The Southern Mercury. (Dallas, Tex.), Vol. 11, No. 29, Ed. 1 Thursday, July 21, 1892 Page: 9 of 16
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July 21, 1892.
SOUTHERN MERCURY.
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railway ownership.
Even this early in the discuss-
ion of the railroad problem, it is
begining to dawn upon the aver-
age investigator's mind, that rail-
ways coatrolled through a railway
commission will ultimately prove
a failure. Controll means an at-
tempt by acts of congress and of
State legislatures to create com-
missions empowered to fix and
maintain schedules' of rates and
tolls. Already these methods
have been conclusively demonstra-
ted to be impracticable. The peo-
ple are finding out that the courts
have emphatically deci l< d ihat
neither congress nor states by leg-
islation or commission, can pro-
vide for or put into operation any
schedule of rates or tolls to bind
a railroad, which cannot be re-
strained by injunction, and de-
clared void by either federal or
state courts.
The policy of the courts has
been all along, "if rates fixed by
law or a commission are not in the
opinion of the courts reasonable
that it amounts to a taking of pri-
vate property for pulic use, with-
out a just- compensation; and is
forbidden by the constitution of the
United States." See Stone vs. the"
Farmers Company 116 U. S.
reports page 307, Dow vs. Beidl-
man 125 U. S. reports page 680;
also in discisions in other federal
and state courts of last resort;
which will be found quoted in
Water Works vs. San Francisco
82 Cal. reports page 286, where it
was held that even where the state
constitution empowered a board
to fix rates absolutely, it could be
restrained by the court, if it thought
rates proper.
We have now seen that the un-
broken line of dicisions rendered
by the courts, declared that the
power to fix and maintain rates,
rests with the courts, and cannot
be placed elsewhere. These dicis-
ions also emphatically declare that
the rates and tolls must pay, 1st
interest on the railway debts. 2d
All its operating expenses; and 3d
a reasonable dividend on its capi
tal stock. The evidence to de-
termine these sums must be addu-
ced upon a trial of the cause. The
books of the company will neces-
sarially furnish the evidence. To
attempt to disprove these books
will inevitably be a failure, even
though they were falsely kept
The railway managers are too
smart tobe caught in such a flimsy
trap. If they ever anticipated such
result, they have strongly fortified
themselves against any attack in
this direction. Texas within the
next two years is destined to learn
some valuable, but costly lessons
on this «very question. In fact
the pipe is already laid to destroy
what little efficacy our railway
commission may have had to pro-
tect the people against railway
spoliation.
Judge Brown in rendering the
decision in the case of the North
Western railway vs. the State of
Iowa, outlined this very principle,
and the courts of last resort, in this
country, can be implicitly relied
upon to render paralell discisions.
Mr. C. P. Huntington in an inter-
view published in the San Francis-
co Examiner April 4, 1892, when
asked if the Merchants Traffic As-
sociation undertook to compel a
reduction of rates said: "I will say
that the Association may, or may
not, draw the company into poli-
tics. I think not; but, if the legis-
lature of the state passes an act
tending to destroy the value of our
property, we shall have to call for
protection from the judicial arm of
the government."
This language is significant.
The recent movements among
leading i ail way managers in
Texas, clearly shows that Mr.
Huntington's words will be
the rule of action of every rail
road in this country. Presuming
what every one in Texas will learn
later on, that "railway control
under a railway commission is a
fallacy," the question legitimately
comes to the front: What are the
people going to do about it? In
what way can the people effectu-
ally protect themselves and pos
terity against railway spoliation?
No one believes that Americans
will permit the railways to remain
long their masters, Then there is
but one way left open and that is
in government ownership.
The latest statistical reports for
1891 show that railway managers
estimate the value of railway pro-
perty in the United States as fol-
lows:
A88ETT8.
Railroads and equipments $8,598,081,477
Real estate, stocks, bonds, and
other investments 1,177.4531,927
Other assetts 239,929,541
Current accounts 190,050,105
Total 810,205,493,050
LIABILITIES.
Capital stock $4,495,095*,318
Bonded debt 4,828,365,771
Unfunded debt £57,477 160
Current account 250,510,897
Total •• $9,931,453,146
Excess of assetts over liabilities $274 039,904
Total earnings $1,199,722,053
EXPENDITURES A8 FOLLOWS:
Interest $226.793,682
Rents and interest paid 59,129,924
Miscellaneous 35,174,83:4
Operating expenses 774,373,838
Dividends 82,303,616
Total $,1,147,78U 3
It is thus seen, that the total
earnings over expenditures was
$51,990,660. Now add to this the
"dividends" $82,303,616, and it
makes $134,294,276. It4 is gener-
ally admitted that at least 40 per
cent, of the railway stocks and
bonds are fictitious, and by de-
ducting that amount, it would re-
duce the cost of railways to $6,-
123,296,830; a saviog of $4,082,-
197,220. By reducing the interest
from 5 to 2 per cent would add an
additional saving of $306,164,791,
annually. It is admitted by all
those well informed on this ques-
tion that an annual saving of $145,-
000,000 in running expenses would
result from government ownership;
and by adding these annual sav-
ings together, or $585,459,067,
enough would be saved to pay for
the roads in less than twenty
years.
Nor is this all. By comparing
the passenger tariffs in the United
States with those in Hungary, (that
government owning its railway
system,) we note a great difference:
HUNO A BY. UNITED STATES.
40 miles..
100 " ...
125 • ...
375 " .
500 " ...
..$ .81
.. 2.18
.. 2.62
.. 3.50
.. 3.60
40 niilos..
100 •' ...
125 ,k ..
375 " ..
500 " ..
9 i.a
3.00
3.75
11
15.00
The above is for first-class tick-
ets. Second-class cost 16 per cent
less, and third-class 50 per cent.
On slow trains the fares are stiil
lower. Freight tariffs are in the
same proportion.
It is thus seen that this plan
benefits the producers and citizens
remote from centers of population,
as well as consumers in the centers.
This is precisely what the South
and West need, and if they have
the manhood to vote for it, they
will get it.
But, says the objectors, the oper-
atives of the railroads will perpet-
uate the party in power indefinite-
ly. To this we reply if they could
do this, then they now can perpet
uate the rule of corporations. The
facts are that the history of this
country contradicts such state-
ments. This assertion is in line
with the oft repeated proposition,
that the ofiice now defeats the will
of the people. Cleveland defeated
Blaine, when he had the offices at
his back. Then Harrison defeated
Cleveland, when he ir. turn had
the machinery of the government
to aid his re-election. It is the
people who elect presidents and
congressmen, and with their rapid-
ly expanding intelligence, they will
continue to do so.
That there may be no shadow
of a foundation for such assertions,
reformers propose to place railway
and telegraph operatives under
rigid civil service rules. This will
effectually destroy the possibility
of their being used as a political
machine.
Hungary, Australia, Victori.*
and other countries own their rail
ways. They foresaw that the
great danger was in the corpora-
tions squeezing immense sums of
money out of the people by exorb-
itant rates, and then use this mon-
ey to buy up more hoodlum votes
than all government employees
could possibly cast in any election.
"queer but true.
It is not a new position for a
democrat to occupy, to be found
opposing the present financial
system, nor should it be thought
strange for republicans, who be-
lieve in good government to be
found in the ranks of reformers.
In 1872 the democratic party
was almost a unit in its opposition
to the financial system as inaugu-
rated by the republicans. It was
while' advocating this policy that
they gained their majority in Con-
gress; their strength being sup-
plied principaly by the West and
Northwest; the South at that time
being largely republican.
Until 1876 the opposition con-
tinued without abatement. There
was nothing too hard to be said
about this banking system by
democrats at that time. How dif-
ferent it all is row. In '72 it was
not treason to democracy to ad-
vocate a direct issuance of money
to the people by the government.
Whv should it be considered . so
now? And yet it is the sin of all
sins in the eves of the so called
democracv ot '92.
Has there been any chancre in
the laws controlling national banks
or has the financial poliev of the
Government been so modified that
democracy is appeased? There
has been no legislation in our
financial svstem to justifv these
changes with thedignitvof reform
laws. Whv then is the test of
democracv in this state made on
this financial question alone? Is
not the answer to th's, that the so
called democracv have changed
principle upon this question so as to
make them fit republican methods?
"It would look that way to a man
up a tree."
HE DID NOT DO IT.
Mr. J- H. Patterson of Cooper,
Texas, writes to know if Ex- Pres-
ident Cleveland gave five or ten
thousand dollars of his private
funds to the drouth sufferes ofWést
Texas. He did not. The state
of Texas furnished some of the
monev, and a considerable amount
of it was raised in New York City
through the instrumentalities of the
Presbyterian and other churches.
There was various sums of money
contributed bv the good people
Texas, as well as bv the people of
other states. Besides the
good people of various cities do-
nated cardad after earload of pro-
visions. No sir. If Mr. Cleve-
land gave even one dollar we have
no knowledge of it. He alleged
that it was unconstitutional to
help Texas fall T)emocrat«"J but,
♦he constitution did not. d^tpr him
from helping colored republicans
in Mississippi.
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Park, Milton. The Southern Mercury. (Dallas, Tex.), Vol. 11, No. 29, Ed. 1 Thursday, July 21, 1892, newspaper, July 21, 1892; Dallas, Texas. (https://texashistory.unt.edu/ark:/67531/metapth185474/m1/9/: accessed July 16, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; .