This bill is not designed to work a hardship on anyone. There is in it no word indicative of anything but justice and equal rights. It lays no burden on the carrier that does not rightly belong there, and it promises nothing to shippers but their plain undisputed rights. It is fair, then, to urge its passage in the name of common justice.

I am not in sympathy with the bread and butter philosophy of railway advocates who tell us that this measure promises the commission too much power. Either the commission must have sufficient power to render its rulings effective or it will continue to be an impotent body. This fact is self-evident. In the minds of those willing to pay fair rates there is no excuse why carriers should refuse to have the same guaranteed by law. Indeed, the whole matter appears to hinge on the question of good or ill intentions of the carriers toward the public. If they desire to continue to favor large shippers, trusts, and combinations to the disadvantage of the small shipper, then opposition to this measure is easily defined; but if they have any wish to treat all shippers fairly and alike, I can expect nothing less than their ardent support of this bill. The question of equal rights is the foundation of this legislative construction. To deny that this is every citizen's due means hostility to this measure. To advocate the constitutional right of the citizen means to emphasize his claim to the protection provided for in this bill.

We are told by railway representatives that the measure proposed will impose needless hardships upon the common carriers; that they should be permitted to conduct their affairs in their own way without the interference of the Government. We, who advocate the cause for the people, are presumed to be meddlers, interfering with the sacred rights of innocent corporations, without reason and without warrant. Such is the haughty attitude of the giant corporations that have been granted the right of monopoly of routes, invested with the power of condemnation of property and eminent domain by the people. It means that the people may only give, never ask.

It means that the people must either trust their rights to the tender mercies or the caprice of the magnates of the commercial highways of the nation, or that the people will demand what is their due and set up such laws as are calculated to protect them in the enjoyment of such rights. There is no doubt whatever concerning the power of Congress to regulate the conduct of interstate carriers, however much they may object to the process, nor is there the least doubt of the pressing need of such regulation.

The encroachment of common carriers upon the rights of private citizens has been continuous and unrelenting for many years and has of late become so oppressive and alarming that the general public, in the hope of self-preservation, must appeal to the law-making power of the land for protection and relief. Not satisfied with control of the forests and mines along their lines, the carriers have sought to, and do, in the larger area of the country, control absolutely the movement and value of the products of the soil. They have now invaded the household and the farm and are ambitious to be the dictators of the ballot. Senator KEAN. To control what?

Mr. GALLAGHER. The ballot.

Senator TILLMAN. You mean votes.

Mr. GALLAGHER. Yes, sir.

The CHAIRMAN. Who does that?

Mr. GALLAGHER. The railroad companies.
Senator ALLEN. Nobody denies that.

Mr. GALLAGHER. This state of affairs has been growing worse and worse, until now it has become intolerable. Either the masses of the people, the merchants and manufacturers of moderate capital, the smaller tradesmen, the operators of industries not favored by the carriers, the artisan and the farmer, and the millions of others that depend on them for support, must speedily be reduced to industrial and commercial slavery, or their emancipation must be provided for along the lines suggested by the bill under consideration. The necessaries of life and the commodities of trade are alike controlled by favored shippers, who are day after day rearing towering fortunes, that their owners. may the more easily, and if possible the more effectually, oppress those dependent upon them or subject to their arbitrary and mercenary

power.

To particularize with regard to the encroachments of common carriers upon the rights of individuals, I need only show to you that the grain trade of the United States--the trade concerning which I happen to be informed-is controlled, absolutely, in its primary movements by less than a score of individuals or corporations. Naturally, the great army of farmers who produce this grain and the dealers and millers through whose hands it might otherwise pass at a profit com plain that the transportation facilities of the Central and Western States have been placed at the command of the favored few. I shall call your attention to a statement that is current trade gossip and which may be verified by inquiry of grain merchants in any of the market centers of the Central and Western States. That statement is that for the purpose of controlling the movement of grain Armour & Co. command the entire Chicago, Milwaukee and St. Paul system and the Missouri River Division of the Burlington.

When Armour desires to buy grain along those lines the dealer, shipper, and miller, alike, must retire from the market. The effect of this monopoly is seen in lower prices, which can be forced owing to the greatly reduced rate at which the favored shipper is permitted to transport his grain. But Armour & Co. have just as much right to control the grain business on the lines mentioned as Counselman & Co. have to control the grain business on the Chicago, Rock Island and Pacific, or Richardson & Co. on the Sante Fe, Peavey & Co. on the Union Pacific, the Anglo-American Grain Company and the Iowa Development Company on the Chicago Great Western, Peavey & Co., Bartlett, Frazier & Co., the Weare Commission Company on the Chicago and Northwestern, and Harris & Co. on the Burlington system. These firms are, on account of railway favoritism, looked upon and are, in fact, the absolute dictators of prices and facilities throughout the territory covered by the great systems mentioned.

A similar state of affairs exists to a limited extent along the Kansas City lines, Minneapolis lines, and St. Louis lines, and all told, as I have stated, the control of the movement of the staff of life from the field of production to the markets of the world is at the pleasure and mercy of less than twenty firms or corporations. These firms and corporations thus controlling the grain business are, to some extent, interested in the storage facilities at terminals, but as a general thing, the great railway systems have storage facilities of their own which they lease to favored shippers. It is utterly impossible for an individual to com

pete with one of these concerns having back of it the immense storage facilities and the favorable freight rates that have in defiance of good business policy been accorded them for years.

Senator TILLMAN. Can you give us the names of some witnesses besides your mere statement?

The CHAIRMAN. What evidence have you?

Senator TILLMAN. We want some man in the business, or a dozen men of reputation and character, who will come here and show us that these charges of yours are true. As I understand your statement, you say that the different firms you have mentioned there have a monopoly. In other words, they have parceled out the grain territory of the West, and Armour & Company will take a certain system of railroads and the territory tributary thereto and the others keep out? Mr. GALLAGHER. That is true.

area.

Senator TILLMAN. And so on throughout the entire grain-producing Of course that creates a combination of monopolies, forming one big monopoly. While they may not pool their products, they at least parcel out the territory and surrender the farmers and producers, as well as their competitors, the smaller men, to the tender mercies or maws of this firm, who has the controlling interest and the favoring rates of the railroads. Is that the analysis of your statement? Mr. GALLAGHER. That is a very concise statement of the facts. Senator TILLMAN. Where are the witnesses? We would like, if we are going into this matter, to have these assertions of facts substantiated by some reputable witnesses, such as the gentlemen you mention. We can summon them later.

The CHAIRMAN. The substance of the inquiry of the Senator from South Carolina is what evidence you possess that those statements are true.

Mr. GALLAGHER. The best evidence in the world to a tradesman.

Senator ALLEN. I suggest that he give us the names of the witnesses later on.

Senator TILLMAN. I do not want a big piece of sheet lightning in the form of an assertion to go out with the statement that we let it go by without coming down to particulars.

The CHAIRMAN. We will get the names if he has them.
Mr. GALLAGHER. We are anxious to prove the case.

Senator TILLMAN. I do not doubt that you can prove it, but I want to act in such a sensible way here as will carry some weight. Those of us now present are a very small part of the committee and the committee as a whole is a very small part of the Senate, and my experience has been that it is very difficult to get anything in favor of the people out of the committee into the Senate, and next to impossible to get anything through the Senate and over to the House.

The CHAIRMAN. Let us keep this gentleman down to his text.

Mr. GALLAGHER. I should like to suggest, Mr. Chairman, before proceeding further, that the best evidence in the world of the truthfulness of this to a tradesman would not be evidence before the committee. The tradesmen are absolutely driven from these markets. There is one reason for it.

The CHAIRMAN. "Tradesmen?" What do you mean?

Mr. GALLAGHER. The buyer of wheat and the miller.

The CHAIRMAN. No one else than the parties representing the particular firms can get into the market and buy wheat at all?

Mr. GALLAGHER. That is the fact when those favored shippers desire to control. I should like to refer you to some evidence, and I will undertake to bring before this committee, if you please, testimony taken by the Industrial Commission which will give you the evidence under oath of such men as President Stickney, of the Chicago Great Western, which evidence ought to be good on the subject. He does not deny this at all. He did not undertake to deny that they control the grain trade along that line. There were other witnesses of like character, Mr. Charles Counsellman among them.

Another feature of discrimination I wish to bring to your attention is that practiced by the railways of the country generally from February 1 last until about the end of 1899. During that period published tariffs charging a much higher rate on flour than grain for export were in effect, the rates varying according to localities. For twenty years previous to that time the rates on those commodities had been the same, and an immense flour-export industry was built up in this country. This policy of the railroads, a departure from common railroad usage, had the effect of almost destroying the export flour industry in the States south of the Great Lakes. The system of discrimination thus applied in the exportation of grain took from the millers of the United States the supplies that grew at their very doors and transported them to foreign countries at relatively lower rates than were given either on domestic grain or export flour, thus contributing directly to the upbuilding of the milling industry of foreign countries. It is a fact that since the existence of present discrimination not one mill in ten south of the Great Lakes that formerly enjoyed a good export flour trade has retained any of it worth mentioning. In this particular instance the effect of arbitrary discrimination could not produce much worse results unless the business of the mills was destroyed absolutely.

In April last an appeal was made to the Interstate Commerce Commission for relief from this ruinous condition. Hearings were had at New York, Chicago, St. Louis, and Washington, and after the most searching investigation the commission ruled that good business policy and good railway policy alike demanded that export flour should be transported at the same rate as export wheat, but that in no case should export wheat take a lower rate than 2 cents below the rate on export flour. This ruling was regarded by shippers as favorable to the transportation companies. Naturally they reasoned so from the fact that for twenty years the rates on both export products had been the same. The CHAIRMAN. Let me ask you a question. Excuse me for interrupting you. Do you make the statement that the rates on flour and wheat have been the same heretofore?

Mr. GALLAGHER. They were, for something like twenty-years, Mr. Chairman. I believe that the history of railway tariff publications will show that there has been no published tariff-the rates doubtless were cut; in fact, the evidence of railroad managers is that they were cut at various times-showing a different rate on export wheat from that on export flour until February 1 of last year.

But in their eagerness to get relief from the 4, 5, 6, 7, 8 cents and higher discrimination against flour in favor of grain for export the millers ardently hoped to see the order of the commission obeyed. Senator ALLEN. They hope to see what?

Mr. GALLAGHER. The order of the commission obeyed.

The CHAIRMAN. As I understand it the Interstate Commerce Commission had a hearing and determined that the discrimination between wheat and flour was too great and determined what the right rate or discrimination or difference ought to be.

Senator ALLEN. Do these interruptions annoy or disconnect you? Mr. GALLAGHER. No, sir. On the contrary I invite them.

Senator ALLEN. You realize the fact that the Interstate Commerce Commission has no power! It is merely advisory?

Mr. GALLAGHER. We do, very bitterly, realize that fact.

Senator TILLMAN. It was so stated by the first gentleman before Senator Allen came in.

Senator ALLEN. They may make an order, and it will be carried out according to the wish of the transportation company, or ignored according to its desire?

Mr. GALLAGHER. Entirely.

Senator ALLEN. There is no power outside of the judiciary?

Mr. GALLAGHER. None whatever. We had in mind the fact that the commission was impotent, and we brought this case for the purpose of getting the transcript of the evidence in the case to submit to this committee and to Congress. Mr. Barry has stated that we will submit the full transcript of that hearing to the committee.

Senator ALLEN. What do you expect to accomplish by this bill? Mr. GALLAGHER. I believe that the bill will practically end the discriminations that are now complained of.

Senator ALLEN. You can not confer judicial power on the Interstate Commerce Commission.

Mr. GALLAGHER. You say it can not be done?

Senator ALLEN. You have to make a judicial tribunal of it.

The CHAIRMAN. Allow me, Senator.

Senator TILLMAN. We had better reserve our discussion for another forum. We are trying to get facts upon which to formulate some legislation.

The CHAIRMAN. This gentleman, as he says, is not a lawyer, and it will be my purpose, if agreeable to the committee, before we get through, after hearing these gentlemen on facts, to have gentlemen come before the committee on the question of the power of the commission, and I think we ought to call the members of the commission.

Mr. GALLAGHER. I was speaking, when interrupted, of the discrimination of 4, or 5, or 6, or 7, or 8 cents with reference to localities. In the distribution of favors it is quite common to give one locality a different rate.

Apparently the only attention paid by the railroads to the order of the commission, to which I have referred, was to either disregard it or increase the then violent discrimination between grain and grain products for export, and it was not until after this bill was introduced into the Senate that a general compliance with the order of the commission was deemed advisable. Manifestly this compliance is designed with a view to the effect it may have upon Congress. But in this connection I shall ask you to take into consideration the destructive influences of the discrimination complained of. There are to-day throughout the West and Southwest thousands of families dependent upon mechanics for a livelihood who are feeling keenly the results of enforced idleness.

Thousands of flour mills have been forced to operate on limited time COM- -2