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ably set aside as unreasonable, as they doubtless should have been. Legislatures can now deal only with tariffs within the state, which are doubtless, however, of great importance.

There are many who favor government ownership of all railroads. This would doubtless remove the abuse of passes, the evil of stock jobbing in railroad securities, corruption in aid of private interests, and discrimination between individuals. It would not, however, remove the conflict between local and industrial interests, which causes most of our trouble. It would merely transfer the combat to the halls of the Legislatures, and the private offices of officers appointed by we know not what influences. It would involve an indebtedness of several billions of dollars,* upon which interest must be paid, whether earned by the properties or not, and an increase in the number of employees of the nation to the number of nearly a million. If the eight-hour day were insisted upon, and the scale of wages fixed as in other government employment, the number of employees would be largely increased, and with it the cost of transportation. Of course it could not all come at once, and I have such confidence in the common sense and executive ability of our people that I feel confident that the gravity of the situation would compel soberness in dealing with it, and that we should evolve a competent and effective service. It would take a long time, cost a great deal of money, and many lives, but we should do it. Frankly, however, as a business proposition, I am unable to see much wisdom in buying what we can control without buying. At any rate it will be time to discuss the matter when seriously presented in concrete form, by men who understand the subject. We can buy the roads whenever we decide that we wish them. Most railroad owners would prefer United States three per cent bonds to their present railroad securities, and the val

*It is hard to say how many billions. As stated on pages 161, 162, the railroads of the country, in 1896, paid dividends and interest to the amount of $337,227,538. This, at 3 per cent, represents a capital of $11,240,917,933, which is $1,496,518,601 more than the total alleged capitalization of all the roadswatered stock and all. Capitalized at 4 per cent, it represents $8,215,356,725. • Capitalized at 5 per cent it represents $6,744,550,760. Capitalized at 6 per cent it represents $5,620,458,966. It is a tidy sum, at all events.

uation could probably be agreed upon. If we chose to pay in two per cent bonds, we could do so by increasing the valuation.

The immediate question is of the method of control.* Unjust control will be defeated in the courts, as it should be. The Constitution protects rich and poor alike, and the rich know how to make its protection effective. Just control can only come from exact information, and to this we are entitled. The fundamental principle which, as the first step, must be comprehended, adopted, and acted upon is this: No quasipublic corporation can have any secrets which the public is bound to respect. Upon this must come the second fight. The first fight was over the right to control. That has been won by the people. Logically, the next step is the knowledge requisite for intelligent control. That demand has never been

Many people, including most railroad officials, insist that the public can not control the railroads, and that the only practicable method of removing the glaring evils which largely arise from unrestricted competition is to permit competing roads to form pools, upon such terms as they may mutually agree upon. As they will then have no interest in underbidding each other, they will have no motive to continue the unjust discriminations, which are more injurious to the public than excessive rates impartially applied. The Interstate Commerce Commission, in its report for 1897, intimates that unless the power of the commission is to be increased, railroads may as well be allowed to pool under the supervision of the commission. I am not willing, myself, to concede that the large measure of failure which has thus far attended our efforts for control proves that we shall not ultimately succeed. To a large extent failure has been due to prejudice, excited by agitators and demagogues, leading to popular demand for what is not only unjust but opposed to the interests of those who demand it. In the end such demands come to nothing, but meanwhile the attention of the people is distracted from the real issues, so that no popular support is given to such bodies as the Interstate Commerce Commission, which knows very well how to control the railroads, and will do so if the people will compel their representatives to give them the power. It is my belief that most railroads would welcome a control which would control competitors as well as themselves, provided that the control be intelligent and honest. What railroads most fear is control by men who do not understand the transportation business. The short terms of state railroad commissioners expire before they have had time to learn anything about transportation. Even the Interstate Commerce Commission has never had a member who was a trained railroad man. Probably no really competent railroad man could be got to serve at present, as such men would not work for the salaries of public officers. If the time ever comes when real power and great honor attach to these positions, trained railroad men of the highest character will consent to serve, just as our greatest lawyers accept appointments to the Supreme Court of the United States at salaries which are very small compared with what they earn at the bar,

properly formulated that I know of. The formula given is the proper one to adopt. As the first step in the education of the public it should be adopted, and published, without rhetoric, and without passion, by every body of farmers in the land. By law, the Interstate Commerce Commission has power to prescribe methods of accounting to be followed by railroads in their interstate commerce traffic, and the roads seem generally to comply with it. But there are subjects

upon which the public demands details, which it must insist upon getting. Details of certain expenditures, with a requirement of vouchers, would be more effective in the prevention of improper practices than any other method which could be adopted. The public is entitled to them and should insist upon getting them. Should occasion be found to require it, railroad auditors should be public officials. At any rate, whatever degree of severity and coercion may be found necessary to put the public in possession of the information required. for intelligent dealing with railroads, should be relentlessly applied.

No intelligent public opinion can be created to guide farmers or anybody else in formulating specific demands for reform without some knowledge of the facts and principles involved. Of these farmers are now practically ignorant. What, from their reading of inflammatory literature, they believe to be true, is mostly not true, and what they demand is as apt to be unjust as otherwise. They can usually see only their own interests, and will not understand that others, and very likely other farmers, must be considered. I know of but one place where the American farmer can get the information which he needs on this subject, and that is from the Reports of the Interstate and State Railroad Commissions. The Reports of the Interstate Commission from 1887 to date, give complete and impartial discussions of all problems of interstate traffic, and the syllabi of the great number of cases decided give more facts than can be had anywhere else. A set of these may be found in any good public library, and can be collected by granges or individuals. A sufficient inquiry would doubtless result in a republication of these documents,

i

omitting repetitions.

The citizens of each state can obtain

the reports of their own states.

Farmers, while insisting upon disclosure of all railroad secrets, and fully informing themselves as to what is now known, should work for the strengthening of the Interstate Commerce Commission by the legislation which it has asked for, but which Congress refuses to give, and for the strengthening, in certain directions, of state commissions. In the newer states the railroad commissions are usually objects of public contempt and this whether honest or dishonest. They are usually expected to accomplish the impossible, and having foolishly accepted office must suffer the consequences. I do not see how a good railroad commissioner can ever be evolved from the tumult of a political convention, but it is a fact that good men are often both nominated and elected to those places. The trouble is apt to be with their mental calibre. They are expected to become advocates, and are not usually able to cope with the intellectual forces against them.

The true functions of a railroad commissioner are not those of an advocate, but of an investigator and judge. A railroad commissioner can not make a freight tariff. He does not know how. Just classifications and rate sheets must be a matter of growth. The railroads must make their own tariffs, and the commissioners must hear complaints, and decide them after due hearing, ordering such changes as may seem just. The decisions once made, and upheld, if contested, by the courts, must be enforced relentlessly, and at all hazards, by the people, whether in favor of the complainants or against them. When decisions are just, as they usually will be, the railroads will, in nearly all cases, promptly comply with them. What the farmer must do, therefore, to secure justice from the railroads, is: First, insist upon finding out and publishing whatever the railroads desire to keep secret. Secondly, study the railroad question from original official documents; no other publications, especially if controversial, are of much value. Third, insist upon strong national and state commissions, with full power and wide discretion in investigation and review. Fourth, get good men into those positions. Fifth, sustain them when they are there.

CHAPTER IV.

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THE FARMER AND THE SPECULATOR.

HE science of economics recognizes the existence of moral obligations, but does not concern itself with their enforcement. It merely takes account of economic results following their observance or non-observance. That "honesty is the best policy" is an economic, not a moral precept, meaning that in the long run uprightness is most profitable. With the resemblance, if any, of speculation to gambling, or the immorality of that practice, if it be immoral, this work has nothing to do. What I have to consider in this chapter is the economic result to farmers, of speculation, by others than themselves, in the products of the farm.

"Speculation" is the purchase of a commodity not needed by the purchaser for consumption (or for sale to customers in the ordinary course of business), in the expectation that the market price will be higher; or the contracting to deliver at some future time a commodity not owned by the seller, in the expectation that before the maturity of the contract he will be able to purchase for delivery at a price lower than that contracted to be paid to him. The speculator who buys will profit by higher prices, and is interested in promoting them, which he commonly does by the persistent circulation of facts or rumors indicating a scarcity of the commodity. He is called a "bull" from the habit of that animal of tossing things up on his horns. He desires prices to go up. More commonly, of late years, he is called "long of the market," meaning that he has a supply of the commodity in excess of his contracts to sell. Speculators who contract to make future deliveries are called "bears," from the habit of that animal of tearing down things with his claws. They wish prices to go down. More commonly, of late years, they are called "short of the market," meaning that they own less of the commodity than

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