of the 15th ultimo yesterday for the purpose of answering it reflectively. I hope you will abandon the thought that I am trying to get the better of you in debate. My purpose and desire is to clearly understand your position, and to be illumined by your knowledge of the subject, at the same time defending my position as best I can.

1. I am glad to be set right as to your position which I now see I had misunderstood. In a word, you hold that the Commission must first investigate and pass upon a rate made by a carrier or carriers, and that this correction must be approved by a Federal court before you can issue your legislative order establishing a rate for the future. You also concede that the courts cannot interfere with the execution of your legislative order, following such preliminary determination of the rate established by the carrier, such legislative order being beyond the function of the judiciary. Observing just here that this does not touch the vital questions of principle and of policy which separate us, I proceed with the discussion.

2. Will you be so kind as to indicate to me in Senate Bill 1439 the provisions which clearly sustain the method of regulation which you proclaim? I confess that in reading the bill this point is not at all clear to me. Besides I find in the bill and in the hearings expressions apparently at variance with what you believe to be its import. For example, referring to page 14, lines 4 to 8 of the bill, I find the distinction drawn between "an order under the provisions of this Act," i. e., a judicial order, and an administrative order, i. e., a legislative order. Then proceeding to amended Section 16, beginning with line 21, page 14, I read about the review of "an order for the payment" of money—i. e., a judicial order, and then passing on to the second paragraph, line 23, page 15, I read, "Any carrier may within thirty days from the

service of an administrative order upon it begin in the circuit court of the United States * * * proceedings for the review of such order, &c., &c." Now this reads to me like authority to review an administrative or legislative order, which you and I agree cannot be done by the courts. In a word, sections 15 and 16 as amended in Senate Bill 1439 appear to me to be muddled. You may be able to show that they are logical, and that they do not involve the solecism alluded to, but I fear they would suffer under judicial determination.

Then I pass on to the testimony, and fail to find any clear statement of the limitation of judicial powers to judicial orders, as distinguished from legislative orders. Instead, I am further led into the dark by what I read. For example, turning to page 101 of your testimony, at lines 21 and 22 from the bottom, I read: "The Court shall stay that order unless it is a just, reasonable and lawful order." Now, from the context, it appears to me that you refer either to the legislative order prescribing rates for the future or to the whole proceeding, embracing the rate made by the carrier and the rate made by the Commission, either of which would be in conflict with the view expressed in your letters to me of June 12th and June 15th.

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Then, at page 122, in reply to the inquiry of the chairman if the rate prescribed by the Commission goes into effect at once, Mr. Prouty replied that the Commission prescribes the time when that order shall go into effect." He also stated that this legislative order "takes effect as of the date prescribed," unless reviewed or set aside by the courts. This seems to contemplate the reversal of a legislative order by the courts. But on page 118, lines 8 to 11, Mr. Prouty stated the true doctrine, as you and I understand it, as follows: "The prescribing of a rate is, under the decision of the Supreme Court, a legislative, not a judicial, function, and

for that reason the courts could not, even if Congress so elected, be invested with that authority."、

I do not mention these facts for the purpose of indicating that either you or Commissioner Prouty has stultified himself, as I know the difficulties under which you both labored. You were both zigzaged over the various provisions of the bill in a way to break up your line of thought and to confuse you, and I certainly give you both credit for being clear-headed men with a clearly defined plan of regulation in mind. All I mean to assert in the foregoing is that the phraseology of the law appears to me to be confusing and that there was no attempt at the hearing to have the plan of procedure properly explained.

But all the foregoing relates to procedure and form and does not touch upon the great questions of principle and of public policy which the method of regulation proposed by the Commission clearly involves. I now invite your attention to these questions.

It is hardly presumable that you would in any case disturb a rate made by a carrier without a thorough investiga. tion of the question as to whether it is or is not a just and reasonable rate. That seems to go without saying. But let us see just what are the objects which you have in view. In your Seventh Annual Report you stated them as follows:

(1) To give to each community the rightful benefit of location.

(2) To keep different commodities on an equal footing, so that each shall circulate freely and in natural volume.

(3) To prescribe schedule rates which shall be reasonably just to both shipper and carrier throughout the country.

This seems to constitute what you have styled your "high ideal." Elsewhere you have spoken of the general determination of rates throughout the country as "the

central idea of regulation and the special field of the Commission's usefulness." This, to my mind, proposes the governmental solution of the insolvable problem of human intercourse in a vast country of varied and enormous resources. It also means placing under governmental restraint and direction the commercial and industrial interaction and development of a virile race with whom liberty means above all things else freedom of interaction, involving all there is of weal or woe in competition and in combination or co-operation. This scheme of yours appears to me, therefore, to be utterly utopian, and, as I have said in my statement before the Senate Committee, transcendental. In a word, you propose to embark at once in a great scheme of State socialism.

You seem to think that any possible evil from all this is avoided by the fact which you assume that the courts would have to agree with you as to the injustice of a rate made by some carrier before you could take leave of the courts and set up your schemes of "administrative orders."

The fact that your determinations have the force of prima facie evidence as to the matters stated by you would carry you through the courts in almost every case, for no rate maker in the United States ever claimed infallibility and you could always obtain an overwhelming amount of evidence to prove that almost any rate attacked is in some respect imperfect. So you would have about as clear a field in practice as if you had autocratic power to cancel any and all rates made by carriers and to institute new rates, with no interference by the courts in regard to rates made by carriers.

But it is to the political effect of your proposed method of regulations that I stand aghast; not on account of any dangerous proclivity on the part of any member of the Commission, but from a conviction that you will be overwhelmed

by a force of circumstance far beyond your control. The Commission was once snowed under by appeals of railroad companies for relief from the long and short haul rules as erroneously interpreted, and got out of the scrape as speedily as possible. But what would be the condition of affairs when shippers in all parts of this vast country would be encouraged to ask the Commission for more favorable rates of transportation. I shall not enlarge upon this point here as it is fully debated in my published statements of various sorts, and particularly in an article from my pen in The Forum for September, 1897, copy of which is sent you to-day.

There is an aspect of the case upon which the Commission seems to place great reliance for success in securing the passage of Senate Bill 1439, and that is the trials and tribulations of railroad companies and of shippers and producers in various parts of the country under existing conditions. That argument has been used chiefly by Commissioner Clements, a gentleman for whom I entertain only feelings of good will and of profound respect. The unhappinesses of the situation are set forth by him on pages 127 to 161 of the Hearings." But it fails to convey to my mind any reason for recourse to the drastic form of regulation to which you gentlemen are so strongly committed, and I will tell you why. The freedom of commerce is essentially a freedom of struggle. It was ever thus and it will be so until the end of time. It is of the constitution of human nature and human society. In the historic view of this subject I find, however, great comfort. Ever since the age of connected railroad service began, about 1865, this struggle has been going on, and I see, as the result, wonderfully reduced cost of transportation, greatly reduced and eliminated discriminations, a service vastly improved in efficiency, and a remnant of causes of complaint utterly insignificant in compar