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A Spirit of


To return, therefore, to the political aspects of the question, it is fairly to be said that the positions of Republican and Democratic leaders alike would seem very tolerant under all the circumstances. There is little disposition to find fault with the better class of hardworking railroad officials. It has been unfortunate that our railroads should have fallen into the control of our American plutocracy, and should thus have been taken out of the hands and control of efficient and single-minded railroad men. The consequence is that the Government must put on a great deal of pressure, in order to bring railroads up to the necessary standards of efficiency and of beneficial service to the public. The President of the United States is studying these questions in a broad spirit, and will undoubtedly have a series of proposals to lay before the next Congress. Nobody need feel any apprehension as to the essential character of such a program. It will strengthen rather than weaken the value of railroad securities, and it will reassure rather than dishearten the best of our well-trained men who make railroading a true profession. Speaking in a practical sense, there are few things that intelligent and well-trained men can now do in this country that are more useful to the people than the wise development and operation of railroads. Let us, therefore, say nothing that would be unjust toward those engaged in good faith in this great and necessary public function. There will be such a demand for amplification of transportation service in the next quarter-century that young men may rightly feel that the best brain and the highest training will be required in the railroad field.

What Is

The Harriman controversy and Really all phases of the current railroad Wanted. and political discussions are timely and valuable. They are all helping public opinion to form itself fairly and intelligently. Mr. Harriman's financial methods do not meet with general public approval, but unquestionably he has been a leading spirit in the achievement of some great undertakings in the line of railroad improvement. The country wants railroad improvement to go on at a rapid pace. It wants no public policy that would frighten capital away from the investments necessary to put the railroads in

efficient working order. Before the next Presidential election there will be a remarkable degree of acceptance on all hands of President Roosevelt's safe and just proposals.

The LiningUp of Parties.

It is hard to see what the Republicans and the Democrats will find to fight about, yet party lines. will be maintained, the South will probably keep its preference for its old Democratic alliance, and the exigencies of State and local politics will add momentum to the party campaigns. It is very possible that Mr. Hearst's Independence League may take the field as an independent third party, with Mr. Hearst as its Presidential candidate. Branches of the League, it would seem, are being formed constantly throughout the country. Mr. Hearst made a conspicuous appearance in an address on Jefferson's birthday last month, advocating such a third-party movement. He said that the motto of the Democratic party was "Anything to get in," and that of the Republican party was "Anything to stay in." He was very sarcastic at the expense of both parties. Of the Republican party he said: "It takes campaign funds from the public plunderers it professes to oppose, and then virtuously prosecutes those that do not pay." But unless the situation should change very materially, it does not seem likely that there would be much popular material upon which to found a strong thirdparty movement next year.

New York's

Just as public sentiment was rapPublic Utilities idly developed last year in sup


port of President Roosevelt's railroad-rate legislation, it has now come to the support of Governor Hughes, of New York, in his efforts to secure a more efficient State control of the various public-service corporations. The so-called Public Utilities bill, which was introduced in the New York Legislature early in March, is the most comprehensive measure of the kind that any American State has ever been called upon to enact. It undertakes to establish two commissions, the members of which are to be appointed by the Governor, one of which will have jurisdiction over all common carriers, lighting companies, and public-service corporations of every sort operating in the city of New York, while the other will exercise similar authority over like corporations doing business in the State at large. The powers of these commissions in respect to the railroads of the State are not unlike those


possessed by the Interstate Commerce Commission and by the more efficient of the State railroad commissions, the most important of these powers being the fixing of rates and the prevention of discriminations.

The Opposition.

There has long been in New York a State railroad commission, which has had practically no authority and has been of no real benefit whatever either to the people of the State or to the railroad corporations themselves. It was natural enough that the proposal to supersede this wholly inefficient body by the creation of a board of able and disinterested public officers owing their appointment neither to the politicians nor to the corporations interested should meet with determined opposition from both quarters. An attempt was made to amend the bill by inserting a provision for court review, which would take purely administrative functions out of the hands of the commission and confer them on the State's judiciary. Governor Hughes had no difficulty in pointing out that the property rights of the corporations are already carefully guarded, both by existing law and by the terms of the Public Utilities bill itself, and no legislation, however radical, can deprive the corporations of their appeal to the courts. It would, on the other hand, be an. unwarranted and unseemly confusion of powers to hand over to the courts such purely administrative functions as those concerned with the adjusting of railroad rates.

On only one other point did the The Power of opponents of the Public Utilities Removal bill succeed in securing any concentration of sentiment. It was contended that the power of removal should not be lodged with the Governor, but should reside in the State Senate. The amendment of the bill in this direction would greatly weaken the principle of executive responsibility, for while the Governor might be held accountable for his own appointments, he could frequently evade responsibility for bad conduct or inefficiency on the part of a State commission on the ground that some of the members, at least, were the appointees of a former administration and could only be removed by the action of the State Senate. In a public address at Utica, early last month, Governor Hughes took occasion to review the provisions of the Public Utilities bill and to state with great clearness the consid

STATE SENATOR ALFRED R. PAGE, OF NEW YORK. (Who introduced the Public Utilities bill in the Legislature.)

sion has attracted an unusual amount of attention throughout the country. Not even the debates in Congress a year ago were followed with deeper interest by the country at large. It is fully realized that the time has come when the people's control over corporations which owe their very existence to popular will as expressed through legislation must be more efficiently exerted.

The Evil of Stock

The corporations controlling public services of various kinds,

Watering. trolley companies, lighting and water companies, and others,-have outgrown or overridden almost every form of restraint that our earlier legislation had devised for them. It has never been the intention of any great number of citizens to deprive these corporations of their just and fair earnings, but by devious methods of stockwatering it has been possible for many of these companies to demand of the public such rates for service as would yield far more than a reasonable return on actual investment, and at the same time to offer plausible excuses for poor service. A single illustration from actual experience will show to what lengths these abuses have gone. Within the suburban zone of New York City it was late


was serving half a dozen towns and villages was capitalized at the enormous figure of $32,000,000. This company had been formed by the consolidation of four or five small local concerns, and the aggregate plant at the present time, even including all the perfected machinery that has been acquired within the last few years, still falls far short of $2,000,000 at the most liberal appraisal. The consumers who are dependent on this lighting company for service have been compelled to pay interest on more than thirty millions of watered stock.

The Bill


It is one of the purposes of the Meets Actual Public Utilities bill to forestall Conditions. all enterprises of this kind. Under the terms of the bill, when a consolidation is formed the aggregate stock issue of the new company cannot exceed the sum total of the capital stocks of the original companies. Furthermore, the entire matter of capitalization is submitted to the scrutiny of the State commission and an actual value in plant and porations the New York bill strikes at one of equipment must be shown. The enforce the most serious evils in the whole situation; ment of such a law would prevent, in future, for if the consumers were compelled to pay the creation of such parasitic corporations as only a fair and reasonable income on actual the lighting company to which we have just investment, it is not doubted that the present referred, and, besides protecting the public rates for a service in many localities would from imposition in the matter of rates and in- be cut in half. In the case of the suburban adequate service, it would at the same time. lighting company to which we have alluded offer the strongest possible safeguard to legitimate investors. In these provisions restricting the issues of stocks by public-service cor

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the rate for electric-light service is precisely twice the average rate for towns and villages Public Utilities bill provides, it is true, for throughout the State of New York. The the intervention of the commission in cases of extortionate rates, and through the operation of this measure it is believed that many communities will be able to secure redress for grievances of this kind; but with the abolition of stock-watering the basis of a large part of this evil of injustice in rates would undoubtedly be removed. Every State in the Union is interested in just this problem. At the present moment all eyes are on New York. As these pages were closed for the press it was generally regarded as probable that the bill would be passed.

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This bill, as amended and sent to the Governor, provides that no child under sixteen shall work more than eight hours a day, between 8 a.m. and 5 p.m. The hours are thus definitely fixed, because it has been the experience of labor inspectors that without an absolute limitation of this kind manufacturers will evade the statutes and work children overtime. A striking feature in the debate on this bill in the State Senate was the declaration of one of the Senators that he himself before he was fourteen had worked more than twelve hours a day. Only one other. measure of prime importance had been enacted at Albany up to our date of going to press. This was the so-called Bingham Police bill, the purpose of which is to enable the New York City Police Commissioner to remove inspectors and to permit the thorough reorganization of the detective bureau. These were reforms that for some time had been seen to be highly desirable, and had been advocated by the leading civic organizations of the city. They would probably not have been embodied in law, however, had it not been for the persistent and courageous course of Commissioner Bingham and the equally commendable attitude of Governor Hughes.

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liable observer who has twice before favored the readers of this magazine with unusually intelligent summaries of Chicago traction is sues, as they have developed from year to year. This year's election, like those that have preceded it, turned chiefly on the city's policy in dealing with the traction interests. It will be recalled that conditions of service had become so intolerable in Chicago, two

mayor elected after an unusually bitter contest with Mayor Dunne, is pledged to take immediate steps toward the reconstruction of the entire traction system of the city. Το the outsider it would seem that the retiring mayor, instead of suffering defeat for reelection, might have taken advantage of this remarkable situation and, by adopting the plan of settlement as a measure of his own administration, might very possibly have been retained in office. But at all events the city of Chicago is to be congratulated on the fact that it is still able to avail itself of the services of the special traction. counsel, Mr. Walter L. Fisher, whose advice in all these negotiations has been invaluable. A sketch of the new mayor, Mr. Fred A. Busse, from the pen of Mr. George C. Sikes, appears on page 585 of this issue.



At the end of March a serious Threatened strike among the employees of Railroad Strike more than forty railroad lines centering in Chicago was deemed unavoidable. The conductors and trainmen of both the passenger and the freight service had demanded a material increase in wages and a reduction in hours. The general managers of the roads conceded a wage advance averaging somewhat less than 10 per cent. for all grades of employment and a reduction in hours for men on work-trains from twelve to ten. The men had demanded a nine-hour day all around. The Brotherhood of Railroad Trainmen, headed by Grand Master P. H. Morrissey, refused to accept these concessions, and the outlook seemed anything but hope(Who welcomed the Government's mediation in ful. At that juncture the general managers the differences between railroad managers and employees at Chicago last month.)


law of 1898, which commits to the chairman of the Interstate Commerce Commission and the United States Commissioner of Labor the duty of mediating in railroad strikes when invited to do so by either party.

called into service a federal statute that had almost escaped the notice of the general pubyears ago, that Mayor Dunne was elected lic, so seldom had application been made of its upon a municipal-ownership platform. The provisions. This is the so-called Erdmann obstacles in the way of realizing municipal ownership were so many and so serious that some of the most active supporters of that policy were compelled to abandon it temporarily, and to unite with those who favored a bargain with the traction companies on the best terms obtainable. The outcome of all the negotiations that took place during Mayor Dunne's term of office was a settlement with the various street-railway companies by which the city of Chicago obtained better terms than any American city has yet secured. These are fully set forth in the article on page 581. The so-called "settlement ordinances were carried at the late election by a decisive majority, and the new administration, under a

A Triumph

of Mediation.

Chairman Knapp and Commissioner Neill arrived in Chicago on March 30, and by April 4 they had succeeded in effecting a complete and satisfactory settlement of all the differences between the railway managers and their employees. The men waived their demand for a nine-hour day, accepting a ten-hour schedule and an average wage increase of about 10 per cent. This means that the sum

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