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When the entire constitution is not usually is, a feature inherent in the to be revised, special amendments very being of such an instrument. are adopted by the legislature, in The name “ constitutionitself many of the States, and submitted to

means a body of law by which the the people for acceptance or rejec- government is constituted and given tion. In some of the States only a

organization and functions. Fremajority vote is necessary to pass a

quent changes, therefore, as well as resolution making a proposal of

the introduction of too great a numamendment, but in most States it

ber of subjects which belong more takes the vote of two-thirds or threefourths of the members of each house. properly to private law through statuSome States require that the resolu

tory enactments, regulating the rela

tions of citizens to each other in their tions be proposed by two successive legislatures before they are acted private capacities, are not in accord

with the nature of the instrument upon. At some regular election the people ratify or reject at the polls

and scarcely fall within its legitimate the amendment so proposed by the

province. Nevertheless, the constilegislature, special majorities of the

tution makers of to-day, particularly

those of the newer States admitted to popular vote being sometimes required.

the Union in the last forty years, have The third method of amending a

shown a most marked tendency to constitution - that of the initiative

make numerous changes and to treat and referendum- operates by a cer

a great variety of subjects in this intain per cent. of the legal voters strument. It is undoubtedly true that (eight per cent. in Oregon, for ex

respect for the State constitutions ample) proposing the amendment by

would be greater if the changes were petition. The proposal is submitted fewer and that the changes would be to popular vote and is made part of fewer if respect were greater. Mr. the constitution if upheld by a ma

Bryce went so far as to say that, aljority of the voters. A notable fea- though a constitution is the fundature in the later development of the

mental and supreme law of the State, State constitutions is the tendency of

its provisions are no better observed the new democratic spirit to refer

and enforced than those of an ordieverything to the direct vote of the nary statute; but this is very much to people.

be doubted at present, whatever the Some States have made frequent facts were in 1889 when The Americhanges in their constitutions, others can Commonwealth first appeared. but few, there being on the whole a So far as concerns unrestricted prostrong conservative tendency. This posal of amendments by a single legtendency should be, of course, and islative action and the adoption of



amendments by the vote of a majority (1875), , Ohio


Oklahoma of the persons voting thereon, there (1907), Rhode Island (1842), Tennesis an undoubted tendency toward the see (1870), and Wyoming (1889). easy amending process. The devel- With them should be classed Missisopment in quite recent years has been sippi (1890) and New Hampshire to make amendment still easier by with its requirement that an amendgiving to the people the power of in- ment receive two-thirds of the vote itiating amendments. The constitu- cast upon the question of its adoption tions which illustrate best the easy or rejection. Where, in addition to amending tendency are those of the requirement of a majority of all California (1897), Florida (1885), votes at an election, there are other Georgia (1877), Idaho (1889), Louisi- restrictions upon the amending procana (1898), Maine (1819), Maryland ess, the alteration of a constitution (1867), Missouri (1875), Michigan often becomes practically impossible. (1908), North Carolina (1875), Ore- This is true of Tennessee and to a gon (1906), South Dakota (1889), smaller extent of Illinois and Indiana, Texas (1875), Utah (1895), Washing- owing to their special combinations ton (1889), and West Virginia West Virginia of limitations.

. * (1872). To this

To this group might be added Colorado, Kansas and Mon

* F. N. Thorpe, The Federal and State Consti

tutions, Colonial Charters and Other Organic tana, which restrict the legislative Laws (7 vols. compiled and edited under act of proposal of amendments; also South Congress, 1906); James Bryce, The American

Commonwealth; R. L. Ashley, The American Carolina, which provides for popular

Federal State; Charles Borgeaud, Adoption and proposal and vote upon amendments. Amendment of Constitutions in Europe and The States whose constitutions are

America; J. Q. Dealey, Our State Constitutions;

H. Hitchcock, American State Constitutions; least flexible, requiring a popular William B. Guitteau, Government and Politics in vote greater than that of a majority the United States; J. A. Jameson, Constitutional

Conventions; Judson S. Landon, The Constituof all persons voting upon the amend

tional History and Government of the United ment, are: Alabama (1901), Arkan- States; E. McClain, Constitutional Law in the sas (1874), Illinois (1870), Indiana United States; James Schouler, Constitutional

Studies; J. B. Phillips, Recent State Constitution. (1851), Minnesota (1898), Nebraska Making.




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Federal control of the railways - The Interstate Commerce Commission — Anti-trust legislation - The Sherman

Law — Trust prosecutions — The Department of Commerce and Labor and its various bureaus — The Post-Office — The patent system – The Department of the Interior — The Treasury Department and the financial operations of the Government — Tariff legislation – Reciprocity treaties — The commercial importance of the Panama Canal — The Commercial effects of the Bureau of American Republics The influence of diplomacy on trade — Waterway improvements.

The close of the Civil War marked which is foreign commerce in the eyes the beginning of a new era in the

of the individual States. It was recogUnited States. The material prosper- nized, too, that the commerce clause, ity of the country had in a measure while framed to meet primitive condibeen halted by that colossal conflict. tions, must always be applied to livThe dawn of peace brought new ing issues, for the development of the tariffs, new business methods, new country necessitates statutory conagencies for the promotion of com- trol of its expanding activities. merce, a multiplication of banks and As no effective restrictions or reguclearing-houses, new laws affecting lations of corporate power could be immigration and the conservation of obtained under a system of diverse natural resources. But the develop- State legislation, Congress essayed ment of manufactures and commerce the correction of the abuses of corwas furthered still more by the appli- porate power in interstate commerce. cation of steam and electricity, the Discriminations, special rates, rebates telephone and the telegraph, which and concessions were made between made it possible to transact business shippers, which fostered monopoly, over vast areas with little loss of time. enriched favored patrons,

and The most revolutionary developments strangled individual enterprise. Such arose from the economic necessity of

a situation called for some kind of concentration, which endowed corpo

restraint. rations with a tremendous power for

Federal control of railroad rates begood or evil.

gan in 1866, but no serious attempt at

regulation was made until the InterFederal Control of Railroads.

state Commerce Act of 1887, which In giving Congress control of for- forbids unjust and unreasonable eign commerce, the Constitution gave charges and discriminations by special it control also of interstate commerce, rates, or rebates, or any unreasonable



advantage to any particular person, road system, as to its administration, or corporation, firm, or locality, or have created vastly improved ecoclass of traffic. * It forbids the charg- nomic conditions. ing, under like circumstances, of a The Commission has power to inlarger sum for the shorter than for the quire into the management of the busilonger haul over the same road. It ness of the common carriers engaged prohibits the pooling of freights and in interstate commerce and to obtain the division of earnings, requires pub- all necessary information for destroylicity of rates, and confers upon the ing the rebate system and other disInterstate Commerce Commission, criminations, so as to put all shippers created by act of Congress, power to on a basis of equality. The Commiscarry out its provisions. This act was sion is not given the general rate-makamended by the acts of 1889, 1891, ing power, however, though it can 1893, 1903, 1906, and 1910, each repre- name a reasonable rate for a particusenting an addition to the organic lar service and adjust overcharges. growth of the power of Congress to It also has authority to suspend proregulate interstate commerce. Of posed rates pending investigation as these the most important are the to their reasonableness. On the other Elkins Act of 1903, which prevents hand, where circumstances require unjust discrimination in railroad swift action, certain rates may be escharges; the Hepburn Act of 1906 tablished on short notice. It is rewhich first gave really effective force quired by law to report to the Attorto provisions that were merely tenta- ney-General all violations of the intertive in preceding acts; and the Mann- state commerce laws. Elkins Act of 1910, which extends the The Commission supervises also duties and jurisdiction of the Commis- steamboat lines doing an interstate sion both as to carriers formerly sub- business in connection with the railject to law and to other agencies of roads under common control, and intransportation and transmission. Al

cludes supervision of the interstate though the passage of these laws was commerce of express companies, sleepfought both by trusts and railroad ing car companies, telegraph, cable, companies, the result has been that

and wireless telegraph companies, and the railroads have grown stronger pipe line concerns transmitting comeach year, and the rigid prohibitions modities other than water or gas. The as to rebates and free passages had Commission has supervision of railan immense effect in improving earn- road accidents, and investigates all ings. The laws that restrict freedom

such accidents on its own initiative. of action throughout the whole rail

Congress had adopted the policy of

forcing upon railroad corporations the See pp. 35–36, ante. See also chapter on Interstate Commerce by Professor Huebner, ante.

use of safety appliances to reduce accidents to a minimum. The Block Sig- vanced form of trust, and its successor

a nal and Train Control Board, organ- in most cases, is the holding corporaized by the Commission, has charge tion, which differs in certain respects of investigating the thousands of de- from the usual type of trust. Its propvices that apply to signals, coupling erty consists of a majority of shares of of cars, ties, rails, switches, automatic stock in various corporations, its ditrain control, non-telescoping devices, rectors voting the shares held by it at and inspection of locomotives. Under the meetings of the subsidiary corpothe provisions of the Erdman Act, a rations and receiving the apportioned member of the Commission may be

dividends. A holding company is a appointed by the President to coöper- corporation of corporations, which, ate with the Commissioner of Labor by virtue of holding a majority of the with a view of settling any differences stock in each, elects the directors of that may arise between railroads and all and through them operates the intheir employés. This law has proved dividual corporations in the interest of great benefit to the parties con- of the holding corporation. cerned in settling many disputes by The legal status of the holding corarbitration.

poration is highly complicated, since

it operates under two conflicting jurisAnti-Trust Legislation.

dictions, each supreme in its own field An aggregation of several indus

- those of the State and Federal govtrial organizations of a similar kind

ernments. Many of the States, under under a single control is denominated

the leadership of New Jersey, have a trust.*

The trust was preceded by made laws legalizing holding corporathe combination, which was a feature

tions under certain conditions, but of industrial development from 1872

these are subject to Federal control to 1882 and which aimed simply at

only in so far as they interfere with similarity of action between the corpo

interstate trade. rations included therein in maintain

Public opinion demanded that the ing a fixed price, limiting territory, pernicious activities of the trusts be

, the output of goods, sales-combina

, tions, or profit-sharing arrangements. curbed, and the first law on the sub

ject (known as the Sherman AntiCombinations were generally held to

trust Act of 1890 and entitled “An act be illegal at common law and the ma

to protect commerce against unlaw. jority of the States created laws pe

ful restraints and monopolies ") was nalizing them. They were superseded

passed by Congress and signed by the in the 80's by the trust. A more ad

President on July 2, 1890.* This Act

declares that every contract, combina* In this connection see the chapter on Trusts and Industrial Combinations and Associations,

* For complete text see ante, pp. 46-47.


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