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Chapter XIV.

Railroad Measures.

Constitutional Amendment to Clear the Way for an Effective Railroad Regulation Bill Defeated - Rate Investigation Delayed Until Too Late for Effectiveness - Resolution to Continue Investigation Defeated - Reciprocal Demurrage Bill Becomes a Law - "Error" in the Full Crew Bill.

The anti-machine members of the Legislature had not proceeded far in their efforts to pass an effective railroad regulation law, before they became convinced that at best only a make-shift measure is possible, until certain alleged ambiguities of those sections of the State Constitution prescribing the powers and duties of the State Board of Railroad Commissioners have been removed. Where, to the common sense mind, no ambiguities exist, machine claquers and Southern Pacific attorneys can read them into the Constitution very easily, as in the dispute as to whether the absolute or the minimum rate is constitutional.

Advised by the attorneys representing the shipping interests, the anti-machine members undertook to simplify the language of the sections in dispute, so that a wayfaring man though a Judge on the bench or a machine legislator need not err in the construction thereof.

Early in the session, Senator Campbell had introduced a constitutional amendment to that end. The amendment went to the Judiciary Committee on January 14th. The majority of the committee, openly against the machine, favored the submission to the people of such an amendment. But it was not until February 22d that the amendment - or rather a substitute for it - was reported back to the Senate.

The day following, February 23d, Senator Campbell had the measure re-referred to the committee, that an amendment better calculated to meet the needs of the State might be prepared. The committee took until March 5th to make its report. The anti-machine Senators on the committee had to fight for every inch of the way toward securing a report upon an effective amendment. This, however, they finally succeeded in doing. The second substitute amendment smoothed out the ambiguities and the alleged ambiguities of the Constitution, of which the machine legislators made so much during the session, and of which it is feared the courts may make much later on. For the long list of constitutional powers and duties of the Railroad Commissioners, which are so worded as to confuse the legal mind, the framers of the amendment substituted the following:

"The Commission (Railroad) and each of its members shall have such powers and perform such duties as are now or may hereafter be provided for by law." Under that simple permission there could have been no question of the authority of the Legislature to empower the Railroad Commissioners to fix a system of absolute rates. Section 23, Article XII., of the Constitution, which at least confused the lawyers employed by the railroads to prevent the passage of the Stetson bill, was repealed entirely. The adoption of the amendment, would, had it been approved by the people at the general election of 1910, have removed every impediment which railroad attorneys claim to be in the way of an effective railroad regulation law for California.

Curiously enough the machine Senators who had been so much exercised over the alleged ambiguities of the Constitution when the Stetson bill was under consideration were found opposed to the submission of the amendment to the people. Every Senator who voted against the amendment had voted against the Stetson bill and had voted for the Wright bill. Burnett, who had been led to believe when he voted for the Wright bill that the amendment would be submitted to the people, voted for the amendment. Walker also switched back from the machine. Wright and McCartney, who had voted against the Stetson bill, also went on record for the amendment. The remaining fourteen Senators who voted for it, to a man, had voted for the Stetson bill and against the passage of the Wright bill. But a two-thirds vote of the Senate was required for the amendment's adoption. This meant twenty-seven votes. The amendment was defeated, the vote being nineteen for submission of the measure to the people, and sixteen against[66].

This ended all hope of a model railroad regulation law for California until 1913, for the Constitution must be amended before such a law can be realized. If a satisfactory amendment be adopted in 1911, it must before going into effect be ratified by the people. This ratification would come in 1912. The Legislature of 1913 would then be able to proceed with the passage of the model statute.

An attempt to investigate the causes and the necessity of the arbitrary increase in transcontinental freight rates failed as completely as did the attempted amendment of the Constitution.

Early in the session, on January 18, to be exact, Senator Caminetti introduced a resolution which directed the Senate Committee on Federal Relations to inquire into the cause of the increase in freight rates, and to report its findings to the Senate. Two days later Caminetti introduced a second and companion resolution, which provided that investigation should be made into the causes for the increase in express charges. On Senator Leavitt's motion this last resolution was made a special order for January 22, when the first resolution was to come up. The Senate on the 22d re-referred the resolutions back to the committee.

The Senate Committee on Federal Relations was, by Caminetti's clever; tactics in having the resolutions go to that body, forced into a prominence which evidently worried the machine. It consisted of Burnett, Black and Sanford. Black, Republican, and Sanford, Democrat, were working openly against the machine. Burnett, while he managed to land on the machine side of things at critical points in the progress of the session, was by no means a machine coolie. Had it been known that the Committee on Federal Relations was to be charged with an investigation into railroad affairs, a very different committee would unquestionably have been appointed. The machine's problem was to correct the blunder made when the anti-machine forces were given a majority on what had become a committee charged with the handling of an important railroad issue. The ease with which the blunder was corrected speaks volumes for the machine's resourcefulness.

The air at the capitol suddenly became permeated with the idea that a committee of three was altogether too small to conduct so important an investigation as that proposed in the Caminetti resolutions. Accordingly the Committee on Federal Relations very readily recommended, when it reported the resolutions back to the Senate with the recommendation thatthe investigation be held, that two Senators be added to the committee, making it a committee of five. Had the machine observed the unwritten rules of Senatorial courtesy[67], which machine Senators insist upon so loudly, the anti-machine element would have been safe enough in doing this. Senatorial courtesy required that the author of the resolutions, Caminetti, be made one of the two additional members. This would have given the anti-machine element at least three members of the enlarged committee, a condition which did not line with machine purposes at all. So Senatorial courtesy was thrown to the winds, Senator Caminetti was ignored, and Senators Wolfe and Bills were named as the additional members of the committee. The machine seldom blunders, but when it does, usually covers its blunders with astonishing directness and dispatch. A glance at the records made by Senators Wolfe and Bills, which will be found in Table "A" of the Appendix, will show the truth of this statement.

The machine's next move was to delay the investigation. For one reason and another the investigation was delayed. Finally, on February 19, Caminetti gave notice that on the following Tuesday, he would move that the committee be discharged and a second committee ordered to carry out the instructions contained in the resolutions. This declaration of war stirred the machine to action - machine action. Assurances were given that the investigation would be held, but it was March 12, almost two months after the resolution had been introduced, and only twelve days before adjournment, before the committee placed its first witness on the stand.

At that time the Senate was in the midst of the Direct Primary fight, and in addition, the machine after months of planning was sending literally hundreds of measures into Senate and Assembly for final action. There was no time nor were the members of the committee in a condition to conduct the investigation which the anti-machine element had contemplated. But hurried hearings were held, and a mass of evidence of railroad and express company extortion brought into the open. The interested reader will find the testimony printed in the Senate journal of March 23, 1909.

Men of the standing of Edwin Bonnheim[68], treasurer and manager of Weinstock, Lubin & Co.; Russell D. Carpenter, auditor of Hale Brothers, Inc.; J. O. Bracken, manager of the California Commercial Association; C. H. Bentley of the California Fruit Canners Association; all testified that the increase in express and freight charges has worked great hardship upon the State. They showed that in the final analysis the consumer pays the increased charges. Furthermore, testimony was produced which at least indicated that the transportation companies, if economically not to say honestly managed, would receive fair returns on their legitimate investments, were even lower freight rates to be charged than those exacted prior to the increase of 1908. It was also shown that the State of California could institute and conduct an examination into railroad affairs before the Interstate Commerce Commission[69]. It was clear to all that thorough investigation under the Caminetti resolutions would prove of enormous benefit to the State. That the committee could do little or nothing in the short time remaining before adjournment was also recognized. Burnett had come out for thorough investigation, giving the anti-machine forces a majority of the committee. Witness after witness representing the large shippers and importers of the State urged that the investigation be carried on even after the Legislature had adjourned. Burnett as chairman of the committee was urging this course, but it was March 23, the day before adjournment, before he could get his committee report ready, and filed with the Senate, as basis for a resolution to continue the investigation after the Legislature had adjourned. There were but eleven dependable anti-machine Senators in addition to Burnett who were within reach of the capitol. But the machine had a safe majority within call. Burnett's resolution was defeated, the investigation denied, by a vote of twelve for to sixteen against[70].

But two important railroad measures were finally passed by the Legislature. The first of these was the "Full Crew bill," which required adequate manning of railroad trains. After being held-up as long as the machine dared, the bill was finally passed. But the "Full Crew bill" met with one of those unfortunate "errors"[71] which played such important parts in the passage of the Anti-Gambling bill and the Direct Primary bill. When the Legislature had adjourned this error was discovered, and Governor Gillett refused to sign the bill because of it.

The second important railroad measure passed was the Reciprocal Demurrage bill, introduced in the Senate by Miller, and in the Assembly by Drew. As finally passed the bill provides that railroad companies which fail to supply shippers with cars when proper requisition has been made for them, shall pay the injured shipper demurrage at the rate of $5 per car per day. On the other hand, shippers who fail to load or unload cars after a stated time, are required to pay the railroad $6 daily as demurrage. The extra dollar which the shippers are required to pay the railroads is exacted to compensate the railroads for rental of the car.

Similar laws up to the time of the passage of the Miller-Drew bill had been adopted by seventeen States of the Union, including Oregon and Texas. During the recent car shortage, it is alleged that empty cars needed in California, were sent into Oregon and into Texas, that the railroads might escape the demurrage charges exacted in those two States. California, without a demurrage law, was helpless. At the session of 1907, however, the machine, in complete control of the Senate, defeated a reciprocal demurrage bill. To be sure the demurrage was higher in the measure proposed in 1907 than in that passed at the session of 1909, but it was the principle of demurrage, not its amount, that the machine was against in 1907. In 1909, however, not a Senator voted against the bill. And in this connection there is a story told which unquestionably had its bearing upon the fate of the Reciprocal Demurrage bill at the 1909 session. The story deals with a political adventure in the life of one Henry Lynch.

Mr. Lynch voted against reciprocal demurrage in 1907. He voted neither for nor against reciprocal demurrage in 1909, for he was not at Sacramento to vote. Mr. Lynch was not at Sacramento to vote in 1909, for one reason at least, because he did vote against reciprocal demurrage in 1907.

Mr. Lynch hailed from the Thirty-first Senatorial District, which takes in San Benito and San Luis Obispo counties. These counties are intensely Republican; they are also farming communities. And since the one-time Senator Lynch voted against the Reciprocal Demurrage bill, the farmers have seen tons upon tons of their products rot in the fields because they could not get cars to move their crops.

But while the farmers of San Luis Obispo and San Benito counties were watching their products rot for want of cars to move them, it is alleged that cars were being sent from California to Oregon to meet the requisitions of Oregon shippers. Oregon had a reciprocal demurrage law on her statute books; California had not.

Senator Lynch's vote against the Reciprocal Demurrage bill was made a sort of issue in San Benito and San Luis Obispo counties at the election of 1908. A. E. Campbell, Democrat, was running against Mr. Lynch, Republican, for the State Senate. Right or wrong - the reader may judge which - the farmers of the two counties credited the defeat of the Reciprocal Demurrage bill not to the Republican Party, but to the Republican machine, or better described perhaps as the Republican-Democratic machine, that dominates the State, a machine which the people of California are just now engaged in smashing.

Being good Republicans, the people of Mr. Lynch's district gave Mr. Taft a plurality of more than 1,700; remembering the defeat of the Reciprocal Demurrage bill, they gave Mr. Campbell, Democratic candidate for the Senate, a plurality of 416. The fact that a United States Senator was to be elected didn't influence the Republicans of San Luis Obispo County at all. They elected a Democrat to the State Senate because they knew him to be free from machine domination - a machine maintained for the purpose of defeating good measures, such as the Reciprocal Demurrage bill, and furthering the passage of bad ones.

But the influence of Lynch's vote against the Reciprocal Demurrage bill was not confined to San Luis Obispo and San Benito Counties. It spread over into the adjoining Twenty-ninth District, which takes in Santa Cruz and San Mateo Counties. These counties are also intensely Republican. They gave Taft a plurality of 2,799. But they gave the Democratic candidate for the State Senate, James B. Holohan, a plurality of 677. Holohan ran 3,476 votes ahead of his ticket in a district where only 9,483 votes were cast for State Senator. Holohan was known to be free of machine influences. He could be counted upon to vote for a Reciprocal Demurrage bill without first consulting the Southern Pacific's political agent, Jere Burke. And the Republican whose place he took in the Senate had voted against the Reciprocal Demurrage bill of 1907.

The election of Holohan and Campbell unquestionably had its influence on the passage of the Demurrage, bill. Not a member of the Senate cast his vote against it, although several of the Senators who had voted against the bill two years before, sat in the Senate of 1909. Among these were ten Senators who, during the session of 1909, were conspicuously on the wrong side of most questions. They were Senators Bates, Hartman, Leavitt, McCartney, Reily, Savage, Weed, Willis, Wolfe and Wright. The ten, for example, constituted half the twenty Senators who opposed the plan to give The People State-wide popular vote in the selection of United States Senators. Only seven Senators voted against the Anti-Racetrack Gambling bill. Five of the seven - Hartman, Leavitt, Reily, Weed and Wolfe - had voted against reciprocal demurrage in 1907. But there was a harkening to the demand of The People in 1909, which hadbeen wanting two years before. Seven of these ten Senators, who voted against reciprocal demurrage in 1907 - Bates, Hartman, McCartney, Savage, Willis, Wolfe and Wright - voted for reciprocal demurrage in 1909. Three of them - Leavitt, Reily and Weed - did not vote at all.

[66] The vote was as follows:

For the amendment: Bell, Birdsall, Boynton, Burnett, Caminetti, Campbell, Cartwright, Curtin, Cutten, Holohan, McCartney, Miller, Roseberry, Rush, Strobridge, Sanford, Thompson, Walker, Wright - 19.

Against the amendment: Anthony, Bills, Estudillo, Finn, Hartman, Hurd, Kennedy, Leavitt, Lewis, Price, Reily, Savage, Weed, Welch, Willis, Wolfe - 16.

[67] Machine Senators habitually exact the utmost consideration and courtesy from the anti-machine Senators, and habitually repay it with deceit and trickery. The curious feature of this is that the anti-machine Senators continue to extend the courtesy and continue to be tricked and imposed upon. A shutting off of "Senatorial courtesy" would go far toward solving the problem of machine domination of the Legislature.

[68] Mr. Bonnheim testified that prior to the new schedule of express rates enforced between New York and the city of San Francisco, the rate was $8.00 per hundred for shipments of from 10,000 to 20,000 pounds; $9.00 per hundred for 5,000 to 10,000 pounds; $10.00 per hundred for 2,000 to 5,000 pounds; $11.00 per hundred from 1,000 to 2,000 pounds. and $12.00 from 500 to 1,000 pounds; $13.50 from 100 to 500 pounds.

That the withdrawal of the bulk rates in December, 1908, resulted in an advance of 35 per cent by the withdrawal of the 2,000 pound rate, and an advance of 50 per cent by the withdrawal of the 5,000 pound rate; an advance of 66 3/4 per cent by the withdrawal of the 10,000 pound rate, and that the withdrawal of the 20,000 pound rate amounted to an advance of 92 8/10 per cent.

[69] Senator Cartwright actually introduced a resolution calling upon the Attorney-General to institute proceedings before the Interstate Commerce Commission:

To determine whether existing rates are reasonable or unreasonable.

To ascertain, fix and establish a reasonable schedule of freight rates, and to enforce the same.

To determine whether or not any existing rate is discriminatory.

And to prevent further discrimination between persons or places.

The resolution carried an appropriation of $25,000 to ensure competent legal and expert assistance.

The resolution was introduced on February 4. It went first to the Committee on Federal Relations, then to the Judiciary Committee, then to the Committee on Finance, from which it emerged March 1 with the recommendation that it be adopted. On March 2 it was sent back to the Committee on Finance and was never heard from again. The enormous benefit to the State if such an investigation could be honestly and effectively carried on, will be recognized.

[70] The vote was as follows:

For the resolution: Bell, Birdsall, Boynton, Burnett, Caminetti, Cutten, Estudillo, Holohan, Roseberry, Rush, Sanford, Thompson - 12.

Against the resolution: Anthony, Bates, Bills, Finn, Hartman, Hurd, Kennedy, Leavitt, Lewis, Martinelli, Reily, Savage, Weed, Willis, Wolfe, Wright - 16.

[71] E. F. Mitchell, Executive Secretary to Governor Gillett, makes the following statement regarding this particular error:

The electric companies which run interurban trains, also claimed that the bill, as prepared, applied to them, and would place upon them an unnecessary burden and expense.

"There is no doubt that section three of the act applies to motor cars and electric cars. The language is very plain. Section one of the bill describes passenger trains, section two refers to freight trains, and section three says "all other trains not propelled by steam locomotives." Now, there are only two classes of cars that are not propelled by steam locomotives, and those are motor and electric cars. In the Governor's opinion, an error was made in endeavoring to amend it, so it would not apply to motor cars and electric cars. The amendment was prepared, and we had here in the office, during the argument on the bill, the original committee amendments proposed. The amendment was to be made after the word "train" on the second line and had this amendment been made as contemplated, it would have excluded motor cars and electric cars, but instead of having been made on line two, as expected, it was carried into line three, where it gave the bill an entirely different meaning, It was one of those unfortunate things that crept into legislation through an oversight of somebody, which could have beenreadily corrected if the bill had been watched. The insertion of this amendment in the wrong place, instead of excluding motor cars and electric cars, as intended, included them. This error was not discovered until the bill came up before the Governor for consideration."

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