plan, beneficial as it would be if carried out efficiently, must depend upon the agreement and cooperation of the railroads, and the time is at hand when some such modern and progressive method of furthering railroad service must be adopted.

Car per diem.-In connection with the question last treated it is to be noted, and that with some emphasis, that one of the problems which the railroad that desires to deal honestly by the public has to meet is the dishonesty of its fellow-carriers. "Car appropriation between carriers does not seem to be regarded as dishonorable nor even looked upon with great disfavor.

It is not many years since the railroad which originated freight transferred at its junctions to the cars of the connecting road. Each railroad was thus made to supply its own equipment. This was an uneconomical and time-wasting method, and so out of their own necessities and to give a prompter service the railroads developed the practice which generally obtains to-day of permitting cars to pass onto the tracks of their connecting roads and making a per diem charge there for. Under this system the present method of hauling freight over several connecting lines has made possible that great body of through transportation which is perhaps the most distinctive feature of American railroading. Experience has proved, however, that the rules governing the return of cars were evaded to such an extent that not a few railroads relied upon foreign equipment for their own needs.

Realizing that a charge of 20 cents per day was insufficient penalty, over 100 railroads within this month have raised the per diem to 50 cents. That this will be effective in securing return of cars to the owning railroads during the few months of the year when traffic is light may be conceded, but that it will insure return during times of great need is not likely, for in such times the holder could earn perhaps ten times the amount that he would be compelled to pay by using the foreign car.

A rule might be adopted fixing a minimum of 50 cents per day during those months of the year when traffic is light, and increasing this possibly fourfold during the latter half of the year, when cars are most needed.

While the railroads may fix the price that shall be charged for the use of their cars by other roads, it may become advisable for the protection of those roads which, realizing their duties as common carriers, furnish themselves with adequate equipment, that power be vested in this Commission to make rules governing the interchange of cars and that Congress also enact a penal law under which railroads may be punished for confiscation of foreign equipment. It is submitted that the carriers themselves can not deal with this problem

by raising the per diem charge without seriously limiting the extent and utility of through transportation, a contingency that would demoralize the business of the country. That this matter of securing the return of cars to their owners is not one to be regarded indifferently is made evident by the fact that railroads having 10 per cent of the total mileage in one of the States rely "entirely " for equipment upon foreign cars.

Reciprocal car demurrage.-The most generally advocated remedy for the failure on the part of carriers to furnish cars when demanded is that now generally known as "reciprocal car demurrage." This phrase means, in a word, that carriers shall be penalized upon failure to furnish cars demanded, and the phrase arises out of the universal railroad practice of imposing a per diem penalty when a car is held for unloading beyond a certain fixed number of days.

"It is but equitable," the shipper urges, "that if the railroad may charge me for holding its car because that car is needed by it in the conduct of its business that I should be permitted to charge it a stated sum per day when it fails to deliver to me a car which is necessary to the conduct of my business."

The carrier disavows any intention to profit by the delay of the consignee in unloading his freight, but justifies its demurrage rule upon the ground that only by such charge can the consignee be led promptly to free equipment. The shipper in turn urges that such reciprocal demurrage as might be exacted would not compensate for the loss of the car at the time needed, but is intended rather to stimulate the railroad into more promptly providing the car which it is its legal duty to furnish.

Some commercial bodies, advocating this general principle, favor the enactment of a law by Congress dealing directly with the subject, while others favor an enlargement of the powers of the Interstate Commerce Commission under which this body shall have authority to make proper and necessary rules, which may be enforced through the courts under penal provisions similar to those now incorporated in the act to regulate interstate commerce. Each method of procedure has been followed in the legislation of the States. The statute of Texas is an illustration of one method, and the rules framed by the commissions of Louisiana, Florida, Mississippi, North Carolina, and Virginia are illustrations of the other.

It is to us evident and beyond all controversy that the difficulties with which the business of transportation is affected in this country at the present time would not be overcome by the enactment of a reciprocal demurrage bill alone if such measure merely provided for punishing the railroad for nonplacing of cars or nonmovement thereof. The problem is one much deeper and much broader than a mere lack of cars and engines. No doubt an inadequate supply of

these facilities is the cause of all the troubles which beset the shipping public on certain lines. But these instances are few. The problem of car shortage is one in which is involved every factor in railroading the construction, the operation, the maintenance, and the financing of the railroads. The inability of the shipper to secure a car may be but a symptom of a deep-seated and organic trouble.

The real cause of car shortage may lie in the too conservative character of the management of the road or in the unfitness and incompetency of its operating officials. It may flow from an incomprehension on the part of the directors of the full duty imposed by law upon a common carrier. It may arise out of a policy in railroad operation which gives primary consideration to speculative stock operations. It may come from an inability to secure funds to so fit itself that it can discharge its duty. It may follow in a time of exceptional prosperity from an increase in traffic which could not reasonably have been anticipated. Or it may result from an inability to secure labor and materials necessary to the proper enlarging of the railroad's facilities. This enumeration of causes is not exhaustive. It could not well be complete without giving consideration to many industrial and economic factors which at first glance would appear remote and unrelated. Clearly the problem of transportation is so closely interwoven with the fabric of our commercial system, and so closely related and so interdependent are the various activities of our industrial life, that one may not lightly say what are the multitudinous considerations which necessarily enter into so simple a question as the reason why a railroad car is not at once forthcoming when ordered.

The enactment of a reciprocal demurrage bill will not build railroad track, equipment, enlarge and simplify terminals, nor transform incompetent operating officials into first-class railroad men, but it might stimulate, energize, and in some cases revolutionize the methods of deliquent railroads so that they would render the service which they were created to render. This is the theory of reciprocal demurrage. But that of itself it will enable the railroads to render adequate service is not demonstrated by experience.

Perhaps the most serious congestion that exists at any terminal in the United States to-day is to be found in Galveston-in a State suffering seriously from car shortage, but in which there is on the statute books one of the simplest reciprocal demurrage laws to be found in the United States. In a statement by Hon. O. B. Colquitt, of the railroad commission of Texas, is found this pregnant passage:

We have a law in Texas which provides that shippers may make statutory requisition for cars, depositing one-fourth of the freight charge from point of origin of the freight to its destination, and when such requisition is made the

car must be furnished within a specified time or else the railroad company must pay to the party making the requisition demurrage at the rate of $25 per day. This demurrage is reciprocal, and where the shipper or the consignee does not unload such cars within forty-eight hours after same is delivered demurrage at the rate of $25 a day runs against the consignee.

Our court of civil appeals in suits brought by individuals for damages has held that under this law the railroad company can not be compelled to furnish cars for loading where the destination of shipment is beyond the line of the originating road. Acting under this construction of the law the Texas railroads are refusing to furnish cars to be loaded when the destination of the shipment is beyond their line. When shipments are accepted, the cars are held at junction points where the originating line requires loads to be transferred or their connecting line to furnish them with an empty car for every loaded car so tendered at such junction points. The result is that at junction points there are many cars tied up with loads waiting for transfer or exchange of an empty.

The great quantity of commerce going to the port of Galveston from the interior of Texas, as well as from Oklahoma, Kansas, and Nebraska, much of which is originated on railroads that terminate in the interior and have to depend on their connections reaching Galveston to make port delivery, and the originating lines refusing to let their loaded cars go to port destinations, thus forcing the unloading of such cars at interior junction points, first produced a blockade of cars at such points, and so tied up several thousand cars on side tracks in enforced idleness beyond the length of time which it would have required such cars to be transported to destination and returned.

This congestion at junction points soon extended to Galveston, where it was aided greatly by a new policy which the Texas roads had adopted of shipping cotton to the port in mixed consignments, thus necessitating the unloading and sorting of such shipments before delivery could be made.

Manifestly it is of little value to a shipper to be given a car if that car, when loaded, is not moved promptly to destination. Therefore the conclusion is inevitable that reciprocal demurrage alone will not insure better railroad service when the movement is over more than one system of railroad. Such a law or rule must be supplemented by some other rule or law under which the originating carrier may be insured of prompt return of the cars which it delivers to its connec tions.

The traffic of this country can not be moved in the fashion which obtained in the early days of railroading, when transfers were universal at junction points. When the railroad is penalized for not placing a car at a shipper's warehouse or elevator it will protect itself against the loss of that car by refusal to permit it to pass beyond its control unless it can be given another car in its stead, or unless some system is devised similar to that of the car pool under which its needs for cars may be promptly met.

It will profit those who are seeking to remedy the shortage in car service by means of the imposition of reciprocal demurrage to con

sider well the decision of the United States Supreme Court in Houston & Texas Central Railroad Company v. Mayes, 200 U. S., 321. This case involved the applicability of the Texas law to interstate commerce. Mr. Justice Brown, in delivering the opinion of the court, said:

While there is much to be said in favor of laws compelling railroads to furnish adequate facilities for the transportation of both freight and passengers and to regulate the general subject of speed, length, and frequency of stops, for the heating, lighting, and ventilation of passenger cars, the furnishing of food and water to cattle and other live stock, we think an absolute requirement that a railroad shall furnish a certain number of cars at a specified day, regardless of every other consideration except strikes and other public calamities, transcends the police power of the State, and amounts to a burden upon interstate commerce. It makes no exceptions in cases of a sudden congestion of traffic and actual inability to furnish cars by reason of their temporary and unavoidable detention in other States, or in other places within the same State. It makes no allowance for interference of traffic occasioned by wreck or other accident upon the same or other roads, involving a detention of traffic, the breaking of bridges, accidental fires, washouts, or other unavoidable consequence of heavy weather.

While railroad companies may be bound to furnish sufficient cars for their usual and ordinary traffic, cases will inevitably arise where, by reason of an unexpected turn in the market, a great public gathering, or an unforeseen rush of travel, a pressure upon the road for transportation facilities may arise which good management and a desire to fulfill all its legal requirements can not provide for and against which the statute in question makes no allow

ance.

Although it may be admitted that the statute is not far from the line of proper police regulation, we think that sufficient allowance is not made for the practical difficulties in the administration of the law and that, as applied to interstate commerce, it transcends the legitimate powers of the legislature. (Mr. Justice White not participating; the Chief Justice, Mr. Justice Harlan, and Mr. Justice McKenna dissented.)

There is nothing in this decision which justifies the conclusion that a reciprocal demurrage bill or rule governing interstate commerce can not be so drawn as to come within the ruling of the court and the principles declared in the opinion of the learned justice. Clearly, however, in justice to the carriers and in conservation of all the industrial interests of the country which use the railroads, whatever plan may be adopted to penalize the railroads for the nonfurnishing of cars must be supplemented by some provision of law or plan of cooperative operation by which the railroads may be secure in permitting cars to pass to the tracks of connecting lines. If this be not done each carrier will live unto itself and will find it to its own interest to confine its cars to its own tracks.

If the Interstate Commerce Commission is to be vested with power to make rules under which railroads shall be required upon penalty