One way in which the railway managers evade the Interstate Commerce Law, in giving passes to large shippers and others, is to designate the recipients as employees of their own or other companies.[[14]]
President Stickney, of the Chicago and Great Western Railroad, said in a recent address before the Washington Economic Society:
“The law which makes it a misdemeanor for any individual not an officer of a railway company to use a pass was enacted by Congress and approved by the President 18 years ago, and as an individual rule of action it was ignored by the congressmen who passed it and by the President who approved it; and subsequent congressmen and presidents, with rare exceptions, have ignored its provisions. Travelling, they present the evidence of their misdemeanor before the eyes of the public in a way which indicates no regard for the law. The governors of the States, many of the judges,—in short, all officialdom from the highest to the lowest,—the higher clergy, college professors, editors, merchants, bankers, lawyers, present the evidence of their misdemeanor in the same manner.”
As we shall see presently, there are other forms of passenger discrimination, such as the free private car, the rate war, etc.
But neither of these nor the selling of tickets below the normal rates through scalpers, constitutes so inequitable or dangerous a form of discrimination as the pass system. As Hadley says: “The really serious form of passenger discrimination is the free-pass system. It is a serious thing, not so much on account of the money involved, as on account of the state of the public morals which it indicates (and develops). When passes are given as a matter of mere favoritism, it is bad enough. When they are given as a means of influencing legislation, it is far worse. Yet this last form of corruption has become so universal that people cease to regard it as corrupt. Public officials and other men of influence are ready to expect and claim free transportation as a right. To all intents and purposes they use their position to levy blackmail against the railroad companies.”[[15]]
Other leading countries are not afflicted with this pass disease to any such extent as we are; some of them do not have the malady at all. In France and Italy I was offered passes, but the government roads of Austria, Germany, and Belgium not only did not offer passes, but refused to grant them even when considerable pressure was brought to bear.[[16]] The Minister of Railways in Austria informed me that he had no pass himself, but paid his fare like any ordinary traveller. No amount of personal or official pull could secure free transportation. The same thing I found was true in Germany. Only railway employees whose duty calls them over the road have passes. The Minister pays when he travels on his own account. And the Emperor also pays for his railway travel. It is the settled policy of government roads in all enlightened countries to treat all customers alike so far as possible, concessions being made, if at all, to those who cannot afford to pay or who have some claim on the ground of public policy: as in South Africa where children are carried free to school; in New Zealand, where men out of work are taken to places where they may find employment, on credit or contingent payment; and in Germany and other countries, where tickets are sold at half price for the working-people’s trains in and out of the cities morning and night.
Even in England, though the roads are private like ours, the working-people have cheap trains, and public officials pay full fare. The King of England pays his fare when travelling, and if he has a special train he pays regular rates for that too. Members of Parliament also and minor public officers pay for transportation. Passes are not given for political reasons. The law against this class of discriminations is thoroughly enforced. But in this country not only members of Congress and other public officials, but some of our presidents even have subjected themselves to severe criticism by accepting free transportation in disregard of Federal law.
CHAPTER III.
PASSENGER REBATES AND OTHER FORMS OF DISCRIMINATION IN PASSENGER TRAFFIC.
In addition to the passengers who travel free on passes, there are many who have free transportation in other forms. One method of favoritism is the payment of rebates, which are in use in the passenger departments as well as in the freight departments of our railroads. Passenger rebates are repayments of a part or the whole of the amounts paid by favored parties for tickets or mileage. For example, large concerns that employ travelling men buy ordinary passenger mileage books, and when the mileage is used the cover of the book is returned to the railroad and a refund is made.[[17]] In the investigation of the Wisconsin railroads, instituted by Governor La Follette in 1903, it was found that every railroad of importance in the State had been paying passenger rebates in large amounts every year for the whole six years that were covered by the search. From 1897 to the end of 1903 the Chicago, Milwaukee and St. Paul refunded $170,968 in passenger rebates, the Chicago and Northwestern refunded $614,361; adding the Chicago, St. Paul, Minneapolis and Omaha, the Wisconsin Central, and the “Soo Line,” the total passenger rebates paid by the five roads named in the said time was over $972,000.
In the case of some favored shippers in Wisconsin it was found that the railroads secretly refunded the entire original cost of the mileage books bought by the said shippers for themselves or their agents, or $60 per book. So that these favored houses “were able to send out their entire force of travelling men without paying one cent of railroad fare, while their competitors paid full fares.”