Page images
PDF
EPUB

THE RAILROAD SITUATION.

Therefore, several attempts were made in the East and West by different groups of railroads to make out a case for an increase of passenger and freight rates. For years two cents a mile was regarded as a reasonable local and through rate. As late as 1913, some States enacted it for intrastate passenger traffic; and most of the through passenger fares were figured upon that basis. A few of the railroads, especially the New York Central and the Pennsylvania, added to this rate by collecting an excess fare for travel on their fast and desirable trains.

A movement for higher fares brought about a raise in a few States. The same argument applied to interstate rates and the Interstate Com-merce Commission sanctioned raising fares by about 12 per cent. on some lines; partly on the ground that the fast through trains did not pay for themselves, and could only be kept up by making up the deficiency out of the proceeds of the freight business. In several different cases, in which the hearings lasted for months, the Interstate Commerce Commission faced the question of raising freight rates. Combinations of shippers and others appeared to oppose such increases, on the ground that the railroads were not efficiently managed and could meet the difficulty by diminishing the general expense of their business. The old charge of stock-watering was brought up again, and the Commission began a process of "valuation "

561

in order to discover what the railroads had actually cost and therefore what would be a fair allowance for interest on capital. Meantime there were several alarming failures or near failures of great railroad systems. With much hesitation, the Commission finally allowed several small increases of rates. In 1916 there was another concerted movement of the railroad men to increase their whole standard of wages at a cost of about $125,000,000 a year of additional pay. Since the total annual dividends were only about $375,000,000 a year, the railroads strongly resisted the pressure.

The Tariff 1914-1916.

Strictly speaking, the various acts of Congress for increased control of railroads and corporations were not partisan measures. Though they were pushed through in their detail by Democratic caucuses in the two Houses, supported by the influence of the President, they were in the same line as earlier acts passed by the Republicans, and some Republicans voted for them. The tariff was more clearly a party measure, for it was based on a party principle which appeared in the Democratic platform of 1912. The Progressives in their campaign of 1912 and thereafter were in favor of a protective tariff, and most of them joined in the protest of the Republicans against the Democratic Underwood tariff. The proceeds of the import duties in the year 1912-13

under the Payne-Aldrich tariff were $318,000,000. In 1913-14 they were $292,000,000; in 1914-15 they were $209,000,000. To offset this diminished revenue of $109,000,000 the old internal revenue increased only from $309,000,000 to $336,000,000. The corporation and income taxes together increased from $29,000,000 to $80,000,000. The total ordinary receipts

of the United States for the two years dropped from $724,000,000 to $696,000,000.

It is difficult to say what was the actual influence of the tariff upon business, because the outbreak of the European War in 1914 threw all calculations out of account. Some parts of the country showed an alarming lack of employment, and in all parts business was dull during the first two years of President Wilson's administration. A decided movement toward a more highly protective tariff showed itself even in some strong Democratic regions; for instance, the Democrats in Louisiana lost a seat in the election of 1914, on the issue of maintaining the protective sugar duties. Members from some of the western beet-sugar districts joined in the protest against free sugar.

When business revived in 1915 and 1916, though the Republican party stood firm as an advocate of the protective tariff, less was heard about a general revision and more about changes in certain details. During the European War, imports of dye-stuffs from Germany were almost entirely

cut off, thus indicating that that country had possessed something like a monopoly of the business. American manufacturers insisted that they could produce an article equal to that of the Germans, provided they could have assurances that, when the war was over, they would be protected from a renewal of the German competition; and a great pressure was put on Congress to lay a special duty to meet this case. that, at the end of the war, the accumulated stocks of goods in Germany and other countries would be poured into the United States" dumped " was the usual term employed — there was an agitation in favor of special legislation which would raise the duties on such imports.

In view of the likelihood

[ocr errors]

Another question of great moment was a widespread protest against the methods by which tariffs were usually put together. put together. It was notorious that parts of the McKinley tariff of 1890 and the Dingley tariff of 1897 were written by manufacturers, who were allowed almost to dictate the terms of their protection. The Payne-Aldrich tariff of 1909 was so irregular and unscientific that President Taft hesitated to sign it, though he afterwards held it to be the best tariff that the country had ever known.* Like its predecessors, the Underwood tariff was framed by a Committee of Ways and Means which included some men with little knowledge of the subject, and the material which was available See pp. 278-280, ante.

[ocr errors]

THE POLITICAL SITUATION.

in the way of information about the actual conditions of manufacturing both in Europe and in the United States was scanty, conflicting and prejudiced.

President Taft succeeded in secur

ing from Congress a Tariff Board of experts, the purpose of which was to collect information on labor, cost of goods made abroad, etc.* This commission expired in 1912 because the Republican Congress would no longer appropriate money for its support. The idea was revived by President Wilson, and in 1916 a bill was brought in for creating a permanent board containing representatives of the principal parties. It was intended to bring together material bearing on the tariff, to digest it, and to furnish reports which would be an impartial basis for changes in the tariff. Of course no Congress could bind itself or its successors to adopt the schedules that might be drawn up by such a board; but it was expected to settle many disputed questions of fact.

Politics and Parties, 1913-1916. When Wilson became President, the Progressive Party was in exist

ence, and in the November previous

cast over 4,000,000 votes for its can

didate for the Presidency. The Pro

gressives also elected 16 members of the House and one Senator to the next Congress, and maintained organizations in most of the States. In addition there were 25 or 30 discontented members of the House who were * See pp. 279, 288, 289, ante.

563

inclined to disregard party ties occasionally. The "stand-pat" Republicans still held the party machinery and did not for an instant admit that the new party could take their place as the normal opponent of Democracy. In the State elections in the fall of 1913, the Progressive votes declined and the Democrats gained ground. Then the pendulum seemed to swing the other way. The control of the House and Senate from 1915 to 1917 was assured to the Democrats by the election of 1914, though their majority in the House decreased to 31. The combined popular votes of the Progressive Party in 1914 numbered about 1,700,000, but were so distributed that they elected to the House only seven members; they were unable to carry any State governments except California, where they re-elected Governor Hiram Johnson. The Republicans elected Charles S. Whitman governor of New York by a large plurality, and returned to the House ex-Speaker Joseph G. Cannon and others who had been eliminated in 1912. Though the Democrats held their own and elected governors in

Maine, Massachusetts and other supposedly Republican States, the Republicans were much encouraged by the evidence that the Progressives were returning to the Republican ranks.

Since most of the Democratic measures, such as the Federal Reserve Bank and the Trade Commission, were of the same kind as previous

Republican measures, it was hard to manufacture party material out of the action of Congress. President Wilson, in his strong influence on the two Houses, was only following out the same policy as that of Roosevelt and Taft. Inside the Democratic ranks there were a few local quarrels. The Speaker of the House, Champ Clark, of Missouri, who, in 1912, had nearly received the Democratic nomination instead of Wilson, gracefully accepted the situation and supported the the President.

Hence the principal political interest for several years was the quarrels within the regular Republican party, and the disposition of the Progressives to return to their former place in the Republican party. The standpat Republican leaders mostly remained in power. Whether in or out of the National government, such men as ex-Senator W. M. Crane, of Massachusetts, and ex-Senator Elihu Root, of New York, joined to control the party with men like Senator James H. Gallinger, of New Hampshire, and Representative James R. Mann, of Illinois, who became the floor leader of the Republicans. In Massachusetts there was a running fight inside the Republican party for several years, to bring to the front men in sympathy with the Progressives. In Pennsylvania, on the other hand, Boies Penrose, who had been the bête noire of the Progressives, was re-elected to the Senate by popular vote in 1914.

One of the objects of those in control of the Republican party was to put Theodore Roosevelt, commonly called "the Colonel," beyond the possibility of further participation in politics. In 1913 a Michigan journalist circulated reports against Roosevelt's habits, and the Colonel brought suit for libel. The defendant was entirely unable to prove his statements and was convicted. In 1915 a libel suit was brought against Roosevelt by William Barnes, who for years had been the most powerful Republican leader in New York State. After a long trial, the jury decided in favor of Roosevelt. As the nominating convention of 1916 approached, no Republican seemed to stand out from the stand-pat ranks as the national leader, though each of eight States was prepared to support its "favorite son." Justice Hughes of the Supreme Court and Theodore Roosevelt were much discussed in the public prints and in April, 1916, Roosevelt definitely became a candidate for the nomination.

In 1914 the Republican national committee readjusted the membership in the forthcoming convention of 1916, so as to diminish the weight of delegates from Southern States, in which there was not the slightest hope of securing a Republican majority. Each State had a fixed number of delegates, and an additional number depending upon the number of Republican votes cast at the preceding election. This took 89 delegates out of

CONSTITUTIONAL AMENDMENTS AND CHANGES.

the Southern representation, a number which had been sufficient to turn the scale in critical votes in the conventions of 1876 and 1912.

Constitutional Amendments and Changes. One of the notable things during Wilson's administration was the pressure for constitutional changes, both in the Federal and the State governments. The Sixteenth Amendment has been noticed already. When in 1895 the Supreme Court set aside the income tax law of the previous year, on the ground that it was a direct tax, and therefore must be apportioned among the States according to population, an amendment to the Federal Constitution seemed the only remedy. On recommendation of President Taft, both Houses of Congress, with almost no opposition, submitted such an amendment to the States in 1909, allowing an income tax without proportional distribution.* It was ratified by the necessary 36 States-to which six others were promptly added -and became a part of the Constitution, February 25, 1913.

The evident popular feeling in favor of this amendment hurried the submission of the Seventeenth Amendment May 15, 1912, providing that Senators should be elected by popular vote; and it went through with such rapidity that it was put in force May 31, 1913. From that time all vacancies as they occurred were filled by popular election. The result was that some

See page 280, ante.

565

Senators, who had never been chosen to any office by popular vote, found that they could not meet that test and dropped out. By March 4, 1919, the Seventeenth Amendment will have its full effect, so that every member of the Senate at that time will have passed through the popular election.

The Progressive movement led to a large crop of State constitutional amendments, particularly for the referendum and the recall, for extending the suffrage to women, and for limiting the sale of liquor. In New York a special election was held (April, 1914) to decide whether a State constitutional convention should be called. It was accepted by a very narrow majority, and the convention sat from April to September, 1915. Most of the delegates were chosen on party lines, and the Republicans, had complete control. Elihu Root was the leading figure, and he protested against "invisible government" in the State, and scored the confusion and inefficiency of the State government. The most striking part of the constitution gave to the governor the power to appoint all but one of the heads of State departments. The work of the convention was rejected. when submitted to the people by 910,000 votes to 400,000. The labor organizations were opposed to it and also some of the political leaders of the old type, as well as some reformers who thought it weak.

During the three years 1913-16 woman suffrage made large advances

« PreviousContinue »