be as far-reaching in their effect upon interstate commerce as would the legislation of a single state of the same character."'1

IV. Power to control our commerce and corporations: 1. In general. If the predicament we are in is due to unregulated commerce, and/ the inadequate control of the corporations carrying it on, we should get relief by proper regulation of both; but the two are so related that attempts to regulate one without the other, or for one government to try to regulate the commerce, and forty-five different gov ernments undertake to regulate the corporations that carry it on will inevitably result in failure. As we have seen, the particular devices whereby evil is wrought or danger threatened are unjust discriminations in transportation, predatory competition, overcapitalization, and dishonest corporate management,―the first two are matters of commerce, and the last two of corporation law, and though, separable in the mind, they are inextricably bound together in fact. Nothing less than one system of regulation that can reach all can be successful. Where is the power to do this?

2. Power of the states: As to the commerce which has become national in extent, from what has already been said, it is clear this is beyond the powers of the states, first, because the Constitution has taken away the power, and second, because if they had it, it would be impossible to secure the necessary uniformity of regula tion to be efficient or desirable.

3

By the decisions, a state cannot exclude a corporation engaged in interstate commerce,2 nor tax such commerce, even if the corporation is one of its own creation, nor tax the agents engaged in it,5 nor fix the rates for carrying it, nor exclude articles of `such com

6

To secure the uniformity of regulations was the reason the power to regulate national commerce was given to Congress, and it is idle to consider that uniformity will ever be attained by leaving, or further surrendering, this power to the states, as has been suggested.

1 Addyston Pipe & Steel Co. v. 175 U. S. 211 (1899).

2 Pensacola Tel. Co. v. W. U. Tel. Co., 96 U. S. 1; Cooper v. Ferguson, 113 U. S. 727.

8 Brown v. Maryland, 12 Wheat. 419,

♦ Philadelphia Steamship Co. v. Pennsylvania, 122 U. S. 326.

5 Robbins v. Taxing District, 120 U. S. 489.

6 Wabash R'y Co. v. Illinois, 118 U. S. 557.

7 Bowman v. Chicago & N. W. Ry., 125 U. S. 465; Collins v. New Hampshire, 171 U. S. 30.

8 Chy Lung v. Freeman, 92 U. S. 275.

• Crandall v. Nevada, 6 Wall. 35 (1867).

As to regulating the corporations created by the states, it would seem that a state could control its own corporations, and exclude the foreign corporation,-but the very corporation to be controlled is the one that carries on national commerce,—and this takes it out of any effective control, at least when organized in another state.

But aside from these considerations many of the great corporations are so big and powerful as to make it practically impossible to secure adequate control, if the legal authority existed. The net earnings of the United States Steel Corporation for 1902, were over $133,000,000,-more than the total sum raised by taxation in New York and Ohio, together, in 1898, and twice the amount raised by tax in Pennsylvania the same year. The gross income of the same corporation for 1902, $565,000,000, was more than the total ordinary receipts of the National Government for any year prior to 1899. Its stock and bonds are more than the total capital engaged in manufacture in any state of the Union, except New York and Pennsylvania; and likewise the same are greater than the value of all the farm products of any state except Illinois and Iowa. If Judge Grosscup could have been induced to act as attorney for the Northern Securities Company, in the Supreme Court, and been successful in its defense, the company could easily afford to pay him a fee, the interest of which would bring him for life a greater return than his salary as a United States judge. "The only possible competitor for a billion dollar trust is a hundred billion dollar State."'

But the diversity of the laws under which state commercial corporations are or may be formed is as great as the diversity of the commercial regulations of the states was before the Constitution was formed, and has similar effects.

These corporate bodies owe their existence to the different laws of the different states. Wherever they may do business or seek members, all questions relating to the organization, amendment, internal control and regulation, rights, duties and liabilities of members and officers, issue, payment, and transfer of shares, duration, dissolution, and winding-up, are determined by the law of the state where organized, though the members may reside in every state in the Union. Every contract made, wherever made, is subject to the provisions of the charter, which every person who deals with the corporation is presumed to know. The operations of the corporation and its public rights and duties are determined both by

1 Report Com. Am. Bar Assn., 1903, p. 18.

charter provisions, and by the law where the transaction occurs. On such a question as to what duty there is, and the extent of it, to receive and transport safely freight from one state to another, there are seven different views.1

This is a sample of the variety of views upon many questions. The corporate property and shares are usually subject to as many different methods of valuation and taxation, as there are states in which they are located, and in the case of intangible property and shares are not infrequently subject to double, triple or quadruple taxation. Reports and fees required, and terms and conditions of the police control are as diverse as the places in which business is done. Every session of the legislature in each of the forty-five states, and many of the decisions of the courts of last resort, tend to increase, rather than diminish, the diversity. Those who wish to engage in productive industry, not of a purely local character, and in an honorable way, are inordinately inconvenienced and unduly hampered by the conflicting provisions of the state laws. The policy of the states will never be in harmony. Situation, local pride, political bias, party policy, peculiar industries, or financial interest will produce and increase the differences.

3. National power. If state power is too weak for effective regulation, what power has the National Government, over national commerce and over the corporations carrying it on?

As to commerce. Mr. Justice Harlan, in the Lottery Case,2 cautiously said:

"The whole subject is too important, and the questions suggested by its consideration are too difficult of solution to justify any attempt to lay down a rule for determining in advance the validity of every statute that may be enacted under the commerce clause."

Nevertheless, after an extensive review of the cases from Gibbons v. Ogden3 to Hanley v. Kansas City Southern Ry, he concludes that "Congress alone has the power to occupy, by legislation, the whole field of interstate commerce," and as stated In re Rahrer,5 "The framers of the Constitution never intended that the legislative power of the Nation should find itself incapable of disposing of a subject specifically committed to its charge," and points out that

"Commerce among the states embraces navigation, intercourse, communication, traffic, the transit of persons and the transmission of messages by

1 Origin of Right to Engage in Interstate Commerce, E. P. Prentice, Harv. L, R., Nov., 1903, p. 32.

2 188 U. S. 321 (1903).

4 187 U. S. 617

89 Wheat. 1 (1824).

5 140 U. S. 545.

1

telegraph. The power to regulate commerce among the several states is vested in Congress as absolutely as it would be in a single government, having in its Constitution the same restrictions on the exercise of the power as are found in the Constitution of the United States."

Commerce includes the subject-matter of traffic and intercourse, the fact of traffic and intercourse, and the instrumentalities by which it is carried on.

The subject-matter may be "things, goods, chattels, merchandise, or persons.'

The fact of intercourse includes the negotiation of the sale of goods which are in other states whether by solicitor or sample,2 the purchase of goods between citizens of different states, made in either state, communication between persons by the transmission of intelligence by telegraph or telephone, 5 the transit of persons, or the transportation of persons or property, by express, or piping of oil or gas, or driving of cattle, 10 in completion of a commercial transaction across state lines, and also the written documents 11 whereby such transactions are effected.

9

8

As to the instrumentalities, Chief Justice Waite said in Pensacola Tel. Co. v. Western Union Telegraph Co.:12_

"Postoffices and postroads are established to facilitate the transmission of intelligence. Both commerce and the postal service are placed within the power of Congress, because being national in their operation, they should be under the protecting care of the National Government. The powers thus granted are not confined to the instrumentalities of commerce, or the postal service known or in use when the Constitution was adopted, but they keep pace with the progress of the country, and adapt themselves to the new devel

1 McCall v. California, 136 U. S. 104; Lottery Case, 188 U. S. 321 (1903).

Cooper v. Ferguson, 113 U. S. 727 (1885); Robbins v. Taxing District, 120 U. S. 489, 59 Am. R. 267 (1887); U. S. v. E. C. Knight Co., 156 U. S. 1 (1895); Hopkins v. U. S. 171 U. S. 578 (1898); Addyston Pipe Co. v. U. S. 175 U. S. 211 (1899).

3 Same cases as preceding note. McNaughton v. McGirl, 20 Mont. 124, 63 Am. St. R. 610 (1897).

4 Pensacola Tel. Co. v. W. U. Tel. Co. 96 U. S. 1 (1877); Western Union Tel. Co. v. Pendleton 122, U. S. 347.

5 Matter of Pennsylvania Tel. Co., 48 N. J. Eq. 91, 27 Am. St. R. 462.

6 Passenger Cases, 7 How. 283 (1848); Crandall v. Nevada, 6 Wall. 35 (1867); People v. Compagnie Generale, 107 U. S. 59; Covington Bridge Co. v. Kentucky, 154 U. S. 204, 218.

7 The Daniel Ball, 10 Wall. 557 (1870); State Freight Tax Cases, 15 Wall. 232 (1872); Philadelphia Steamship Co. v. Pennsylvania, 122 U. S. 326 (1887).

8 Crutcher v. Kentucky, 141 U. S. 47 (1891).

• State v. Indiana etc. Co., 120 Ind. 575 (1889).

10 Kelley v. Rhoads, 188 U. S. 1 (1903).

11 Almy v. California, 24 How. 169; Fairbanks v. U. S. 181 U. S. 283.

12 96 U. S. 1. 9. 12.

opments of time and circumstances. They extend from the horse with its rider to the stage coach, from the sailing vessel to the steamboat, from the coach and steamboat to the railroad, and from the railroad to the telegraph, as these new agencies are successively brought into use to meet the demands of increasing population and wealth. They were intended for the government of the business to which they relate at all times and under all circumstances."

Exactly when such commerce begins and ends is a difficult question. The production or manufacture1 of things intended for interstate commerce, or gathering them together for the purpose of sending them to other states, or after sending them into another state, keeping them there for the purpose of use or sale,3 if not in the original package, is not interstate commerce.

2

6

Insurance, 5 loaning money, dealing in foreign lands,' dealing in bills of exchange, carrying on building and loan associations,' mining,10 or carrying on the business of brokers or commission merchants, 11 is not interstate commerce so far as to prevent state regulation, or within the present anti-trust act.

Under the power to regulate, the question naturally arises as to how far Congress can prohibit interstate commerce. It has been said that

(1) The power to regulate commerce among the several states is granted to Congress in terms as absolute as is the power to regulate commerce with foreign nations," or with the Indian tribes, it might have been added. (2) "The Federal power of commercial regulation includes necessarily a power of police supervision.''13 (3) "The power to regulate commerce may be used for the promotion of11 other objects of national concern," as excluding and deporting foreigners. And finally, (4) The constitutional amendments that forbid a person from being deprived of life, liberty or property do

1 U. S. v. E. C. Knight Co., 156 U. S. 1 (1895).

2 Coe v. Errol, 116 U. S. 517 (1886); Diamond Match Co. v. Ontonagon, 188 U. S. 82 (1903).

3 Brown v. Houston, 114 U. S. 622.

4 Schollenberger v. Pennsylvania, 171 U, S.1 (1897); May v. New Orleans, 178 U. S. 496

(1900).

5 Paul v. Virginia, 8 Wall 168; Hooper v. California, 155 U. S. 648 (1894).

6 Nelms v. Mortgage Co. 92 Ala. 157.

7 Honduras Com. Co. v. State Board, 54 N. J. L. 278.

8 Bamberger v. Schoolfield, 160 U. S, 149.

9 Southern Building and L. Assn. v. Norman. 98 Ky. 294.

10 Utley v. Gardner Lode Min. Co., 4 Col. 369.

11 U, S. v. Hopkins, 171 U. S. 578 (1898).

12 Brown v. Houston, 114 U. S. 622, 630,-Mr. Justice Bradley; Pittsburgh Coal Co.v. Bates, 156 U. S. 577. 587.

13 Prentice & Egan, The Commerce Clause, p. 337,

14 U. S. v. Williams, 83 Fed. 997; Fong Yue Ting v. U. S. 149 U. S. 698.