602
THE GREEN BAG
Only recently the commission of one of our most aggressive western states warned the railroads by a written communication that if they were not more -considerate of the state as to interstate rates, the commission would retaliate by the exercise of its powers over local affairs. Other commissions, while not thus frank in their avowals, have been equally local in their practices. The severest critic of railroads cannot deny that their policy has been splendidly national, and the most potent single factor in the creation of our vast domestic commerce. In thus maintaining the commercial supremacy of the nation, they have been compelled to withstand the importunities and fierce wrath of local interests. Now, however, the con flict is to be transferred from this field of economics to the field of government. Localism is to speak not by petition but by statute. Under this regime, as governmental control increases in efficiency, the irre pressible conflict between local and national interests will increase in directness as well as in the frequency of its exhibition and the intensity of the passions aroused. It has already brought us to the verge of civil war in North Carolina, and been the occasion of the sharpest acrimony in other states. Such a conflict must in the end result in the complete supremacy of one authority or the other. It is vain to appeal to states, as did Secre tary Root in his New York address, to sub ordinate local advantage to the general welfare. Our whole history is a confirma tion of the statement of Mr. Pinckncy in the constitutional convention that " States pur sue their interests with less scruple than individuals." They exhibit all that lack of conscience characteristic of those who exer cise delegated power. As Justice Miller points out in his lectures on the Constitution, had it not been for the dominant authority of the central government, the general welfare would have been as completely sacrificed to local selfishness under the Con stitution as it was under the articles of con
federation. What states require is not exhortation but authority. The situation in the field of industry pre sents the same general features. To abolish local control over matters extending outside of the state was the origin not only of the article conferring power on the national government to regulate commerce among the states, but also of those provisions which forbid states to lay imposts or duties on exports or imports, and which secure to the citizens of each state the privileges and immunities of citizens of the several states. These restrictions were placed in the Con stitution, not so much that men might be free, as that national commerce and industry might be free. They have been largely nullified in actual life by the fact that busi ness is now carried on by corporations instead of persons. When the Constitution was adopted only twenty-one corporations had been formed in the United States. These were mainly for the construction of ranals and turnpikes. There was but one bank and two trading companies. As busi ness agencies, corporations had no part either in life or thought, consequently they had no place in the Constitution. The Supreme Court has held that they are not citizens within the meaning of the Fifth Amend ment, and that each state may either wholly exclude them, or impose as conditions of their entering or remaining in the state such terms as local policy or interest may suggest. The result is that business, which was intended to be free, has in fact become subject to local authority. The abuses of cor porate organization and management have heretofore commended this exercise of local control. Ultimately, however, we shall become increasingly aware of its injustice and folly. Business cannot be conducted in this century except through the agency of corporations; but the very enlargement of that agency has caused industry, the same as commerce, to overleap the bounds of states, and thus become subject to gov ernments whose only interest in them
