382 THE POPULAR SCIENCE MONTHLY 



have frequently been dominated by the public service corporations. The 

 story related of a member of the Pennsylvania legislature, who, on a 

 certain occasion, moved that if the Pennsylvania railroad has no more 

 business to transact, the legislature do now adjourn, is typical of a situ- 

 ation that has been more or less general. If the railway and other cor- 

 porations have not always been treated fairly by the public, it has some- 

 times been because the corporations by pressing their advantage too far 

 have brought about a revolt from corporate rule. A high financial 

 authority, The Commercial and Financial Chronicle, seldom co m mends 

 the tendency of government to interfere with business. It maintains 

 that the railways have not been getting fair treatment at the hands of 

 the Interstate Commerce Commission. But concerning state regulation 

 of rates, it remarks : 



Immediately preceding the panic of 1907 the states were very active for a 

 time in reducing rates, but as soon as railroad revenues commenced to fall off, the 

 States began to see the logic of the situation and in most cases changed their 

 policy. They desisted from further attacks on the railroads. The local news- 

 papers came to the rescue and pointed out how seriously the railroads were 

 suffering and how detrimental to the best interests of the State this was. Popular 

 sentiment changed and attacks upon the railroads in large measure ceased. Thus 

 it was demonstrated that, after all, the railroads had little to fear from State 

 action.30 



One of the important functions of corporations, according to Pro- 

 fessor Burgess, is to save the people from paternalism by acting as a 

 makeweight against the state. 31 There can be no doubt that corpora- 

 tions serve this purpose. By enabling individuals to combine their 

 several resources and talents, they preempt a large field for individual 

 enterprise which only the state would otherwise be equal to undertake. 

 But it is an open question whether this will prove true in the long run, 

 so strong is the political influence which corporations can bring to bear 

 against the public interest. The problem of keeping corporate action 

 within proper bounds is so difficult that the upshot may be that the state 

 will be driven to take over certain industries and run them on its own 

 account. 



so June 14, 1913, p. 1657. 



{To be continued) 



3i Op. cit., pp. 203-204. 



