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may be, the percentage of traffic carried irregularities of agents do not, under a by the different lines varies but little. pooling system, give rise to much susIf an arbitrator can examine the books picion, because they do not benefit the
and decide what these percentages have road in whose behalf they are underbeen in the past, he can make an award taken. Its percentage being fixed there for the future, under which the compet- is no motive for rate-cutting. So great itive traffic of the different roads may is this advantage that pooling is accepted be fairly divided. The arrangements in almost all other countries as a natural for doing this are various. Sometimes means of maintaining equality of rates ; the roads carry such traffic as may hap- the state railroads of Central Europe pen to be offered, and settle the differ- entering into such contracts with comences with one another by money bal- peting private lines and even with waterances; sometimes they actually divert routes. In America itself, pools have traffic from one line to another. But had a longer and wider history than is the advantage of either of these arrange- generally supposed. In New England ments over a mere agreement to main- they arose and continued to exist on a tain rates is that they cannot be vio- moderate scale without attracting much lated without direct action on the part attention. In the Mississippi Valley, the of the leading authorities of the roads Chicago-Omaha pool began as early as concerned—either in open withdrawal, 1870, and formed the model for a whole or in actual bad faith. The ordinary system of such arrangements extending
as far as the Pacific Coast. But, as in- of traffic had already been resorted to: volving wider questions of public policy, but it was in the hands of outside parthe activity of the Southern and the ties, like the Standard Oil Company or Trunk Line Associations has attracted the cattle eveners, and was made a chief attention.
means of oppression against shippers The man whose name is most promi- not in the combination itself. nently identified with both these sys The conditions were not favorable ;
the result of Fink's efforts to bring order out of chaos was slow and by no means uninterrupted. Yet on the whole, as was admitted even by opponents of the pooling system, it contributed to steadiness and equality of rates. The arrangement of these agreements was hampered by their want of legal status. While the law did not at that time actually prohibit them, it refused to enforce them. Existing thus on sufferance, they depended on the good will of the contracting parties. None but a man of Fink's unimpeached integrity and high intellectual power could have kept matters running at all ; and even he could not prevent the adoption of a policy of making hay while the sun shines, more or less regardless of the future. The results of the trunk-line pool were unsatisfactory—most of all to those who believed in
pools as a system ; but it is tems is Albert Fink. A German by fair to attribute a large part of this failbirth and education, his long experience ure to the absence of legal recognition, as a practical railroad engineer did not which in a manner compelled the agreedeprive him of a taste for studying ments to be arranged to meet the detraffic problems on their theoretical side. mands of the day rather than of the As Vice-President of the Louisville and future. Nashville, he had given special attention Meantime an equally important contrito the economic conditions affecting the bution to the solution of the railroad southern roads; and when, in the years question was being worked out in an1873–75, a traffic association was formed other quarter. In the year 1869 the by a number of these roads to secure Massachusetts Railroad Commission was harmony of action on matters of com- established. Its powers were so slight mon interest, he became the recognized that it was not regarded as likely to be leader. His success in arrangements for an influential public agency. Fortuthrough traffic was so conspicuous that nately it numbered among its members when, in 1877, the trunk lines were ex- Charles Francis Adams, Jr. ; a man whose hausted with an unusually destructive efficiency more than made up for any war of rates, they looked to him as the want of nominal powers. In his hands only man who could deliver them from the mere power to report became the their trouble. In some lines, division most effective of all weapons. Repre
senting at once enlightened public fected-largely by the influence of Senjudgment and far-sighted railroad ator Cullom. As compromises go, it policy, he did much to bring the two was a tolerably fair one. The extreminto harmony and protect the legiti- ists sacrificed their opposition to mate interests on both sides from short- commission, but secured the prohibisighted misuse for the benefit of either tion of pools ; the disputed points with party. The detail of his work is matter regard to rates were left in such a shape of past history ; perhaps its most prom- that no man knew what the law meant, inent result was to introduce to State and each was, for the time being, able legislation the idea of a railroad com- to interpret it to suit the wishes of his mission as administrative body. Congressional district. Those States which had no stringent The immediate effects of the law were laws appointed commissions to take extremely good. There were certain their place; those which had over- sections of it, like those which secured stringent ones appointed commissions publicity of rates and equal treatment to use discretion in applying them. In for different persons in the same cireither case, the existence of a body of cumstances, whose wisdom was univermen representing the State, but possess- sally admitted. Indeed it was rather a ing the technical knowledge to see what disgrace, both to the railroad agents and the exigencies of railroad business de- to the courts, that we had to wait for an manded, was a protection to all parties act of Congress to secure these ends ; concerned.
and most of the railroads made up for But matters were rapidly passing be- past remissness in this respect by quite yond the sphere of State legislation. à spasm of virtue. In some instances Each new consolidation of systems, each additional development of through traffic, made it more impossible to control railroad policy by the action of individual States. It could only be done by a development of the law in the United States courts or by Congressional legislation. The former result was necessarily slow ; each year showed an increased demand for special action on the part of Congress. But such action was hindered by divergence of opinion in that body itself. One set of men wished a moderate law, prohibiting the most serious abuses of railroad power, and enforced under the discretionary care of a commission. These men were for the most part not unwilling to see pools legalized if their members could thereby be held to a fuller measure of responsibility. On the other hand, the extremists wished to prescribe a system of equal mileage rates ; they would hear of no such thing as a commission, and it was even thought that they “stood hated pools as an invention of the ad- up so straight as to lean over backversary. Between the two lay a large ward.” But this was not the only part body of members who had no con- of the law which proved efficient. The victions on the matter, but were desir- very vagueness of the clause concernous to please everybody and offending the relative rates for through and nobody-a hard task in this particular local traffic, which under other circum
It was nearly nine years from the stances might have proved fatal, put time Mr. Reagan introduced his first a most salutary power into the hands bill when a compromise was finally ef- of the Interstate Commerce Commis
Charles Francis Adams.
sion, and one which they were not slow virtually created a body of additional to use.
law, which is read and quoted as authorThe President was fortunate in his ity. With but little ground for expectselection of commissioners ; above all ing it from the letter of the act, they
have become a judicial body of the highest importance. Their existence seems to furnish a possibility for an elastic development of transportation law, neither so weak as to be ineffective nor so strong as to break by its own rigidity.
But the final test of their success is yet to come. They have laid down a few principles as to the cases when competition justifies through rates lower than those at intermediate points. But the application of these principles is as yet far from settled ; and it is rendered doubly hard by the clause against pools, which does much to hamper the roads in any attempt to secure common action
on the matter of through rates. Each Thomas M. Cooley.
ill-judged piece of State legislation, and
each reckless attempt to attack railroad in the chairman, Judge T. M. Cooley, of profits, increases the difficulty. There Michigan, a man whose character, knowl- was a time when the powers of railroad edge of public law, and technical famil- managers were developed without coriarity with railroad business made him responding responsibility. In many singularly well fitted for the place. The parts of the country we are now going work of the Interstate Commission, like to the other extreme-increasing the that of its Massachusetts prototype, responsibility of railroad authorities shows how much more important is toward shipper and employees, State personal power than mere technical au- law and national commission, and at the thority. It was supposed at first that same time striving to restrict their powthe commission would be a purely ad- ers to the utmost. Such a policy canministrative body, with discretion to not be continued indefinitely without a suspend the law. Instead of this, they disastrous effect upon railroad service, have enforced and interpreted it; and and, indirectly, upon the business of in the process of interpretation have the country as a whole.