During President Theodore Roosevelt’s second term (March 4, 1905—March 4, 1909) the major developments regarding federal regulation of railroads were congressional enactment of the Hepburn Act in 1906 and proposed increases in such freight rates in 1907-1908.
The main provision of the Hepburn Act empowered the Interstate Commerce Commission to impose “just and reasonable” freight rates while banning rebates and preferential rates.The debate over this legislation and its terms were covered in prior posts.[1]
Now we look at the controversy over proposed increases in such freight rates in 1908.[2]
Following the Financial Panic of late 1907 [3] and the continued economic recession in the first half of 1908, railroads felt pressured by Roosevelt not to cut wages while believing they could raise profits only by raising freight rates. As a result, some roads announced such increases. Roosevelt did not like this, especially in advance of the November 1908 presidential election.
During this new battle over freight rates, President Roosevelt met at the White House with W. C. Brown, now the Senior Vice President of the New York Central Railroad and my great-great uncle, who through letters and speeches had been the most vocal advocate for raising rates. Indeed, Brown provided the President with a collection of Brown’s speeches and other materials, Freight Rates and Railway Conditions. One was the Freight Rate Primer, which in comic-book form argued that an increase in rates would have minimal impact on the common man. Comic Book Propaganda!
Afterwards in an August 6, 1908, letter, Roosevelt told Brown that raising rates just before the election was very unwise, and instead the issue should be addressed later “purely on its merits.”
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[1] See these posts to dwkcommentaries.com: Federal Regulation of the Railroads in U.S. President Theodore Roosevelt’s Second Term (1905-1909): Introduction (Aug. 19, 2014); Federal Regulation of the Railroads in U.S. President Theodore Roosevelt’s Second Term (1905-1909): The Hepburn Act (Aug. 29, 2014); Reactions to the Hepburn Act Regarding Railroads’ Freight Rates, July-December 1906 (Sept. 8, 2014); Public Debate About U.S. Regulation of Railroads, January-May 1907 (Sept. 12, 2014); President Theodore Roosevelt’s “Decoration Day” Speech About the Railroads (May 30, 1907) (Sept. 14, 2014).
[2] See Edmund Morris, Theodore Rex (Random House; New York; 2001).
[3] See U.S. President Roosevelt’s Second Term: The Economy and Securities Markets of 1906-1907, dwkcommentaries.com (Sept. 11, 2014).
