corporations do not pay their lawyers fees of
from $4,000 to 100000 year for nothing.
With men favorable to the corporations on the
railroad and public utility commissions the corpora
tions began rushing to these commissions for per-
mission to raise rates, just as shippers had pre-
vously rushed to the commission for reduced rates.
There were a thousand and one ways by which vau-
atons could be increased beyond all reason and the
corporations with the help of railroad commissions
friendly to them worked all of them.