AN ADDRESS 
 
 BY 
 
 Mr. W. C. Brown, 
 
 General Manager of fne Missouri Lines 
 • of the ; 
 
 Chicago, Burlington & Quincy Railroad Company, 
 
 HEFOKE 
 
 The Commercial Exchange, 
 
 OF 
 
 DES MQINES, IOWA, 
 
 Thursday, December 20, 1894, 
 
 Pursuant to the Following Resolution: 
 
 - "RESOLVEO, that the Secretary, in the name of the Exchange, be hereby 
 directed to invite Presidents of various Roads entering Des Moines to address 
 our citizens, either in pers»n or by their representatives, at an early and con- 
 venierrt date, on matters pertaining to the advancement of the material interest 
 of Iowa, and as to the conditibns precedent to a new era of prosperity in Iowa 
 and tKe West." ^ 
 
/,- 
 
MR. PRESIDENT, 
 
 Gentlemen of the Commercial Exchange: — 
 I desire to preface what I shall say this evening by 
 acknowledging for the management of the Burlington road, 
 which I have the honor to represent, the profound sense of 
 obligation felt for this opportunity of meeting with the rep- 
 resentatives of the commercial interests of this great city, the 
 Capital and metropolis of this grand state, to counsel to- 
 gether on matters looking to the advancement of the 
 material interests and the future prosperity of Iowa and the 
 West. 
 
 Your invitation was extended to Mr. C. E. Perkins. 
 President of the Burlington Road, and I regret exceedingly, 
 as I know you all do, that it is impossible for him to be 
 present and respond in person. 
 
 For nearly thirty-five years Mr. Perkins has been 
 actively engaged in enterprises which have contributed in no 
 small measure to that marvelous era of development and 
 prosperity in Iowa which w^as inaugurated by the completion 
 of the first three lines of railroad across the state — about 
 1869 — and which continued almost without interruption for 
 nearly twenty years, ' ^. . .; , 
 
 I regret that he cannot be present because he is 
 naturally and by rich experience so much better equipped 
 
for the task, and I know that no citizen of the state feels a 
 deeper interest in the growth, devekipment and prosperity 
 
 of Iowa. . • . 
 
 I am glad of this opportunity to meet these representa- 
 tive citizens of Des Moines and of Iowa. 
 
 Something more than tifty-two years ago my father 
 made the long and tedious journey from New York state, 
 and settled near the forks of the Maquoketa river in the 
 territory of Iowa. 
 
 Almost my entire life has been spent here; I love the 
 state of Iowa and her people; I feel an earnest and abiding 
 interest in her prosperity, and am glad to believe that I 
 have been selected to speak to you this evening upon this 
 important question because our people know that I am 
 always, and in all places, an earnest, consietent friend of 
 Iowa and her interests. 
 
 You have asked us to consider with you "Matters per- 
 taining to the advancement of the material interests of Iowa 
 and as to the conditions precedent to a new era of prosperity 
 in low^a and the West." 
 
 I assume that the language of the invitation, the sub- 
 ject suggested for discussion may be accepted as admitting 
 that there has been a period of comparative depression, of 
 adversity folloAving an era of prosperity, and the fact that 
 in your wisdom you have decided to call into your counsels 
 representatives of the great lines of transportation of this 
 state, is to my mind an exceedingly auspicious omen, as it 
 indicates that the people are learning the important truth 
 that the best interests of all classes of business — commercial, 
 manufacturing, farming, mining and railroads, lie along 
 
3 
 
 parallel lines, and "that all have a common interest in that 
 which tends to build up and add to the prosperity of the 
 state. 
 
 It has been well said that the prosperity of the farmer 
 is the basis upon which all substantial prosperity rests. 
 
 This is true of Iowa, perhaps, more than of a majority 
 of her sister states, because Iowa depends upon her a^^ricul- 
 tural resources in larger measure for prosperity than almost 
 any other state. 
 
 Farming, like any other business, attracts the attention 
 of those seeking investment, in so far as it promises a fair 
 return for labor performed and capital invested. 
 
 When, on account of competition in foreign market, 
 or scant demand for the product of the farm in the home 
 market the price of these products falls to or below the cost 
 of production, the business not only fails to attract new 
 investors, but those already engaged in it seek an oppor- 
 tunity to get out. 
 
 Next in importance to agriculture as an element of 
 prosperity to the State is the business of manufacturing. I 
 care little what the particular commoditj'^ manufactured may 
 be, whether farm implements, steam engines, cutlery, 
 woolen goods, the product of oil mills or flouring mills, or 
 any of the various industries that gather in the raw material 
 from every direction, and by the employment of labor turn 
 out the finished product. 
 
 The two great classes of business named are inter- 
 dependent. Agriculture is most prosperous in the vicinity 
 of a manufacturing center which furnishes a home market 
 for her products, and the multiplication of such centers in 
 
Iowa, or any other state, is a guarantee of the prosperity of 
 the state'^because it furnishes one of the most important 
 conditions essential to the prosperity of the farmers of the 
 state. 
 
 An exceedingly important requisite precedent to pros- 
 perity is reasonable rates for transportation for the products 
 of the farm from the point of production to the point of 
 consumption, whether local or foreign. 
 
 Another, and no less important factor, is the encour- 
 agement by every legitimate and reasonable means of the 
 investment of capital in enterprises which will employ labor, 
 and to see that nothing is done to discourage or deter the 
 location of new industries of this character, or to hamper or 
 embarrass the liberty of action of these already in existence. 
 
 In this connection I ask you to consider the railroads 
 of the state. These roads are manufacturing bridges and 
 buildings, locomotives and cars. They are manufacturing 
 and selling a commodity called "Transportation," and in 
 this business they employ in the state of Iowa nearly thirty 
 thousand men, furnishing directly a means of livelihood for 
 one hundred and fifty thousand people, and contributing 
 indirectly but substantially to the maintenance of many 
 other thousands. 
 
 For years almost every corporation of any magnitude 
 employing a large amount of capital and furnishing employ- 
 ment to large numbers of men, has been made the foot 
 ball of demagogues of all parties. 
 
 Ostensibly in the interest of the farmer and the labor- 
 ing man legislation has been proposed, and in many cases 
 has found a place on the statute books, which worked dis- 
 aster upon the very interests they sought to serve. 
 
Legislation or agitation which results in deterring 
 capital from embarking in business which will give employ- 
 ment to labor, is tenfold more hurtful to labor and ajjricul- 
 ture than to capital. 
 
 The man with capital to invest may elect whether his 
 money shall be invested in manufacturing enterprises which 
 will probably afford a fair return on the investment, but 
 whether it does or not will furnish employment to labor and 
 bring comfort and happiness to many homes ; or whether it 
 shall be invested in government bonds or other similar 
 securities, or lie idle, as is the case with millions of capital 
 at the present time. , . 
 
 Is there any room for doubt that the influence of the 
 demagogue and the walking delegate has been, and is 
 to-daj', potent in preventing the investment of capital in 
 enterprises which would furnish employment for many of 
 the unemployed of our land ? 
 
 This particular feature of demagogisni has heretofore 
 been peculiar to the cities, and in rare instances to some of 
 the states, but unfortunately it is no longer thus limited. 
 
 A report recently made public by a commission ap- 
 pointed by the United States Government to investigate the 
 great railway strike of last summer, which had its storm 
 center in Chicago, but whose baleful clouds cast a shadow 
 of dread and disaster over the entire country, presents an 
 exhibition of demagogism which should bring a blush of 
 shame to the cheek of every American citizen who loves 
 righteousness and justice. 
 
 The history of that disastrous, uncalled for, and wan- 
 ton strike is familiar to the people of this country. 
 
IiijiuguiHted witliout reason, carried on with the utmost 
 arrogance and recklessness, the leaders of that insane revolt 
 against the peace and good order of this country held every 
 business interest of this broad land by the throat, until 
 compelled by the strong arm of the Government to release 
 its murderous grasp, it slunk back into the haunts of An- 
 archy, whence it came. 
 
 The evidence submitted to this committee was published 
 by the daily press of Chicago at length, and was read with 
 interest by thousands who must wonder at the marvelous 
 exhibition of mental gymnastics, distortion of evidence, and 
 utter disregard of facts which made it possible for this com- 
 mission to virtually acquit Debs and his fellow conspirators, 
 and by inuendo and insinuation attempt to place the 
 responsibility for that strike upon the railroad companies 
 which were the innocent victims of that most infamous boy- 
 cott. 
 
 Unwarranted as this report is in its conclusions, glaring 
 in its injustice, and grotesque in its inconsistencies, its 
 disastrous effect will fall far beyond the interests at which 
 it was directed. 
 
 The ultimate eftect of an attack of this kind is to pre- 
 vent tlie investment of capital in any class of business 
 involving the employment of labor; and in thus restricting 
 the demand for labor the blow falls heaviest upon the very 
 interest the authors pretend to have at heart. 
 
 The state or community will be most prosperous, which 
 ofters the most favorable field for the investment of capital 
 which in turn furnishes employment to labor at remunera- 
 tive wages. 
 
Capital is attracted to those localities where it will find 
 the most freedom, where it will be assured of a friendly wel- 
 come, fair treatment, and the greatest measure of considera- 
 tion, protection and liberty of action. ' : 
 
 In discussing the subject before us this evening, in its 
 especial relation to the State of Iowa, I desire to consider 
 with you three important questions. 
 
 First. Have the railroads done everything that can 
 fairly be expected of them, in furnishing transportation at 
 reasonable rates ? 
 
 Second. Has the State of Iowa done her full duty, in 
 fostering, protecting, and encouraging capital already 
 invested i 
 
 Third. Are present conditions in Iowa such as will 
 attract the investment of new capital ? , 
 
 I have said that the twenty years from 1808 to 1888 
 were years of great prosperity for Iowa. 
 
 Perhaps the Burlington Road may be taken as fairly 
 representing the prosperity, and as an index of the general 
 improvement made by the railroads of the State during that 
 period. 
 
 Ten important braches of the Burlington Road were 
 constructed in Iowa, and something more than seventy 
 miles of the main line was double tracked. Great shops for 
 the construction and repair of locomotives and cars, giving 
 employment to hundreds of men, were built at West Bur- 
 lington and Creston. Grades were reduced, iron rail was 
 replaced with steel, and permanent structures of masonry 
 and steel were substituted for the old wooden bridges. 
 Passenger stations, commodious and complete, and a credit 
 to the State as well as to the cities they served, were built 
 
8 
 
 at Burlington and Ottumwa. Estimates were made and 
 plans perfected for extensive additions to the double track, 
 for new passenger stations at principal points, and for re- 
 modelling and modernizing some of the more important 
 yards. ,< • 
 
 This work of improvement was continuous up to the 
 year 1888. During the year 1887 there was spent on the 
 line of the Chicago, Burlington & Quincy in Iowa in the 
 neighborhood of three hundred and fifty thousand dollars in 
 permanent improvements. This amount was in addition to 
 ordinary repairs, and did not come out of the earnings of 
 the road. It was new money sent to Iowa from New 
 England to be paid cut for labor and material in making 
 improvement?. 
 
 In September 1887 the pay rolls of the Burlington 
 Road showed 5,216 men employed in Iowa; in addition to 
 this there were fully two thousand more men employed by 
 contractors who were doing work for the road. The large 
 stone quarries at Dudley and Mount Pleasant were running 
 full handed, furnishing stone for bridges, buildings and 
 ballast, giving employment to scores of men and teams. 
 
 In September, 1894, the pay-rolls show 3,556 men in 
 the service, and I doubt if there has been as much money 
 spent on the Burlington Road in Iowa for improvements, 
 during the six years from 1888 to 1894 inclusive, as was 
 expended in six months during the year 1887. 
 
 For six years the tools of the Iowa contractor have lain 
 idle, the cranes and derricks in the quarries have grown 
 rusty, standing lonely and silent, grim reminders of a time 
 of past activity and prosperity. 
 
9 
 
 These were the evidences of prosperity so far as the 
 railroads were concerned prior to 1888, and while enjoying 
 this season of prosperity, the reports of the railroad com- 
 missiopcrd will show that these roads were contributing in 
 no small measure to the general prosperity of the state, and 
 especially to that of the farmer. 
 
 In the fourth annua report of the board of railroad 
 cemmissioners, on page eight, will be found an extremely 
 interesting table, showing the freight charges and reductions 
 in the same, on fifteen of the most important lines of trans- 
 portation in the United States, including the Erie Canal and 
 the lollowinglowa railroads : The Chicago. Burlington and 
 Quincy ; Chicago, Kock Island and Pacific ; Chicago and 
 Northwestern ; Chicago, Milwaukee and St. Paul ; Burling- 
 ton, Cedar Rapids and Northern ; Illinois Central, and the 
 Central Iowa. 
 
 The period covered by this table is from 1868 to 1&78, 
 and referring to the same the report says : 
 
 "A careful study of the foregoing table will 
 that show the fourteen railroad lines mentioned 
 have, almost without exception, steadily reduced 
 their rates in a substantially fixed ratio during 
 all the successive years from 1868 to 1878 inclusive. 
 The few exceptions to this rule, as previously 
 mentioned, show the slight average increase of 
 only nine-hundredths of a cent per ton per mile 
 — an increase which bears but a slender ratio to 
 the inc" case in the cost of labor, supplies and all 
 forms of material entering into railroad use. In 
 the average the Erie Canal rates show a decrease 
 of 44 per cent from the rates of 1868. The New 
 York Central and the Lake Shore and Michigan 
 Southern, which are practically one continuous 
 line of railroad, and the Chicago, Burlington and 
 Qaincy, show the greatest decrease in charges, 
 
10 
 
 to wit, 68 per cent. The Michigan Central comes 
 next, QQ per cent ; the Boston and Albany, the 
 Chicago, Rock Island and Pacific, the Chicago and 
 Northwestern, the Pennsylvania, and the New 
 York, Lake Erie and Western following in the order 
 named. The average per cent of decrease in the 
 Illinois Central charges, as shown in the four years 
 noted in the table, is found to be equal to those 
 showing the largest decrease for the thirteen years 
 of their exhibits respectively. Another fact prom- 
 inently appears in this table, which is that the 
 largest ratio of decrease has been made during 
 the last five years, more in the average than dur- 
 ing the preceding eight years. From all these 
 deductions it is evident that the cost of transport- 
 ing the great bulk of all the food productions, 
 and lumber, coal, manufactures, merchandise, and 
 indeed of everything moved by rail, is steadily 
 undergoing a marked decrease from year to year, 
 the reduction of the last four or five years being 
 equal in the average of the largest made by any 
 company during the whole time coere<l by the 
 table. Besides this exhibit of decrease in present 
 charges as compared with those of a series of 
 former years, we are enabled to state that the aver- 
 age of the present rate per ton per mile is lower 
 than the rate fixed by the government in Bavaria 
 on grain shipped from Austria-Hungary and from 
 Bavaria to Switzerland and the Rhine. These 
 lines are government railways, and the rates are 
 therefore fixed by the government authorities, and 
 are presumably as near cost as can well be 
 made. This rate on grain is 1.42 cents per ton 
 per mile, while the average on all traffic of the 
 fourteen railroads named in the foregoing paper is 
 1.34 cents per ton per mile. As the latter is the 
 average upon ti'offlc of all kfnd.% and as it is lower 
 than the Bavarian government rate on grain, the 
 comparison will appear all the more striking. As 
 the population per square mile of Bavaria is much 
 greater than the average of the American states 
 
11 
 
 through which the roads ii tuned in the table pass, 
 still greater emphasis will be given to the coinpari 
 sons. The Bavarian rate is equivalent to a rate 
 of 67 cents per cwt. from Chicago to New York." 
 
 As bearing upon this subject of reduced rates during 
 the past few years the ( hief of the national bureau of sta- 
 tistics, in his report just issued, uses this language : 
 
 " It is impossible to estimate the magnitude 
 of the benefits which the reductions made in charges 
 for transportation on railroads have conferred upon 
 the interest of Pirriculture, of mining and of com- 
 merce. That the increase in the value of the 
 domestic exports of the United States to foreign 
 countries from 1442,820,178 during the year ended 
 June 30th, 1871, to $902,319,473 during the year 
 ended June 30th, 1881, has been large!}' due to 
 such reductions, is evident from the fact that such 
 exports are chietly the products of the western and 
 northwestern states, a large proportion of which 
 is transported to the seaboard on railroads." 
 
 Again on page fifty of the same report we find the fol- 
 lowing reference to this remarkable reduction in railway 
 rates : 
 
 '' It may not be amiss right here to ask what 
 are the results of this steady reduction of railroad 
 charges i Some hints of the savings in whole may 
 be gathered from a calculation of the savings on 
 our exports of grain, meat and dairy products. A 
 careful statistician, Hon. Edward Atkinson, of 
 Boston, puts the grain and meat product for export 
 in 1880, qf these northwestern states, which finds 
 its first market in Chicago, at eight million tons. 
 The average distance from those states to the sea- 
 board he estimates at thirteen hundred miles. The 
 reduction in rates from 1860 on the transportation 
 lines by which this body of produce is carried to 
 the seaboard, is shown to have been fully one 
 cent per ton per mile. The saving, therefore, is 
 
seen to reach the enormous sum of one hundred 
 and four millions of dollars. But as the rate of 
 1860 partook somewhat of ihe high prices of every- 
 thing for the three or four years following the war, 
 let uc- take the time from January 1st, 1874. Pres- 
 ent rates in the average from the point of produc- 
 tion to the seaboard have been reduced half a 
 cent per ton per mile, which affords a net saving 
 of lifty-two millions of dollars on the exported 
 portion of tiie grain, meat and dairy product of 
 the northwest for the year 1880. 
 
 "The same authority puts the value of these 
 exported products at 1389,000,000. The saving 
 in the cost of rail transportation, therefore, at a 
 half a cent per ton per mile, on this body of ex- 
 ports, amounts to a fraction more than thirteen 
 and one-third per cent of their total value. We 
 think it safe to say that one-sixth of this saving 
 passed to the credit of Iowa producers — over eight 
 millions of dollars on our exported grain, meat and 
 dairy product for the year 1880. 
 
 "In concluding this branch of the report the 
 commissioners venture to assert that freight is 
 now carried at a rate w hich no competent railway 
 manager or transportation expert would have 
 thought possible half a dozen years ago. The 
 public everywhere will welcome the facts and 
 from them learn to value the means by which 
 they have been obtained. Great confidence must 
 also be felt in the continued operation of these 
 effective forces. While it is true that the reduced 
 rates are more marked on the long hauls between 
 the points of production and consumption — the 
 farm and the seaboard, the factory and the con- 
 sumer, the jobber and the retailer — it will not 
 be forgotten that these through hauls comprise 
 over eighty per cent of the entire volume of 
 Iowa's rail transportation. We have devoted con- 
 siderable space, time and work to this subject of 
 tariff rates and reductions, but we are confident 
 
.13 
 
 that the exhibit will be found of great value alike 
 for reference and instruction upon a branch of 
 the "railway problem" less understood perhaps 
 among the mass than any other on which they seek 
 information.'' 
 
 This was the condition in 1880, Notwithstanding the 
 fact that there had been an increase in the cost of labor, 
 supplies, and all other forms of material entering into rail- 
 road use, in ten years freight rates on the Chicago, Burling- 
 ton & Quincy Railroad had been reduced sixty-eight per 
 cent. ; ■ : 
 
 Let us briefly compare the rates from various important 
 stations on the Chicago, Burlington & Quincy Eailroad in 
 Iowa with rates on farm products from those stations eight 
 years later. .: ; ; ; v a;>v ■ 
 
 In 1880 the rates from Farragut, Shenandoah, Red 
 Oak, Glenwood and other stations in Western Iowa to 
 Chicago, on a thirty-foot car of cattle was $70.00. The 
 rate in 1888 was $47.50, a reduction of 122.50 per car. 
 The charges on a thirty-foot car of hogs from the stations 
 named to Chicago, in 1880, was $70.00. Eight years later 
 the charges on the same car was $37.50, a reduction of 
 $32.50 per car. The rate on wheat from these stations to 
 Chicago in 1880 was 33 cents per hundred pounds. The 
 rate in 1888 was 23 cents per hundred pounds, ejecting a 
 reduction of $30.00 on a thirty thousand pounds capacity car. 
 
 On corn, oats and other grain the rate in 1880 was 28 
 cents per hundred pounds. This rate in 1888 has been 
 reduced to 18 cents per hundred pounds, making a reduc- 
 tion of $30.00 per car on a carload of thirty thousand 
 pounds. 
 
14 
 
 The thirty-foot stock car aucl the thirty thousand pounds 
 capacity grain car is taken as a basis for comparison, as the 
 former was the maximum length of stock car and the latter 
 the maximum capacity of grain car for some years after 
 1870. 
 
 Rates from all other stations in Iowa were reduced in 
 like ratio. 
 
 In his inaugural address, delivered January 4th, 1886, 
 Governor Larrabee confirmed the report of the railroad 
 commission in the following reference to the railroads of the 
 state : 
 
 "It has been the policy of this state to 
 encourage the construction of railroads. The 
 wisdom of this policy is evinced by the rapid 
 growth of the system and the great benefits 
 arising from it to the various interests of our 
 people. 
 
 "We have at the present time over 7,520 
 miles of railway in operation, yet our people 
 will hardly be satisfied until every township in 
 the state is intersected by the rail. 
 
 "Many perplexing questions are constantly 
 arising between individuals and the manage- 
 ment of railroad companies. 
 
 "After experimenting with much profit in past 
 years as to the proper method of dealing with 
 them, we adopted the commissioner system. It 
 has fully answered our expectations, the board 
 having rendered valuable service to the people 
 by vigilant and careful attention to their griev- 
 ances. 
 
 "Largely through the efltbrts of this Board, 
 the rates of transportation have been materially 
 reduced. Many differences are now settled with 
 little or no expense to the person aggrieved, and 
 
15 
 
 . the individual is no longer compelled to resort to 
 
 the courts to secure the correction of abuses and 
 
 impositions. Friction between the railroads and 
 
 the people is less and less each year, as the work 
 
 of the commission is better understood," 
 
 «■ 
 In the light of this eminently fair and conservative 
 
 statement of the relations which existed between the 
 people and the railroads of the state in 1886. and in view of 
 the statistics submitted and the conchisions reached by the 
 commissioners, as set forth in the report quoted, the utter- 
 ances of another important state paper, made public only 
 two years later, are astounding. '' 
 
 In his inaugural address, delivered on January 12th, 
 1888, the (Governor referred briefly to the subject of intem- 
 perance, free ballot, pensions, etc., but the major portion 
 of the document was devoted to a denunciation of the rail- 
 roads of the state, their owners and managers, which, for 
 unmeasured severity and cruel injustice, has never been 
 equalled in any State paper. 
 
 • A quotation or two will serve to show the spirit in 
 which it is written. 
 
 Referring to the railroads of the State, the Governor 
 
 said : 
 
 " Railroads have usurped powers dangerous 
 to the public welfare, and have practiced extortions 
 perhaps less cruel, but in the aggregate more 
 gigantic, than those of the British landlord." 
 
 In speaking of the managers of Iowa railroads, the 
 Governor likened them to Grecian pirates, who ''ravaged 
 villages and plundered unfortified places." 
 
 In the same paper, and in connection with a recom- 
 mendation that "the board of railroad commissioners be 
 
16 
 
 authorized and required to exercise full and complete super- 
 vision over the railroads of the state," the governor said : 
 
 ''This board has been looked upon by the rail- 
 roads as a tribunal, clothed with judicial powers, 
 and charged with the duty of protecting the 
 interests of the people and the railroads alike. 
 This, however, is an erroneous conception of their 
 functions. The railroad commission was created 
 to be a committee of the people, obligated to advo- 
 cate their rights. Organized capital can safely be 
 trusted to defend itself." 
 
 Coincident with the enunciation of this interpretation 
 of the duties of the commission, the powers of the Board 
 were increased to the extent of placing in their hands com- 
 pletely the revenue earning capacity of the railroads of 
 the state. 
 
 Clothed with absolute power to fix rates, make classifi- 
 cations, and to decide controversies of all kinds, from 
 which decision there was no appeal, this tribunal was 
 admonished by the highest authority in the state that it was 
 no part of its duty to consider the interests of the railroad, 
 but in all controversies that might be submitted for decision, 
 the commission was to consider itself the advocate of one 
 party, and to ignore the claims and rights of the other. 
 
 I would discredit the intelligence, as well as the sense 
 of justice of th'8 audience, if I assumed that anything fur- 
 ther than a plain statement of the proposition was necessary 
 in order to show its injustice to the railroads of Iowa. 
 
 If the statistics submitted by the railrord commission 
 are correct, showing as they do a steady and most mar- 
 velous decrease in railroad rates from 1868 to 1878, and if 
 the figures given showing a further reduction of from 
 thirty-three to fifty per cent in the decade from 1878 to 
 
17 
 
 1888, are correct, (and I know from personal investigation 
 that they are), it is liard to understand the hiter utterances 
 of the Governor, and impossible to justify them by 
 the record. 
 
 The sensitiveness and timidity of capital is proverbial; 
 let a shadow of doubt or suspicion be cast upon a bank, and 
 how quickly its coffers are depleted. 
 
 Suggest a doubt as to the safety of any enterprise, and 
 how thoroughly it will be analyzed and investigated before 
 capital will venture to take hold of it. 
 
 Capital keeps in close and sympathetic touch. If 
 investments in any particular line of business, in any state 
 or community are placed in jeopardy, capital becomes 
 alarmed and is reluctant and slow to invest in any enter- 
 prise. 
 
 Iowa railroads are owned almost entirely by Eastern 
 people. Not by capitalists entirely, in the common accept- 
 ance of the term. For instance, the Chicago, Burlington 
 & Quincy Railroad is owned by something more than 
 twelve thousand individuals. Out of thisnumber more than 
 eight thousand people own only fifty shares of the stock, or 
 less, each. Fifty shares at par represents five thousand 
 dollars ; at the present price of the stock it represents about 
 thirty-five hufidred dollars. 
 
 The utterances of Iowa's chief executive were published 
 far and wide. The Associated Press carried them to every 
 city and hamlet in New England and the eastern states; the 
 sentiments expressed were accepted as the sentiments of the 
 businees men and the farmers of Iowa. 
 
 Is it strange that citizens of New England who had 
 invested their money in Iowa railroads, viewed the situation 
 
If 
 
 with apprehension as to what the t'utiiie tni^ht have in store 
 for them '( 
 
 Would it be 8trang;e it" capital seeking safe and profit- 
 able investment should avoid a state where such a spirit was 
 supposed to predominate ? 
 
 As a citizen of tiie state of Iowa at that time, I know 
 that the people of this great state did not intend to deal 
 liarshlj or unjustly by her railroads. From a citizenship of 
 more than thirty-live years I know that wliile the people of 
 Iowa are jealous of their rights, and tenacious in maintain- 
 ing them, they respect and hold sacred the rights of others 
 and do not intentionally infringe thereon. 
 
 I am constrained to believe, however, that because of 
 the impression that has gone out, that the prevailing senti- 
 ment in Iowa is hostile to her railroads, and that money 
 invested here will be subjected to greater risk because 
 accorded less freedom than in neighboring states, that cap- 
 ital is being deterred from coming to Iowa for investment. 
 
 I believe that experience has demonstrated that the law 
 enacted b}' the Twenty-second General Assembly, imposes 
 many restrictions upon the raih-oads of Iowa, which it would 
 be for the best interests of the state to remove. 
 
 One of the principles of trade which is thoroughly es- 
 tablished in commercial transactions everywhere, is the 
 wholesale and retail principle. A lower price is expected 
 by the purchaser and conceded by the seller when the trans- 
 action is large than when it is small. The hardware mer- 
 chant, be he jobber or a retailer, can, and does make a 
 lower price per keg on nails when he sells one hundred kegs 
 than when he sells a single keg. 
 
1J» 
 
 This principle is not only a commercial practice but a 
 commercial neccessity. Without it the jobbing interests of 
 Iowa or any other state could not exist. 
 
 In h)cating new industries, and in extending necessary 
 aid and encouragement to those already in existence, the 
 right to a})ply this priiiciple to its business is extremely 
 important to the railroad and no less important to the state. 
 The cost of securing twenty-five carloads of freight from 
 one shipper, is less than that of securing twenty-five car- 
 loads from twenty-five different shippers, and the cost of 
 performing the service may be materially less. 
 
 The man who ships one or more cars per day every 
 day i 1 the year may reasonably ask, and the circumstances 
 and conditions may be such as to justify the railroad in 
 granting a lower rate per car than is given a shipper who 
 ships but one car in a year. Indeed the conditions may be 
 such that not only the success, but the very existence of 
 enterprises valuable to the communities Avhere located, 
 and an important element in the prosperity of the state 
 may depend upon securing such special concessions from 
 the railroad. 
 
 Is it not a question worthy of serious consideration 
 whether it is necessary or expedient for the state of Iowa to 
 prohibit her railroads from doing that which is frequently 
 essential, and which may be vital to success in other lines 
 of business? 
 
 In this connection I desire to again quote briefly from 
 the Fifth Annual Report of the Board of Railroad Commis- 
 sioners of Iowa, 
 
20 
 
 On paije thirtj-five, and reforrin<ij to the question of 
 
 special rates, Ave tind the following : 
 
 • " Factories located in Iowa, making farm 
 
 machinery, require low rates on raw material 
 that will enable them to compete in Iowa with 
 the same products manufactured in states further 
 east where material is cheaper. This principle is 
 at the basis of all manufacturing in Iowa, and 
 interference with it beyond tlie insistence on like 
 rates, for like customers, for like uses, would stop 
 most of the wheels in the state." 
 
 Again on page forty-five of the same report : 
 
 "If the manufacturing interests of Iowa are 
 developed to any great degree, it must be by the 
 extension to them of special rates, and the only 
 way in which an Iowa manufacturer can succeed, 
 is by special rates to enable him to meet his com- 
 petitors on equal terms. If the oat meal manu- 
 facturers of Central Iowa, as they have done 
 recently, can place their goods in London and 
 Glasgow for fitty cents per hundred pounds, they 
 can compete with the Scotchman on his own 
 ground and in his own product. Otherwise the 
 oats must be fed to stock at home in the place of 
 cheaper food. The railroads get their support 
 from the communities and interests they help build 
 up, and no other industry sufiers if under similar 
 circumstances all are treated alike." 
 
 During the past five years there has been a considerable 
 movement of manufacturing interests from the eastern and 
 middle states to the west. 
 
 The development of the iron and coal mines, the open- 
 ing up of the great timber resources of the south, and the 
 desire to locate nearer the territory where the finished pro- 
 duct of the factory will find a market, will bring to the val- 
 leys of the Mississippi and the Missouri, in the years to come, 
 many of the large factories now located in the east. 
 
21 
 
 Recognizing this, western railroads arc estiibllshiiig 
 '• Industrial Bureaus" tor tlie ])iirpose of securing the loca- 
 tion of as many of these manufacturing ])IantH as j)ossible 
 upon the line of their roads. 
 
 The officer at the head of this department ujakes it his 
 business to keep in touch with eastern enterprises that con- 
 template moving, keeps fully ])08ted as to the necessities 
 and advantages of the various points on his line of railroad, 
 and is prepared to furnish every possible facility for investi- 
 gation, and to offer every reasonable and legitimate induce- 
 ment to secure the location of the plant. 
 
 No person can estimate the importance of securing as 
 many of these industries as possible; every factory located 
 in Iowa employing a large number of men, means an addi- 
 tional demand for the product of the farm. It means 
 increased trade in your stores ; it means more citizens, 
 more homes, and increased prosperity in every avenue of 
 trade. 
 
 I wonder how many citizens of Iowa realize fully how 
 serious a handicap is placed upon this state, in her competi. 
 tion with surrounding states for the location of enterprises 
 of this character, by the operation of the law referred to. 
 
 I believe I am safe in saying that when a manufactur- 
 ing establishment contemplates a change of location, in a 
 large majority of cases the party charged with the selection 
 of a favorable place to locate, visits first, the general office 
 of the railroad company upon whose line of road he would 
 like to locate, if conditions were found to be satisfactory. 
 
 Suppose a representative of a concern of this character 
 calls at the office of one of the great western railroads in 
 Chicaso. After getting all the information he desires, 
 
22 
 
 touching tlie location under consideration, he says : "If we 
 shall decide to locate at this point, we will require several 
 hundred carloads of material, stone, brick, lumber, machin- 
 ery, etc. What can you do for us in the way of reduced 
 rates on this material V If the proposed location happens 
 to be in Illinois, Missouri, Wisconsin, Minnesota, Kansas 
 or Nebraska, the reply will probably be that the road will 
 very gladly make any reasonable concession in that direc- 
 tion, and a satisfactory understanding will be reached with 
 little delay. 
 
 If the proposed location is in Iowa, however, the reply 
 must be: "I am very sorry, Sir, but a law was passed in 
 Iowa a few years ago which prohibits doing anything of 
 this kind, except by specific authority or permission from the 
 Kailroad Commissioners. " 
 
 This information would very likely suggest some further 
 inquiries on the part of the representative of the manu- 
 facturing concern, perhaps as follows: "Well how about our 
 manufactured goods ? We shall be a new enterprise with 
 our trade to build up. Can you, at least until we can es- 
 tablish ourselves, promise us a favorable rate for distributing 
 our product ?" 
 
 The only reply possible would be a quotation of the 
 regular carload rate. 
 
 "But," the gentleman would say, "We shall probably 
 ship five, ten, or perhaps twenty carloads per day the year 
 round, and should certainly be entitled to some consider 
 ation on account of the amount of business we will give 
 you." To this the reply must be that, under the Iowa law, 
 he who ships five thousand carloads of freight in a year 
 must, regardless of circumstances or conditions^ pay as 
 
23 ,.'.-v.--- 
 
 much per carload as he who ships but one carload per year. 
 These conditions are discouraging to the manufacturer seek- 
 ing a location, and no less so to the representative of a 
 railroad who desires to locate the enterprise on his line. 
 
 The case would be stated reluctantly and regretfully, 
 but it must be explained in just this way to every person 
 who, under these circumstances, seeks information. 
 
 These conditions are in direct violation of the laws of 
 business everywhere, but unfortunately for the state, it is the 
 law of Iowa, and no person can estimate the extent to which it 
 operates against the growth and prosperity of the state. 
 
 These conditions, which obtain in no other state, are not 
 only contrary to established laws of business, but are opposed 
 in letter and in spirit to the recommendations of the Board 
 of Railroad Commissioners of the state. 
 
 On page fifty-nine of the Ninth Annual Report of the 
 Hoard, in closing one of the fairest, ablest and most com- 
 prehensive reports ever made by the Board, we find the 
 following reference to rates and conditions in Iowa. 
 
 The sentiments expressed must commend themselves 
 to every thoughtful student of the subject, to every practical 
 business man, and, in the light or subsequent events the 
 utterances seem almost prophetic. 
 
 In referring to the question of the flexibility of rates 
 the commission says : 
 
 " We use the word '•flexibility' in reference 
 to rates of freight carriage. The term is chosen 
 advisedly. Underlying all that is said and written 
 on the subject of rebates, discrimination and 
 special rates by those outside of railroad interests, 
 and in one sense antagonistic to them, it is a com- 
 
24 
 
 mendable desire for fair and equal treatment by 
 railroads of all its patrons, but the trouble is there 
 is a misapprehension on the part of many as to 
 the true meaning and intent of these terms. The 
 general idea is that everything especially in its class 
 shall be carried the same distance for the same 
 price, no matter what the condittons might other- 
 wise be. Hence legislation is asked fixing rates 
 and with severe penalties attached for violation. 
 To our minds this is an impossibility, and at the 
 same time the very thing the people themselves do 
 not want. There is scarcely a community in our 
 state where are not diverse and varied enterprises 
 that must have different treatment from railways in 
 order to live, and the best good of these communi- 
 ties demands their continued existence. Indeed the 
 great agricultural interests of the state, that on 
 which our prosperity depends, demands and 
 receives at the hands of transportation companies 
 discriminating and special rates." 
 
 "There are a thousand and one industries and 
 enterprises among us which go to add to our general 
 prosperity which could not have come into exist- 
 ence, or been sustained at all, only by special rates 
 given them by carriers. These special rates injure 
 no one else nor any other industry. They are a 
 help to the men engaged in them, to the railways 
 and to the people at large. In our opinion the 
 time will come when the people will see that the 
 true rule by which to treat railways will be to give 
 them the widest and freest liberty to adapt their 
 rates to the ever-varying circumstances of the 
 growing and constantly changing conditions of the 
 people; that all the special rates made in accord- 
 ance with the necessities of the cases demanding 
 them be as public as their time cards, and whenever 
 this broad liberty is prostituted to the favoring of 
 persons and places as against others, such abuse or 
 complaint of same shall be subject to the investi- 
 gation of a competent commission having the 
 general supervision of the railways." 
 
25 
 
 This report was signed by Feter A. Dej, James W. 
 McDill and Lorenzo S. Coffin. 
 
 The State of Iowa has been uniformly fort'in^te in 
 having upon its railroad commission citizens of high char- 
 acter and acknowledged ability. 
 
 I detract nothing from the character and standing of 
 any preceeding or succeeding Board, when I say that the 
 high reputation of the gentlemen named, in their capacity 
 of Railroad Commissioners, was not confined to the State 
 of Iowa. 
 
 Two of them remain with us, honored citizens of the 
 state. Judge McDill died while filling an honorable posi- 
 tion upon the Railroad Commission of the nation. His 
 name and memory will be cherished and honored so long as 
 loyalty, integrity and faithfulness to duty are remembered 
 by the people of the state he loved so well, and served so 
 faithfully. 
 
 These words of advice, and perhaps of warning, 
 spoken to the people of Iowa a little more than eight years 
 ago, have by the logic of events been confirmed, verified 
 and emphasized, and I submit to-night whether it is not the 
 part of wisdom in the interest, not of the railroads alone, 
 but looking to the upbuilding and prosperity of all the 
 varied interests of the state, to carefully inquire whether 
 the restraints imposed upon the railroads of the state are 
 not of such a character as to not only cripple the railroads 
 but also to discourage, if not to absolutely prevent the 
 establishment of many new enterprises. Has not the time 
 "come when the people will see that the true rule by which 
 to treat the railways will be to give them the widest and 
 freest liberty to adapt tkeir rates to the ever-changing con- 
 
26 
 
 ditions of the people V I believe that if the restrictions 
 which so seriously hedge about and hamper the railroads of 
 Iowa, and which are certainly calculated to discourage and 
 deter the investment of capital in other enterprises in the 
 state, can be modified or removed, that every railroad 
 within her borders will co-operate heartily, intelligently 
 and successfully with all her other interests, in bringing 
 back to Iowa a new and substantial era of prosperity. 
 
 The railroads of Iowa are citizens of the state ; they 
 form an important part of the value of the state. Many of 
 them were pioneers in opening up and developing her 
 resources. The interests of the railroads are inseparably 
 interwoven with those of every other enterprise in the state. 
 The railroads prosper when the state is prosperous, and suffer 
 with all other interests in times of adversity. Self interest 
 will impel the railroads to foster, encourage and build up in 
 every possible way every business interest in the state. 
 
 These roads are interested in and desire that which will 
 securest© Iowa throughout all her borders the most abundant 
 measure of prosperity. If this will be the ultimate result 
 of the law, it should not be changed, even though tempora- 
 rily it be detrimental to the interests of the railroads. 
 
 If, on the other hand, the maintenance of the law will 
 ultimately prove detrimental to the progress and prosperity 
 of the state, it should be modified or repealed, even though 
 such action may, for the time being, be adverse to the inter- 
 ests of some particular class of business. 
 
 Neither the railroad, or any other business or interest, 
 can afford to avail itself of a temporary advantage which 
 will in the end contravene the h4kt interests of the State. 
 
27 
 
 Either can well afford to suffer temporary adversity if 
 it shall result in the substantial and permanent prosperity of 
 the commonwealth. 
 
 The highest measure of prosperity for the railroads of 
 Iowa will have been reached when every city, every village 
 and every farm in the State has attained the highest limit 
 of prosperity possible. 
 
 From its earliest dawning upon the pine-clad hills of 
 New England, until, its latest rays illumine and glorify the 
 Golden Gateway to the Pacific, the sun shines upon no land 
 more beautiful or possessing greater natural advantages or 
 attractions than this goodly State of Iowa. 
 
 Sprung from that sturdy New England stock that first 
 kindled the fires of religious, political, and commercial lib- 
 erty upon this western continent, the people of Iowa, in 
 their love of liberty, godliness, and justice, are the flower 
 and fruitage of four centuries of American civilization. 
 
 The history of the State is at once a precious heritage, 
 and an inspiration for ourselves, and for all future genera- 
 tions. 
 
 Give her the same opportunities, remove artificial and 
 hurtful restrictions, and this grand old Hawkeye State will 
 not be second to any other state in the Union, in the grand 
 march of Progress and Prosperity which is the destiny of this 
 great Nation.