INTRODUCTION

The Fifty-ninth Congress, at its first session, in June, 1906, enacted legislation amending the Interstate Commerce Act and the Elkins Act, and conferring additional powers upon the Interstate Commerce Commission. The purpose of this legislation was to amplify and broaden the scope of the railroad legislation referred to, so as to protect the interests of the shipper and limit the power of the carrier. From an economic standpoint this new legislation marks an era in the history of the republic. It is the beginning of Federal control of the commerce of the country. It is a recognition by Congress of the inherent power which resides in the Federal government, to regulate and control interstate commerce, and of the obligation which rests upon the government to exercise this sovereign power.

It is a tremendous power. Commerce is one of the chief concerns of government, because it constitutes the life of the nation. "Whoever control the trade of the world," said Sir Walter Raleigh, "commands the riches of the world, and consequently the world itself." When, therefore, Congress, exercising the sovereignty conferred upon it by the Constitution, enacts into law wise and salutary rules for the government of the great transportation companies which operate the railways of the United States, it must, of necessity, exercise Federal control over the commerce of the nation, and thereby establish economic conditions of vital. and far-reaching importance, which suggest new problems in industrial progress.

FEDERAL CONTROL.

The warrant for Federal control of interstate commerce is written plainly in the Constitution. The power to fix

rates and charges for transportation is an attribute of sovereignty, because in operating a public highway, a transportation corporation exercises the power of the sovereign. This power over public highways, constructed for public use, to accommodate public travel, and secure public convenience, is a matter of public concern and is absolutely essential to government. The sovereign cannot surrender this power, because, like the taxing power, the entire community has an interest in preserving it undiminished. Two sovereigns cannot exist in the same jurisdiction. One must be supreme, and the supreme power must, of necessity, be the Federal government. And so it was ordained when our fathers wrote into the Constitution the words declaring that that instrument and the laws made in pursuance thereof "shall be the supreme law of the land," and in express words subordinated the judiciary of the several States by declaring that "the judges in every State shall be bound thereby, anything in the Constitution or laws of any State to the contrary notwithstanding."

The assumption, therefore, by the Federal government of this power to control interstate commerce is not an assumption of the power of the States, because this particular power does not reside in the States, but in the Federal government. Indeed, before Congress assumed to exercise this power by enacting the Interstate Commerce Act, Chief Justice WAITE, in 1877, speaking for the Supreme Court of the United States, declared that "State legislation which seeks to impose a direct burden upon interstate commerce, or to interfere directly with its freedom, does encroach upon the exclusive power of Congress." 1 This doctrine has always prevailed and must prevail, if Congress is to exercise its right to regulate interstate commerce.

RAILWAYS OF THE UNITED STATES.

Our unrivalled railway system, the finest in the world, is the growth of seventy-five years. In 1830 there were but twenty-three miles of railroad in operation in the United

1 Hall v. De Cuir, 95 U. S. 485.

RAILWAYS OF THE UNITED STATES.

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States. On January 1, 1906, the total trackage was 215,000 miles, exclusive of second, third, and fourth tracks, yards, and sidings. If these be included, the aggregate will be 300,000 miles of track. The circumference of the earth is but 25,000 miles. The mileage of railways in the United States embraces two-thirds of the railway mileage of the world. The capital of these transportation corporations is estimated at $13,000,600,000. The aggregate value of their capital stock represents $6,339,899,000, and, in 1905, their income from freight and passenger receipts reached the handsome total of $5,500,000 per day. Some idea of the colossal proportions of the freight business alone may be learned from the fact that an increase of one mill per ton per mile, on the traffic for the year 1905, would produce $174,522,089. They employ 1,600,000 men. Their disbursements include operating expenses, fixed charges, floating indebtedness, improvement of road bed, necessary repairs, and dividends which may be declared from time to time on the capital stock. The vast power, exercised by the carriers of the country, are controlled by a directorate, dominated, it is said, by about a hundred men.

The principal railways of the United States are under the control of seven great systems, as follows: (1) The Vanderbilt System;1 (2) The Pennsylvania;2 (3) The Gould System; (4) The Harriman Lines; (5) The Hill System;"

1 Comprising New York Central; the Lake Shore & Michigan Southern; the Michigan Central; the Cleveland, Cincinnati, Chicago & St. Louis; the Pittsburg & Lake Erie, and the Erie Railway Company (formerly New York, Lake Erie & Western).

2 Including the Pennsylvania, and controlling the Baltimore & Ohio; Chesapeake & Ohio; Norfolk & Western, and holding jointly with the New York Central a controlling interest in the Philadelphia & Reading, which latter controls the Central Railroad of New Jersey.

3 Comprising the Wabash; the Missouri Pacific; the St. Louis Iron Mountain & Southern; the Texas & Pacific; the St. Louis Southwestern; the International Great Northern; the Wheeling & Lake Erie; the West Virginia Central: the Denver & Rio Grande; the Western Maryland, and now constructing the Western Pacific.

4 Comprising the Union Pacific; Southern Pacific; Central Pacific; Oregon Short Line: Oregon Railway & Navigation Co., with large interests in the Illinois Central; the Chicago & Alton, and Kansas City Southern.

5 Including the Great Northern; the Northern Pacific. and the Chicago, Burlington & Quincy.

(6) The Rock Island System;1 and (7) The Southern Railway System.2

These facts give force to the pertinent observation of Hon. JOHN F. DILLON, speaking of the danger of railway consolidation, "that uncontrolled power in a few men by any form of corporate device, to control the railway systems of great country, is a power too great to be compatible with the public weal, and one which would not be permanently endured by the people."

RAILWAY LEGISLATION PRIOR TO 1906.

The first general law by which Congress assumed to exercise control of commerce among the States and with foreign nations was approved February 4, 1887, and is known as the Interstate Commerce Act. It embraced legislation affecting only common carriers, and was supplemented by the Sherman Act, approved July 2, 1890, which included not only common carriers, but manufacturers and producers. The Sherman Act prohibits contracts and agreements of every kind in restraint of trade and commerce. This legislation as to carriers was further supplemented by the Elkins Act, approved February 19, 1903. Two causes contributed to hinder efficient administration of this railway and antitrust legislation. One was occasioned by the unavoidable delay in reaching the Supreme Court of the United States, as an appeal in the first instance was to the United States Circuit Court of Appeals. Another obstacle resulted from the difficulty of securing evidence to prosecute violations of the law. To obviate these difficulties Congress passed the Expediting Act of February 19, 1903, abolishing intermediate appeals to the Circuit Court of Appeals, when the government was a party, and authorizing an appeal directly to the Supreme Court, and giving cases so expedited a preference over all other litigation, except criminal causes. In order to compel witnesses to testify Congress passed several

1 Including the Chicago, Rock Island & Pacific; the St. Louis & San Francisco; the Chicago & Eastern Illinois, and the Choctaw, Oklahoma & Gulf.

2 This system controls nearly all the important railways of the South.