. FUNDAMENTAL CONDITIONS 13 



many of these abuses were due to the fact that the railroads 

 were owned and controlled by men who lived in the East or in 

 Europe. " Absentee ownership " was the term used and it was 

 maintained that the stockholders and directors were far less 

 amenable to public opinion than would have been the case had 

 they been residents of the affected districts. 1 



Complaint was also made of the influence which was exercised 

 by the railroad corporations over legislators and public officials. 

 The most generally prevalent form of this influence was the 

 free pass system, by which all public officials from the highest 

 judges to the local selectmen received free transportation for 

 themselves and their families over the lines of interested rail- 

 roads. To say that no return was expected from this munif- 

 icence is absurd. Even if direct services were not desired, 

 it was intended that a frame of mind should be created which 

 would prevent unfavorable treatment by the public officials. 

 But the corporations did not stop with passes, and bribery 

 appears to have flourished in more subtle forms, such as the 

 transfer of valuable stock to legislators at a price much below the 

 market value, and that to be paid out of the dividends. This 

 is said to have been the case in the famous Credit MobUier 

 scandal in Congress, an investigation of which revealed the 

 purpose of preventing any unfriendly legislation, by distributing 

 stock among members of Congress. 2 



It was in the shape of rates or tariffs, however, that the rail- 

 road problem was most closely brought home to the farmer. 

 The charges preferred were that railroad rates in general were 



384, xxxii. 509-512 (March, October, 1873); Adams, in North American Review, 

 cxx. 402-404 (April, 1875); Martin, Grange Movement, ch. iv; Paine, Granger Move- 

 ment in Illinois, 18; S. L. Clemens and C. D. Warner, The Gilded Age (Hartford, 

 1874), 264-269. 



1 Illinois Railroad Commission, Reports, 1874, p. 17; Adams, in North American 

 Review, cxx. 398-402 (April, 1875); Cook, Corporation Problem, 16; Paine, Granger 

 Movement in Illinois, 17. 



2 J. F. Rhodes, History of the United States since the Compromise of 1850, vii. 

 1-19; Nation, xix. 36 (July 16, 1875); Illinois State Grange, Proceedings, iv. 103 

 (1875); House Reports, 42 Cong., 3 sess., no. 77; W. A. Dunning, Reconstruction, 

 Political and Economic, 231-233; Larrabee, Railroad Question, 205-230; Martin, 

 Grange Movement, chs. vii, viii. 



