In these days regulation has apparently achieved a wider field for operation, and is deemed to be broad enough to regulate not only the property and the management of the property, but the management of everybody connected with it. That won't do. Why, I see it is stated in the report of your Business Association that commissions which have been organized by the states and the Commission organized under the act of Congress, have come to stay. Of course they have come—we know that, and we know another thing, that whenever a governmental commission comes, it stays. The commissions in the states, most of the states—God knows I wish I could say all the states, but I can not truthfully—have subserved a useful purpose. The state lays down the rule and the commission administers the law. There is one thing about a commission in the regulation under the law of railway carriers which places it in respect of proprietary, fairness and fitness for that function, far above Congress or any other legislative body, and that is this: That they have time to listen, to investigate, to get at the truth, which a legislative body does not have time to do in the very nature of things. I do not know, but I think nothing added more to the reputation of Governor Charles E. Hughes, of New York, than the fact that he refused to sign a bill, but vetoed it, reducing the rates which railway companies might charge, upon the ground that there had been no investigation which enabled fair judgment as to what was fair treatment to the railway corporations.
I was in public life a good many years and I am a firm believer in the sober second thought of the American people, for it represents the average judgment of every class of our people; but they get wrong, they get wrong about men, and they get wrong about policies and measures. They are subject, en masse, as men are individually, to moments of passion and excitement, and they know it. As Mr. Webster said, and as the Supreme Court of the United States has said, the fundamental object of a constitution adopted by the people is that they may protect themselves against themselves in moments of excitement and passion. And the American people will always give heed to the popular translation of the phrase, "Due process of law," that is, hear before you strike.
Now the Commission, the Interstate Commerce Commission, was intended by the Congress which created it to be an absolutely independent body. It was to report to the Congress, it was not to be subject to the command of either House of Congress, or of the Executive of the United States. It was intended to be a quasi-judicial body. I know all of its members, and I do not depreciate to the slightest extent the services which it has rendered. The only criticism I would have of it, and that does not arise from its membership, but it is inherent in the system, is that it is never satisfied with the powers it has got. It is as insatiable as death for power. It has been proposed that they shall have the power to regulate the issue of stocks and bonds by railway corporations created by the states, that is, if the state which creates the railway company authorizes it, desiring it to utilize its privileges for the construction of a new railroad, to issue stock, or issue bonds, that it shall not be permitted to do that thing until the act of the legislature and the approval of the governor shall have been supplemented by the approval of the Interstate Commerce Commission. Now I am getting along in years, and I am a little old-fashioned, and I have not yet been able to satisfy myself that where one government creates a stock corporation, another government shall regulate the amount of its capital stock and its bonded indebtedness.
I have seen it proposed lately that the Commission should have the power to fix a rate, and that that rate should be final until a final judgment setting it aside was reached. What becomes of the constitution under such a law as that? A railway company, as I have said, owns its property. It renders a compulsory service to the public over its own property, with its own equipment, with its own employes, and at its own risk, and is entitled to a fair compensation, based upon the fair value of the property which it devotes to the public convenience, and the Supreme Court has held that that property can not be taken—because the use of property is the property—can not be taken for the public use without just compensation, and if the state, the legislature, or the Congress may authorize a commission to fix a rate as reasonable and fair, beyond which the railway company may not charge for services it renders, and require it to observe that rate until the final adjudication as to whether the rate is reasonable or not, and after the lapse of months it is decided that it was unreasonable, how can the railway company recover the great sum in unreasonable rates which it had lost? It is a taking of a private property for a public use without just compensation, and I deny the constitutional power of Congress to do that thing. I admit the power, and the exercise of it to the fullest extent to so far regulate railway corporations as to secure to the public a faithful discharge of all their duties to the public at reasonable rates, and under fair regulations; beyond that I believe that the owners of the property ought to be permitted to manage the property.
The business of railway management has become one of the learned professions. It calls for some of the brightest intellects in the country. It calls for the exercise of powers which, if devoted to the law or to finance or to any other business, would place those who exercise it among those at the head. It is one of infinite complication, and it is not to be supposed that railway commissions can manage railway properties as well as the men who have been trained from boyhood to that business. I have never questioned that the Interstate Commerce Commission, the Commission in Wisconsin, and other commissions, earnestly set out to do the just and fair thing, but the trouble with this whole question is, and has been through many a year, that it gets too often into politics. I do not believe myself that questions of business ever ought to find their way into the political platform of the party, any more than I believe that the relations of the employer to the employe, whatever the business may be, ought to become the football of party politics.
This Association was born out of a happy inspiration. I think these troublesome problems are approaching solution. The railway companies must obey the law. The people ought to see to it that the law which the railway corporations are obliged to obey is a just law, and that is to be ascertained only on painstaking inquiry, and not through the speeches of enthusiastic orators or on the floors of Congress. It has got to be at times that where there was no other issue upon which a political contest could be fought out, the easy, obvious and last resort was "let us go for the railroads," or, as a Governor of Minnesota once expressed it, "Let's shake the railroads over hell." The truth is that the interest of the railroads is the interest of the people. The railroad company is dependent upon the people for its life and its sustenance, and the people are no less dependent upon the railway company, and between the two there should be even-handed justice. They should be dealt with calmly, and legislation should only follow deliberation and investigation, and a law once enacted should be impersonally enforced, not enforced against some and left to fall into innocuous desuetude as to others.
[RAILROAD PROBLEMS OF TODAY]
By J. B. Thayer,
Vice-President Pennsylvania Railroad Company.