The Foraker Bill, which is understood to be preferred by the railroads, provides for thorough inspection of books, records, and transactions of interstate roads by agents of the Commission; and if any rate is found to be unjust, or unreasonable, or the carrier “is committing any discriminations forbidden by law, whether as between shippers, places, commodities, or otherwise, and whether affected by means of rates, rebates, classifications, differentials, preferentials, private cars, switching or terminal charges, elevator charges, failure to supply shippers equally with cars, or in any other manner whatsoever, the Commission, if the carrier will not desist upon due notice, may state the case to the Attorney-General, who is to bring suit in the circuit court in any district in which the act complained of, or part of it, was committed, and the court shall summarily handle the case and enjoin such rate or conduct as it finds unlawful or what is in excess of what is reasonable and just.” Appeal shall lie to the Supreme Court. The Bill authorizes agreements between railroads in respect to rates or charges and their maintenance so long as the agreement is not in unreasonable restraint of trade.
The provisions for inspection and combination seem to us eminently just and useful, although the latter is strenuously opposed by many on the ground that it authorizes and invites all the railroads of the United States to form a huge trust and monopoly to fix rates for the whole country. This, it is claimed by ex-Senator Chandler, “gives away all that has been gained by the Supreme Court decisions in the cases of the Trans-Missouri Freight Association, the Joint Traffic Association, and the Northern Securities Company. In the Joint Traffic Association case the nine railroad systems between New York and Chicago formed an organization of three billions of capital, made all the rates, and prohibited any one of the roads from lowering any rate without the consent of the nine managers of the trust. The court destroyed this three-billion monster. The Foraker Bill creates a fourteen-billion monster, which will prevent any railroad anywhere in the country from lowering any rates without the consent of the traffic managers of the combination.”
The plan of making the Interstate Commission a mere investigating body with no power to fix a rate, but only to state the matter to the Attorney-General, leaving the case to be tried on his initiative piecemeal in the circuit courts all over the country, with appeal to the Supreme Court, seems to us much more objectionable than the permission to form rate agreements. Under any such form of court procedure it will be possible for the railroads to delay final decision, fixing of a just rate, or abolition of an unjust practice for years.
Senator Elkins’ plan is substantially the same, his idea being to give the Commission no real power over rates, but only the right of petition for judicial action. And suits may be brought in the Federal courts of every district through which the lines of the carrier in fault are operated, with appeal on every suit to the Supreme Court of the United States.
Mr. Hearst has introduced a hill to bring the pipe lines carrying oil within the Interstate Act and subject them to the jurisdiction of the Commission; and another bill enabling the Commission to fix a rate, not merely a maximum rate, but the actual rate that is to be used in place of any rate found unreasonable or unjust. The order to take effect after 30 days. A special court of interstate commerce is provided for, which shall have exclusive jurisdiction to review the orders of the Commission, and suspend, annul, or enforce such orders, with an appeal to the Supreme Court only on questions of constitutional law. These are admirable measures in many ways, but are probably too radical for passage through the Senate, in which railroad interests have so large a representation.
Of the other bills the most important are the Esch-Townsend Bill, the Interstate Commission’s Bill, and the Hepburn Bill. The Esch-Townsend Bill was intended to give the Interstate Commission full power to fix a specific rate, either single or joint, in place of a rate found to be unreasonable or unjust, and to establish a special court of transportation to have exclusive original jurisdiction of all suits to enforce or prevent the enforcement of orders issued by the Commission under the act.[[381]] Last year this Bill was regarded as the most important measure before Congress, but this year, 1906, it has been superseded by the Hepburn Bill.
The main points of the Commission’s Bill are: 1. That power be granted the Commission, after full hearing, to fix the rate or practice to be observed in the future in place of the rate or practice found by the Commission to be unreasonable or unjust.[[382]] 2. That the Commission shall have authority to prescribe the form in which railway books shall be kept, with the right to examine such books at any and all times.[[383]] 3. That private car-lines, industrial railroads, import and export rates, etc., shall be brought within the scope of the Commission’s power. 4. That the time of notice of tariff changes shall be extended to 60 days, subject to modification in the discretion of the Commission, and the Commission says: “We think that 60 days is not too long in the great majority of cases, and that such length of notice would add greatly to the stability of rates.” 5. That the Commission shall have authority to order railways to continue through routes and joint rates and to prescribe the divisions which the several carriers shall receive in the distribution of those rates in case they fail to agree among themselves. At present “carriers are under no legal obligations to establish through routes or joint rates, and may at their pleasure withdraw from such arrangements when they have been actually entered into,” so that “if the Commission were to pronounce a joint rate unreasonable and order a reduction of that rate and the carriers parties to the rate should thereupon either cancel all joint arrangements, or, as they might, cancel their joint rates upon the commodity in question, the Commission would be practically powerless to enforce the reduced rate. When it is considered that a large part of the most important rates of this country are joint rates, it will be seen that the railways have it in their discretion by this means to largely defeat the purpose of the law.”[[384]]
The Hepburn Bill, which is one of the strongest measures before Congress, provides that the Interstate Commission, on complaint and proof that any railway rates or charges, or any regulations or practices affecting such rates are unjust, or unreasonable, unjustly discriminatory, or unduly preferential or prejudicial, may determine and prescribe what will, in its judgment,[[385]] be the just and reasonable rate or charge, which shall thereafter be observed as the maximum in such case; and what regulation or practice in respect to such transportation is just, fair, and reasonable to be thereafter followed. The order is to go into effect thirty days after notice to the carrier. And any company, officer, or agent, receiver, trustee, or lessee who knowingly fails and neglects to obey any such order is liable to a penalty of $5,000 for each offence; and in case of a continuing violation each day is to be deemed a separate offence. It is provided that the Commission may establish maximum joint rates or through rates as well as rates pertaining to a single company, and may adjust the division of such joint rates if the companies fail to agree among themselves. The Commission may also determine what is a reasonable maximum charge for the use of private cars and other instrumentalities and services, such as the switching services of terminal railways, etc. No change is to be made in any rate except after thirty days’ notice to the Commission, unless the Commission for good cause shown allows changes upon shorter notice.
The Commission may petition the Circuit Court to enforce any order the railroads do not obey. And if on hearing “it appears that the order was regularly made and duly served, and that the carrier is in disobedience of the same, the court shall enforce obedience to such order by a writ of injunction, or other proper process, mandatory or otherwise, to restrain such carrier, its officers, agents, or representatives, from further disobedience of such order, or to enjoin upon it or them obedience to the same.” Appeal may be taken by either party to the Supreme Court of the United States. The Commission may in its discretion prescribe the forms of all accounts, records, and memoranda to be kept by the railways, and provision is made for inspection as follows:
“The Commission shall at all times have access to all accounts, records, and memoranda kept by carriers subject to this Act, and it shall be unlawful for such carriers to keep any other accounts, records, or memoranda than those prescribed or approved by the Commission, and it may employ special agents or examiners, who shall have authority under the order of the Commission to inspect and examine any and all accounts, records, and memoranda kept by such carriers.”[[386]]