Commissioners, to bankers, or to a fiscal agent, the continuing power of finally deciding what, from time to time, is or is not for the public good? Is the power of Eminent Domain susceptible of unlimited delegation as against reluctant third persons; and, if not, what are the limits? It may be noted in passing that to impose a special tax on stockholders, in order to provide the cost of limiting their dividends, savours of hardship. It is rather like seething "the kid in his mother's milk."

If the irregularity complained of be extortion or discrimination, legislation limiting dividends would seem to apply a corrective in the wrong place. It is, on the whole, more tolerable to restrict the method of farming than first to encourage unrestricted outlay by the farmer and then to confiscate part of his harvest. If legislative coercion be needed, it is the business of the statesman to see that it be applied in the right place; that the mode of application combine the maximum of force with the minimum of friction; that his remedy be proportionate, in point of severity, to the irregularity complained of; and that it will not (except where an explicit penalty is imposed on the wrong-doer) irreparably injure the fortunes, or impair the public efficiency, of the enterprise to which it may be applied. Restriction of dividends, considered as a remedy for discrimination or extortion, can scarcely be taken to fulfil these conditions.

Mature consideration of the subject of Railroad Commissions is to-day tending towards a preference for the grant of moderate, as distinguished from extreme, powers. Though the opinion of the United States Supreme Court at Washington must, on the whole, be taken to incline towards the law laid down in the "Granger" cases, there are wholesome symptoms of dissent from that somewhat

extreme interpretation of the law. In any event, an intending investor will do well, before selecting any particular State as a sphere of investment, to examine the powers conferred on Commissioners and the exercise made of them as embodied in their annual report. He will probably conclude that advisory, or even moderate compulsory, powers exercised by competent men are thoroughly beneficial to railroad property, but that the grant of drastic powers involves many perils and risks from the investor's point of view.

•CHAPTER XV.

VESTED INTERESTS.

AMONG the most striking traits of the American national character are the singular elasticity with which it recovers from disasters, and the rapidity with which it throws the past behind its back. Few more remarkable passages of history can be found than that which records America's resurrection after the close of the great Civil War. Long before people had ceased to discuss its tremendous incidents, the nation was again in full march towards prosperity and wealth. Again, the Chicago fire was a very sharp and decisive calamity. But a new city arose from the ashes with unprecedented speed, and in the twinkling of an eye the past was left behind. This kind of recuperative power reasonably inspires the foreign investor with. courage and hopefulness. But the observer will be apt to note that facility in throwing the past behind our backs is a more or less two-edged weapon. From the investor's point of view, it is a serious question what is the subjectmatter that is thus easily forgotten. If it is a loss or a toothache, well and good. If it is a mortgage or a valuable consideration, the memory and benefit of which ought to be permanent until they have been respectively discharged or recognized, the case is somewhat altered. Perhaps the most striking instances of this short memory have been afforded by States which have, in whole or in part, repudiated loans of which they were sorely in need at the time

of contracting them, or have repudiated subsequent compositions assented to by both lenders and borrowers after a fair consideration of the circumstances proper to the particular case. Instances are not lacking in which the lenders' rights have been frankly disregarded, in spite of the fact that the very railroads on which the borrowed money was expended had for years been largely contributing to State wealth, and are doing so to-day.

Securities of this class, although their amount is not inconsiderable, will probably possess a very limited interest for our enquirer. He will therefore be content to note one or two salient points connected with current controversies. These may be worth passing attention, because they illustrate to some extent the incidents of State rights in their bearing on broader questions of vested interests in property generally. First, then, he will do well to bear in mind that a State claims the rights and immunities of sovereignty. An aggrieved person who desires to sue a State may find himself checkmated by a great variety of tactics. Under certain conditions a' State may decline to permit itself to be sued-except in courts possessing a particular jurisdiction-in 'respect of a claim the merits of which it does not explicitly deny. That is a serious disappointment to a suitor who is perhaps a good swordsman and would like to fight his opponent according to the established etiquette of the arena. He has issued his challenge, but his opponent politely declines to fight. The Executive of the State claims to be, in a certain sense, at once the trustee and the servant of the sovereign people. It can meet the challenge of a suitor with a simple "Non possumus." That is a line of defence very difficult to break down, because, by availing itself of this mode of obstruction, the State need not take into account the

specific merits of a suitor's claim. There is left to the aggrieved person an appeal ad misericordiam. So long as he is aware of the limit of his power, "forewarned is forearmed." But it is always weak, and sometimes dangerous, to confuse the right of entreaty with the possession of a valid remedy. Concerning his rights in the Federal courts one or two comments will be found below.

But the obstructions which the suitor may meet with in any effort to enforce his alleged rights are not confined to the power of the State Executive to decline his challenge. He has to reckon with State Legislatures, and therefore with demagogues of many types who (side by side with many honourable and distinguished Statesmen) sit therein. In the hands of a clique of demagogues, who are described in vernacular language as "on the make" and who have their own axes to grind,—a mode of procedure which may be roughly described as "hook and eye" legislation is a tremendous engine. This designation is simply adopted for lack of a better term, and is not sufficiently clear to justify the writer in dispensing with some words of explanation. Its distinctive feature consists in the notion of carrying by two or more separate and distinct bills a measure which would certainly be rejected if its principles, purposes and incidents had been considered as a whole. It is easy to the adroit manipulator of legislative procedure so to marshal and to arrange the sequence of his bills that the first instalment of the proposed legislation in view appears not only harmless, but absolutely patriotic and noble. Once grant that the first instalment is meritorious and has become law, the second follows as a logical sequence. Yet, if both the bills had been considered together, the net result would have been palpably unjust, and legislation promoting it would have