lated, in the justice of government, and in its impartial administration.

To require just and impartial rates on the part of the railroads is a just exercise of the power, but there must be no reduction of rates below what is just and right; and ample provision should be made for testing the question whether or not the rates are really such.

Of course, in addition to this broad principle of impartiality towards the railroads and the citizens owning them, as toward any other citizens, all constitutional restrictions, State and Federal, are to be observed, and all lawful contracts and engagements made with the railroads by the State to remain inviolate.

All this is consistent with the most pronounced and decided maintenance on the part of the State of the right of regulatlon; the State itself being likewise under law, constitutional and natural.

THE DELEGATION TO THE RAILROADS

of this right of regulation to one party, however, would be an abdication by the State of a great public duty. The repository of the power must be as impartial as any judicial tribunal, or juror.

In many ways, in the proper exercise of its right, the State will really have greatly subserved the interest of the real owners of the railroads against arbitrary and irresponsible agents.

Nor has there been any reference to the legal decisions, abundantly sustaining the views above presented, both in their general aspect and their details; especially the learned and powerful decision of Judge Woods (printed in the appendix to this report) meeting the exact issues, each and all of them, with singular clearness and fullnees. We have preferred to prethe basis of the authorities on the subject. sent rather the general principles which lie at

NO WANT OF POWER.

The limitations we have referred to on the right of regulation do not depend upon any want of power in the General Assembly, nor any want of jurisdiction of the subject matter, but rather upon the just exercise of legislative discretion. Nor does the right of legislative regulation depend merely upon the principles set forth in the decision of the Supreme Court of the United States in Munn vs. Illinois, as expressed by a majority of the court; it falls fully and clearly within the minority decision also; upon the views above set forth, the court were unanimous. Under that decision, indeed, the power of each and every State Legislature is limited only by the Constitution of the United States and of the State itself. In Georgia, on this point, there was no need for this decision. Within the limits just named, the Legislature of Georgia is as omnipotent as the British Parliament. The State Constitution itself settles the question, aside from all other considerations or decisions, by the broad grant of authority in article 3, section 8, paragraph 22, which provides that

Many nice questions have arisen as to the power of government to depart with its power of regulation, taxation, etc., and to grant special exemptions. The Constitution of 1877 deals with most of these questions, and provides means of rectifying the errors of the past; asserting even as a last resort, the right of eminent domain, and the purchase of the property for just compensation, if this should become necessary to correct the errors of the past; also in the novation of any charter, it provides for subject-ever, to the last Constitution, but continued ing the railroad to legal regulation under the from those previously in force. act of 1863.

make all laws and ordinances consistent with "The General Assembly shall have power to this Constitution and not repugnant to Constitution of the United States, which they shall deem necessary and proper for the welfare of the State." A wide grant, not peculiar, how

Now, in the Constitution not only is there no It will have been observed that in the whole inhibition of the regulation of railroads by law, of the preceding line of argument we have not but a direct and express provision requiring such assumed the advanced ground taken in some regulation as a legislative duty. The Legislarecent discussions-that the railroads are them-ture is not straitened as to power, but only as to selves public property. Whether this view be its just exercise, and to a careful use of its discrea correct one or not, it is certainly not essential to the argument, which is perfect and complete without such assumption.

tion. On this point we fully concur in the view presented in the article already referred to in the Fortnightly Review, that "legislation cannot

be too cautiously applied," by virtue of the infinite variety of conditions and circumstances, ever shifting and changing. It must of necessity, indeed, provide to meet these shifting occasions, by a tribunal ever ready to consider them, and to make the needful modifications and adjustments.

3.

MODE OF EXERCISING THE RIGHT OF REGU-
LATION.

sive regulation would be USURPATION, while proper regulation would simply be the fulfillment of a constitutional duty.

As to the MODE of regulation-leaving the whole matter to the corporations interested; would be but a rope of sand-direct legislation would be an iron rod, inflexible and harshwhile regulation through the medium of a commission is both efficient and safe; this furnishes a link flexible, elastic and adjustable.

In comparing the different instrumentalities, At all the latter stages of transportation by we have already seen that the legislative assemhigh road, turnpike, etc., there was appropri- bly is as little fitted for this special business as ate legislation for the protection of the public, it is for those of a court of justice. No such sometimes direct, sometimes through the me- functions are exercised by it, except in the one dium of the county authorities, or commission-case of impeachment; very costly and of rare ers of roads.

occurrence.

The judiciary itself is not well fitted for the task, except through the medium of experts; and the very object of the law creating a commission is to educate a board of experts, to aid judicial decisions The great principle of

THE DIVISION OF LABOR

applies in this case. In great Britain, for example, there are separate tribunals for the trial of common law cases, equity, criminal cases, etc., each court being educated to its special

In the fifty years of railroad experience, there have been many efforts for proper means of regulation; the final result of which has been the establishment of Railroad Commissioners for the purpose. These have proved by far the most satisfactory and successful means of dealing with the problem ; being a well-adapted instrumentality, now so well established as not likely to give place to any other, and which would indeed probably survive even the great change, contemplated in some of the European States, of direct government ownership. Gov-duties. The study of the transportation quesernment, even in such case, in order to act advisedly, would need to act through a commission. Its adaptation is as complete as that of the judiciary system itself. Analysing the different views held on this subject by various persons to the state of parties in a deliberative assembly expressed by the terms

LEFT.

Extreme Left-Left Center.

CENTER.

tion involves matters really requiring more distinct and special study, and wider apart in their details, than the several departments of the law. With a properly constituted board of commissioners, this board would naturally be better informed upon railroad matters, to which its attention was exclusively devoted, than any one department of the judiciary could well be; with its seldom and occasional contact with the railroad problem, as but one of many subjects. Right Center Extreme-Right. Except as informed by impartial experts, the courts would rather advise an appeal from the courts to the Commission, than vice versa from the Commission to the courts.

RIGHT.

the commission occupies a central position, at once conservative and safe. The extreme Left would leave the railroads wholly unregulated by law; the extreme Right, representing only the interest of citizens, would consider the railroads wholly as public property, forgetting private right. Again, as to the manner, one would leave regulation entirely to the railroad officials --the other would trust as entirely to direct legislation. As to the FACT of regulation the extremes and proper means would stand thus: the extreme Left, the total failure to regulate, would be ABDICATION, the extreme Right, exces

Indeed, the Railroad Commission, as a special department for dealing with one of the most important and delicate departments of public regulation, stands now in Great Britain and elsewhere upon a basis not less impregnable than that which supports the JUDICIARY SYSTEM itself. It is indeed a special department of the judiciary.

There are a thousand questions, nice and delicate, to be settled, of a peculiar and professional sort, requiring a special education. The

need of a special tribunal is obvious enough, by | said, are such powers to be entrusted to three reason of the number and importance of the men, with human frailty and liability to misprinciples involved, requiring nicely adapted take and passion?" They are not, however, so study and long experience. The questions entrusted in fact, for the action of the Commiswhich arise as to classification of the thousands sion in Georgia is a report and not a judgment. of articles to be transported, such as cotton, And even were it final, must there not, at the breadstuffs, provender, manufactured goods, last, be finality somewhere? Are not the lives, coal, fertilizers, etc., etc., through the endless liberties and prosperity of the whole people of catalogue of all production, can only be under- the State, subject now to three men who constistood by experts. So the principles of pro-rat- tute the Supreme Court of the State? To quote ing fairly, per mile and per ton; the relative in- a homely saying, we cannot have better flour fluence and effect of distance, and of way and than can be made of wheat "—we cannot get through business; the expense of loading and better judges than men. And the law in this unloading, billing and book-keeping, of rates instance provides for the as affected by value, weight, bulk, convenience, cleanliness, season of the year, etc.; all these are involved.

Nor will it do to say that the railroad officials themselves have this matter in charge,

CORRECTION OF ERRORS

and mistakes, in the most complete and informal way, by an appeal to the Commission itself, without any motion for a new trial, and before and aside from an ultimate appeal to court

and are competent to deal with it. The public after court, to the Supreme Court of the State

have an interest to be represented, and a right of regulation, not at all secured by this means. Really, this is one of the troubles-of the evils to be remedied, viz.: that these railroad officials do understand it, and no one else does, and so the information and bias are all on one side. The lack to be supplied is that of experienced and

EDUCATED EXPERTS,

without bias. To study and decide upon these questions gives ample occupation to a separate tribunal. The questions to be settled are not inferior in importance to those settled by the Supreme Court of the State. They involve as much property and as nice questions of right. The effort accordingly has been in Great Britain and elsewhere in Europe, and in many of the States, North and South, to constitute a tribunal of the highest character, in point of intelligence, integrity and impartiality. It is to acquire special knowledge of railroad matters, business and laws, just as the Supreme Court of the principles of jurisdiction.

and the United States. So much for mistakes.

As for corruption, it may well be said that the
railroads rather than the public would have
the advantage-having by far the best means
for that purpose.
And the law moreover pro-

vides for the removal of a Commissioner in an
informal way, should there be reasonable
ground of suspicion of any sort, whether of cor-
ruption or other maladministration, without
awaiting the necessity of a formal conviction.
The law certainly was intended to be very pru-
dent in this as in all other points.

The number of appeals from the decision of the Commission has been small. Of the needed facilities for such appeals we shall say more hereafter. We have been compelled by the Tilley case to a very careful review of the act of 1879, and the powers of the Commission.

Almost every form and mode of dealing with the question has been the subject of actual experience in Europe and in this country: Government ownership of the whole, as is proposed Again, it must be prompt, for often the delay in Germany; government ownership of lines of justice is equivalent to its denial; and acces- sufficient to establish competition, as in Belsible to all, so that no one will be too insignifi- gium: government suppressing competition cant to get his rights, or too poor to contend among the lines and itself regulating rates, as with the most powerful corporation. Such a in France; government regulating the monoptribunal is useful to both parties, to the rail- oly, but not prohibiting competition, as in Engroads and the public, and hurtful only to cor- land. The great point and most difficult of atrupt and dishonest officials. Its results in tainment is not so much the prevention of exEngland and America have been eminently sat- tortion, as that of illegitimate form of competiisfactory. tion, which affects not the whole business but Of course the Commission may err, and it is special points or person, and is the parent of

unjust discrimination. Not improbably the | a short distance, these suggestions did not fit in establishment of a national commission will be at both ends, and so could not carry him essential to this result. through.

A very large part of the efficiency of a commission is really in the

PUBLICITY

Here, too, a comparison of the Commission as an agent, with the president and directors, or the general freight agents, or soliciting agents of different railroads is in point, as to impartiality between the railroads and the pr:blic, as to breadth of view and careful computation of all the elements and factors, of valuation, rates, profits, expenses, etc., and as to covering the whole field, and more than a single

given to railroad affairs. This conduces as
much to the interest of the stockholders as of
the public especially of the small stockhold-
ers. A mere formal compliance with a law re-
quiring publication of statements, however, is
wholly insufficient and illusive. The publica-year or administration.

tion often

CONCEALS RATHER THAN REVEALS

the state of the company's affairs. Huge for-
tunes have been made by misrepresentation.
Examples are to be found in the Glasgow Bank
abroad, and the Tallassee Factory in a neigh-
boring State, in numerous Insurance companies
etc., etc.
Perhaps, indeed, it is not necessary to
go beyond the limits of the State for illustra-
tions. No other corporations have greater fa-
cilities for misrepresentation than railroads;
indeed, no other is so difficult to represent
properly, with the most honest intentions and
efforts. How to do this effectually has been one
of our chief studies, as it underlies all else.

On the whole, a railroad commission is the best adapted means yet discovered, or likely to be discovered, of dealing with the subject, as is seen by a comparison of its adaptation, with that of any other means, say, of regulation by the government, or by the Legislature, or a committee thereof, or with a court, Superior or Supreme, State or Federal, or with a jury; in the various needful qualifications-say, of experience, opportunity, relative study and means of knowledge, and of the division of labor, as a means thereto.

The duty of making a tariff of just and reasonable rates, instead of making rates on one or two articles at a time is obviously fit and right, because a preparation for part involves a preparation for all. The study must be systematic else its results will be a piece of patchwork. The chief engineer of the Cincinnati Southern railroad, which traverses a difficult country, suggested a fit illustration of this necessity of studying the problem as a whole. Many plausible partial routes were proposed over this line of road, but he had ever to bear in mind the whole line, and usually found that while best for

3

As the decision of the Commission affects the one interest or the other, so will the complaints be. Thus circular No. 10 brought out comcircular No. 11 from the railroads. So it is in plaints from certain portions of the public;

each case. The Commission can only hope to escape censure by real justice, capable, in the course of time, of being made obvious justice. It is found that local prejudices do, in fact, gradually give way with increasing light and information, and that in like manner railroad it is found also that those who are hurt in one prejudices yield to time and reflection. Usually respect are helped in others, so bringing about an equilibrium. The action and its results need to be studied, as we endeavor to study item, without the reduction of all to correct them, as a whole. The separate study of each word in a dictionary not arranged in alphabetiprinciples and systems, is like the search for a cal order. It is almost as troublesome to find a single word as to alphabet the whole.

REVIEW OF EXISTING LEGISLATION.

This has been to some extent anticipated. The Georgia system is based on the idea of a systematic view of the whole subject, and a comprehensive report of what, on such a view, are reasonable and just rates, and rules and regulations. A large field of comparison and basis of induction are secured; of comparison of railroad with railroad in the State, and of our own roads with those of other States.

In the study of the subject, and in the practical operation of the conclusions reached, just as the shoe pinches this or that interest, is the representatives of such interest sure to be heard. A large view of the several

CONFLICTING INTERESTS

has been developed in the State of New York. There the railroads themselves are very power

competing lines, one or more not subject to the jurisdiction of the Commission, then the line or lines which are so subject, and are working at the lowest rate under the rules, may at such competing point or other point injuriously affected by such competition, make rates below the Standard Tariff, to meet such competition, without making a corresponding reduction along the line of road."

ful, and anxious to be let alone entirely. The however, from any point in this State there are city of New York raised the first loud outcry, regarding itself as threatened with ruin by rates discriminating against it, and in favor of rival cities. The power of the city was also great, though of course, since much of the railroad stock was owned in the city, this interest was not a unit. As this outcry called attention to the matter, the country too began to see its interests, and an equally intense agitation began, representing the agricultural interests, and complaining that the high priced lands of New York State were virtually placed west of the Mississippi, and all natural facilities subverted and turned upside down, by the huge discriminations between through and local freights. After all, it has ever been the question of discrimination which has given the greatest trouble.

As we have already seen,

ILLEGITIMATE COMPETITION

(as distinguished from fair and legitimate competition) has been the prolific parent of all the abuses of unjust discrimination. The termini have usually not merely gotten their rights, but much more, at the expense of the way stations. As each case involves these principles, the propriety of the Georgia system of studying the subject as a whole is manifest. The greatness and difficulty of the question render it one of slow and patient and gradual solution, patiently to be worked upon. Through freights especially and classification are the most difficult features.

In the endeavor of the Commission to meet the exigency, Rule 6 (with modifications) was adopted, reading as follows, viz.:

"RULE VI. REGULATIONS CONCERNING FREIGHT RATES.-The freight rates prescribed by the Commission are maximum rates, which shall not be transcended by the railroads. They may carry, however, at less than the prescribed rates, provided that if they carry for less for one person, they shall for the like service carry for the same lessened rate for all persons, except as mentioned hereafter; and if they adopt less freight rates from one station, they shall make a reduction of the same per cent. at all stations along the line of road, so as to make no unjust discrimination as against any person or locality.

This rule has given, perhaps, more discontent to the railroad authorities, and more satisfaction to the public, than any other rule or regulation adopted by the Commission. Even the termini affected have to a large extent, however, admitted the reasonableness and propriety of the rule. It has done all that is within our power to equalize and distribute burdens and benefits within this State. Were its application general, it would largely remove the evils of unjust discrimination affecting the public interest, and act as a fly-wheel, giving quietness and reliability to rates, and steadying all railroad operations.

The modifications we

were compelled to make arose from the fact that the Legislature of Georgia could only control the railroads within her own borders. Of course it could not interfere with business without her limits, though needing a like control.

The co-operation of the contiguous States, and even of States beyond them, is necessary to complete the beneficial action of the rule-say in Georgia the co-operation of the States of Tennessee and Kentucky, especially, and also of Alabama and the Carolinas.

Such co-operation of a properly harmonious character it is almost impossible to obtain. The States and their special interests are too numerous, and either too conflicting in fact, or supposed to be so, to make it at all probable that they can concur in the same exact policy. It is possible that that feature of the United States Constitution by which Congress is empowered to regulate commerce between the States, will have to be invoked, as a necessary and proper means of effecting this object of common and harmonious action. The efforts of any State are necessarily cramped by its territorial limits; and yet just here it is, that the strongest safeguards are needed, by virtue of the "COMPETING LINES NOT ALL WITHIN THE excessive discriminations between way and OF THE COMMISSION.-When, through freight-the very point of complaint.

JURISDICTION