The midland journal. (Rising Sun, Md.) 1885-1947, 1934-11-09
National Topics Interpreted

tOI VI A0AhOauSp
NeSU Idea on is going to recon-
Business Control mend in reports
soon to appear
that there be more stringent regula-
tion Of the railroads, 1t is to be noted
that Washington conversation lately
has included new idea respecting gov
ernmental relations with businesses
coming under direct federal regulation.
The discussion seems to center about
some idea concerning the obligation
which government owes whatever bust
ness 1t regulates and whose profits 1t
limits.
The talk one hears in many places is
to the effect that If the government, or
any government, lays down rules which
prohibit a business from reaping the
profits that accrue In good years, by
the same token it ought to consider
some form of compensation to that
business in the periods Of depression
through such as we are now passing
because it has refused to permit that
business to create huge layer Of fat
upon which it can feast in the bad
years.
Advocates of such theory, of course,
have Immediately found opponents. In
other words, two very definite schools
of thought have developed and al
though the question is nowhere near
solution nor is 1t likely that the forth
Of onn will
approach an answer, one can hear ar
guments pro and con on the point most
anywhere the subject is preached.
The proponents of the theory that
the government owes an obligation to
those businesses which it has regu-
lated within an inch Of their lives con-
tend that investors-which means the
public who own shares of stock-are
being Disseminated against by their
own government. Their claim is that a
business cannot survive unless it is
enabled to store away profits of the
good years against which it may draw
when the prolonged economic depres-
sions strike. The result is, according
~ tilIo al uAhC4t, LlldL uulCoo LllC 1oI
is stored away after the manner of the
bear in preparation for winter in
vestors can expect only to see their saw
ings destroyed from time to time, and
this with the sanction of their own
government.
In opposition to this new theory of
relationship between government and
business, one hears the usual denounce-
ments of the sins of the railroads and
the public utilities, but one also hears
complaint that if the federal govern
ment should embark upon a policy of
compromising those businesses which-it
regulates, it might be placing a pre-
MUM on mismanagement and even
downright crookedness. 1t is argued
likewise that the federal government
must not use taxpayers money in this
manner nor that it should employ the
policy Of compensation, as that
amounts to a subsidy.
At any rate new field has been
opened. On each side are to be found
vigilant and virulent defenders and
from this time it is made to appear
that congress is eventually going to
be compelled to decide how far this
regulation of business can properly go.
From all of the argument. here, it
would seem that each side has solid
ground upon which to stand. 1t may
be possible that from this controversy
something in the way of a new eco
nomic policy will develop. The Roose-
welt administration has gone farther
than any other in history in its regula-
ton Of business and there are those
who believe that a reaction is due. If
that be the case, then it appears log
ical at least that the two opposing
forces may bring about a compromise
that will be favorable to general bust
ness, which is subject to regulation,
and enable those who place their saw
dngs In stocks or bonds of such utili-
ties to feel reasonably secure about
some sort of an annual return.
Solution of this question of equity
between the government and the bust
nesses which it reg
Sotuttou ulates is not as sim
Not Simple pie as it may super
ficially appear. For
example, the question is put forward
whether 1t is possible to evolve any
method of measuring, even roughly,
the extent of the public obligation. It
is likewise necessary to determine In
advance of a final answer to the uues-
tion, whether the past inequities and
past treatment of public utilities is the
factor to be considered. There is
question whether the government is
openly to assume direct voice in the
management Of properties which 1t reg
ulates If there is compromising ar
rangement to protect investors in those
businesses. Then. 1t goes into the ques-
ton Of government ownership or gov
eminent control Of private industry.
Some Of the advocates Of this pro-
gram Of compensation call attention to
the public necessity for maintenance of
service, such as the. railroads supply,