Commerce Commission's report for 1897, the eleventh annual report, which is as follows: But it (the Commission) further understood that when, as in this case, the rates had been established by the carriers and afterwards challenged or complained of as unreasonable and the question of unreasonableness had been tried, the Commission could declare not only what rate was wrong, but what would be right. That is to say, when a rate had been established by the carriers, challenged by or on behalf of the shippers, and tried by the Commission in a proceeding ordered and regulated as near as it may be in conformity with United States court proceedings, the Commission had a right, and it became its duty, when justified by the facts, to declare the rate wrong, decide what rate would be right, and through the judgment of the court compel the carrier to perform its legal duty to receive and carry property at rates which are reasonable and just. The Commission exercised this power in a case commenced in the second month after its organization and continued to exercise it for a period of more than ten years, during which time no member of the Commission ever officially questioned the existence of such authority or failed to join in its exercise. As already stated, the authority of the Commission to modify and reduce an established rate and to enforce a reasonable rate for the future was not questioned in the answer of the defendant in the Atlanta rate case, decided March 30, 1896, nor had it ever been denied in any of the answers made to more than four hundred cases previously commenced, many of them alleging unreasonable and unjust charges and praying the Commission to enforce a reduction and lower rates in the future. I wish to state that the power which has been exercised by the Commission during the ten years referred to in these extracts, and the existence of which was denied by the Supreme Court, was not denied. on account of any question as to the constitutional right of Congress to confer that power, but simply on account of the point that the act itself did not express it specifically. And I wish to say further that during that period while that power was exercised no complaint was ever made by any of the carriers of a rate that had been substituted or ordered by the Commission as being unjust or as inflicting any hardship upon the carriers. But the validity of the order was questioned only on the point as to whether the Commission actually possessed the power to make such an order. One question that was asked the other day I would like to say a few words in relation to, and that is as to the rightfulness or the legality of requiring the Commission to take all of the testimony in case of an appeal, to take any additional testimony which might be desired to be offered by either of the parties to the case. It seems to me that the apparent difficulties which exist in relation to the rightfulness of this arise from the fact that the Commission has been regarded as a judicial body. That is not the case. It acts as an agent of Congress in exercising legislative functions of making a rate, of prescribing a rate, after finding that the existing rate is unjust or discriminating, and that as an administrative or legislative act it should and must necessarily, and ought in fact, to go into immediate effect as any legislative act does; and parties who question its rightfulness have their remedy in an appeal to the courts for a review of the question as is provided in the Corliss bill. My idea is simply this, that an act of the Commission, not being a judicial act, there is no reason why it should not go into immediate effect, being a legislative or administrative act instead of a judicial one. The CHAIRMAN. You regard the fixing of a rate as a legislative act? Mr. BACON. As legislative, yes, sir; and as all legislative acts must necessarily go into immediate effect, and then parties who object to the effect of that act have their remedy in the courts, and while it is being tested in the court it is in operation and effect, and any loss which may be sustained by it by anybody is one of those contingent results which can not be provided for. But in point of fact, during the ten years when this authority was exercised, no railroad company ever claimed that it experienced any hardship or suffered any wrong in consequence of the acts of the Commission. Experience is far better than theory. The CHAIRMAN. Have we had any experience in procedure such as is now proposed during the ten years you speak of? Mr. BACON. Yes; we have had continuous experience on that direct line. Numerous cases have been decided by the Commission in which a rate has been fixed. The CHAIRMAN. Yes; but when they fixed a rate they did not attempt to enforce that rate, If it was to be enforced, if it needed any further power, they had to go to the court. Mr. BACON. They had to go to the court. The CHAIRMAN. The court then rendered its judgment. Mr. BACON. They had to go to the court if the railroad did not obey the order. The CHAIRMAN. If they did not obey it. Mr. BACON. So that during the ten years of that time, or most of that time, eight or nine years, the railroads almost universally complied with the rates of the Commission and the rates it prescribed were promptly observed, it being regarded by the railroads at that time as a proper function of the Commission and the orders were obeyed and the rates put into effect which the Commission prescribed; and as I say, no one ever claimed them as being wrong and no railroad ever suffered from that practice on the part of the Commission, and that practice, I say, is far better than any theory. We may theorize as to what possible results may be and yet when we have had ten years of experience it is worth far more to us than any theorizing of what may occur to us in the future, and having had that experienceand it having resulted satisfactorily, not only to the public but to the carriers themselves-that is the best warrant in the world for reinvesting the Commission with that particular power. The question was asked the other day if bonds should be given between those two parties, the complainants on the one hand and the railroads on the other; but that is utterly impracticable from the nature of the case. The party who pays the freight is very rarely the one who bears it ultimately. He is the middleman. The great bulk of transportation of the country is carried on by middlemen, and freight paid by them is immediately added to the cost of the goods, and follows the goods, and is paid by the consumer in case of merchandise, and in case of agricultural products the freight to be paid is deducted from the value of the product at the point of production, and is borne in advance by the producer. Consequently there are no parties who can give bond during the pendency of the case who are the real sufferers, and the man who has paid the freight is not a sufferer at all, although the rate may be excessive and exorbitant and unjust in other respects; yet he has paid it, and has recouped himself by charging it on the goods, and he has actually recovered it in that way, and there is no remaining direct or personal interest in it whatever. Hence, the impracticability of providing bonds as has been suggested, and hence the necessity of providing an entirely different method of treatment for cases relating to the freight to that relating to claims between individuals. It is absolutely essential that they should be treated in an entirely different manner, because of the difference in the nature of the case. This treatment can only be provided by carrying into effect the rate prescribed by the Commission, when, upon full investigation, the rate is found to be unjust or unreasonable. Upon the question of the constitutionality of some of the provisions of the bill I would like to file a pamphlet entitled "Power of Congress over Interstate Commerce," which cites numerous cases which have been decided by the Supreme Court in relation to the governmental supervision over rates of freight and passage. It is an able legal document. I will give way here to Mr. Jones, the chairman of the National Grange. NATIONAL AND STATE ORGANIZATIONS. APRIL 4, 1902. Grain Dealers' National Association, Indiana State Board of Commerce, Illinois Manufacturers' Association, Kansas Millers' Association, Michigan State Millers' Association, Millers' National Association, Millers' National Federation, Minnesota Retail Grocers and General Merchants' Association, Missouri, Kansas and Oklahoma Lumber Association, National Board of Trade, National Dining Table Association, National Wholesale Druggists' Association, National Live Stock Association, National League of Commission Merchants, National Retail Grocers' Association, National Hay Association, National Wholesale Lumber Dealers' Association, Nebraska Retail Grocers and General Merchants' Association, New England Shoe and Leather Association. New England Granite Manufacturers' Association, Ohio Grain Dealers' Association, Ohio State Association Patrons of Industry, Oklahoma Millers' Association, Texas Cattle Raisers' Association, Texas Millers' Association, Utah Live Stock Association, Winter Wheat Millers' League, Wisconsin Cheese Makers' Association, Wisconsin Retail Hardware Dealers' Association, Wisconsin Retail Lumber Dealers' Association. LOCAL ORGANIZATIONS. California.-Claremont Citrus Union; Colton, San Bernardino County Fruit Exchange; Los Angeles Chamber of Commerce; Los Angeles, Southern California Fruit Exchange; North Pomona, Indian Hill Citrus Union; Pomona Fruit Growers' Exchange; Pomona, San Antonio Fruit Exchange; Porterville Board of Trade; Porterville, Tulare County Citrus Fruit Exchange; San Diego Chamber of Commerce; Santa Barbara Lemon Growers' Exchange; Santa Barbara, Santa Barbara County Chamber of Commerce. Colorado.-Colorado Springs Chamber of Commerce. Indiana.-Indianapolis Board of Trade, Indianapolis Commercial Club. Iowa.-Davenport Business Men's Association. Kansas.-Topeka Commercial Club. Louisiana.-New Orleans Board of Trade. Massachusetts.-Brockton Board of Trade, Fitchburg Merchants' Association, Worcester Board of Trade. Michigan.-Detroit Merchants and Manufacturers' Exchange. Mississippi.-Westpoint, Aberdeen Group Commercial Association. change. Nebraska-Lincoln, Retail Grocers' Association; South Omaha Livestock Exchange. New York. Brooklyn, United Retail Grocers' Association; Buffalo Lumber Exchange; Buffalo Merchants' Exchange; Middletown, Business Men's Association; New York Lumber Trade Association; New York Manufacturers' Association; New York Merchants' Association; New York Produce Exchange; New York Stationers' Board of Trade. North Carolina.-Wilmington Chamber of Commerce. Ohio. Cincinnati Chamber of Commerce, Toledo Produce Exchange; Newark Board of Trade. Oregon.-Portland Chamber of Commerce. Wisconsin.-Milwaukee Chamber of Commerce; Milwaukee Mer- STATEMENT OF MR. AARON JONES, GRAND MASTER OF THE NATIONAL GRANGE, PATRONS OF HUSBANDRY. Mr. JONES. Mr. Chairman, I will not detain your committee with any extended remarks upon these questions. Representing the agricultural interests of the United States as presented by our order, we are very much concerned to have an equitable law upon transportation. It is a question that more vitally affects the producing classes than any other classes in our country, as the statistics show that 60 per cent of the freights carried upon our vast railway systems are paid upon the products of agriculture. Hence, an unjust or unfair or inequitable freight rate is very detrimental to us. As has been remarked by Mr. Bacon the cost of the freight is immaterial to the freighter, because he takes it out in the purchase of his product and the cost falls upon the farmers. I want to say that the farmers are not antagonistic to the railway interests. They do not desire legislation that will cripple or hinder the progress of the railroad development of this country; neither do they want to prevent them from making a reasonable and fair profit for the money and the energies engaged in transportation. But upon the lands in which these railways acquire their rights to build their roads over our property, where a difference arises between the owner of lands and the company seeking a right of way, where those differences exist, all the States have provided that a disinterested tribunal, not interested in the lands or in the company, shall sit and determine what are the damages to the individual for dispossession of this prop erty, and that we esteem to be right and proper. It is in the interest of the progress of our nation. Now, after a railroad has acquired its right to build its road, if there should any contention arise as to the equity of transportation of any of the products which grow upon this or any other farm in that community, certainly it would be but just and fair that where that contention arises some commission should be able to examine this contention and determine, as in the one case, also in the second case, what would be right and fair, and then we would be placed upon an equality. The management of railroads has been in the past, in some respects, regardless of the interests of the producer or the interests of the farmer. In the classification of freight they have made it prohibitory to market some products, so that they are absolutely worthless, because the producers are unable to pay the freight charges upon them. These charges are not in proportion to the cost of carriage, as we understand it. In cases of that kind it seems to me that the farmers ought to have a remedy, and that remedy ought to be provided by the National Congress. For many, many years our organization, in its subordinate granges scattered through 41 States of this Union, have met in our State assemblages, our national assemblages, and have continually presented this claim and pressed it upon Congress to give us a remedy. We have carefully examined the Nelson-Corliss bill, and we believe. its amendments to the original interstate-commerce act are just, fair, and equitable, and that they will provide the remedy that we have sought. That remedy is that when the Commission has examined a case clearly and fully, and determined, whatever their finding may be, the railroad companies must obey that finding, and thereafter carry the product at the rate of the finding of the Commission until it has been reviewed and set aside by the courts. The There is not any other protection that the farming interests of this country can secure. We are handicapped. The value of our lands all depends upon the management of the railroad corporations. rapid combination and consolidation of these roads under a single management makes it more imperative at this time, and more and more forcibly is the necessity felt that we should have legislation, such as we ask now, than in any other period in our country's history, because we are absolutely at the mercy of the transportation interests of the country. I believe that the loyalty of the farming population to our country is unquestioned. They are willing to pay their proportion of the country's expenses, and they are also willing to stand for its defense, and this is the only remedy we have for our protection. As isolated individual farmers they are unable to make any contention or go into the courts to seek a remedy. They are unable to pay for it. They are absolutely shut out. It would seem to me that the Congress ought to provide this remedy for us and protect its weakest citizen as well as its strongest corporation. I believe the safety, I believe the liberty, and I believe the loyalty of all the people of this country depend upon laws which shall fall justly upon all its respective classes. If the farmers of this country become thoroughly impressed with the idea that the Congress that they have elected does not take cognizance of their necessities, and |