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Frank Parsons’ “The Heart of the Railroad Problem” is a scholarly investigation into the long‑standing inequities of American rail transport. Drawing on a decade of travel through nine European nations and three‑quarters of the United States, the author assembled testimony from railroad presidents, legislators, and regulators, then wove those observations into a systematic study of favoritism toward large shippers and political insiders. The opening pages set the stage with a clear thesis: the chief grievance is not high rates but the pervasive, institutionalized bias that privileges powerful interests. From the common‑law principle of carrier impartiality to detailed accounts of free passes, rebates, and commodity‑rate discrimination, Parsons maps the legal, economic, and social dimensions of the issue, while also surveying comparative practices abroad.
Written in a dense, early‑20th‑century prose style, the work reads like a blend of investigative report and policy treatise, complete with extensive footnotes, chapter headings, and a thorough index. Its meticulous documentation and rhetorical vigor will appeal to historians of American industry, legal scholars interested in antitrust and transportation law, and readers who enjoy rigorous analyses of corporate influence on public policy.
The opening · free to read
This work is one of the consequences of a conversation years ago with Dr. C. F. Taylor, of Philadelphia, editor and publisher of The Medical World and of Equity Series. The doctor said that Equity Series should have a book on the railroad question. The writer replied that there was room for a book dealing with the political, industrial, and social effects of different systems of railway ownership and control. A plan was adopted for a book, to be called “The Railways, the Trusts, and the People,” which is now on the press of Equity Series. For the preparation of this work the writer travelled through nine countries of Europe and over three-fourths of the United States, studying railways, meeting railroad presidents and managers, ministers of railways, members of railway commissions, governors, senators, and leading men of every class, in the effort to get a thorough understanding of the railway situation. He also made an extensive study of the railroad literature of leading countries, and examined thoroughly the reports and decisions of commissions and courts in railroad cases in the United States.
As these studies progressed, the writer became more and more convinced that the heart of the railroad problem lies in the question of impartial treatment of shippers. The chief complaint against our railroads is not that the rates as a whole are unreasonable, but that favoritism is shown for large shippers or special interests having control of railways or a special pull with the management. This book consists, in the main, of the broad study of railway favoritism, which was made as a basis for the generalizations outlined in the brief chapter on that subject in “The Railways, the Trusts, and the People,”—one of the thirty chapters of that book. This study reveals the facts in reference to railway favoritism or unjust discrimination from the beginning of our railway history to the present time, discloses the motives and causes of discrimination, discusses various remedies that have been proposed, and gathers hints from the railway systems of other countries to clarify and develop the conclusions indicated by our own railroad history.
Special acknowledgments are due to Dr. Taylor, who paid a part of the cost of the special investigations on which the book is based and has taken a keen interest in the progress of the work from its inception, and also to Mr. Ralph Albertson, who has worked almost constantly with the writer for the past eight months and more or less for two years before that, and has rendered great assistance in research, in consultation and criticism, and in the checking and revision of proof.
FRANK PARSONS.
BOSTON, March, 1906.
It is a principle of the common law that common carriers must be impartial. “They cannot legally give undue or unjust preferences, or make unequal or extravagant charges.... They are bound to provide reasonable and sufficient facilities. They must not refuse to carry any goods or passengers properly applying for transportation.... They have no right to grant monopolies or special privileges or unequal preferences, but are bound to treat all fairly and impartially.”[1] That is the rule of the common law which represents the crystallized common-sense and practical conscience of the Anglo-Saxon and every other civilized race. The legal principle that a common carrier must be impartial was established long before the Interstate Commerce Act was passed, or the Granger laws enacted,—yes, before railways or steamboats were born. They inherited the family character and the family law. It has been applied to them in innumerable cases. There is a solid line of decisions from the infancy of the English law to the present time. Constitutional provisions and State and Federal statutes have been passed to affirm and enforce the rule. The railroads themselves declare the rule to be right. And yet, in spite of the railway conscience and the common law, the universal sense of justice of mankind, and the whole legislative, executive, and judicial power of the government, the rule is not obeyed. On the contrary, disregard of it is chronic and contagious, and constitutes one of the leading characteristics of our railway system. In spite of law and justice our railway practice is a tissue of unfair discrimination, denying the small man equal opportunity with the rich and influential, and breaking the connection between merit and success.
The railways unjustly favor persons, places, and commodities, and they do it constantly, systematically, habitually. If every instance of unjust discrimination that occurs to-day were embodied in human form and the process were continued for a year,[2] the outlaw host would dwarf the Moslem hordes that deluged southern Europe in the days of Charles Martel, outnumber many fold the Grand Army of the Republic in its palmiest days, and, shoulder to shoulder, the dark and dangerous mob would reach across the continent, across the ocean, over Europe and Asia, and around the world.
The railways discriminate partly because they wish to, and partly because they have to. The managers favor some interests because they are linked with the interests of the railways or the managers, and they favor some other interests because they are forced to. The pressure of private interest is stronger than the pressure of the law, and so the railroad manager fractures his conscience and breaks the statutes and common law into fragments.
CHAPTER II. PASSES AND POLITICS.
One of the most important forms of discrimination is the railroad pass. Many persons of wealth or influence, legislators, judges, sheriffs, assessors, representatives of the press, big shippers, and agents of large concerns, get free transportation, while those less favored must pay not only for their own transportation, but for that of the railway favorites also.
A farmer and a lawyer occupied the same seat in a railroad car. When the conductor came the farmer presented his ticket, and the lawyer a pass. The farmer did not conceal his disgust when he discovered that his seat-mate was a deadhead. The lawyer, trying to assuage the indignation of the farmer, said to him: “My friend, you travel very cheaply on this road.” “I think so myself,” replied the farmer, “considering the fact that I have to pay fare for both of us.”
The free-pass system is specially vicious because of its relation to government. Passes are constantly given to public officials in spite of the law, and constitute one of the most insidious forms of bribery and corruption yet invented. I have in my possession some photographs of annual passes given by the Pennsylvania Railroad in 1903, 1904, and 1905 to members of the State Legislature, and the Common Council of Philadelphia.
The Constitution of Pennsylvania, Section 8 of Article 8, says: “No railroad, railway, or other transportation company, shall grant free passes, or passes at a discount, to any persons except officers or employees of the company.”
The question is whether the members of the Legislature are employees of the Pennsylvania Railroad.
Recently the Pennsylvania Railroad gave notice that after January 1, 1906, no free passes would be issued except to employees. As we have seen reason to believe, this may still include members of the Legislature, and even if the order should happen to be enforced according to the common acceptation of the word “employees,” there are plenty of ways in which free transportation can be given to men the railroad management deems it desirable to favor. Railroads have made such orders before, and in every case the fact has proved to be that the order simply constituted an easy method of lopping off the overgrown demand for passes, a ready excuse for denying requests the railroad does not wish to honor, without in the least interfering with its power of favoring those it really wishes to favor. In cutting off passes under said order to multitudes of city officials in Pittsburg lately the Pennsylvania railroad officers stated that the demand had become so great that those having free rides were actually crowding the paying passengers on many of the trains. The Philadelphia North American declared that in that city every big and little politician expected free passage when he requested it, and that there was no ward heeler so humble that he might not demand transportation for himself and friends to Atlantic City, Harrisburg, or any other point on the Pennsylvania line. The Springfield Republican said: “It does not appear to be recognized, in the praise given to the present action of the railroad company, how great an impeachment of its management the old order constituted. We are told that passes were issued literally in bundles for the use of political workers, big and little.”
We watched with much interest to see what the railroad would really do when the time for full enforcement of the order came. In Pennsylvania, as was anticipated, the order has been used as a basis for refusing passes to the overgrown horde of grafters who have feasted so long at the Pennsylvania’s tables. The railway does not want anything this year in Pennsylvania that the grafters can give it, and it is an excellent opportunity to punish the Pittsburg politicians for allowing the Gould lines to enter the city. But in Ohio the situation is different, and, in spite of the recent order, the time-honored free passes have been sent to every member of the Ohio Legislature. A press despatch from Columbus, January 1, says: “One of the notable events that marked the opening of the general assembly to-day was the unexpected arrival of railroad passes for every member. The Pennsylvania, first to announce that the time-honored graft would be cut off, was the first to send the little tickets, and the other lines followed suit.”
The Pennsylvania is not alone in its delicate generosity to legislators and other persons of influence. The practice is practically universal.[3] From Maine to California there is not a State in which the railroads refrain from giving passes to legislators, judges, mayors, assessors, etc. And the roads expect full value for their favors. Some time ago a member of the Illinois Legislature applied to the president of a leading railroad for a pass. In reply he received the following:
“Your letter of the 22nd to President ——, requesting an annual over the railroad of this company, has been referred to me. A couple of years ago, after you had been furnished with an annual over this line, you voted against a bill which you knew this company was directly interested in. Do you know of any particular reason, therefore, why we should favor you with an annual this year?”
The railroads give passes to legislators and public officials not, as a rule, in any spirit of philanthropy or respect for public office, but as a matter of business; and if a legislator does not recognize the obligation that adheres to the pass, the pass is not likely to adhere to him in subsequent years.
In many cases the pass is the first step on the road to railroad servitude. Governor Folk said to me: “The railroads debauch legislators at the start by the free pass. It is a misdemeanor by the law of this State to take such a favor.[4] But it seems so ordinary a thing that the legislator takes it. He may start out with good intentions, but he takes a pass and then the railroad people have him in their power. He has broken the law, and if he does not do as they wish they threaten to publish the number of his pass. He generally ends by taking bribe money. He’s in the railroad power anyway to a certain extent, and thinks he might as well make something out of it. In investigating cases of corruption I have found that in almost every instance the first step of the legislator toward bribery was the acceptance of a railroad pass.”
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