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These great changes in the condition of the interior of British India were initiated, or, at least, actively commenced in accordance with a policy adopted at the commencement of our civil war. England, in place of attempting to break up our monopoly of the cotton trade by an open and formal assistance of the South, resolved to effect the same object by other and surer means. Her statesmen, with far reaching sagacity, resolved to improve the opportunity afforded by the American crisis, so as to attach the tottering Indian Empire to the imperial government by a bridge of gold.

In 1860-61, the Marquis Dalhousie, Governor General, inaugurated the extensive system of internal improvement, which was to enable the people of Hindostan to compete with America for the cotton trade of the world. The most favorable cotton regions of India were inaccessible for want of proper facilities for communication. In order to get the staple to a market, it was necessary to carry it by man and horse power over vast tracts of jungle, across mountains and ravines, and ferry it over great rivers.

To obviate these difficulties, the railroad movement inaugurated was of the most comprehensive character. The population of India subject to the English government is probably not less than two hundred millions. The country comprises an area of 1,364,000 square miles, stretching 1,800 miles in length and 1,500 miles in breadth from east to west. This great country is broken up into an almost endless geographical diversity. There are vast and impassable jungles, huge forests, mighty rivers, mountain chains and extensive plains, the whole being combined with a wonderful luxuriance of vegetation, which at every step obstructs progress and almost prevents any passage by man or beast.

It was over this country, presenting so many difficulties, that Lord Dalhousie contemplated his admirable network of railroads. The system was, of course, planned with reference to the geographical features of the country, so as to connect the extremes of the vast empire with grand trunk lines, from which branch lines, or feeders, might be constructed, according to the future requirements of local commerce. Four thousand six hundred miles of railroad were to be built, at an estimated expense of $440,000,000. The credit of the imperial government was granted to private companies, guaranteeing a certain amount of interest on all money invested in Indian railroads. The government wisely left all details of construction and management to the energies of the companies themselves, which had every motive for economy, as all money earned above the guaranteed dividends was clear gain. The system worked so well, that last year several Indian railways exceeded the 5 per cent. guaranteed interest. During the half year ending December 31st, the East Indian and the Great Peninsular railroad companies were able to declare surplus dividends. Half the amount of surplus income was devoted to the repayment of former advances for interest by the government, and the other half was divided among the stockholders.

The net amount of guaranteed interest paid by the government diminishes every year. In 1865 the amount was £1,450,000; in 1866 it was £800,000, and this year only £600,000 was required. These figures indicate the profitable character of these Indian railroad enterprises.

The original system of Indian railroads contemplated the establishment of communications between Bombay, Madras, and Calcutta, the three

great centres of military and commercial power. The extremes of the empire were united, and roads were cut through the great agricultural and producing districts. The East Indian Railroad Company has now under its management 1,310 miles of railway, constructed at an expense of $100,000,000, and is the longest line of road in the world under one company. The Great Indian Peninsular road will be 1,233 miles long wheu completed, and next year it will be open for traffic along its entire length. In 1868, from Calcutta to Bombay, a distance of 1,458 miles, there will be an unbroken railroad communication. The branch lines connecting with the main stems are of great extent, and will cost as much money as the main roads. To show the progress of Indian railroads it may be stated that it is only fourteen years since the first line was opened in that country. At the present time there are 3,200 miles in operation, and next year a thousand additional miles will be completed.

This development of railroads in British India is of the highest importance as affecting the cotton trade. Formerly we enjoyed a monopoly of the market; now, nearly one-half of the cotton manufactured in England is derived from India alone. A late Liverpool circular estimates the quantity of American cotton now on hand and to arrive before December 31st, 1867, at 680,000 bales, while the supply of India cotton for the same period is estimated at 925,000 bales. Without expressing any opinion as to the correctness of these figures, the more important fact for us to remember is that the manufacturers of England have so altered and improved their machinery as to be able to use in much larger proportion than formerly the shorter India staple, while, at the same time, the quality of cotton from that country has been decidedly and steadily improved, and is being more carefully prepared for market. Judging then of the future from the past, it may be expected to equal the American article at no distant period.

The establishment of railroads in India removes the chief obstacles to the growth of an almost unlimited supply of cotton. The country is admirably adapted for it, and the teeming population has long been familiar with the staple, and exhibit great aptitude in its culture. The best cotton regions have not yet been opened to the world; the only facilties for reaching a market being the slow and expensive process of cattle teams. The new railroads, however, will convey the products of these regions to market cheaply and expeditiously. And it is a noticeable feature of Indian railroad companies that their revenues are derived from goods rather than from passengers. Of $35,000,000 income of Indian railroads during the three years ending June, 1866, two-thirds were received from merchandise traffic.

J. L. PEARSON, PRINTER, Cor. 9th & D sts.

2d Session.

REGULATION AND CONTROL OF RAILROADS.

No. 57.

JUNE 9, 1868.-Ordered to be printed.

Mr. Cook, from the Committee on Roads and Canals, made the following

REPORT.

The Committee on Roads and Canals, who were instructed by resolution passed April 27, 1868, to inquire whether Congress has the power, under the Constitution, to provide, by law, for the regulation and control of railroads, especially those extending through several States, so as to secure, first, the safety of passengers; second, uniform and equitable rates of fare; third, uniform and equitable charges for freight or transportation of property; fourth, proper connections with each other as to transportation of passengers and freight; and if, in the opinion of the committee, Congress possesses such power, then to report a bill which will secure the foregoing objects, respectfully report.

The first question is whether Congress has, by the Constitution, such legislative control over the railways of the country which form continuous lines between the different States that it may pass general laws to insure regularity in the running of the trains, uniformity of charges, and safety of passengers, on all of such continuous lines of railroad in the United States. The eighth section of the first article of the Constitution provides "that Congress shall have power to regulate commerce' among the several States." Commerce among the several States has been judicially defined to be the interchange of merchandise and the intercourse of persons between two or more States, and the means used for the transportation of such merchandise and of passengers from one State to another are the instruments of commerce. The power to regulate commerce is the power to prescribe rules in conformity with which commerce must be carried on, and extends to the persons who conduct it as well as to the instruments used; this principle was settled by the Supreme Court, in the case of Cooley vs. The Board of Wardens, 12th Howard, 316. Accordingly, the first Congress assembled under the Constitution passed laws requiring the masters of ships and vessels to be citizens of the United States, and established rules for the government of officers and seamen; and when navigation by steam was introduced, Congress passed statutes regulating steamboats, their construction, equipment, officers and crews, prescribing qualifications of pilots and engineers, limiting the number of passengers they may carry, specifying the signals they shall use in passing each other, and, in short, has prescribed a minute code for building and navigating those vessels. The right to do this depends wholly upon the power vested in Congress to regulate commerce, and has never been disputed.

Congress has power to prevent the obstruction of any navigable stream which is a means of commerce between any two or more States. Works vs. Junction Railroad, 5th McLain, 526; Jolley vs. Terry Haute Railroad Company, 6th McLain, 237; Devoe vs. Penrose Ferry-bridge Company, 3d American Law Jurist, 79. The power given to Congress in the Constitution to regulate commerce among the States is an unqualified power, not limited to any particular branch, nor restricted to any specified instruments of commerce. The power

conferred is not a power to regulate navigation, but the power to regulate commerce, and if commerce be not limited to the interchange of commodities and the intercourse of persons by boats and vessels, or by navigable waters, then the power of Congress is not limited to the regulation of navigation only. The necessity is the same for the exercise by Congress of the power to regulate commerce carried on by railway as that carried on by steamboat. The reason for the power is the same. The grant of power in the Constitution applies, by its terms, equally to both. Commerce among the several States is not, at this day, exclusively or even mainly carried on by water; other instruments of commerce are now used unknown to the framers of the Constitution, but which seem as plainly within the letter of the Constitution as the instruments of commerce which were known to the framers of that instrument. In the case of Gray vs. The Clinton Bridge Company, reported in the American Law Register for January, 1868, Mr. Justice Miller, of the Supreme Court of the United States,

says:

Navigation, however, is only one of the elements of commerce. It is an element of commerce, because it affords the means of transporting passengers and merchandise, the interchange of which is commerce itself. Any other mode of effecting this would be as much an element of commerce as navigation. When this transportation or interchange of commodities is carried on by land, it is commerce as well as when carried on by water, and the power of Congress to regulate it is as ample in the one case as in the other. The "commerce among the States" spoken of in the Constitution must, at the time that instrument was adopted, have been mainly of this character, for the steamboat, which has created our great internal commerce on the rivers, was then unknown.

Another means of transportation, equal in importance to the steamboat, has also come into existence since the Constitution was adopted, a means by which merchandise is transported across States and kingdoms in the same vehicle in which it started. The railroad now shares with the steamboat the monopoly of the carrying trade. The one has, with great benefit, been subject to the control of salutary congressional legislation, because it is an instrument of commerce. Is there any reason why the other should not? However, this question may be answered in regard to that commerce which is conducted wholly within the limits of a State, and is, therefore, neither foreign commerce, nor commerce among the States. It seems to me, that where these roads become parts of great highways of our Union, transporting a commerce which embraces many States, and destined, as some of these roads are, to become the channels through which the nations of Europe and Asia shall interchange their commodities, there can be no reason to doubt that to regulate them is to regulate commerce, both with foreign nations and among the States; and that to refuse to do this is a refusal to discharge one of the most important duties of the federal government. As already intimated, the shackles with which the different States fettered commerce in their selfish efforts to benefit themselves at the expense of their confederates, was one of the main causes which led to the formation of our present Constitution. The wonderful growth of that commerce, since it has been placed exclusively under the control of the federal government, has justified the wisdom of our fathers. But are we to remit the most valuable part of that commerce again to the control of the States, and to the consequent vexations and burdens which the States may impose through whose territories it must be carried on? And must all this be permitted because the carrying is done by a method not thought of when the Constitution was framed! For myself, I must say, that I have no doubt of the right of Congress to prescribe all needful and proper regulations for the conduct of this immense traffic over any railroad which has voluntarily become part of one of those lines of inter-State communication, or to authorize the creation of such roads, when the purposes of inter-State transportation of persons and property justify or require it.

Before the days of railroads, in the celebrated case of Gibbons vs. Ogden, above referred to, Mr. Webster said:

A road, indeed, may be a matter of great commercial concern; in many cases it is so; and when it is so, I think there is no doubt of the power of Congress to make it.

It seems too clear for argument that the immense traffic now carried on between the several States, the interchange of the commodities of the several States, and the transit of the passengers from one State to another, constitutes commerce among the several States according to the strictest meaning of those words as used in the Constitution, and it has been settled beyond controversy that wherever" commerce among the States" goes, the power of the nation goes with it to protect and enforce its rights. Gibbons vs. Ogden, 9th Wheaton, 191;

Steamboat vs. Livingston, 3d Cowan, 713; Gilman vs. Philadelphia, 3d Wallace, 725.

Few things are better known than the fact that one of the most prevailing motives for the adoption of the Constitution was to regulate commerce; to rescue it from the embarrassing and destructive consequences resulting from the legislation of so many different States, and to place it under the protection of a uniform law. It was believed that the opportunity that some States would have in rendering others tributary to them in commercial relations would be impatiently submitted to by tributary States. A very material and essential object of this power was the relief of those States which, from their peculiar geographical position, must import and export through other States, from the improper contributions which might be levied upon them by the latter. Were the several States at liberty to regulate the question between State and State, means might be resorted to to load the articles of export and import, during their passage through their jurisdictions, with burdens which would fall with peculiar severity on the citizens of the interior States. Since the adoption of the Constitution the importance of these considerations has greatly increased. A large number of new States have grown up, at a great distance from the seaboard, whose exports and imports are carried mainly over the great lines of railroad. If any State has the right, either directly or indirectly, to collect from the inhabitants of other States passing through it any tax or impost whatever, whether the same be collected directly from the passenger or freight, or from the corporation, in proportion to the number of its passengers or the amount of its freight, and so indirectly from the passenger or freight, or if a State may lay a special tax upon any particular line of road, its passengers or earnings, different from that imposed on other roads, and in consideration of the payment of such tax may grant to the corporation the right to fix its own charges, and provide by law against the construction of any competing line, a very heavy burden may be imposed upon the people of the interior States, and the relief sought to be secured by the provision of the Constitution which gives power to Congress to regulate commerce among the several States be in a great measure lost.

It is insisted that the right of eminent domain is in the several States, and not in the United States, and that, therefore, the United States cannot authorize the construction of a railroad, and that the constitutional power of Congress is restricted to the regulation of commerce among the several States, and does not extend to the creation of an instrument of commerce. It is sufficient to say in reply, that the questions that the committee were directed to answer in this report do not embrace the question "whether Congress has the constitutional power to authorize the construction of a railroad between one State and another," but are limited, in express terms, to the question of the regulation of the traffic and intercourse among the several States by means of railroads, and depend for their solution only upon this question: Does the interchange of commodities and the intercourse of persons constitute commerce, as well when carried on by means of railroads as by means of navigable rivers?

It is impossible for the committee to state the value of the commerce among the States at the time of the adoption of the Constitution. It was, however, limited to a few millions of dollars. In the year ending March 31, 1867, the value of freight transported across the State of Illinois by railroad from east to west was $411,000,000. The value of freight transported across the same State, in the same year, from west to east, was $235,000,000.

Through-freight westward, for the year 1862.

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