Year: 1874




The effect of the recent decision of the
United States Circuit Court regarding the
law enacted by the Wisconsin Legislature
to reduce the rate of fare on railroad lines
within that State, is just now the subject Of
much discussion. The passage of the law
in question was the first bold stroke by any
legislative body in the country in behalf Of
and in response to the demands of the
Grangers. 1t was intended for this purpose,
and was the result of mature deliberation
and careful thought The assumption upon
which it was based was that the State had
the right Of control over the charters of
railroad companies, because the franchises
under which they were built were derived
from the State. When it was put into exc
cution the Chicago and Northwestern COM
pany complained that inaSmuch as 1t re-
duced the tariff from four to three cents per
mile, it took twenty five per cent. away from
the earnings of the road, and consequently
prevented the possibility of paying profits
to stockholders. The court held that ''the
charters of the railroad corporations under
'the constitution of Wisconsin may be
ALTERED or repealed by the Legislature at
''sny time after their passage In legal
effect, therefore, there was incorporated,
Gin all the numerous grants under which
'the Northwestern Railway Company now
claims its rights of franchise and property
''in this State, the foregoing condition con-
''tained in the constitution. 1t became
part, by operation Of law, of every con-
tract or mortgage made by the company,
"or by any of its numerous predecessors
under which it claims The share and
"bondholders took their stock or their Sc
'curities subject to this paramount condi-
''ton, and of which they in law had notice.
"If the corporation by making a contract
''or deed of trust on its property could
''clothe its creditors with an absolute un-
''chsngesble right it would enable the cor
'poration by its own act to abrogate one of
the provisions of the fundamental law of
''the State" The court concludes there
fore that las to the rates for the transit of
persons and property exclusively within
'fhe limits of this State, the Legislature
chad the right to alter the terms of the
''charter of the Northwestern Railway
Company, and the fact that such altera-
''tion might affect the value of its property
"or franchises cannot touch the question of
power in the Legislature"


A careful investigation of the full text of
the decision shows that the foregoing ex-
tract embraces only points definitely settled.
The law also includes within its terms
property and persons transported on rail-
roads from other States into Wisconsin and
from Wisconsin into other States. Regard
ing this point, the court expressed no opin-
ion, and it is understood that the case will
be brought before the October term Of the
Supreme Court next fall.


1t will be seen from this that the "vic-
tory" of the Grangers is not so much of a
victory after all, because the question un-
derlying the entire subject-cheap inter-
State transportation for grsin-has not been
reached. 1t was indirectly involved; but
as the court merely held that the Legisla-
ture had constitutional authority to alter or
repeal the charters Of the companies at any
time after their passage, it follows that un-
less the same authority exists under the
constitutions of other States, the decision is
merely local in its character and will not
affect the continuous lines of railways from
the grain regions to the seaboard The
remedy, then, for the Grangers is to COM
bine to effect the same condition of affairs
in all the States of the Union-an under
taking, it must be admitted, which will re-
quire money, time and almost endless labor.
At the same time II must not be forgotten
that the railroad companies will not be idle
If they fail to defeat the law in the courts,
they will doubtless spend their money in
the Legislatures, and we shall have more
scandal and more corruption.