Part 5 (1/2)

What are the powers delegated to the general government by the const.i.tution in questions of this character? Article I. Section 8, contains, among others, the following, as some of the powers conferred upon congress: ”To regulate commerce with foreign nations, and among the several states, and with the Indian tribes;” ”To establish post offices and post roads;” ”To make all laws which shall be necessary and proper for carrying into execution the foregoing powers and all other powers vested by this const.i.tution in the government of the United States, or in any department or office thereof.” The same section gives congress power to provide for organizing the army, &c.; and, in time of war, extraordinary powers, controlled only by the necessities of the case, are vested in congress. If congress have power under the const.i.tution to charter private corporations, it must be derived from, or contained in, the provisions above quoted. Article IX. of the const.i.tution reads as follows: ”The enumeration in the const.i.tution of certain rights shall not be construed to deny or disparage others retained by the people.”

And Section 10 reads as follows: ”The powers not delegated to the United States by the const.i.tution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.” And the framers of the const.i.tution it would seem, for the purpose of making the line of demarcation between the powers of the states and the general government still more plain and definite, provided as follows: Article IV., Section 2: ”The citizens of each state shall be ent.i.tled to all privileges and immunities of citizens in the several states.”

We think that the above quotations from the const.i.tution (and we have quoted all having any relation to the question we are discussing) prove conclusively that the powers conferred upon congress by the const.i.tution are limited; that while within the scope of the delegated powers its action is supreme, there is inherent in it no general power to legislate upon subjects not named in the const.i.tution, or not included by necessary implication. On the contrary, all the powers not expressly given are reserved to the states or to the people.

Is the authority to charter private corporations necessarily included in the delegated power to regulate commerce among the several states, or to establish post roads? We think not. What do we understand by the word ”Commerce?” Webster defines it as follows: ”1st. _In a general sense_, an interchange or mutual change of goods, wares, productions, or property of any kind between nations or individuals, either by barter, or by purchase and sale; trade; traffic. Commerce is _foreign, or inland_. Foreign commerce is the trade which one nation carries on with another; inland commerce, or inland trade, is the trade in the exchange of commodities between citizens of the same nation or state. 2d.

Intercourse between individuals; interchange of work, business, civilities, or amus.e.m.e.nts; mutual dealings in life.” And again: ”To traffic; to carry on trade.” In the absence of any definition given to it in the const.i.tution, we must accept the above general definition of its meaning as being the sense in which it is used in the const.i.tution.

Respecting trade with foreign nations or the Indian tribes, it can only relate to the interchange of commodities, or purchase or sale of articles of traffic. As incidental to this power, congress can prescribe rules for the regulation of navigation upon the high seas, including police regulations on board of vessels, because the oceans are the common or public highways of all nations, and each nation navigating the same is bound to protect not only its commerce, but its citizens or subjects. Nations hold commerce with nations across and upon the high seas, the citizens and subjects of each being protected by their own government. This commerce with foreign nations is not regulated by grants of private charters, but by acts of congress is open to all alike, save where, for the encouragement of certain branches of trade, certain bounties or privileges have been granted to particular parties for a specified time. But all such grants have been to parties navigating the high seas. The control of navigable streams within the United States does not depend alone upon the powers given to congress to regulate the commerce of the country, but depends also upon the further power vesting in the general government exclusive maritime jurisdiction.

If we concede that the power to regulate commerce among the several states gives congress the exclusive right to regulate the commerce carried on upon our rivers, it would not follow that the power to charter railway companies is conferred. Navigable streams are _public highways_, open to the travel of all. No man, set of men, or corporations, can claim the exclusive right to navigate these rivers, nor could congress grant such exclusive right. The duty of protecting the rights of the citizen, and of making river transportation safe, and of protecting the rights of property, demand that the national, and not the state legislature, should be supreme in this particular jurisdiction, and hence this branch of commerce is placed in the custody of the nation. But keeping in mind the definition of the word, ”Commerce,” let us see what is meant by the term as applied to dealings between the states. We insist that it has no reference to the construction of roads, railroads, ca.n.a.ls, or any other ways upon which commerce might be carried, or over which articles of trade or traffic might pa.s.s, but that it refers only to the dealing of the people of one state with another; that while the people of each state are under the supreme control of their state authority, all the privileges enjoyed by the citizens of any one of the states as to residence or traffic with the citizens of another state, are to be the same. No distinction can be made, and for the purpose of carrying out this provision of the const.i.tution, and preventing the levy of tariffs or taxes by one state upon the citizens of another state, and for the purpose of guaranteeing to all citizens of the United States immunity from these unjust discriminations, the power to regulate commerce among the states was delegated to congress. Nor does it follow, that, for the purpose of regulating commerce among the states, congress can grant exclusive privileges and monopolies in any business not confided to one state.

When the const.i.tution was adopted, each state was independent; each had all the powers and prerogatives of a nation; each was supreme within its geographical limits; each might prescribe its own rules in relation to immigrants, and to trade and traffic with other states; it might discriminate in favor of its own citizens; it might impose tariffs on foreign imports, and deal with its sister states as with foreign nations. To prevent this, and to secure to all citizens of the United States equal privileges and immunities in all parts of the United States, the provisions of the const.i.tution we have quoted were adopted.

While the independence of the states was recognized and preserved, the power to regulate commerce, among them, was delegated to congress; not the power to withdraw from the state its right to legislate upon the subject of commerce among its own citizens, or the right to protect its own citizens in their dealings with the citizens of other states; but simply providing that no discriminations should be made on account of residence, and establis.h.i.+ng equal rights and privileges of all citizens of the United States in all the states, free from discriminations sought to be enforced under local or state statutes and regulations. Should any one state attempt to deny to the people of another state the privileges guaranteed by the const.i.tution, then it would be the plain duty of congress to interfere and ”_regulate commerce_” between these states.

But while a general national law might const.i.tutionally be enacted upon this subject, it certainly cannot be claimed, that upon the pretext of regulating commerce among the states, congress can charter railroad companies, or any other companies organized for pecuniary profit. Nor can this power be claimed under the const.i.tutional provision for the establishment of post offices and post roads. We admit that the grant of this power carries with it all such as are incidental; that by implication it includes within its terms the carrying and distribution of the mails, and all other matter necessarily connected therewith; and that congress might build, own, and control post roads, so far as the same might be found necessary for the transportation of the mails over the territory belonging to the United States, and to provide for the use of public roads for government purposes. Public highways are free to all. Over these highways, whether on land or water, congress can provide for the transportation of the mails, troops, army stores, munitions of war, and other public property. These highways are at all times open to the public. But while this is true, it does not follow that the government of the United States can take the absolute control of these public highways, and, by act of congress, deny the states a control over those within their borders respectively. The location and establishment of public roads within a state is a part of the local or police regulation, and while these roads are free to the pa.s.sage of all, they are, by the provisions of the const.i.tution and the universally accepted custom of the country, recognized as being under the exclusive control of the states within which they are situated. The fact that congress never has taken the control of the public roads of the country is a full recognition of the exclusive right of the states to control them. Then how can it be claimed that congress, under the const.i.tution, possesses the power to charter railroad companies? Until within the last few years, no attempt was made to grant charters to railroad companies by the general government, nor indeed were charters granted for any purpose save in relation to the financial departments, as in the case of United States banks, fiscal agencies, &c., which were chartered for the public benefit, and not as private inst.i.tutions. We are not positive that the const.i.tutionality of these railroad charters has been determined by the courts of the United States, but we are aware of the fact that congress has deemed it necessary, in almost every instance where charters have been granted and aid voted, to declare, and place upon the record as a part of the charter, the reasons for granting it.

The following are the reasons a.s.signed in some of the charters, to-wit: In the charter of the Union Pacific railroad company--”For the purpose of aiding in the construction of said railroad and telegraph line, and to secure _the safe and speedy transportation of the mails, troops, munitions of war, and public stores thereon_.”

In the charter of the Northern Pacific railroad company: ”For the purpose of aiding in the construction of said railroad and telegraph line to the Pacific coast, and to secure _the safe and speedy transportation of the mails, troops, munitions of war, and public stores_.” In all other cases the above quoted statement of cause is inserted in the charters, as though the right or authority to make these grants was so doubtful that it became necessary in every case to state the reason for the grant. If the present necessities of the government demand such special legislation, then the same reasons existed from the organization of our government; and if congress possesses the power under the const.i.tution to make these grants, and to a.s.sume the absolute control of public or private roads through the states, then from the adoption of that const.i.tution congress could have taken the absolute control of all the public roads in all the states of the Union. Before railroads were constructed, all overland transportation of mails, troops, munitions of war, &c., was over the public highways--highways that were and still are under the exclusive control of the states in which they lie. Over these public roads and such private ways as maybe selected, government has a right to transport the mails, troops, and public property, and no state has the right to prohibit or restrict this right. Still, no power is given by the const.i.tution, nor is there any implied, under which congress can, under the plea of rendering more safe and speedy the transportation of mails, troops, &c., grant exclusive charters and privileges to private corporations. In the nature of things, as our government is organized, the right to charter and control all corporations organized for pecuniary profit remains with the states.

This power has never been delegated to the general government, nor prohibited to the states, or people. There can be no doubt upon this point, when we remember that the general government is limited to the delegated powers; and that it is supreme only in those matters which are delegated to and vested in it by the const.i.tution. This position is fully sustained by the adjudication of the supreme court of the United States. In Marshall, on the federal const.i.tution, page 164, we find the following: ”This government is acknowledged by all to be one of enumerated powers. The principle that it can exercise only the powers granted to it, would seem too apparent to have required to be enforced by all those arguments which its enlightened friends, while it was depending before the people, found it necessary to urge. That princ.i.p.al is now universally admitted.” Again, on page 301, the author says: ”In our complex system presenting the rare and difficult scheme of one general government whose action extends over the whole, but which possesses only certain enumerated powers and of numerous state governments, which retain and exercise all powers not delegated to the union, contests respecting power must arise. Were it otherwise, the measures taken by the respective governments to execute their acknowledged powers would often be of the same description, and might sometimes interfere. This, however, does not prove that the one is exercising, or has the right to exercise, the power of the other.”

As to the power of congress to create corporations, an argument has been drawn in its favor from the provision of the const.i.tution, which declares that congress shall have the power of making ”all laws which shall be necessary and proper for carrying into execution the foregoing powers, and all other powers vested by this const.i.tution in the government of the United States, or in any department thereof.” The question before the court arose out of the attempt of the state of Maryland to tax the United States bank, a corporation chartered by congress. In this case the power was upheld on the ground that the bank was necessary in the administration of the finances of the government, that being one of the matters vested in or delegated to the general government, the power to charter the bank was incidental to the granted power. But on the question of the power of congress to create corporations, Mr. Marshall says, page 167: ”The creation of a corporation, it is said, appertains to sovereignty. This is admitted.

But to what portion of sovereignty does it appertain? Does it belong to one more than another? In America the powers of sovereignty are divided between the government of the Union, and those of the states. They are each sovereign with respect to the objects committed to it, and neither sovereign with respect to the objects committed to the other. We cannot comprehend that train of reasoning which would maintain that the extent of power granted by the people is to be ascertained, not by the nature and terms of the grant, but by its date. Some state const.i.tutions were formed before, some since that of the United States. We cannot believe that their relation to each other is in any degree dependent upon this circ.u.mstance. Their respective powers must, we think, be precisely the same as if they had been formed at the same time. Had they been formed at the same time, and had the people conferred on the general government the power contained in the const.i.tution and on the states the whole residium of power, would it have been a.s.serted that the government of the union was not sovereign with respect to those objects which were entrusted to it, in relation to which its laws were declared to be supreme? If this could have been a.s.serted, we cannot well comprehend the process of reasoning which maintains that a power appertaining to sovereignty cannot be connected with that vast portion of it which is granted to the general government, so far as it is calculated to subserve the legitimate objects of that government. The power of creating a corporation, though appertaining to sovereignty, is not like the power of making war, or levying taxes, or of regulating commerce, a great substantive and independent power which cannot be implied as incidental to other powers, or used as a means of executing them. It is never the end for which other powers are exercised, but the means by which these objects are accomplished. No contributions are made to charity for the sake of an incorporation, but a corporation is created to administer the charity. No seminary of learning is inst.i.tuted in order to be incorporated, but the corporate character is conferred to subserve the purposes of education. No city was ever built with the sole object of being incorporated, but it is incorporated as the best means of being well governed. The power of creating a corporation is never used for its own sake, but for the purpose of effecting something else.

No sufficient reason is therefore perceived why it may not pa.s.s as incidental to those powers which are expressly given, if it be the direct mode of executing them.”

Taking the above definition of corporations, and their use, in the administration of the government, we can have no difficulty in distinguis.h.i.+ng the cases in which congress can grant charters to any company or a.s.sociation. It is only when some of the delegated powers require the aid of corporate acts in their administration, that the right exists in congress to grant charters, as incidental to the grants.

The grants of charters to railroad companies cannot be claimed as incidental to any express delegation of power to the general government.

If railroads are private property, they cannot be chartered or controlled by congress. If they are to be taken and treated as public highways, then they are as exclusively under and subject to the control of the respective state governments, as common highways. The state legislatures have exclusive control of them in either case. If they are treated as private corporations, then under the rights reserved to the states, as well as by long usage, their exclusive control is retained by the states. If they are public roads, the same local or state laws apply to them as to all other public roads. Admit that congress has the right to grant charters for railroads, then it follows that it can control them. Admit that they are public roads, and that they are to be taken and treated as common highways, and congress at once a.s.sumes the local and police regulations of all the public roads in all of the United States.

To this doctrine we cannot subscribe, but insist that the exclusive power to charter and control railroad corporations remains with the people to be exercised by and under the exclusive control of the state governments. Nor can congress, rightfully, under the const.i.tution, charter railroad corporations in the territories. The power vested in congress ”to dispose of and make all needful rules respecting the territory or other property belonging to the United States,” does not authorize the creation of private monopolies. When territorial governments are formed, they are clothed with many of the attributes of sovereignty. These governments are at liberty to legislate and to provide for the well-being of the people, and subject to the provisions of their ”organic law,” have the complete control of local and police regulations. They can construct highways, erect public buildings, impose taxes, grant charters, including charters to railroad companies. That territorial governments can charter railroad companies, and that general government has so acknowledged is proven by the acts of congress in donating lands and bonds to companies chartered by territorial legislation. This was done in the case of the Leavenworth, p.a.w.nee, & Western railroad company, chartered by the territorial legislature of Kansas; and other instances are common. The power to grant charters cannot vest in the states, and territorial governments, and at the same time exist in the general government, for the reason that the supreme power must exist in one or the other. If this were not so, one government could destroy what the other had created. The privileges acquired by a corporation under the one could be entirely annulled by the other. Private rights would be subject to the adjudication of two separate and distinct tribunals, created and sustained by distinct governments, the one claiming to be supreme, because the right to exercise the power had been granted to it, and the other denying such grant, and because of this denial claiming the power as still remaining with the state government. This course would be destructive of the rights of the people, as well as of our system of government. Concede to congress the right to charter railroad companies, and there is no limit to the monopolies that can be forced upon the people of the whole country. Land companies, loan, and interest companies, manufacturing companies, and in short all conceivable projects of speculation can obtain charters from congress, and our government becomes entirely personal in character, without restraint or const.i.tutional limit. The a.s.sumption by congress of the power to create private corporations is a fatal stab at our system of government, destructive of state rights, and a wanton violation of the const.i.tution.

CHAPTER IX.

STATE RIGHTS AT THE BAR OF A CORRUPT CONGRESS.

None of the subjects of legislation have tended to destroy const.i.tutional safeguards and debase public morals so much as congressional legislation, with its grants of land and bonds, and other special benefits in favor of railroad corporations. This species of legislation has well nigh destroyed republican inst.i.tutions. While our government is republican in name it is in fact controlled by an oligarchy. The whole government has become a prey to the cla.s.s of corporations above named, and is administered in their interest. Their influence controls the legislative department, the courts of the country, and its finances. This is a sweeping a.s.sertion, but who will deny it. Further, the very men who by their votes in congress have created these monopolies, have themselves in many instances received pecuniary consideration for their votes, either in corporate stock, or direct payment. This last a.s.sertion is now (January 9, 1873) being supported by results arrived at by committees appointed to investigate charges of corruption made against members of both branches of congress.

Having a.s.sumed the right to grant charters and aid to these corporations in violation of the const.i.tution, it was but one step further in the same direction for congress to enact other unconst.i.tutional laws, regulating and combining railroads receiving their charters from state legislatures, laws which enable these roads to so combine their operations as to control the entire interests of the country. These acts are numerous in the published laws of congress. We will refer to some of them, and direct the reader to the following, of a general nature: On the 15th of June, 1866, congress pa.s.sed the following unconst.i.tutional act in the interest and for the benefit of railroad corporations: See Second Brightley's Digest, page 528, ”That every railroad company in the United States, whose road is operated by steam, its successors and a.s.signs, be and is hereby authorized to carry upon and over its road, boats, bridges, and ferries, all pa.s.sengers, troops, government supplies, mails, freight, and property, on their way from one state to another state, and to receive compensation therefor, and to connect with roads of other states so as to form continuous lines for the transportation of the same to the place of destination. Provided, that this act shall not affect any stipulations between the government of the United States, and any railroad company for transportation and fares without compensation, nor impair or change the conditions imposed by the terms of the acts granting lands to any such company to aid in the construction of its road, nor shall it be construed to authorize any railroad company to build any new road, or connection with any other road without authority from the state in which said railroad, or connection, may be proposed.” Commenting upon this extraordinary statute, the editor says: ”In the preamble to this extraordinary a.s.sumption of power, on the part of the federal congress, they prefer to base their authority for it on the power to regulate commerce among the several states, to establish post-roads, and to raise and support armies. But it has been decided that the const.i.tutional power to establish post-roads is confined to such as are regularly laid out under state authority; the government of the United States cannot construct a post-road within a state of the Union without its consent. The post-roads of the United States are the property of the states through which they pa.s.s. The United States have the mere right of transit over them for the purpose of carrying the mails; the government could not have an injunction to prevent the destruction of a mail-road.” Citing the case of the Cleveland, Painesville, & Ashtabula railroad company _vs_. The Franklin ca.n.a.l company, in the circuit court of the United States, the editor adds: ”Congress certainly can confer no rights on a railroad company incorporated by a state government, which are withheld from it by the charter of its creator.”

The above quoted act a.s.sumes that congress has full power to regulate the connection of railroads in the different states, as well as the carrying trade upon the same. It strips the several state governments of all power to interfere, and in case of any controversy takes from the state courts the power to determine the rights of the respective parties; the act of congress could be pleaded, and, as a necessary consequence, the United States courts would have exclusive jurisdiction.

It cannot be claimed that this act can be supported under any express delegation of power to the general government, nor can it be supported as being incidental to any express grant. It is an usurpation not warranted or sustained by any part of the const.i.tution. This one section quoted, destroys the right of any state of the Union, or of two or more of them, to legislate upon the subject of uniting or connecting railroads meeting on the lines dividing them, and also takes from the states the right to regulate the carrying trade within their own respective borders. Congress had no more authority under the const.i.tution to enact this law, than to provide by statute for the construction of public highways when they meet upon the line dividing states, or to provide for the pa.s.sage of teams from one state to another, and the transportation of freights over the common highways within or across a state. The whole power under the const.i.tution is reserved to the states. Prior to the creation of these great railroad monopolies by congress, an attempt at such legislation would have been deemed unconst.i.tutional, but as soon as the whole affairs of government pa.s.sed into the hands of the few, and when the protection of their interests demanded it, the act was pa.s.sed, and has remained upon the statute book as one of the laws of the land. This act is about the only one that openly and broadly covers the whole ground, and a.s.sumes to regulate the internal affairs of the states, but there are numerous acts pa.s.sed in relation to land grants and the companies chartered by congress, which have the same effect. In some cases the absolute control of roads constructed under charters obtained from state legislatures, or under state laws, has been taken from the states by acts of congress, and placed under the jurisdiction of the general government. In most instances where this has been done, members of congress, or their near relatives, were large owners of stock in the companies to be benefited by the act. To speak more plainly, the acts granting special privileges to particular companies, and placing them under the jurisdiction of the federal government, were pa.s.sed for the benefit of congressmen and others in high official position. Let us examine some of these acts.

Among the stockholders and directors of the Union Pacific and its branches, there are found at least eight persons who were members of congress at the date of the act of congress creating the corporation, and also at the date of the material amendments to the charter. Some of these congressmen are still stockholders and directors, and were directors when congress released these companies from payment of interest on the bonds they had received from the government. Another land grant company having congressmen among its stockholders and directors, is the Leavenworth, Lawrence, & Galveston; also, the Iowa Falls & Sioux City; also, the Cedar Rapids & Missouri River; also, the Burlington & Missouri River; also, the Atlantic & Pacific; also, the New Orleans, Mobile, & Texas; also, the Northern Pacific; also, Sioux City & Pacific; also, the Fremont, Elkhorn, & Missouri Valley. The number might be extended, but enough is given to sustain our charge. Most of the above named companies were organized under state laws, or received their charters from state or territorial legislatures. For the purpose of consummating certain speculative ends, congress has treated with contempt state laws and state authority. Where charters have been granted under state authority, and the companies were rightfully under the control of the states within which their roads were located, acts like the following have been pa.s.sed by congress: ”That the Leavenworth, p.a.w.nee, & Western railroad company, of Kansas, are hereby authorized to construct a railroad and telegraph line from the Missouri river, at the mouth of the Kansas river, on the south side thereof so as to connect with the Pacific railroad of Missouri;” and then follow the details for constructing and operating the road, and placing it under the control of the general government. In the case of the Central Pacific company, chartered by the state of California, congress pa.s.sed the following act:--

”The Central Pacific railroad company of California, a corporation existing under the laws of the state of California, are hereby authorized to construct a railroad and telegraph line from the Pacific coast, at or near San Francisco, or the navigable waters of the Sacramento river, to the eastern boundary of California.”

Substantially the same provision is found for most of the corporations above named, and in all those cases, the authority to construct the road is followed by a provision for aid by the general government.