The CHAIRMAN. Now, let me call your attention to this language of Judge Cooley, and I will then ask you if you are familiar with it. The Commission would be required to act as rate makers for all the roads, and would be compelled to so adjust the tariffs as to meet the exigencies of business, while at the same time endeavoring to protect relative rights and equities of rival carriers and rival localities. This, in any considerable state, would be an enormous task. In a country so large as ours, and with so vast a mileage of roads, it would be superhuman. A construction of the statutes which would require its performance would render the due administration of the law altogether impracticable, and that fact tends strongly to show that such a construction could not have been intended. Are you familiar with that language? Mr. BACON. I think I have seen that before; and I understand that that applies to the general initiative rate-making power. The CHAIRMAN. Yes, sir. This bill does not contemplate anything of that kind? Mr. BACON. It simply contemplates the making of a rate- Mr. BACON (Continuing). Which, upon due investigation, has been found to be unreasonable and unjust. The CHAIRMAN. That is, the action of the Commission must be in response to a complaint to the Commission? Mr. BACON. Yes, sir; in response to the complaint. The CHAIRMAN. Yes, sir. Then the jurisdiction of the committee in this particular matter would be dependent upon the character of the complaint? Mr. BACON. The character of the complaint, and the evidence produced. The CHAIRMAN. Then if the complaint was enlarged so as to cover a number of roads, the jurisdiction of the Commission would be corresponding to that? Mr. BACON. There is no doubt, if the complaint embraced a number of different complaints The CHAIRMAN. If the complainant was authorized to make a complaint against one rate contained in a schedule, he could with equal propriety complain of all the rates in that schedule, could he not, and make one complaint of it? Mr. BACON. He could, but I think the Commission would exercise its discretion as to entertaining a case that involved The CHAIRMAN. How could it exercise its discretion under this bill if it was to confine its inquiry to the complaint? You have just said that the complaint fixed the jurisdiction under this bill. Mr. BACON. I have said that the complaint could be filed. I did not say that it fixed the jurisdiction. The CHAIRMAN. I understood you to say so. That is what I asked you. Mr. BACON. I did not intend to say so. If I did, it was a mistake. The CHAIRMAN. Is it not your opinion that under this bill a complainant would have a right to make a complaint against all the rates from all the stations named in a given schedule? Mr. BACON. I think if such a complaint were made The CHAIRMAN. Will you answer that question? Under the bill would he not have that authority? Mr. BACON. I think I answered substantially the same question in the affirmative. The CHAIRMAN. That he would have? Mr. BACON. Yes, sir. But I did say that it would be in the discretion of the Commission whether to entertain such a broad complaint. The CHAIRMAN. Then you think that under the provisions of this bill, and in the interest of remedying present difficulties, it would be in the province of the Commission to select such parts of a man's complaint as it saw fit to regard as important and exclude others? Mr. BACON. I think it would be in its province to require that the complaint should be limited to a series of rates that were dependent upon one another. The CHAIRMAN. To a series of rates? Mr. BACON. Yes. Rates that had a necessary relation to one another. The CHAIRMAN. Now, it often happens, does it not, that a particular rate upon one road is largely dependent upon another rate? Mr. BACON. To be sure. The CHAIRMAN. To be sure. And it happens that a rate from one locality is very often dependent upon a rate from another locality? Mr. BACON. One of the principal objects of this bill is to prevent discrimination between those several points that come into competition for business and to establish the proper relations between roads to and from competitive points. The CHAIRMAN. Then it would be utterly impossible, in the just administration of this law, for the Commission to confine itself to a single rate upon one commodity from one locality, would it not? Mr. BACON. I would not say that it would be impossible. There might be occasions and situations in which it would be essential that it should be restricted. The CHAIRMAN. Yes. But it would not suffice for them to say that they would consider nothing but a single rate upon a single commodity from a single shipping place? Mr. BACON. If the rates which were combined in the complaint had no bearing upon each other and no relation to each other, I think it would be perfectly competent for them to require the complaint to be amended. The CHAIRMAN. Is it not true, in a certain sense, that every rate is inter-dependent and is related to every other rate in the schedule? Mr. BACON. That is a pretty broad statement, Mr. Chairman. The CHAIRMAN. Is it not true? Mr. BACON. Not by any means. The CHAIRMAN. It is not? Mr. BACON. Have you any idea of the number of rates in force in this country? The CHAIRMAN. I think I have. Mr. BACON. It would be utterly impossible to say what the relation was. The CHAIRMAN. You say they have no relation? Mr. BACON. No, sir. The CHAIRMAN. They have, certainly, in the contemplation of the railway companies in the matter of surplus earnings, do they not, over and above the operating expenses? Mr. BACON. Not all the rates in the country. The CHAIRMAN. The rates of that particular road? Mr. BACON. The rates of any particular road. The CHAIRMAN. They do have relation to one another? Mr. BACON. Yes, sir; certainly. The CHAIRMAN. And that, too, in an important sense, more or less, to one of the parties to the controversy, to the railroad company, namely? Mr. BACON. Not of any greater importance to the railroad company than to the public? They have equal interests. The CHAIRMAN. But they do have that important relation? The CHAIRMAN. What is, in your judgment, the serious evil properly to be complained of relating to railway charges? Mr. BACON. Well, sir, I should say that there were two. First, there is the relation of rates between competing points, and the relation of rates between competing commodities, all of which are very important. The CHAIRMAN. They are all in the nature of discriminations? Mr. BACON. They are all in the nature of discriminations, but beyond that, and of far greater importance, is the general scale of rates throughout the country, which has been raised from year to year during the past four years to an extent that has produced, according to a statement made by the Interstate Commerce Commission, a difference in the charges for the year ending June 30, 1903, of $155,000,000 in excess of what the rates would have been that were in force in 1899. The CHAIRMAN. That is, including the volume of traffic? The CHAIRMAN. On the same tonnage? Mr. BACON. The same rate per ton of 1899, applied to the traffic of 1903, produced a difference of over $155,000,000 in excess. The CHAIRMAN. That included the increased traffic? Mr. BACON. No, sir; it takes the same rate per ton which was applied in 1899. Mr. CUSHMAN. The same number of tons? Mr. BACON. The same rate per ton that was in force in 1899, applied to the tonnage of 1903, increases the earnings by $155,000,000. That is to say, if the tonnage of 1903 was charged at the rates in force in 1899, the revenues derived by the railroads, or the charges paid by the public, were $155,000,000 greater than they would have been under the rates of 1899. That is the statement of the Interstate Commerce Commission, made to the Senate in response to a resolution of inquiry. Mr. CUSHMAN. Do you mean that the same rate applied in 1899 applied now to the same number of tons would produce this excess? Mr. BACON. Not quite so much. The tonnage in 1903 was a little more, but the rate of 1903 applied to the tonnage of 1899 would produce $155,000,000 more. Mr. CUSHMAN. That might be a question of increased amount of tonnage. Mr. BACON. That has no bearing upon it. Mr. CUSHMAN. Then I do not understand you. Mr. BACON. I have endeavored to make myself plain. Mr. MOSELEY. If the rate of 1899 had been in force in 1903 the amount of freight paid would have been $155,000,000 less than it was. Mr. BACON. That is it, exactly. And this is a question that concerns the public. One point is very often forgotten-that is, that shippers have no concern as to what the actual freight rate is. Their concern is that no one else shall have a lower rate than they have and that other places with which they have to compete shall have no discrimination in their favor against them; but the public is concerned in the rate itself. Everything that is consumed, in every form, whether for food or clothing, or heating or building, or for any other purpose whatever, is subject to these rates of freight, and the public are the ones who bear that rate. The CHAIRMAN. Now, to get back to this matter of the character of the complaints that are made. Is it not true that the great volume of complaint is with regard to some form of discrimination, either in rates, or as to persons, or as to commodities, or as to localities? Mr. BACON. That is the burden of the complaints, so far as shippers are concerned. The CHAIRMAN. That is the great burden? Mr. BACON. No, sir; the shippers are one class and the public are another. The shippers constitute perhaps one-fiftieth part of the public. The CHAIRMAN. Yes, sir. Mr. BACON. And as long as their rates are equitable with regard to each other and with reference to the various commodities they handle they are fully satisfied; but they are the ones that make complaints against this particular evil, this evil of discrimination. The CHAIRMAN. Yes. Mr. BACON. That is, discrimination between localities and between commodities. But the public at large is making complaint through the press of the country in the most impressive manner, and has been for years. Almost every paper in the country has been burdened with this complaint. But the people have no organization before Congress. They are left entirely to themselves and they are pleading their cause in an indefinite and indirect manner. The CHAIRMAN. You have been appearing heretofore, have you not, as the representative of the shippers? Mr. BACON. I am the representative of the shippers. The CHAIRMAN. The commercial associations? Mr. BACON. Yes sir; but the shippers naturally feel that they are interested The CHAIRMAN. Let me go a little further. So that, so far as your representative capacity is concerned, you are intereted in these discriminations, and drawbacks, and things of that kind? Mr. BACON. That is true. But we shippers The CHAIRMAN (continuing). And the people whom you represent, as you have just stated, have but little care as to what the rate is if it is equitable with regard to all of the shippers? Mr. BACON. That is it. The CHAIRMAN. That is it. So that when you make these other representations of the complaints of the populace that are voiced in the newspapers, you are getting outside of your official relations to this subject, are you not? Mr. BACON. I take exception to the term "populist," because they are not embraced in any party. The CHAIRMAN. I did not say "populist." I said "populace." [Laughter.] Mr. BACON. I beg your pardon. While the shippers are interested in the rates being properly adjusted, they naturally feel a reciprocal interest toward those from whom they derive their business, those with whom they are doing business, and when they see that the rates are excessive, and that their customers and clients are suffering unjustly in regard to it, they naturally feel that it is necessary for them to exert their influence as far as it may be necessary to relieve that. The CHAIRMAN. So that in representing this part of the subject- The CHAIRMAN. You are speaking emotionally rather than professionally? [Laughter.] Mr. BACON. Yes, sir. The CHAIRMAN. I would be glad, Mr. Bacon, if you would tell us in what way legislation is necessary-what new legislation is necessary-in order to remedy this vast number of complaints that are the complaints of the shippers which you have just spoken of? Mr. BACON. The very legislation which is comprised in the bill which has been prepared through this committee. The CHAIRMAN. Have they not now legislation which prohibits discriminations between persons? Mr. BACON. Yes, sir. The CHAIRMAN. Do they not have legislation which prohibits discriminations between localities? Mr. BACON. We have legislation which prohibits it, but we have no means of enforcing it. The Commission is absolutely The CHAIRMAN. We will get to that after a bit. Do we not have legislation with regard to discriminations as to commodities? Mr. BACON. There is legislation-that is, there is a declarative statement in an act of Congress prohibiting that. The CHAIRMAN. Prohibiting that? Mr. BACON. We are not asking for legislation to prohibit it. We are asking for the means of enforcing that legislation. The CHAIRMAN. Yes, sir. Now, we have a criminal statute to aid in its enforcement, have we not? Mr. BACON. Not in its enforcement. The CHAIRMAN. We have not a criminal statute? Mr. BACON. Only in regard to personal relations. The CHAIRMAN. Have we not legislation with regard to discriminations, prohibiting discriminations as to commodities? Mr. BACON. There are no penalties. The CHAIRMAN. There are no penalties? Mr. BACON. No, sir. The CHAIRMAN. A discrimination either against the person or against the locality or again st a rate is forbidden by the law, is it not? Mr. BACON. It is forbidden that rates shall be discriminative between localities or between commodities, or, as the act expresses it, between different descriptions of traffic; but it ends there. The CHAIRMAN. And between persons? Mr. BACON. I left out the persons. The CHAIRMAN. See if it ends there. I think it does not. Discrim ination in either of these respects by a carrier is prohibited, you say? Mr. BACON. It is prohibited; yes, sir. The CHAIRMAN. Then it is an offense, is it not, against the statute— a violation of the statute? Mr. BACON. It is a violation of the statute. |