Monopolies and the People Part 12

_First._--It is announced that railroad corporations have the right of eminent domain, that this right is an attribute of sovereignty; and for this reason they must be considered public corporations. We have referred to this already, but refer to it again for the purpose of showing that the argument is not sound. The right of eminent domain is possessed by the supreme power of the nation. It belongs to all governments. Of right it is not inherent in, nor can it be acquired by, any private person or corporation. If the right is ever exercised by any corporation, company, or individual, it must be by the permission of the governing power; in this country by legislative grant. If it belonged to corporations they could exercise it without the consent of the legislature. They could themselves decide how, when, and where they would exercise it. They could prescribe the mode of condemning the property of others to their own use, and no power in government could question their acts. It will not be contended that without special legislative enactment, railroad companies could appropriate the property of others for the purpose of building their roads upon it. All will agree that before they can do this, the legislature must confer the right upon them. Does the act of granting to corporations the right to build their roads through the property of others confer upon them any of the attributes of sovereignty? If so, the legislature possesses the power of granting its attributes to corporations or to any private person. It would be immaterial whether a single person, a company, or a corporation, desired to build a railroad. To make such person, company, or corporation a part of the government, the legislature need but delegate to the party desiring to build a railroad the right of eminent domain; and from that moment the individual or corporation becomes a part of the government. A moment's reflection will convince the reader that the position is untenable. If one of the attributes of sovereignty can be _farmed out_ to railroad corporations, another can be to some other interest, and in process of time the government itself would become a mere skeleton, having delegated all its powers to private parties, remaining only a government in name. From time immemorial, the legislature has granted to various parties the same kind of privileges that are granted to railroad companies; yet it never was, and is not now claimed, that because of such grants, the parties obtaining them became public corporations, or that they were clothed with any of the attributes of sovereignty. Ferry companies, plank-road companies, and turnpike road companies, have been chartered with power to take the property of others, and place their ferries, buildings, and roads upon the property so taken, upon payment of the appraised value. In many of the states laws have been enacted under which private parties have been granted the same privilege. Persons building mills are permitted to construct dams across streams and appropriate such portions of the overflowed lands of adjoining owners to their own use, upon payment of its value as found by appraisers. A and B, and their a.s.sociates, desire to build a mill; in the construction of their dam they cause the backwater to flood the land of C. Under the provisions of the statute a jury is called, who a.s.sess the value of the land of C so overflowed and appropriated by A and B. The mill is built for the accommodation of the public. All who desire to do so can take their grain to this mill and have it ground upon payment of the required toll. The owners have, under the statute, the same right of eminent domain that is conferred upon railroad companies; and their mill is used expressly for grinding for all who patronize it and pay the required toll. The owners of the railroad, and the owners of the mill alike, serve the public. Both do it for a pecuniary consideration. Both have the same right of appropriating the property of others. Yet the railroad, under the decisions of the courts, is a public corporation, while the mill is a private one. The railroad corporation is clothed with one of the attributes of sovereignty, while the owners of the mill retain their character as a private corporation. No good reason appears for this distinction. While we admit that the supreme court of the United States has decided that because of the fact of legislatures having granted to railroad companies the right to appropriate the lands of other persons to be used as road-beds, they become public corporations, and that until reversed we must accept it as the law, we contend that as long as the railroads are owned and controlled by private parties, and their earnings are appropriated and used exclusively for private purposes, the facts are in direct conflict with the law as declared by the supreme court, and that either the facts or the law must be changed before they harmonize.

_Second._--It has also been decided by the courts that railroads are public highways (an absurdity on its face, that under the law railroads are public highways, while they are owned and controlled by private companies, who become public corporations because of one of the attributes of sovereignty having been conferred upon them), and that, because they are public highways, taxes can be levied upon the people for building and repairing them. The fact being admitted that private parties own and control railroads; that the government receives no part of their earnings, and that neither the government nor private persons can ride upon them without paying for the privilege, or procuring a pa.s.s, and that no freights can be shipped over them without payment of the amounts demanded, seems to conflict with the decisions of the courts. Under the decisions of the supreme court, the property of the citizen is taken from him without compensation, and bestowed upon a private corporation, and the plain provision of the const.i.tution has received a new interpretation, which compels the property owners to bestow a part of it on corporations without any consideration whatever.

The situation is about as follows: When a conflict arises between the people and railroad corporations, or when the legislature attempts to reform abuses practiced by them, the courts hold that railroad charters are in the nature of contracts, and that the legislature can neither alter, amend, or repeal them. The companies are then treated as private corporations. In proof of this look at the following decision, of recent date:--

"SUPREME COURT OF THE UNITED STATES.

"_The Wilmington & Weldon Railroad Company, Plaintiff in error, vs.

John A. Reid, Sheriff, etc.--In error to the Supreme Court of the State of North Carolina._

"Mr. Justice Davis delivered the opinion of the court:--

"This is a writ of error to the supreme court of the state of North Carolina, and brings up the question whether the recent legislation of the state, concerning the collection of taxes, is, as it affects the plaintiff in error, in violation of that provision of the const.i.tution of the United States which declares that no state shall pa.s.s any law impairing the obligation of contracts. As early as 1833, the general a.s.sembly of North Carolina incorporated the Wilmington & Weldon railroad company, for the purpose of constructing a railroad in the state, and inserted a provision in the charter 'that the property of said company, and the shares therein, shall be exempted from any public charge or tax whatsoever.' It has been so often decided by this court that a charter of incorporation granted by a state creates a contract between the state and the corporators, which the state cannot violate, that it would be a work of supererogation to repeat the reasons on which the argument is founded. It is true that when a corporation claims an exemption from taxation, it must show that the power to tax has been clearly relinquished by the state, and if there be a reasonable doubt about this having been done, that doubt must be solved in favor of the state. (The Binghampton Bridge Case, 3 Wallace.) If, however, the contract is plain and unambiguous, and the meaning of the parties to it can be clearly ascertained, it is the duty of the court to give effect to it, the same as if it were a contract between private persons, without regard to its supposed injurious effects upon the public interests.

"It may be conceded that it were better for the interests of the state that the tax-paying power, which is one of the highest and most important attributes of sovereignty, should on no occasion be surrendered. In the nature of things, the necessities of the government cannot always be foreseen, and in the changes of time the ability to raise revenue from every species of property may be of vital importance to the state, but the courts of the country are not the proper tribunals to apply the corrective to improvident legislation of this character. If there be no const.i.tutional restraint on the action of the legislature on this subject, there is no remedy, except through the influence of a wise public sentiment, reaching and controlling the conduct of the law-making power.

"There is no difficulty whatever in this case. The general a.s.sembly of North Carolina told the Wilmington & Weldon railroad company, in language which no one can misunderstand, that if they would complete the work of internal improvement for which they were incorporated, their property and the shares of their stockholders should be forever exempt from taxation. This is not denied, but it is contended that the subsequent legislation does not impair the obligation of the contract, and this presents the only question in the case. The taxes imposed are upon the franchise and rolling stock of the company, and upon lots of land appurtenant to and forming part of the property of the company, and necessary to be used in the successful operation of its business. It certainly requires no argument to show that a railroad corporation cannot perform the functions for which it was created without owning rolling stock, and a limited quant.i.ty of real estate, and that these are embraced in the general term property. Property is a word of large import, and, in its application to this company, included all the real and personal estate required by it for the successful prosecution of its business. If it had appeared that the company had acquired either real or personal estate beyond its legitimate wants, it is very clear that such acquisitions would not be within the protection of the contract.

But no such case has arisen, and we are only called upon to decide upon the case made by the record, which shows plainly enough that the company has not undertaken to abuse the favor of the legislature.

"It is insisted, however, that the tax on the franchise is something entirely distinct from the property of the corporation, and that the legislature, therefore, was not inhibited from taxing it. This position is equally unsound with the others taken in this case. Nothing is better settled than that the franchise of a private corporation--which, in its application to a railroad, is the privilege of running it and taking fare and freight--is property, and of the most valuable kind, as it cannot be taken for public use even, without compensation. (Redfield on Railways, p. 129, sec. 70.) It is true it is not the same sort of property as the rolling stock, road-bed, and depot grounds, but it is equally with them covered by the general term, 'the property of the company,' and, therefore, equally within the protection of the charter.

"It is needless to argue the question further. It is clear that the legislation in controversy did impair the obligation of the contract which the general a.s.sembly of North Carolina made with the plaintiff in error, and it follows that the judgment of the supreme court must be reversed. It is so ordered, and the cause is remanded for further proceedings, in conformity with this opinion.

"D. W. MIDDLETON, "C. S. C. U. S."

When the question of the right to levy taxes upon the people, for the purpose of building railroads, is before the courts, they decide that such right exists: First, because the right of eminent domain has been conferred upon the company; and, second, because the railroads are public highways; so, that, in every phase the question a.s.sumes, the decisions of the courts are in favor of these corporations, and adverse to the people.

Notwithstanding the fact that the decisions of the courts fix the status of the railroad corporations as public in their nature, the real fact remains that railroads are owned and controlled by private parties, and it is a mere fiction of law to call them public; and while we accept the decisions as law, the facts are unchanged. The effect of the legislation to which we have referred is apparent to all. It has strengthened corporations, enlarged their powers, and constantly encroaches upon the rights of the people. So great has this evil become that almost the entire population of the country, not under the control of or interested in railroad corporations, are demanding a change of legislation, and relief from the oppressions heaped upon them by these monopolies.

But the injuries inflicted upon the people by the decisions of the courts are far greater than those resulting from legislation. By the decisions of the supreme court of the United States, the distinction between public and private rights has been obliterated; the const.i.tution of the country has become of no more binding force than statute laws.

State statutes and the decisions of state courts have been overridden and annulled where the interests of corporations were to be subserved; the settled decisions of the same court have been overruled, and a new doctrine, in conflict with the settled interpretation of the fundamental law of the land, has been announced, which makes the people the va.s.sals of railroad corporations. The rights of the people and the states have been disregarded, and the edicts of the supreme court have been subst.i.tuted for const.i.tutional law. By the decree of that court, railroad corporations are clothed with the attributes of sovereignty, and the people are compelled to pay taxes to aid in the construction of their roads. That court has engaged in judicial legislation, and fastened upon the people a despotic government, with railroad corporations as their rulers. If it be true that railroad corporations are public and not private, they are not subject to the control of state courts or state legislatures. They are not by their charters, or the powers derived from legislative grants, made public corporations, and if they are public, they are made so by the decisions of the supreme court, or by some a.s.sumed power not visible to the public eye. It is contended by some, that if it is fully established that they are public corporations, the state legislatures and the state courts can regulate and control them. Is this so? Will not that fact take from the states all jurisdiction over them? The decision making railroad corporations public, also makes their roads public highways extending throughout the country. It is claimed that the general government, having power to regulate commerce between the states, can take control of all the railroads in the United States. No power is conferred upon state legislatures, in many of the states, to grant charters to railroad companies, conferring upon them any sovereign powers. And by the const.i.tutions of some of the states they are deprived of the power of aiding in any works of internal improvement. As a consequence, there could not be uniform legislation among the states in relation to railroads. Being public highways, and the corporations being also public, the power of regulating and controlling them, and preventing discrimination among the states, would belong to the general government, and these powerful corporations, chartered by the state in which they are located, could defy state authority. With a congress composed of their friends, and a supreme court already committed to their interests, the people would be powerless. But on the other hand, if (as we insist is the fact) railroad companies are private corporations, then they are within the jurisdiction, and subject to the control of, the authorities of the states in which they are located. This we insist is the true status of railroad corporations, and the courts, by their decisions, cannot change this character. The decisions of the courts of the different states and of the nation have not been of a character to command the respect of the people, and unless we accept the last edict of the supreme court of the nation, as the supreme law of the land, and admit that it supersedes the const.i.tutions and statutes of the states, as well as the decisions of the state courts, it is difficult to determine the character of railroad corporations and their relation to the people. Accepting that decision as final, the const.i.tution of the United States is of but small value, and state governments are of but little benefit to the people. Upon the various questions that have arisen in connection with the construction of railroads, and the rights of the people, and railroad corporations respectively, there has been such confusion in the decisions of the courts, as well as contradiction, reversals, and overrulings, that there now exists a necessity for the regular issue of a judicial bulletin, like the market reports, that the people may know what is the latest interpretation of the const.i.tution.

By the supreme court of the state of Iowa, it was decided to be const.i.tutional for counties and cities to subscribe stock to railroad companies, and that there was a statute authorizing such subscriptions.

By the same court it was decided, overruling the above named decision, that the const.i.tution did not confer the power to subscribe stock to railroad companies, and that there was no law of the state authorizing such subscription. The whole matter arose under the const.i.tution and laws of the state. The supreme court of the United States overruled this last decision of the state courts, and decided that such subscription was const.i.tutional and was authorized by the laws of the state. The courts of the states of Pennsylvania, Illinois, Indiana, Wisconsin, Missouri, and others, made like decisions, and the supreme court of the United States overruled them. The legislatures of some of the states--Iowa, Wisconsin, and Michigan included, pa.s.sed statutes authorizing local aid in shape of a tax to be voted to railroad companies. The supreme courts of these states decided that the statutes were unconst.i.tutional, and within fifteen months thereafter the supreme court of Iowa decided that the Iowa act was const.i.tutional. Like decisions were made in some of the other states. In Wisconsin the state courts decided the act was unconst.i.tutional, and the supreme court of the United States overruled that decision and decided that the act was const.i.tutional. Some of the state courts hold that railroad corporations are private, whilst others decide that they are public. The supreme court of the United States, by its decisions, clothes them with one of the attributes of sovereignty, and declares that under the law they are public corporations, and that their roads are public highways. The same court, upon the legal tender issues, decided that treasury notes were not legal tender for debts contracted before the enactment of the statute providing for their issue. In a few months after that decision was made, and after the friends of railroad corporations had so reconstructed the court as to have a majority of the court in favor of a re-hearing of the question, the same _high court_ decided that treasury notes were not only legal tender for all debts (save those excepted by the statutes), but that they were the standard of values. In all of the above decisions made by the supreme court of the nation, either reversing the decisions of the state courts, or reversing and overruling its own decisions, such reversals and overrulings were in favor of the corporations and against the people. When courts, whose duty it is to declare the law and interpret the const.i.tution, differ so widely and change so often, it is not strange that the people should begin to look with suspicion upon, and doubt the binding force of, these decisions; and when it is received as a truth, that in the appointment of judges care was taken to select men who were pledged to decide important issues then pending, in accordance with the interests and expressed wishes of railroad companies, it will not appear strange that the people, before voting for a judge, should demand of him a pledge in favor of measures advocated by them, or that he at least should pledge himself to abstain from judicial legislation and from twisting the meaning of the const.i.tution to suit the views of the monopolists who are already clothed with too much power. If it is important that men elected to congress and state legislatures should be in sympathy with the people in their struggle to regain their rights, now usurped by the different monopolies of the country; and if it is necessary that the executive departments of the state and national government should be filled with men who are friends of the people and in favor of restricting corporations within proper and legitimate bounds,--it is of vastly more importance that the seats of justice, the courts of the country, should be filled and controlled by men who, instead of deciding cases according to their own personal views of what the const.i.tution ought to be, will accept it in letter and spirit as it is, and decide accordingly. An inordinate desire to interpret the fundamental law, to give it a new meaning, or, as it is commonly expressed, for amending the const.i.tution by judicial legislation, seems to have seized the courts, and has been followed to such length as to make it almost impossible for even the courts themselves to decide when an act is const.i.tutional and when it is not. A new decision is made as often as a new judge is appointed, not unfrequently overruling the long settled decisions of the courts. These decisions, no matter how absurd or unjust, must be accepted by the whole country as the supreme law of the land. Of late years, by accident or design, most of the decisions on questions of a general nature have been adverse to the interests of the people, and in favor of monopolies.

Newly appointed judges, scarcely warm in their seats, have not hesitated to overrule the decisions of "Marshall," of "Story," and "Chase;" to disregard the views of "Webster," of "Adams," of "Jefferson," of "Washington," and "Hamilton," on const.i.tutional questions. Their own personal views have been subst.i.tuted for const.i.tutional law, until the protection that instrument is supposed to afford the private citizen is entirely destroyed, and the absolute control of the government is transferred to the few monopolists, who, under the sanction of the courts, oppress the whole people. Whatever reform may be effected in the legislative and executive departments of the government, no real reform can obtain without a reformation of the courts.

FIFTH.--_The Effect of the Legal Tender Decision, and its Antidote._--The power of congress to issue treasury notes and government paper as a war measure, is not denied. The authority or the right, under the const.i.tution, to make government promises to pay (treasury notes) legal tender, is not admitted. We have already treated of the legal tender decisions; of the reconstruction of the court, and the means used to secure the appointment of judges to insure a majority in favor of the validity of the legal tender act, and its general application to all debts save those excepted in the act, no matter at what time they were contracted. We recur to this subject again for the purpose of showing its effect upon the financial interests of the country. Whatever may have been the views of congress in pa.s.sing the act, or of the court in declaring it const.i.tutional, it has proved disastrous to the interests of the people, and of great benefit to the corporate oligarchy that now rules the country. Whatever may have been the views of the majority of the court, or the motives that prompted and controlled that majority in rendering the legal tender decisions, these decisions have proved disastrous to the interests of the people, and added greatly to the already great power of corporations and Wall street speculators. In our commerce with foreign nations we are obliged to use _money_ or its equivalent. While the acts of congress and the decisions of courts may make treasury notes legal tender for all domestic debts, and all foreign debts payable in this country, neither the acts of congress nor the decisions of courts can have any power or controlling influence over other nations. Debts due from us payable in foreign countries must be paid in coin or its equivalent. Our governmental promises to pay will not pa.s.s current as money in foreign countries, even though accompanied and supported by the decision of the supreme court, deciding that they are to be received by us as legal tender in all of our transactions. No one will claim that treasury notes are money, or that they are of intrinsic value. It is because the government is pledged to redeem this cla.s.s of paper with coin that it has a market value. All other nations recognize coin--gold and silver--as the measure of values. It is the standard for all other articles of barter or sale. It is _money_. All other issues are but the representatives of money. Debts due from us, payable in foreign countries, must be paid in money; legal tender will not answer. But if debts due us from persons residing in other countries are to be paid here, the debtors can take their money, buy our legal tender at a discount of fifteen or twenty dollars to the hundred, and discharge their debts, saving for themselves the difference between coin and paper. The confidence we have in the promises of the government to redeem in coin is all that makes treasury notes pa.s.s current, or gives them a market value.

The hope of an early resumption of specie payment is blasted by the legal tender decision. Its effect is to drain the United States of coin in our commerce with foreign nations, thus making it impossible to resume. Our coin grows less from day to day, and the secretary of the treasury is obliged to sell gold in New York at short intervals and in large amounts, in order to prevent the Wall street brokers making a margin of twenty-five per cent or more between coin and government paper. While stock jobbers and gold brokers make large profits in the appreciated price of gold; and railroad companies, in paying their bonds, make a net gain to the amount of the difference in value between gold and legal tender currency, the farmers and producers suffer loss to the amount of this difference in disposing of their products. When wheat is sold for one dollar per bushel, the seller gets but eighty-four cents, or just the value of treasury notes, and not one dollar in money, as he imagines, because the dollar he gets has no intrinsic value, but sells at its market worth, coin being the standard of values.

Another result of the legal tender decision is to make the value of farm products dependent upon the operations of Wall street sharpers. Legal tenders are the standard of values, says the court; coin and all marketable articles have their values measured by treasury notes. The price of treasury notes fluctuates. This fluctuation is not caused by any real change in the relative value of coin and treasury notes, but results from the dealings and operations in Wall street. If the "bulls"

corner gold, its value rises, or, more properly speaking, treasury notes depreciate in value. When the "bears" control the market, the price of treasury notes advances. This legal measure of values is constantly changing, and with its rise and fall the prices of western products also rise or fall. Railroads, railroad stocks and bonds, and the currency of the country, as well as the coin, are all under the control of Wall street operators, and as long as treasury notes are treated as legal tender, these same operators will control the markets of the whole country.

The legal tender acts and decisions, in effect, provide an irredeemable paper currency for the people, and coin for the government. Duties on imports must be paid in coin. Wall street brokers have the coin of the country cornered; the importer must buy it of them; he pays it to the government; government sells it to the broker, and he again sells it to the importer. It cannot get into general use, because the brokers preserve so great a margin between gold and paper as to drive all coin from circulation. They monopolize the gold market, and, under the legal tender decision, control the money market of the whole country. This state of things must continue until the legal tender act is repealed or the decisions of the supreme court are reversed.

The imagination cannot devise a more perfect system for the subjection of the best interests of the people to the control of railroad and monied corporations and companies, and Wall street brokers and gamblers.

It needed but the legal tender decision to make it perfect; to subject the whole country to the rule of rings and combinations of unscrupulous and dishonest men; to reduce the people to a state of va.s.salage more degrading than that of the Russian serfs. In name we are a free people, protected by the const.i.tution of our country; in fact, we are the servants of these giant monopolies. We retain of the proceeds of our labor such portion as they graciously permit us to keep. With the congress of the United States, and the legislatures of most of the states, committed to their interests, and the supreme court of the nation issuing its edicts in their favor, they can defy the people and continue their oppressions.

SIXTH.--_Popular Measure of Relief Discussed.--The Nature of the Reform Needed._--We recognize no higher human power than the will of the people. When the servants of the people, elected and appointed to represent their interests in legislative bodies, or to decide upon questions affecting public interests, prove recreant to the trusts and interests confided to them, the people--the sovereign power--can remove them in the method provided by the fundamental law, or, if this cannot be effected, then the people have the right, the G.o.d-given right, to resort to nature's first law for self-preservation. If by legislation the rights of the people are taken from them, then that power, retained by the whole people to be exercised when their rights are refused them--that power which is inherent in the supreme rulers of our country--can be exercised. Under our system of government it should not be a.s.serted save in the last extremety. When all other means fail; when redress can be obtained in no other way, then the people, as supreme rulers, should arise in their majesty, and, by the exercise of their reserved rights, _take_ what their servants have denied them. As a people, we have not yet reached the point which would justify extreme measures. While the different monopolies of which we have been treating, by their shrewd management, by the use of their money, and by concert of action, have obtained almost unlimited control of all the departments of the government, numerically they comprise but a small part of the population of the country. Their success is to be attributed to two causes: their systematic organization, and their unlimited control of the finances of the country. We might add, as a further cause of their success, the inattention of a large majority of the people to the political affairs of the country, and their willingness to follow a few political leaders, to whom they seem to have entrusted the entire control of the politics of the country. As a rule, we submit to wrongs in the administration of the affairs of states, as well as the national government, until we individually suffer from their mal-administration, then, what has been termed the "sober second thought of the people"

manifests itself, and reforms are effected. The situation of the affairs of the nation, and the great power that the monopolists have obtained in the land, have aroused that "sober second thought," and never in the history of our government has there been more urgent need of action on the part of the people. Never were issues presented that demanded more earnestly the united efforts of all who love and prize const.i.tutional liberty. The evils of which we have been treating can be remedied by demanding of all who fill official positions a recognition of the superior binding force of the const.i.tution. It is not to be expected that those men filling official places in the legislative and judicial departments of the government, who, from interest and custom, have become addicted to the habit of giving new meanings and interpretations to the const.i.tution, will reform the abuses that have been rapidly acc.u.mulating, or that they will manifest any zeal or alacrity in stripping the railroad corporations and other monopolies of the great powers conferred upon them, or that any real reformation can be effected without a thorough change of public servants. No matter what political party has control of the government, or to what party the men selected to fill the different offices belong, or with what political organizations they affiliate, unless they acknowledge the superior binding force of the fundamental law they should be requested to vacate their official positions, and their places should be filled by men who are willing to acknowledge the binding force of the const.i.tution, and will pledge themselves to abstain from judicial legislation. Men elected to congress and state legislatures are the servants of the people, elected to protect their interests; hence, their will should control the action of members of congress and state legislatures. Being elected to serve the people and not to promote selfish interests or support cla.s.s legislation, the people, before supporting any candidate for a legislative office, should demand of him a pledge to labor for and support only such measures as will tend to a restoration of the rights that have been taken from and denied to them, and by special charters and grants conferred upon corporations and other monopolies. Railroad corporations being created by legislative grants, their business being that of common carriers for hire, the legislature possesses full power to enact such laws as will limit and restrict their charges for transportation to a reasonable tariff, prohibit and punish extortions and unjust discriminations, and provide for the swift infliction of penalties whenever the laws are violated. Before the people elect any man to a legislative office, he should pledge himself to support and obey the requirements of the const.i.tution, and to abstain from that bane of a republican government, special cla.s.s legislation. By supporting only such men as would, in good faith, pledge themselves, as above suggested, and who, as legislators, would abide by their pledges, unjust discriminations would cease, and some of the rights of the people would be restored. But reforms must extend beyond the points named. Railroad companies being chartered and railroads constructed for the prosecution of the business of common carriers, having received aid in lands and bonds from the general government, and from states, counties, cities, and towns, bonds and taxes, as well as special privileges not granted to any other corporations, in contemplation of law, these companies are bound to act honestly. It was never the intent of the legislatures (if they acted in good faith) to create these powerful corporations, to grant them extraordinary aid and privileges, and then allow them, by false and fict.i.tious reports as to the cost of their roads, to charge unjust prices for carrying freights and pa.s.sengers. By the watering process to which we have referred, the pretended cost of the roads, as shown from their reports, is often two or three times the actual cost, and the rates that are charged for transportation are such as to pay dividends not only on the cost of the road, but on the fict.i.tious or added stock. Indeed, in many cases the stock reported as paid up is not paid in a legitimate manner; but when the company is organized, by selling bonds it builds its road from the proceeds, and from the earning of the road pays not only the interest on its bonds but acc.u.mulates a surplus. This surplus is divided among the stockholders, not as dividends on their paid-up stock, but is capitalized and stock issued to subscribers. The road is made to pay the interest, and eventually the princ.i.p.al, of the capital borrowed to build it, and also to earn money enough to show a paid-up capital to the amount of the actual cost of the road. This species of financiering on the part of the company is robbing the people, and abusing the privileges conferred by the charter. No thorough reform of the abuses practiced by railroad companies can be effected until the legislatures, by statutes, compel each and every company to purge its stock of every spurious dollar, so that the stock of each company shall not appear to be in excess of the cost of its road. If the legislature does not possess the power to do this, then it has the power to create a corporation that, by arbitrarily increasing its stock to any amount it may choose, can extort from the people sufficient to pay the interest upon such amount, and defy the power of its creator. The position is not sound. Any and all abuses practiced by railroad corporations can be corrected by legislative enactment, unless we admit that the creature is greater than the creator.

But it is claimed that if the legislatures should by statute compel railroad companies to reduce their stock to the cost of constructing their roads, or to their actual value, and then limit their tariff of charges to reasonable rates, great injustice would be done the innocent holders of their bonds; that such reduction would render it impossible for them to pay either the interest or princ.i.p.al of these bonds; that such statutes would impair the obligations of contracts; that many of the bonds are held by widows and orphans, who would be ruined. This may or may not be true. If true, who is responsible for it? Certainly not the states or the people. Originally the bonds were purchased of the railroad companies. If these companies by false representations have obtained credit on their roads to two or three times their actual value, the companies are the responsible parties, and not the public. While innocent persons may suffer, their suffering results from their own imprudence, or it is a misfortune occasioned by the fraud of the railroad company. There is no justice in allowing these companies to extort from the people money sufficient to relieve themselves from the consequences of their frauds. A owns a farm worth $2,000; he represents it to be worth $6,000, and by reason of this false representation obtains from B a loan of $4,000, secured by a mortgage on this farm. He fails to pay the money borrowed, and B forecloses his mortgage, and sells the farm. It pays but one-half his judgment or decree. Would B have any claim upon the public for the balance of his debt? He made his own contract, and expected a profit on his investment, but was disappointed. Under the law A had full authority to mortgage his land, and B had the option of loaning his money to A and taking a mortgage. He acted in good faith, and believed his security was ample, but was mistaken. Is there any difference in principle between the case of A and B and the purchasers of railroad bonds? Both parties will suffer loss because of the fraud of the party with whom they dealt. Neither have any claim upon the public in law or in equity, and both must look to the parties with whom they contracted. The charters to railroad companies empowered them to transact business, but did not empower them to commit frauds, by mortgaging their roads for three times their actual value. To require railroad companies to act honestly and charge reasonable rates for carrying freights, does not impair the obligations of any contract.

Nor does it, to compel them to reduce their stock to what it actually should be, measured by the value of their roads. The legislature should be composed of men who are not embarra.s.sed by personal interest, and who have not received bribes. We do not claim that because of the fact that men are stockholders or directors in railroad companies they are disqualified for seats in the legislatures of states, or of congress.

But do insist that when men are elected for the express purpose of advocating the increase of the already too great powers and privileges conferred upon corporations, they prost.i.tute their offices to base and illegitimate purposes. When the sole aim of men elected to represent the people is demonstrated to be to defeat every measure designed to relieve them from the effect of unjust laws, and to correct abuses practiced by the combined influence of corporations, they dishonor the place they fill. The rights of the people can be neither restored nor preserved, until legislatures are purged of this cla.s.s of men. Men who receive any remuneration from any man, cla.s.s of men, or corporations, paid or bestowed for the purpose of securing friendly legislation, are unfit to represent the people. It makes no difference whether the consideration is paid in money, or in _pa.s.ses over the railroads_; it is given as a _bribe_. Pa.s.ses are called complimentary; they are accepted as complimentary, yet it is a fact that these complimentary pa.s.ses are placed where they "will do the most good." They are given to congressmen, legislators, judges of courts, and executive officers. If it were necessary to offer proof that these pa.s.ses were intended as bribes, we need only look at the manner of their distribution to the members of the last Iowa legislature. They were distributed among those friendly to legislation in favor of railroads, and withheld from those opposed to such legislation. If pa.s.ses are purely complimentary, this was wrong; but if they are given as _bribes_ it was the proper distribution of them. The legislator who accepts a pa.s.s, and the party giving it, should be punished under the provisions of the statutes against "bribery and corruption in office." And the provisions of the same statutes ought to be enforced against all persons holding official positions in the states, and in the general government. If officers cannot afford to pay for travel over railroads on their present salaries, increase them so as to make them independent of railroad companies, who estimate official integrity as being equal in value to a pa.s.s over their respective roads. History demonstrates that in some cases these pa.s.ses have been received as full consideration for official influence. Legislatures possess the power to regulate and control railroad companies, and should exercise that power in every case of abuse of their privileges by the railroad companies. Some deny the power of legislatures to compel railroad companies to reduce their stock to the actual cost of their roads. This power is lodged in some department of government. We are not prepared to admit that these corporations are supreme; that they can openly, and in defiance of law, and the rights of the governing power, practice frauds, which, if practiced by an individual, would consign him to prison. If the legislature does not possess it, the courts certainly do, as we will hereafter demonstrate.

We have shown that by the manner of building roads with borrowed capital obtained by sale of bonds, and by extortionate charges for transportation, making their roads earn sufficient to pay dividends on stock which had not been paid, as well as on the watered stock, the railroad companies in the United States whose roads cost $2,456,230,000, yet in fact representing the enormous sum of $6,236,638,749, in what purports to be-paid-up capital stock, and bonds, were robbing the people.

The question we are now discussing is, How to remedy these evils. Our attempt thus far has been to demonstrate the fact that the remedy is exclusively within the state authorities, and not in those of the United States, and that railroad companies are private, and not public.

Adhering to these views, we contend that railroad companies are subject to taxation at the same rate on the a.s.sessed value of their property as an individual; and the legislature cannot adopt a different rule for taxing railroad property without disregarding the letter and spirit of the const.i.tution. The chartering, regulating, and controlling of railroad companies, and all corporations created for pecuniary profit, must remain with the states. To concede the exercise of this power to the national administration is to overturn republican government and take from the people the rights and powers reserved to them and the states; create a great central power without const.i.tutional limit or rest.i.tution, but governed by the personal views of those in office. We have treated of this subject in the preceding pages, and refer to it here in considering the remedies for the evils endured by the people. We know that congress has granted charters to corporations organized for pecuniary profit, and that United States courts have taken jurisdiction of cases arising under state statutes, and disregarded the action of state legislatures and state courts on questions affecting the interests of railroad corporations, and have also decided that congress possesses the power to charter railroad companies. But we do not recognize the decisions as right, nor do we believe they will remain long unreversed.

The opinion generally prevails that railroad corporations have abused, and are abusing, their charters; that they are oppressing the people; that there must be a reform of the abuses practiced by them. But differences of opinion exist as to the means to be applied. If we recognize the people as the source of power, and that they retain all the power they have not delegated to the government, the more nearly the interests of the people and the companies approach each other, the more closely they can be blended and united, and the more readily can abuses be corrected. To divide their rights and interests; to provide different governments, and rules of decisions for them; to make the people amenable to state authority, while the United States authority takes control of corporations, will create rival interests, and render railroad companies independent of the people. If the congress of the United States, claiming to have the const.i.tutional right, should provide by statute for transferring the exclusive control of railroad corporations to the United States, an entire change of the relation between the states and the general government would be the result. The states would not have the power to redress any abuses of the charter privileges granted to these companies, either by legislative enactment or by judicial decisions. Railroad companies created by state legislatures, and hitherto subject to the jurisdiction of the state courts, would be released from all obligations to state government, and from the control of state legislatures and courts. The congress of the United States and the federal courts would have exclusive control and jurisdiction over them, and constant confusion and conflicts of jurisdiction would naturally follow. Such a course would confer upon railroad companies still greater power, and place in their hands more efficient means for oppressing the people. Another evil resulting from such a course would be, that the whole corporate interest of the country could combine and concentrate their whole influence for the purpose of accomplishing any desired object. Now both congress and state legislatures must be bought over to their support; but if the United States government should take the whole control of corporations and railroad companies, the whole railroad force of the country, from the men who own, manage, and control this great interest, to the most menial employes, could be directed to a single purpose--that of securing congressional favor.

Now, state legislatures must be approached, and _persuaded_, as well as congress; then a single legislative body, and that one the farthest removed from the people, would be the only body to claim the attention of this great corporate interest. When grants were once made to railroad companies, and privileges conferred upon them, it would be simply impossible to effect any change, no matter how oppressive they might be upon the people. The idea that railroads are public highways, and that railroad companies are public corporations, already obtains among congressmen and in the supreme court of the United States. This is well understood among railroad men, as well as the fact that there is an increasing demand on the part of the people for the reform of the many abuses that are now practiced by them. Hence their anxiety to have the United States government a.s.sume control of railroad corporations. They desire it for another reason: Most of the special favors and grants they have received have been the result of bargain and sale. The same means will be used in the future unless a thorough reform is effected, and it will cost the corporate interests of the country less to deal with one body representing all the states than it would to deal with the legislatures of all the states. Another reason for this desire on the part of railroad companies is, that the supreme court, as now formed, is in full sympathy with them upon the points at issue between corporations and the people.

Careful consideration and examination of this question will satisfy the people that their only hope for the restoration and preservation of their rights in the conflict now existing between themselves and the railroad companies is in states retaining exclusive jurisdiction and control of all the railroad corporations and railroads within their respective borders. Another remedy suggested is, for the general government to purchase and own all the railroads in the country, and control them in the future. If this plan were feasible, it is of doubtful wisdom. The purchase could not be made without the consent of the owners of the roads. This consent could only be obtained upon payment of the prices demanded, because railroad stock is not such property as can be condemned for public use. It is not to be expected that the companies owning the stocks and roads would sell for less than cost; and this cost would be the amount of money represented by the roads. This we have shown is over $6,000,000,000. To pay less than this amount (being nearly three times their actual cost) would be aiding the companies to defraud their creditors, for the reason that the roads are the only security the bondholders have. The purchase of the roads would increase the national debt to the amount paid for them, and impose additional burdens in the shape of taxes upon the people. It would add to the list of government officers and employes at least two hundred thousand men, whose influence could be relied upon when the interests of the people and those persons in office conflicted.

It may be said that the government would not operate the roads, but would lease them. Would this afford relief? It would require two parties to make the contract. The contractor would agree to pay a certain stipulated amount for the use of the road. He would then fix his own rate of charges for transportation, and being only a lessee, would be virtually irresponsible. Government could not fix the price to be paid for the use of the road, and also the tariff of charges. But the lessee would demand the right to fix his own tariff in order that he might have sufficient to make repairs, pay for the use of the road, and make his profit. This system would be subject to the abuses of which the shippers now complain. Irresponsible persons would often have control of these roads, or a part of them, and a wide field would be open for fraud and irregular practices. The wants of the people demand some other and cheaper mode of transportation; either a cheaper system of building and operating railroads, so that the tariffs can be reduced, or some new method. The present roads may be superseded and another kind adopted. In that case, the present railroad system would become of little value, and would prove a loss to the government. Last of all, the general government cannot go into the railroad business without contravening the provisions of the const.i.tution. In addition to the above reasons why the government should not become the owner of the railroads, is this one, which outweighs all others: It would place them entirely beyond the control of the people. If the control of corporations is left to the states, they are in the hands of the people; each county, town, and neighborhood, can bring its influence to bear upon the questions at issue. In the election of congressmen and other United States officers, local issues are lost sight of. National questions engage the public mind, while in the election of members of the state legislatures and other state officers, local questions enter largely in the canva.s.s.

Numerically, the monopolists are but a small fraction of the people; their great strength lies in the control they have obtained over the business and finances of the country. The people, united against the monopolists, can elect whom they choose to any state office, and can secure a majority in their favor. The remedy is in their own hands, and by united action they cannot fail of success. If a reform is ever effected, if the people ever regain their lost rights, they must commence at the _ballot box_. The producers throughout the west and south are largely in the majority; they can elect their own men. If they fail to do so, if they do not themselves apply the remedy, they ought not to complain of others because they do not apply it for them. There need be no difficulty or delay in effecting reforms dependent upon legislative action, provided the people are true to their own interests.

They elect their agents to act for them. If they do not elect men who are with them in principle, sympathy, and feeling, they ought not to complain.

But, says the reader, admitting that legislative reform can be accomplished, how can the decisions of the courts be changed? This question presents more difficulty. It has been the custom from time immemorial for courts to be governed and controlled by precedents. This is adopted in order that the law may be settled and certain. When questions arise under statutes, the meaning of which is ambiguous, resort is had to former decisions under like statutes, for a rule of construction, and thus the law is _settled_. We accept the decision as the law of the land, and to criticise it is seemed discourteous to the court making it. To call in question the motives of the courts, or to doubt their wisdom, is deemed rank "treason." The rule governing them may be of ancient date; the reason for its adoption may have long since ceased; the rule itself may be obsolete. Yet, to find a precedent for a decision that outrages justice and is at war with the best interests of the people, but in favor of the corporate interests of the country, this old rule is dragged from its long repose and made the basis of new decisions. Most of these old precedents originated in monarchical countries, where all doubtful questions were construed in favor of the crown, and where the rights of the people always yielded to kingly prerogative. While precedents should have their true weight in determining between private parties, when none of the great questions arise affecting the national welfare, and while interpretations of the const.i.tution, acquiesced in for many years, should remain as the settled law of the land, and be observed by the courts, the practice of solving const.i.tutional problems by resort to old monarchical precedents, and the adoption of the reasoning of the high courts of the king's _exchequer_, should not be tolerated in a republic. Our form of government is new.

Our courts should be the courts of the people, and not a _star chamber_ for the protection and perpetuation of the monarchical dogma, that "it is absolutely essential to independent national existence that government should have a firm hold of the two great sovereign instrumentalities of the _sword_ and the _purse_," as was declared by the supreme court of the United States, in December, 1871. Such declarations are at war with our ideas of republican government. It has no support save in despotic governments and decisions emanating from them; yet it is the doctrine that must obtain, if the recent decisions of the supreme court are to remain as the settled law of the nation. To accept this doctrine as a final exposition of the relative rights of the people and the government, is to acknowledge that the agents and servants of the people, elected and appointed to office, become their masters, clothed with imperial powers.

It is not only in the adoption of old precedents that the rights of the people have been denied in courts, but by wresting the meaning of the earlier decisions made by the distinguished men who graced the bench of the supreme court in its earlier and purer days. The "Dartmouth College"

case was the first in which the rights of states or the people to interfere with charter privileges was determined. We have given the history of this case in preceding pages. It in no sense justifies or supports the recent decisions of the court, as to the rights and privileges of corporations organized for pecuniary profit. Yet, taking the decision in that case as a precedent, the supreme court has gradually encroached upon the rights of the people, until, under its latest decisions, railroad corporations are public corporations, their roads are public highways, and the property of all the tax-payers can be taxed, and the taxes thus collected can be used by these private corporations to pay for building and repairing their roads. This is the latest new departure, and with the "Legal Tender" decision, makes the interest of the whole people, as well as the value of their property, depend upon the action of corporations.

No good reason can be shown why the decisions of courts should not be subjected to criticism, the same as the acts of legislative bodies. The courts are a co-ordinate branch of the government, but with a power greater than that of the legislative and executive branches combined.

The decisions of courts render nugatory the acts of the other departments of the government. To admit that the decisions of the judiciary cannot be questioned, is to concede to it all the prerogatives possessed by absolute tyrants. Not only have the people the right to question the decisions of the courts, and if need be to examine the motives which prompted them, but also to know the views of the men who aspire to judicial positions, upon all questions of a general and public nature. No candidate for judicial position should be expected to form an opinion upon, or decide a question affecting the rights of parties until it had been finally submitted. But, upon the great questions that frequently arise affecting the public welfare, his views should be publicly known. Let the people understand the views of the men seeking for a seat on the bench, before his election, and judicial legislation and partisan decisions will soon disappear. The judges of the supreme court of the United States hold their offices for life, by appointment; that court is further removed from the people than state courts. Reforms are not easily effected. Judges recently appointed received their appointment because of their understood views upon certain public questions. The course of decisions of this court demonstrates that the rights of the people are considered of less importance than the demands of corporations, in cases of conflict. While the present system of selecting these judges continues, with their life terms, it will be hard for the people to regain their rights. There are times when, because of oppressions, the people have the right to demand changes in the fundamental law. At the present time they are demanding redress; they are asking to be relieved from the unjust burdens imposed upon them by companies and corporations, who are petted and supported by the supreme court. But one certain means is left them, and that is an amendment to the const.i.tution, restricting their term to a certain number of years, and providing for their election by the people. We could then free ourselves from the burdens imposed upon us by this anti-republican department of our national government, and take from corporations some of their oppressive powers and privileges, now a.s.sured to them by the decisions of the supreme court. If any relief is afforded the people from the oppressions under which they now suffer, they must obtain it through their own efforts. No other channel is now open. All of the departments of the government, state and national, are more or less controlled by the monopolies against which the farmers are now preparing to fight. The silent ballot is the weapon to use; when used by a united people victory is a.s.sured. It is more potent than all the appliances of an army; more thorough in its execution than the bullet. It is the dread of the unfaithful legislator, dishonest office-holder, and the unjust judge. It strikes terror into the hearts of the unscrupulous men, who are willing to sacrifice honor, country, and future happiness for the purpose of ama.s.sing wealth, by extortions practiced upon the sweating, toiling millions who till the ground. While partial relief may be obtained through other channels, real, genuine, and lasting redress can only be obtained by organized action at the polls.

How can the abuses of the transportation system be corrected? This question is now having a practical test in Illinois, and is being discussed throughout the country. It is being demonstrated that a _pro rata_ tariff will not afford relief; and that some other means must be adopted. What that may be, time will develop. No uniform _pro rata_ tariff would be just to either the companies or the people. The shipping of way freights is always attended with more proportionate expense and delay than at prominent and terminal points. The extensive shipper, who loads a large number of cars for a single train, should be allowed more favorable rates than the one who ships at some way station but one car of freight at long intervals. The real cause of complaint is the uniformly exorbitant rates charged for carrying freights, in connection with the present warehouse and elevator system. The legislatures and the courts are clothed with full power to prevent oppressive or unjust charges for carrying freight. They care not how much per cent the companies shall make upon their investments; but when their charges amount to an abuse of their charter privileges the legislatures and the courts can correct them. The rule established by railroad companies, to force from shippers such rates as will pay interest or dividends upon an amount of imaginary stock, is unjust. The process by which they increase their stock to two or three times the amount invested is fraudulent. The legislatures and the courts possess the power to compel railroad companies to make a return of the actual amounts of money invested in their respective roads, in order to determine whether their charges are excessive and oppressive. Railroad companies being dependent upon state legislatures for such grants as will enable them to construct their roads, and being common carriers, the legislature can, by statute, restrict the capital stock to the amount invested. If this course had been adopted years ago many of the abuses now endured by the people would have been prevented. Not only has the law-making power the right to restrict the stock to the actual cost of the road, but it has also the power to fix the maximum rates for transportation. Compet.i.tion will always have a controlling influence upon the price of any commodity, as well as fixing the price of any species of services or labor. The legislature has the power to enact statutes to prohibit the consolidation of the business of railroad companies, or a combination on their part to charge excessive tariffs; and the courts possess the power to enforce the observance of such statutes by the infliction of suitable penalties. In this connection the abuses practiced by the dispatch compa