which are to become effective without any really judiciary tribunal first considering them. Certainly no such theory as this was ever supposed to have been adopted by Congress or was ever universally, or at all, acquiesced in, and yet the same argument of alleged intention and acquiescence is being used to sweep this innovation into operation along with the other extensive features of the present bill. Whether such a combination of utterly incompatible functions clearly belonging to distinct departments of the Government can be vested in a single tribunal, is an entirely novel question under the Federal Constitution which must undoubtedly be raised for decision if this bill is passed, although on account of the comparatively small importance of the State railroad commissions a similar question seems never to have been raised as to any of them.

JOINT RATES.

There was never any pretense that the original interstate-commerce act gave the Commission the power to establish joint rates against the will and judgment of the carriers interested, or, in other words, to force carriers into involuntary partnerships, and the constitutionality of any such provision is open to the gravest doubt, yet this innovation seems almost to be incorporated in the present bill with the idea of being swept into existence along with the others on the unfounded plea that the whole measure is simply giving effect to what was supposed to have been enacted many years ago.

RELATIVE ADVANTAGE OF COMPETING LOCALITIES.

The most that was ever pretended, even by the Interstate Commerce Commission under the original act, was the power to prescribe a maximum rate, and the Commission expressly decided it had no power to prescribe a minimum rate, yet the power conferred by the present bill is the power to prescribe a specific rate which can neither be increased. nor reduced without the consent of the Commission. This will clearly enable the Commission to put into effect its theories about what should be the relative advantages of competing localities and which will introduce a sectional, and possibly political, phase into the administration of the interstate-commerce act which was absolutely removed from all the theories of regulation which Congress seriously considered when the interstate-commerce act was passed. Much of the support for the present measure comes from parties interested in particular localities who hope to profit by the Commission being able to give effect to its theories as to the comparative commercial advantages of competing communities, although everyone must, on reflection, appreciate that every time the Commission helps one community by such an exercise of its power it correspondingly hurts another, and also puts a check upon the most wholesome competition which has ever existed in this country-that is, the competition between rival localities or rival sources of production for the markets of the country.

TRAFFIC-MANAGER RATES ONCE ORDERED CAN BE CHANGED ONLY BY COMMISSION.

Moreover, this feature of the bill constitutes the Commission the perpetual traffic manager of every rate it assumes to fix, because when once fixed it becomes the specific rate which must thereafter be charged until the Commission authorizes a change. Consequently, every rate the Commission fixes will add to its duties and difficulties, because for all time thereafter it will have to supervise that rate, and no change can be made to meet new conditions or to correct inequitable results which experience may demonstrate without being investigated and authorized by the Commission.

DOES PROPOSED ACT FACILITATE DECISIONS?

The majority of the committee reports that the present Commission has failed to perform its present work in a reasonable time, and yet it proposes to confer upon the Commission the most stupendous additional powers and duties, and expects these new herculean tasks to be performed in a reasonable time, simply because it adds two members to the Commission, making it necessary for a body of seven to act on all the changes which the commerce of the country may demand in the specific rates which the Commission may fix, instead of having those matters disposed of by a body of five. The idea that any tribunal, whether five or seven, or any other number, should have to sit in judgment upon the changes necessary to be made in rates in this country for the development of commerce, was never at any time in the mind of Congress or in the mind of the people, but this will be the precise situation if the present bill is enacted with respect to each rate and rate adjustment that the Commission fixes.

The power and work of any State railroad commission in existence are simply infinitesimal compared with the power and work of the Interstate Commerce Commission under the proposed bill. No state in the Union has as much as 6 per cent of the total railroad mileage of about 212,000 miles. On an average, not 25 per cent of the traffic of any one State is subject to the control of the State commission. As a matter of fact, all the really important controversies between competing localities (which will furnish by all odds the most important and difficult rate-making propositions) grow almost without exception out of interstate rate adjustments with which State commissions have nothing to do. The Commission, through Judge Cooley as chairman, declared many years ago that the adjustment of the claims of rival communities in any single State would be an enormous task, but that in the Union as a whole it would be superhuman. Therefore, the country is utterly without any precedent to support the idea that a commission of seven or any other number of men can make, with the necessary wisdom and promptness, the changes which commercial conditions will from time to time demand in the specific rates and rate adjustsments which the Commission may fix under the pending bill, even if we assume that the Commission's original orders fixing the respective rates and rate adjustments are in themselves wise and proper.

POWERS CONFERRED CONTROL ALL REGULATIONS AND PRACTICES AFFECTING TRANSPORTATION.

66

The original interstate-commerce act deals primarily with charges for transportation and regulations affecting those charges. But the present bill increases its assortment of radical innovations by extending the power of the Commission to all regulations and practices whatsoever affecting the transportation of persons or property.' Under this bill the regulations and practices which the Commission may fix need not at all relate to or affect the charges for transportation, but the Commission's power will extend to all regulations and practices which affect the transportation itself. It is impossible to determine in advance of judicial construction how far this innovation goes and how much of the practical side of railroad transportation is thus put in the power of the Commission. Practically everything a railroad does affects the transportation of persons or property, and apparently the Commission is to be given the power to fix all rules and practices of the company which do affect such transportation, whether they relate to rates and charges or not. It is certainly carrying the argument of supposed original intention of Congress and supposed acquiescence far beyond the limit of reason to put this innovation under its protection and to rush through Congress the provision that the Commission may prescribe all practices and regulations affecting transportation in this country a matter which has never been seriously presented to Congress and which appears to have received no independent consideration.

REBATES.

The fact is that this bill is simply an aggregation of extensive innovations, and it is the outgrowth of a remarkable series of misconceptions. One of the most important is that in some way this bill is going to aid in the prevention of secret rebates, whereas not a single provision of the measure will give the slightest assistance in that direction or in the remotest degree help to insure that the highways of commerce shall be kept open to all on equal terms. The present laws, if fully enforced, will stop all rebates, and there is absolutely nothing in this bill to strengthen the present laws in that respect or to facilitate their enforcement. On the contrary, this bill is going to confer such tremendous and really impracticable powers upon the Commission as to make it more difficult than ever for the Commission to give the necessary time and attention to the paramount duty of discovering and preventing secret rebates. Moreover, this bill, by authorizing the Commission to prescribe specific rates, which can not be departed from without application to the Commission, is going to encourage secret rebates, because, when commercial conditions imperatively necessitate a speedy reduction in specific rates established by the Commission, it will be impossible to get the necessary consideration and action by the Commission in time to meet the exigencies of the occasion, and this condition will constitute an almost overwhelming temptation to the railroads to violate the mandate of the law that the rate fixed by the Commission must be observed until changed by the Commission and to make secret reductions from such rates for the purpose of meeting the immediate necessities of commerce.

D & P-05-16

TERMINAL TRACKS PRIVATE REFRIGERATOR CARS.

Aside from the evil of rebates, the discontent about allowances to terminal tracks and about the practices of private refrigerator car lines has constituted the most prominent basis of agitation for amendment of the interstate-commerce act, and yet there is not a word in the present bill which seeks to define any more clearly the relation of the Commission or of the interstate-commerce act to these terminal tracks or to the private refrigerator car lines, so that one of the principal sources of agitation remains absolutely unsatisfied and is still left for the consideration of the courts without any assistance from Congress.

PRESENT LAW HAS BEEN CONSTRUED-PROPOSED ACT MUST BE SUBJECT OF EXTENDED LITIGATION.

The status of the present act to regulate commerce has now been pretty thoroughly established by the courts, and what can be done under it is fairly well understood. The claim that as so construed it is unavailing is utterly without support, and though the supporters of the new legislation have been repeatedly urged to point to instances of failure of the present law where the Commission has acted along the lines prescribed by the courts, they have without exception failed to do so. The present bill simply amounts to throwing aside the reasonably well-defined system which now exists and which has not been shown to be insufficient, and to substitute for it a series of the most remarkable innovations, many and perhaps all of which will call for judicial construction, and to put the whole question of regulating interstate commerce into uncertainty for another series of years pending final judicial determination of the status of the new legislation; and all this is proposed without any demonstration of evils which the present act can not remedy, and certainly without any effort to increase the effectiveness of the law with respect to the particular evils which have excited the greatest attention.

PRESENT EVILS NOT ANALYZED OR REMEDIES PROVIDED.

The facts seem to demonstrate conclusively that the present evils have not been sufficiently analyzed, and the effectiveness of the present law has not been adequately considered. Certainly the relation of the proposed bill to the existing evils is most remote, and there is absolutely no excuse for many of the innovations which are sought to be incorporated in the law. The railroads and the commerce of the country have no more practical protection under this bill than they would have under any other form of drastic railroad legislation which could be enacted. The entire subject is too large, the interests involved from the public as well as the railroad standpoint are too great, and the details to be considered are too numerous and complex to make it just or proper that a bill so crude and uncertain as the one now proposed should receive the sanction and the impetus which would come from its passage from either House of Congress.

To borrow a phrase from one of our most accomplished statesmen, the agitation for the amendment of the interstate commerce act is

simply a "fortuitous concourse of unrelated prejudices;" and the bill now proposed does not remove the various causes of those prejudices, but launches the country on an absolutely untried and uncertain system of commercial regulation without time to consider what is really needed and what the bill really means, and yet upon a system which is fraught with the gravest menace to the railroads and the commerce of the country.

LOUISVILLE, KY., February 5, 1905:

WALKER D. HINES.

Mr. SMITH. I now ask permission-and this is my most important request--that Col. Henry L. Stone, of Kentucky, address you. Colonel Stone has been a soldier, is a lawyer, and is general counsel of the Louisville and Nashville Railroad Company.

Senator CULLOM. Is this all you want to say, Mr. Smith?
Mr. SMITH. Yes, sir; that is all I want to say myself.

STATEMENT OF COL. HENRY L. STONE, GENERAL COUNSEL OF THE LOUISVILLE AND NASHVILLE RAILROAD COMPANY.

Colonel STONE. Mr. Chairman, in the brief time that will likely be allotted to me this morning I should be glad at least to make a start upon one question and be allowed to finish it if the short time the committee is to sit will permit.

Senator CULLOM. Upon some subject pertaining to this bill? The general subject we have had discussed until we are almost worn out. Please address yourself to this bill; let us see what there is in it.

Colonel STONE. I want to take up one question which seems to have been presented by Senator Carmack at the last session of the committee, the constitutionality of this bill, whether or not the Congress can delegate power to a commission to perform a legislative act.

Senator CULLOM. Please address yourself to that.

Colonel STONE. The power to prescribe rates for transportation is a legislative power. The Constitution provides that

The Congress shall have power to regulate commerce with foreign nations, and among the several States, and among the Indian tribes.

Also that

All legislative powers herein granted shall be vested in a Congress of the United States, which shall consist of a Senate and House of Representatives.

This legislative power that is exercised is frequently called, in the decisions of the courts, an administrative power, but that it is a legislative power has been settled by the Supreme Court of the United States. In the case of Field v. Člark (143 U. S., 692) the question of the power of Congress to delegate legislative power was before the court. In considering the constitutionality of the act of October 1, 1890, containing certain reciprocity features, allowing the President to suspend the operation of that act, the act was upheld simply because the court held that the act, in so far as it conferred this power upon the President, was administrative; that the terms of the act as to tariff and regulations were prescribed by Congress; that power was only vested in the President to suspend the operation of the act by proc