The Constitution of the United States was adopted nearly fifty years before the locomotive made its appearance. Had the steam railroad been in existence in 1787 and been as important an agency of commerce as it is to-day, there is every reason to believe that the railroad question would have received the special attention of the framers of that instrument. It is a well-known fact that the "new and more perfect government" had its origin in the necessities of commerce, and while the future exigencies of trade were beyond the reach of the most speculative mind, the provisions of the Constitution relating to the subject of interstate commerce were made broad and far-reaching. Section 8 of Article I. of the Constitution provides that "the Congress shall have power ... to regulate commerce with foreign nations, and among the several States, and with the Indian tribes ... and to make all laws which shall be necessary and proper for carrying into execution the foregoing powers and all other powers vested by this Constitution in the Government of the United States, or in any department or officer thereof."

If any doubt ever existed as to the import of the phrase "to regulate commerce," it has been entirely removed by the decisions of the Supreme Court. In the Passenger cases, 7 Howard, 416, the court said:

And again, in the Philadelphia and Reading Railroad vs. Pennsylvania, the Supreme Court said:

Chief Justice Marshall, in Gibbons vs. Ogden, 9 Wheaten, 196, construed the words "power to regulate" as follows:

It is a strange fact that during the first eighty years of the Government's existence Congress did not exert its power to regulate the conduct of common carriers engaged in interstate transportation. The first act regulating such carriers was passed in July, 1866. It authorized railroad companies chartered by the States to carry passengers, freights, etc., "on their way from any State to another State, and to receive compensation therefor, and to connect with roads of other States so as to form continuous lines for transportation of the same to the place of destination." The passage of this act, it should be remembered, was urged by the railroad companies themselves. Seven years later an act was passed providing that "no railway within the United States, whose road forms any part of a line or road over which cattle, sheep, swine or other animals shall be conveyed from one State to another, or the owners or masters of steam, sailing or other vessels carrying or transporting cattle, sheep or swine or other animals from one State to another, shall confine the same in cars, boats or vessels of any description for a longer period than twenty-eight consecutive hours, without unloading the same for water, rest and feeding, for a period of at least five consecutive hours, unless prevented from so unloading by storm or accidental causes."

Every violation of this act was made punishable by a penalty of from $100 to $500.

Though Congress had asserted the right to regulate commerce among the States, it had made previous to 1873 very limited use of that power. In the midst of the Granger movement the Senate of the United States passed on the 26th day of March, 1873, the following resolution:

The committee, under the chairmanship of Mr. Windom, discharged their duty with great fidelity, and submitted their report to the Senate during its next regular session. They declared that the defects and abuses of the then existing systems of transportation were insufficient facilities, unfair discrimination and extortionate charges. As the principal causes of such excessive rates they assigned stock watering, capitalization of surplus earnings, construction rings, general extravagance and corruption in railway management, and combinations and consolidations of railway companies. The committee were of the opinion that the promotion of competition would not permanently remedy the existing evils, and laid it down as a general rule that competition among railways ends in combination and in enhanced rates. As expedient and practical remedies for the existing evils they recommended the following measures:

1. Direct Congressional regulation of railway transportation, under the power to regulate commerce among the several States.

2. Indirect regulation and promotion of competition, through the agency of one or more lines of railway, to be owned and controlled by the Government.

3. The improvement of natural water-ways and the construction of artificial channels of water communication.

The report was accepted and considered, but there the matter rested, so far as the practical results were concerned.

In 1878 Mr. John H. Reagan, of Texas, introduced in the House of Representatives a bill for an act to regulate railroad companies engaged in interstate commerce. This may be said to have been the first real interstate commerce bill before Congress. It was a progressive, thorough and well-planned measure, but failed to receive the approval of Congress because a majority of its members considered it too radical a measure. The bill contained many of the provisions of the present Interstate Commerce Act, including the anti-pooling and the long and short haul clauses; but instead of creating a commission it lodged in the courts, both State and Federal, the power to enforce the law.Other bills were introduced from year to year, but during a period of nine years none of them drew sufficient votes to make it a law. Congress may be said to have been divided into three camps upon the railroad question, viz.: those who favored the system of regulation proposed by Mr. Reagan, those who favored the commissioner system and those who were opposed to every mode of Federal regulation of interstate commerce. In the meantime, the inactivity of Congress caused considerable restlessness among the people, and the demand for action became louder every year. The issue entered into politics, and a number of Western Congressmen owed their failure to be re-elected to their indifference or enmity to Federal railroad legislation.

On March 21st, 1885, under authority of a resolution adopted by the Senate of the United States, the President of the Senate appointed a select committee to investigate and report upon the subject of the regulation of the transportation of freight and passengers between the several States by railroad and water routes. Senator Cullom, of Illinois, became its chairman. The committee examined a large number of witnesses, including railroad managers and shippers, addressed letters to the railroad commissioners of the several States, to boards of trade, chambers of commerce, State boards of agriculture, Patrons of Husbandry, Farmers' Alliances, etc., and made every effort to obtain the opinions of those who had given special attention to the transportation problem.

The report of the committee was submitted to the Senate on January 18, 1886. Concerning the abuses of railroad transportation it differed but little from that of the Windom committee. The report declared publicity to be the best remedy for unjust discrimination and recommended that the posting of rates and public notice of all changes in tariffs be required. It also recommended that a greater charge for a shorter than a longer haul be made presumptive evidence of an unjust discrimination, and that a national commission be established for the enforcement of any laws that might be passed for the regulation of interstate commerce. Upon the question of pooling the report stated:

The report was accompanied by a bill representing "the substantially unanimous judgment of the committee as to the regulations which are believed to be expedient and necessary for the government and control of the carriers engaged in interstate traffic."

The bill was before Congress for more than a year, receiving several important amendments before its final passage in both houses. It was approved by the President on the 4th day of February, 1887, and took effect sixty days after its passage, except as to the provisions relating to the appointment and organization of an Interstate Commerce Commission, which took effect at once.

The act contains twenty-four sections, but is by no means cumbersome. It is, in many respects, the most important piece of legislation that has been had in Congress for the past twenty years. It applies to common carriers engaged in the transportation of passengers or property wholly by railroad, or partly by railroad and partly by water, when both are used, under a common control, management or arrangement, for a continuous carriage or shipment from one State or Territory of the United States, or the District of Columbia, to any other State or Territory in the United States or the District of Columbia, or from any place in the United States to an adjacent foreign country, or from any place in the United States through a foreign country to any other place in the United States. It prohibits unjust and unreasonable charges, special rates, rebates, drawbacks, undue or unreasonable preferences, advantages, prejudices and disadvantages, as well as all discriminations between connecting lines. It makes unlawful a less charge for a longer than for a shorter haul over the same line, in the same direction, the shorter being included within the longer distance, except when specially authorized by the Interstate Commerce Commission. It prohibits pools, requires schedules of freight rates and passenger fares to be kept in all depots and stations, permits no advance in the rates, fares and charges once established, except after ten days' public notice, and makes it unlawful for common carriers to charge either more or less than schedule rates.

It also requires them to file copies of all schedules, traffic contracts and joint schedules with the Interstate Commerce Commission, as well as to make them public when directed by the commission, and prohibits combinations to prevent the carriage of freight from being continuous from the place of shipment to the place of destination. It makes common carriers liable for all damages to persons injured by violations of the act, and specially provides that any court before which such a damage suit may be pending may compel any director, officer, receiver, trustee or agent of the defendant company to appear and testify in the case, and that the claim that any such testimony or evidence may tend to criminate the person giving such evidence shall not excuse such witness from testifying, but that such evidence or testimony shall not be used against such person on the trial of any criminal proceeding. It likewise subjects such officers and employes of a railroad company as may be guilty of aiding or abetting in violations of the act to fines not exceeding $5,000 for each offense.

These provisions are covered by the first ten sections of the act. Section 11 establishes the Interstate Commerce Commission, to be composed of five commissioners appointed by the President by and with the advice and consent of the Senate. It provides that the commissioners first appointed shall continue in office for the term of two, three, four, five and six years, respectively, from the first of January, 1887, the term of each to be designated by the President, and that their successors shall be appointed for terms of six years, except that any person chosen to fill a vacancy shall be appointed only for the unexpired term of the commissioner whom he shall succeed. No more than three commissioners may be appointed from the same political party, and the President has the power to remove any commissioner for inefficiency, neglect of duty or malfeasance in office. Authority is given to the commission to inquire into the management of the business of all common carriers subject to the provisions of the act and to require the attendance of witnesses and to invoke the aid of any court of the United States for that purpose.Section 13 authorizes any person, firm, corporation or association, any mercantile, agricultural or manufacturing society, any body politic or municipal organization to file complaints against any common carrier subject to the provisions of the act, with the commission, whose duty it is made to forward a statement of the charges to such common carrier and call upon him to satisfy the complaint or answer the same in writing, and to investigate the matters complained of, if the complaint is not satisfied. The commission is also charged with the duty of making such investigations at the request of State or territorial railroad commissions and may even institute them at its own motion. Section 14 requires the commission to make a report in writing of any investigation it may make and to enter it of record and furnish copies of it to the complainant and the common carrier complained of. Section 15 makes it the commissioners' duty, when it is found that any law cognizable by it has been violated by a common carrier, to serve notice on such carrier to desist from such violation and to make reparation for an injury found to have been done. If any lawful order or requirement of the commission is disobeyed by a common carrier, it becomes their duty and is lawful for any company or person interested in such order to apply by petition to the Circuit Court of the United States sitting in equity in the judicial district in which the common carrier complained of has its principal office, and the court has power to hear and determine the matter speedily and without the formal pleadings and proceedings applicable to ordinary suits, and to restrain the common carrier from continuing such violation or disobedience. It is further provided by this section that on such hearings the report of the commission shall be accepted as prima facie evidence.Section 17 regulates the proceedings of the commission. A majority constitute a quorum for the transaction of business. The commission may from time to time make or amend rules for the regulation of proceedings before it. Any party may appear before it and be heard in person or by attorney, and every vote or official act of the commission must be entered of record and its proceedings made public upon the request of either party interested.

Section 19 provides that the principal office of the commission shall be in Washington, but that for the convenience of the public it may hold special sessions in any part of the United States.

Section 20 authorizes the commission to require annual reports from all common carriers subject to the provisions of the act, to fix the time and prescribe the manner in which such reports shall be made, and to require from such carriers specific answers to all questions upon which the commission may need information.

Section 21 excepts from the operation of the act the carriage of property for the United States, State or municipal governments, or for charitable purposes, or for fairs and expositions; also the issuance of mileage, excursion and commutation tickets, the giving of reduced rates to ministers of religion, the free carriage by a railroad company of its own officers and employes, and the exchanging of passes or tickets among the principal officers of railroad companies.

The sections not noticed are of minor importance, relating to annual reports, salaries, appropriations of funds, etc.

The act was amended on March 2, 1889, but the amendments made did not materially affect its principal provisions.When the law was passed its friends well realized that its success would greatly depend on the character of the commissioners whom it was incumbent upon the President to appoint. It was feared that if the railroad influence should control these appointments, the power to suspend the long and short haul clause would be the chief and perhaps the only power exercised by the commission. There was great danger that the office of Interstate Commerce Commissioner might become a sinecure for servile railroad lawyers, as similar State officers had been before, and that a public trust might be turned into an additional corporation agency for evil. The selection of the commissioners, and especially that of Judge T. M. Cooley, of Michigan, was greatly to the credit of President Cleveland. A man of unquestionable integrity, an eminent jurist and close student of railroad affairs, Judge Cooley was particularly well qualified for the office of chairman of the Interstate Commerce Commission, which he occupied for nearly five years with signal fitness, and from which he only retired to the sincere regret of the American people. Under Judge Cooley's leadership the commission has been more than a purely executive board. It was under the Constitution not in the power of Congress to clothe the Interstate Commerce Commission with full judicial authority without giving its members, like other Federal judges, tenure for life, instead of a term of years. The inherent force of the commission's decisions in its interpretation of the law made them in many cases virtually the equivalent of judicial rulings.

A few of the most important decisions of the commission may be mentioned here. Construing the long and short haul clause, they held that, in case of complaint for violating this section of the act, "the burden of proof is on the carrier to justify any departure from the general rule described by the statute, by showing that the circumstances and conditions are substantially dissimilar." They also decided that "when a greater charge in the aggregate is made for the transportation of passengers or the like kind of property for a shorter than a longer distance over the same line in the same direction, the shorter being included in the longer distance, it is not sufficient justification therefor that the traffic which is subjected to such greater charge is way or local traffic and that which is given the more favorable rates is not; and that it is not "sufficient justification for such greater charge that the short-haul traffic is more expensive to the carrier, unless when the circumstances are such as to make it exceptionally excessive, or the long-haul traffic exceptionally inexpensive, the difference being extraordinary and susceptible of definite proof; nor that the lesser charge on the longer haul has for its motive the encouragement of manufactures or some other branch of industry, nor that it is designed to build up business or trade centers."

Upon the question of publicity of the railroad business the commission held that, as the books of the defendant carriers, as to rates charged, facilities furnished and general movements of freight, are in the nature of semi-public records, the officers and agents of defendant carriers ought to give promptly to a complainant any statement of facts called for, if such statement may probably have importance on the hearing.

Judge Brewer's opinion as to what constitutes a reasonable rate was evidently not shared by Judge Cooley and his colleagues, for in the case of the New Orleans Cotton Exchange vs. the Cincinnati, New Orleans and Pacific Railway Company the commission decided that the fact that a road earns but little more than operating expenses cannot be made to justify grossly excessive rates, and that "wherever there are more roads than the business at fair rates will remunerate, they must rely upon future earnings for the return of investments and profits." In another case the commission hold that "in fixing reasonable rates the requirements of operating expenses, bonded debt, fixed charges and dividend on capital stock from the total traffic are all to be considered, but the claim that any particular rate is to be measured by these as a fixed standard, below which the rate may not lawfully be reduced, is one rightly subject to some qualifications, one of which is that the obligations must be actual and in good faith."

The rules governing the proper construction of classification sheets which the commission has laid down are founded upon common sense and justice. They say:

In defining what is legitimate traffic the commission made the following decision:

It has been shown in a former chapter that the weaker oil refiners have been discriminated against by the railroads, which permitted the Standard Oil Company to use their own tank cars in the shipment of oil and charge its competitors excessive rates for like shipments in barrels. Complaint being made of this discrimination, the commission held that it is properly the business of a carrier by railroad to supply rolling stock for the freight he offers or proposes to carry, and that "if the diversities and peculiarities of traffic are such that this is not always practical, and the consignor is allowed to supply it for himself, the carrier must not allow its own deficiencies in this particular to be made the means of putting at unreasonable disadvantage those who may use in the same traffic all the facilities which it supplies."

A most important ruling of the commission is that relating to the pass abuse. Complaint was made that the Boston and Maine Railroad Company issued in the States of Maine, New Hampshire, Vermont and Massachusetts free passes to certain classes of persons, among them "gentlemen long eminent in the public service, higher officials of the States, prominent officials of the United States, members of the legislative railroad committees of the above named States, and persons whose good will was claimed to be important to the defendant." The commission decided that such a discrimination is unwarranted, that a carrier is bound to charge equally to all persons, regardless of their relative individual standing in the community, and that the words "under substantially similar circumstances and conditions" relate to the nature and character of the service rendered by the carrier, and not to the official, social or business position of the passenger.It is a notorious fact that the practice of issuing free passes to public officials and other influential persons has been more or less indulged in by nearly every railroad in the country up to the present time. It is to be hoped that this ruling of the commission will be enforced in such a manner as to put an end to this intolerable abuse.

The Interstate Commerce Commission has been equally efficient in its administrative capacity. From the very first it called attention to the great advantage of having one classification of freight throughout the country, and it has since labored diligently to unify the various classifications in use. As the commission in this undertaking is only armed with the armor of moral suasion, it is a difficult task; but there is little doubt that the accomplishment of this great reform is only a question of a few years. Iniquities in classifications and rates are constantly pointed out by the commission and corrected by the companies. Moreover, the annual reports of the commission, not to mention its very excellent statistical data, diffuse much useful information and dispel many delusions. Thus the fourth annual report of the commission says:

The same report contains a rather pointed reply to Judge Brewer's ruling in the Iowa rate cases, viz., that, "where the rates prescribed will not pay some compensation to the owners, then it is the duty of the courts to interfere and protect the companies from such rates," and that compensation implies three things: "Payment of cost of service, interest on bonds and then some dividends." The commission reviews this stupid rule as follows:

It is no exaggeration to say that the annual reports of the commission stand unexcelled as dauntless, clear, concise and instructive public documents. It may also be asserted that whatever success has so far attended the Interstate Commerce Law, that success is in a great measure due to the tact, courage and ability of the men who, in the past, have been the guiding spirits of the commission.

Efforts will be made by railroad managers in the future, as they have been made in the past, to weaken the commission by securing the appointment of men servile to the railroad interest as members of that body.

Mr. Depew says that "all railroad men are politicians, and active ones." This is true as to manipulating managers and will continue to be so just as long as we allow such extraordinary powers to be exercised by them. The saloon men are politicians, and active ones. There is not a city or town in this broad land that is not in danger of falling under their sway unless their offensive efforts are resisted. The old United States Bank managers were politicians, and active ones. They perverted the trust reposed in their hands to such an extent that the indignation of the people was aroused, and under the lead of a stern old patriot the bank was swept out of existence. Shall we restrain corporation management within proper limits and make corporations serve the public welfare, or shall we let the abuses go on until the people, under the lead of another Jackson, demand emphatically the application of some remedy, for better or for worse? Perhaps Government ownership, perhaps something else. Nations, like individuals, should profit by the experience of the past.

The Interstate Commerce Commission, in their sixth annual report, say, concerning the Interstate Commerce Law: