rates in order to maintain proportionate local rates? And why should not the local rates be made to govern the through rates to the extent that the charge for a short haul should not exceed the charge for the longer haul? The more especially so since the intermediate points supply so much the larger proportion of the freight.

All railroads must depend chiefly for support on the traffic originating along the lines of their roads, and for that reason ought to encourage and build up their local business. This is a well-recognized fact. Then why should this great preponderance of local traffic be subordinated to the caprices of a comparatively small amount of traffic from through competitive points?

Take, for instance, the tonnage over the Pennsylvania Railroad on its main line east of Pittsburgh, and the statistics for the past four years show that a fraction over 90 per cent. originated on its line, and only about 10 per cent. of what is called through freight originated and came to it from lines west of Pittsburgh. And what is true of the Pennsylvania Railroad is true to a greater or less extent of all other railroads. This statement differs greatly from the general impression in regard to the extent and volume of what is called through freights, and I call the attention of Senators to it; that 90 per cent. of the freight traffic passing over the Pennsylvania Railroad east of Pittsburgh originates on its line, and that only 10 per cent. comes from west of Pittsburghthe proportion may vary on other roads. And yet this small percentage of through freight is the subject of nearly all the railroad wars and rate-cuttings that disturb the transportation of the country. Is it not therefore fair, Mr. President, to shippers, and good policy on the part of the railroads, that the 90 per cent. of local freights originating along the line of the road should, within certain limits, govern the rates on the 10 per cent. of through business?

Mr. Fink says that the tariffs on the Pennsylvania Railroad are so ar: ranged that no higher charge is made from any station east of Pittsburgh to Philadelphia than is charged from Pittsburgh to Philadelphia, nor from any station this side of Chicago than from Chicago, and that this is the rule generally adopted by all railroads.

Now, that is just what is asked to be fixed by the proposed amendment, and it is precisely what is demanded by the great body of shippers of the country. It embodies a principle of fairness to shippers and security to railroads that is beginning to be recognized by nearly all railroad men, and I believe that all well-managed railroads would be ready to adopt and be controlled by this principle if, as Mr. Fink says, they could control themselves; but as it is conceded they can not control themselves Congress ought, in passing an interstate-commerce bill, to interpose and assert and maintain the principle for shippers and railroads alike.

Mr. President, this is no new position with me. I advocated the same principle in the Forty-eighth Congress when an amendment similar to the one now proposed only received 11 votes in this body. I quote from my speech in the CONGRESSIONAL RECORD, pages 886 and 887:

In my judgment, many of the evils complained of against the railroads are the result of unwise and undue competition between the roads which forces them to do things which are unnatural and unhealthy in a business point of view, and I believe that careful and progressive legislation will result in great advantage to the railroads as well as to the people by protecting the roads from the necessities of their own errors, for in nine cases out of ten the unwise action of one road in making undue discrimination forces all the other competing roads not only to do the same thing and to adopt for the time being the same policy, but even at times to go to a further extreme in the same direction. It is now a well-established principle in railroading that the movement of car

loads of freight costs the railroad so much per ton per mile on the average. This amount is ascertained and known by each road with almost mathematical exactness. We may assume, if you please, for illustration, that this cost is at the average rate of 1 cent per ton per mile for all the freight hauled over the whole line of road, and it is equally well known that long hauls can be made at somewhat less cost in proportion than short hauls. It is, therefore, a fundamental principle in railroading that the average rates of tonnage per mile must be kept up to a point necessary to yield the road a fair profit on its capital from its gross business. Now, when a road takes its through freight from competitive points on a long haul at less than it can afford to do the business per mile and make a profit, or at less than it can afford to do the business and pay actual expenses, it must make up the deficiency on its average business from non-competitive points between the starting place and the market to be reached, and the lower it is forced to take through freight the higher it must charge on its local freight. This is the result of competition forced upon railroads by themselves rather than their voluntary action. For it is fair to presume that railroads as a matter of business would not of choice discriminate unjustly between shippers, but would equalize rates to a reasonable extent to produce the average earnings per mile required if they could follow out their own judgment of what would be equitable and fair and their own inclinations to do it.

And again:

There can be no good reason assigned to justify railroads in making these discriminations, and I do not think they do make them from choice, but from necessity, to bring up their average earnings. There can be no more reason for a railroad charging more for half the labor than for twice the amount of labor than there would be for any other interest governed by the rules affected by machinery and labor, or than there would be for charging more for making one plow than for making two plows, or for a cart to charge more for carrying a load half a mile than it would for a mile over the same road; or for a hod-carrier to charge more to carry brick to the first story of a house than he would to carry the same brick to the second story over the same ladder by which he reached the first story. The cost of transportation to a railroad is measured by the wear and tear of the road and equipment, and the expenses per mile for fuel and labor in moving the train; and there is no theory that I have ever seen advanced that satisfies my mind that these physical conditions are varied to any great extent per mile in proportion to the distance.

It may be urged by Senators from the Western States that this amend ment will tend to increase the through rates from Chicago, Saint Louis, and other large Western competitive points. I admit that on its face it will have this tendency, but it will have the counterbalancing effect in reducing the rates to shippers in the same States outside of the large cities. Under the operation of the amendment they will be relieved of burdens now borne on shipments into these centers from the interior, and so the principle will in the end adjust itself without detriment to the consumers or unjust influences on the large commercial centers. I have no complaint to make of the cheap rates given to the Western cities. I have no objection to that. What I want is that the nearer shipper shall not be charged more than the more distant shipper, and to that extent be made to assume and bear his burdens. But why should shippers from the far West, cultivating cheaper and more productive lands, ask to receive cheaper transportation for the same kind of products than is given to persons nearer the market, cultivating less productive and more expensive lands?

Why should the shipper of the same kind of products in the States of Indiana, Ohio, Tennessee, Kentucky, West Virginia, Virginia, Maryland, Pennsylvania, and other States similarly situated geographically be discriminated against and compelled to pay more than is charged from Chicago or Saint Louis? I think it is too plain for argument that the true principle is, that the nearer shippers should not be charged more than the shipper at a greater distance under any circumstances or under any conditions.

Mr. President, I have directed my remarks mainly to that clause in the section limiting its provisions to the same original point of departure, because that limitation embraces by far the widest range of ex

ceptions in the application of the long and short haul principle. Its application, embracing all sections of the country, gives it almost universal application, and for that reason is of much greater importance than the provision extending discretionary power to vary the rule where there are competing water ways. This only affects comparatively few localities, but that provision, in my judgment, is also very objectionable, for it discriminates against water transportation by allowing the railroads to compete against such transportation at ruinous rates in order to take the freight that naturally belongs to such modes of transportation.

If a railroad can not afford to take freight from competitive points, that might otherwise go by water transportation, at rates that justify the same roads in taking freights of the same kind from nearer points, then the water routes should be allowed to carry it without legislative interference against their interests. To make this exception would in some cases interfere with equality and justice as between railroads. Thus New York, Philadelphia, Baltimore, and Norfolk are competitive points for exportation; the railroads leading to all these cities are in competition at the same points in many sections where limited water transportation exists.

The railroads leading to one of these exporting cities may have water competition, while the roads leading to another export city may not have water competition. The effect of this proviso would be either to allow railroads to compete upon an unequal basis to seaboard cities by reason of one point having competing water transportation while another point did not have it, or else, by conceding the competitive rates governed by water transportation to all the roads leading to the seaboard, it would destroy the long and short haul principles at intermediate points on all the roads.

The proportion of the amount of freight carried by water is fast being diminished, and steel rails and other improvements in operating railroads tending to cheapen transportation, added to the certainty of quicker time and diminished risk, is enabling railroads to do the general business cheaper than the water ways. Railroads will in time become almost the sole carriers, but there are still large interests and investments in the equipments for water transportation, and the water ways still serve a most useful purpose in commerce. The speed of its destruction and disuse should not be hastened faster than fair, legitimate competition produces it. Therefore, whenever it will not pay railroads to take any kind of freight at rates that water ways can afford to take it, then the water ways should take it if the shipper prefers it. Railroads are now being built along the chief water courses, because it has been demonstrated that they can do the business cheaper than it can be done by water. Commerce should be left to follow its natural channels, and the railroads and water ways should be left to compete without discrimination.

In framing a general law for the benefit of the whole people of this country to regulate its vast carrying interests, is it not better to make the rule uniform and of general application, in which the interests of the vast body of the whole people are to be affected, rather than to make exceptions that apply only to isolated cases, and which exceptions may affect so materially the purposes of the bill?

In order to get at the exceptions it becomes necessary to delegate to the commission appointed under the provisions of the bill a dangerous discretion, which virtually places in their hands the essence of the whole question of discriminations intended to be remedied by the bill. It will also impair the usefulness and high reputation which the commis

sion ought to possess for disinterested fairness and subject it to suspicions and imputations; for every exception the commission may make must be in the interests of the railroads, and it will subject it to embarrassing criticisms, from which it ought to be exempt.

Mr. President, I wish it understood that I have no war to make upon railroads or corporations within the proper limit of their usefulness. I only aim at fair and just regulations, such as will correct the unwisdom of their own acts and produce approximate stability and fairness in rates to their patrons. I know there are in many communities men whose hobby it is to denounce railroads, men who are neither laborers, producers, nor shippers themselves, and who never aided with encouragement or contributed by their means to the employment of labor, the building of railroads, or the development of any other useful public enterprise; men who do not create employment or "make two blades of grass grow where only one grew before."

If the development of the country in which they live had depended upon their exertions we would have had little interstate commerce to regulate, and we and our children perhaps for generations to come would have found our way from our forest homes by means familiar to the pioneers. In the eyes of such men, the man who invests his means or gives his energies to public enterprises is the subject of suspicion, denunciation, and abuse.

Mr. President, I have no sympathy with this class of agitators. They agitate, not because they have ever felt or known the effects of discriminations or the oppression of corporations, but agitate and denounce because it is their political stock in trade-a capital that costs nothing, an investment which if it pays is all clear gain to them, and leaves the development and thrift of the country to take care of itself or be taken care of by those who are willing to labor for it and be advertised as enemies to the public good.

Our railroads have been of untold benefit. They have been the means of opening up and developing this country as no other country has ever been developed in the same space of time before. They are the arteries through which flows the life-blood of the world's commerce." They are the means of civilization and of progress in all the material aims and purposes of life. They have become so necessary to the development of every section of country, that emigration and capital will not go beyond the lines of transportation, and in the very nature of things all enterprises of magnitude, whether of railroad, mining, or manufacturing interests, must be built up and operated by the aggregation of capital in the form of corporations.

This capital, except in rare instances, can not be obtained in the communities to be benefited most by their construction. It is therefore not only unwise but unjust to foster the impression that such corporations are public enemies, to be denounced and legislated against as such.

This country has more capital invested in railroads than the aggregate of all other investments, and these securities are owned throughout the country indiscriminately, and they have precisely as much right to protection and no more than any other class of property that exists. There is no community without the facilities of railroad transportation that does not hail with satisfaction the prospect of obtaining it, with all its accompanying advantages and conveniences. Without transportation manufacturing can not exist, mines can not be operated, forests can not be turned to value, labor is without demand and forced to seek employment where thrift and enterprise follow in the wake of transportation and commerce. We feel this in the State which I have the

honor in part to represent, a State which lacks only railroad facilities to penetrate and develop its mines of hidden wealth and carry off its forests of valuable timber to make it one of the foremost States of the Union in wealth, prosperity, and increasing population. For these reasons I would ask no unjust or oppressive legislation to retard developments or imperil the capital already invested. I would treat all such corporations with the same fairness I would treat individuals, but I would require from them equal fairness to their patrons.

I would invite capital and enterprise and labor with the hospitality of friendship to come and make their homes with us, and would assure them fair and generous protection instead of proclaiming them enemies seeking to intrude unbidden and unwelcome into our territory. And, Mr. President, whatever may be said or done by the few who may be prompted by motives of their own, political or otherwise, I am sure that in the statement of this spirit of broad-minded and liberal fairness I represent the general sentiment on this subject which characterizes the great body of the good people of my own State and of the country at large.

This spirit is just to all-it is this spirit which has marked and made the progress of mankind. It will continue to promote the development of the country at large, and no State in all classes of its citizenship, with fair adjustment of the relations of labor and capital, will profit more largely by it than my own.

The Senate, as in Committee of the Whole, resumed the consideration of the bill (S. 1532) to regulate commerce.

Mr. CULLOM. I do not desire to address the Senate to-day, as the bill now before the Senate for consideration has been three times read I believe and is before the Senate for amendment. I have explained the provisions of the bill as far as I was able to do so a few days ago, and do not care to make any further remarks upon it at present.

Mr. ALLISON. I believe a number of amendments have been proposed.

The PRESIDENT pro tempore. None of the amendments of which notice has been given have been proposed.

Mr. SEWELL. I desire to have the amendments read which I submitted.

The PRESIDENT pro tempore. Which amendment does the Senator offer?

Mr. SEWELL.

I should like to have them all read.

The PRESIDENT pro tempore. The amendments will be read. The CHIEF CLERK. It is proposed to add as a new section the following:

SEC.-. That no person or corporation shall have authority to engage in interstate commerce, after three months from the passage of this act, without having procured a license for that purpose from the board of commissioners herein provided; and one of the conditions of such license shall be the acceptance of this act by such person or corporation, and of such regulations as said board may lawfully make in pursuance thereof. And where any route over which interstate commerce shall be carried between the several States and Territories of the United States includes as a part thereof a railway or water route outside of the United States, no license shall issue for the transportation of interstate commerce over such route unless the railway company or companies controlling the portions of such route situated within the United States become responsible for and guarantee the observance by those controlling the portion of the route outside thereof of the terms and conditions of such license. And when any