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AMERICAN RAILWAY
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See also:AMERICAN RAILWAY LEGISLATION Before 1870.-The earliest legislation is contained in charters granted by See also:special See also:act, for the construction of See also:railways. These special acts gradually gave way to See also:general statutes under which railway corporations could be created without application to the legislature. In the See also:east, where, as a See also:rule, charters had been See also:uniform and consistent, the See also:change to general See also:incorporation See also:law was due to a See also:desire to render incorporations speedier and less expensive. In the See also:west, general See also:laws came rather as a result of the abuses of special legislation. By 1850, general incorporation laws were found in nearly all the eastern states, and by 187o in those of the west. See also:Early legislation was confined almost entirely to matters of construction. In cases where statutes did See also:touch the question of regulation, they had to do with the operation of trains and with the See also:provision of facilities for shippers and passengers, rather than with questions of rates. It was natural that this should be so, for the new transportation agency was so much more efficient than anything previously available that the See also:people were eager to take See also:advantage of its See also:superior service. As a rule, the making of rates was See also:left to the corporations. If the maximum rates were prescribed, as they sometimes were, the limit was placed so high as to be of no See also:practical value for See also:control. Such crude attempts as were made to prevent rates from being excessive concerned themselves with profits, and were designed to confiscate for the See also:state See also:treasury any earnings beyond a certain prescribed See also:dividend. Publicity of rates was not generally required, and provisions against discrimination were rare. In the See also:period before 185o there was but little realization of the public nature of the railway See also:industry and of the possibilities of injury to the public if railway corporations were left uncontrolled. . In regions where See also:capital was lacking eagerness for railway facilities led the people to demand the See also:direct co-operation of the state, and many projects, most of which ended in disaster, were undertaken either by the state itself or through the aid of the state's See also:credit. For example,- See also:Michigan, in 1837, in the first session of its state legislature, made plans, for the construction of 557 See also:miles of railway under the direct control of the state, and the See also:governor was authorized to issue bonds for the purpose. The unfortunate results of this policy led many of the states, from about 185o, to put constitutional limitations upon the See also:power of their legislatures to lend the state's credit or to involve the state as stockholder in the affairs of any See also:corporation. As railway See also:building increased in response to See also:traffic needs, and as the consolidation of See also:short lines into continuous systems proceeded, legislation applicable to railways became somewhat broader in See also:scope and more intelligent. About 1850 there began to appear on the See also:statute books laws requiring publicity of rates and the submission of See also:annual reports to the legislature, prescribing limits to corporate indebtedness, and also making provision for safety in operation and for the See also:character and quality of railway service. Consolidation and leasing were commonly permitted in the See also:case of continuous lines, but were regularly prohibited in the case of parallel and competing lines. The practice of pooling seems not to have attracted the See also:attention of the legislature. In general it may be asserted that legislation of this period was See also:ill-considered, haphazard, and on a See also:petty See also:scale. Moreover, it was of little practical importance even within its narrow range, for it does not appear to have been generally enforced. 1870-1900.-Railway legislation first assumed importance in connection with the " See also:Granger See also:Movement " in the See also:middle west. There the policy of subsidies for railway building had been carried to a reckless extreme. Roads had been constructed in advance of See also:settlement, and See also:land-seekers had been transported to these frontier sections only to become dependent upon the railways for their very existence. To the unusual temptations thus offered for favouritism and discriminations in rates, the railways generally yielded. This preferential and discriminating policy, combined with other causes which cannot here be discussed, resulted in the Granger legislation of the 'seventies. In the first instance laws were enacted pre-scribing schedules of maximum See also:freight and passenger rates with stringent penalties against rebates and discriminations. These See also:measures proving unsatisfactory, they were soon superseded by statutes creating railway commissions with varied See also:powers of regulation. The See also:commission method of control was not a new one. Such bodies, established to appraise land for railway purposes, to apportion receipts and expenditures of interstate traffic, and in a general way to supervise railway transportation, had been in existence in New See also:England before 1860, one of the earliest being that of Rhode See also:Island in 1839. In 1869 See also:Massachusetts had instituted a commission of more See also:modern type, which was given only powers of investigation and recommendation, the force of public See also:opinion being relied upon to make its orders effective. Western commissions, the offspring of the Granger movement, were of a more vigorous type. Most of them had power to impose schedules of maximum rates; practically all of them had authority to prescribe rates upon complaint of shippers; and they could all seek the aid of the courts to enforce their decrees. Their power to initiate rates. conferred upon them by their legislatures, was sustained by the Supreme See also:Court of the See also:United States, the Court reserving to itself only the power to decide whether the prescribed rates were reasonable. But the See also:jurisdiction of the state commissions was, by judicial See also:interpretation, limited to See also:commerce beginning and ending within the limits of the single state. The most important See also:part of railway transportation, that which was interstate in character, was left untouched. It was this See also:impotence of the state commission that furnished the strongest incentive to Congressional See also:action. The result was the passage, in 1887, of the Interstate Commerce Act, which was directed towards the extirpation of illegal and unjust practices in commerce among the states. Its See also:primary purpose was to embody in statutory See also:form the See also:common-law principle of equal treatment under like circumstances, and to provide machinery for enforcement. It aimed at the See also:prohibition of discrimination between persons, places and commodities. It made provision for publicity of rates and for due See also:notice of any change in rates; it forbade pooling of freight or earnings, and required annual reports from the See also:carriers. For its enforcement, it created an Interstate Commerce Commission of five members, with powers of investigation, and with authority to issue remedial. orders upon complaint and after See also:hearing. Findings of the Commission were to be prima facie See also:evidence in any court proceeding for the enforcement of its orders. In this connexion, reference should be made to the See also:Anti-See also:Trust Act of 1890, which, by its judicial interpretation, has been held to include railways and to forbid See also:rate agreements between competing carriers. The act of 1887 remained in force without substantial See also:amendment until 1906, although with constantly diminishing See also:prestige, a result largely due to adverse decisions concerning the powers of the Commission. Ten years after the passage of the law, the court decided that the Commission had no power to prescribe a rate, and that its jurisdiction over rates was confined to a determination of the question whether the rate complained of was unreasonable. The Commission had much difficulty at the beginning in securing the testimony of witnesses, who invoked the Constitution of the United States as a See also:bar against self-incrimination, and the See also:immunity clause of the act had to be amended before testimony could be obtained. The so-called " See also:long-and-short-haul clause," which forbade a greater See also:charge for a long than for a short haul over the same See also:line, if circumstances were substantially similar, was also robbed of all its vitality by court decision. The See also:section requiring annual reports, while it led to the creation of a See also:Bureau of See also:Statistics, did not givethe Commission power to compel See also:complete or satisfactory answers to its See also:requests for See also:information. The only See also:element of real strength that the statute acquired during the first twenty years of its See also:history came from the Elkins Act of. 1903, which stipulated that the published rate should be the legal rate, and declared any departure from the published rate to be a See also:misdemeanour. It held shipper as well as See also:carrier, and corporation as well as its officer or See also:agent, liable for violations of the act, and conferred upon United States courts power to employ See also:equity processes in putting an end to discrimination. Conviction for granting rebates was by this law made easier and more effective. Since z9oo-The movement in favour of more vigorous railway regulation became pronounced after 1900. Twenty years of experience and observation had revealed the defects of the earlier legislation, and had concentrated public attention more intelligently than ever before upon the problem of strengthening the weak spots. The state commissions, since their See also:establishment in the 'seventies and the 'eighties, had increased their functions and See also:influence. Many of them, beginning only with powers of recommendation, had obtained a large See also:extension of authority. By 1908, See also:thirty-five of the See also:forty state commissions were of the mandatory type, and thirteen of these had been created since 1904. They had been given power to require complete annual reports from carriers, with a consequent See also:great increase in public knowledge concerning railway operation and practice. The most See also:recent type of state commission is the so-called Public Utility Commission, of which the best examples are those of New See also:York and See also:Wisconsin, established in 1907. In both states, the Commissions have power over electric railways and See also:local public utilities furnishing See also:heat, See also:light and power, as well as over See also:steam railway transportation, and the Wisconsin Commission also has control over See also:telephone companies. In both states the consent of the Commission is necessary for the issue of corporate securities.
Mention should be made of the See also:mass of general legislation passed, principally by western states, since 1905, in response to a popular demand for See also:lower rates. This demand has in many instances led to ill-considered legislation, has frequently ignored the prerogatives and even the existence of the state commissions, and has brought about the passage by state legislatures of maxi-mum freight and passenger rate laws, with rates so See also:low in many cases that they have been set aside by the courts as unconstitutional. The numerous laws limiting the fare for passengers to two cents per mile are an See also:illustration of this tendency.
In the See also: It expressly conferred upon the Commission the power to prescribe maximum rates, upon complaint and after hearing,. as well as to make See also:joint rates, and to establish through rates when the carriers had themselves refused to do so. It enacted that published rates should not be changed except on thirty days' notice, whether the change involved an increase or a decrease, and it required annual reports to be made under See also:oath, penalties being prescribed for failure to comply with the Commission's requests for information. Power was also given to prescribe uniform systems of accounts for all classes of carriers,. and to employ special examiners to inspect the books and accounts. Carriers were forbidden to keep any accounts, records or memoranda other than those approved by the Commission. Orders of the Commission became effective within such See also:time, not less than thirty days, as the Commission should prescribe, and penalties began to take effect from the date fixed by the Commission, unless the carrier secured an See also:injunction from the Court suspending the See also:order. Such injunction might not issue except after hearing, of which five days' notice must be given. Decisions of the Commission were not reviewable by the Court Unless the Commission had exceeded its authority, or had issued an unconstitutional order. A new and important act was signed by the See also:President on the 18th of See also:June 1910. It created a Commerce Court (composed of five See also:judges nominated by the president of the United States from the Federal See also:circuit judges), transferred to it jurisdiction in cases instituted to enforce or set aside orders pf the Inter-State Commerce Commission, and made the United States instead of the Commission a party in all such actions. The law forbids a railway or any other common carrier to charge more for a short haul than for a long haul over the same line, unless, in special cases, it is authorized to do so by the Commission. It forbids a railway which has reduced its rates while in competition with a See also:water route to raise them again when the competition has ceased, unless the Commission permits it to do so because of other changed conditions. It extends the initiative of the Commission from the investigation of complaints to the investigation of rates on its own See also:motion; authorizes it to suspend rates in advance of their going into effect, pending an investigation which may be continued for ten months, and to establish through routes; and provides for a special commission, appointed by the President, to investigate questions pertaining to the issuance of railway securities. BIBLIOCRAPnv.—See A. T. See also:Hadley, Railroad Transportation (New York, 1885) ; B. H. See also:Meyer, Railway Legislation in the United States (New York, 1903) ; F. A. See also:Cleveland and F. W. See also:Powell, Railroad Promotion and Capitalization in the United States (New York, 1909); L. H. Haney, A Congressional History of Railways (2 vols., See also:Madison, Wis.; 1908 and 1910) ; Elkins See also:Committee See also:Report (1905) ; F. H. See also:Dixon, " The Interstate Commerce Act as Amended," Quarterly See also:Journal of See also:Economics, xxi. 22 (Nov. 1906); F. H.. Dixon, ' Recent Railroad Commission Legislation," See also:Political See also:Science Quarterly, xx. 612 (Dec. 1905). (F. H. Additional information and CommentsThere are no comments yet for this article.
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