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I say to you that as between the Congress of the United States and the Legislatures of these states, the states have always guarded themselves by first passing railroad legislation controlling them, and in every other manner conserving what they believe is for the best interests of their states. I say there can be no danger of monopolistic control of water rights. Why do I say that? I say it because under the law of every state in the Union, the transmission of electricity becomes the subject of a public utility commission that can control it. (Applause.) They are nothing but common carriers; that is all; and consequently, when in the state of Colorado it would be attempted to charge an exorbitant rate, we find that conditions will arise by which the Commission in Colorado will say, just like the County Commissioners in the case of water for irrigation, “you cannot charge more than a certain amount.” It may be that in this broad domain there has been some development of water power, but there has been very little in the state of Colorado. There has been very little because of the fact that it has been attempted to make a charge by virtue of a lease provision, by which the natural resources of water in that state, that belong to the state, must turn over to the Federal Government, as I understand it, somewhere in the neighborhood of one dollar per horsepower that is generated. It was undertaken in the first instance to make these water powers directly the subject of a tax, and when they examined the decisions of the Supreme Court of the United States, they found that the non-navigable streams were not subject to the jurisdiction of the United States; that that was a local matter; that the local authorities had control of it, and could make such regulations or rules as they deemed best. There was a decision rendered here not long ago in the case of the state of Kansas against the state of Colorado, relative to water, and I want to read to you an extract from that decision. It is found in the 206th U. S. Supreme Court Reports at pages 46 to 118. In that decision the Court used this language: “That the Government of the United States is one of enumerated powers; that it has no inherent power of sovereignty; that the enumeration of the powers granted is to be found in the Constitution of the United States and in that alone; that all powers are granted or reserved to the people. That while Congress has general legislative jurisdiction over the territories and may control the flow of waters in their streams, it has no power to control a like flow within the limits of a state except to preserve or improve the navigability of a stream; that the control of these waters is vested in the state.” In view of that decision, in view of all our line of government—namely, that the National Government should have control of national affairs and that the states should have control of local affairs—I ask in God's name how you can compel a jurisdiction of the National Government over these things for the purpose of putting money into the revenues of the National Government? (Applause.)

I want to say with respect to this that these states were all admitted into the Union under an enabling act. Here is the language of the enabling act which admitted the state of Colorado into the Union:

“That the inhabitants of the territory of Colorado, included in the boundaries hereinafter designated, be and they are hereby authorized to form for themselves, out of said territory, a state government with the name of the state of Colorado, which state, when formed, shall be admitted into the Union upon an equal footing with the original states in all respects whatsoever.”

When we find that down here in the east there is no claim that on a non-navigable stream you can control water power, you can readily see that they cannot enforce a different rule upon the states of the west. We recognize out there that when the pioneers crossed the plains—what was then a desert for 600 miles—and began to build up a great republic, we were doing something that was of great advantage to the United States itself. Not only that, but the United States Government never intended that any of this Public Domain should be the subject of profit. They never intended that there should be perpetual ownership in the Government. Yet, according to the theory of this provision as to water power and the provisions as to coal lands and the provisions as to other lands, a leasing system will impose upon the western states an undue proportion of burdens of government which is not imposed upon the other states of the Union. Why they picked out this vast territory, most unpropitious territory, that which it seems was harder to develop, and why these burdens should be imposed upon them, is past my comprehension.

When I was Governor of the state of Colorado I began to wonder why it was that our revenues were so light, and I began to investigate. I found that in one county in my state nine-tenths of it was in forest reserve. I found that in the state of Colorado there were 15,000,000 acres of land in forest reserves. I found that that is an area equal to Massachusetts, Connecticut and Rhode Island combined. In other words, the people owning one-tenth of the land in that county had to bear the burdens of government at their own expense, and the Government land was not subject to taxation at all.

We find in the west—and I understand the same applies to many places in the east—that the payment of taxes upon water power plants or upon anything else for a period of thirty years, with a reasonable interest charge upon each yearly payment, amounts to the entire value of the land. When this burden is cast for the purpose of maintaining government over all of the territory, including the water powers, the forests and everything else, and government has to be made at the expense of the state, you can readily see that it makes that one-tenth pay for those lands over again every thirty years by increasing their taxation and by charges that are necessary in order to maintain government over all of it. We are partners. We must recognize that the states have a dual relation; that the Government of these United States has a dual relation. It has a relation with the states. It is a partner of the states. We are both building up a Government republican in form, and we are charged by the United States Government with the duty of maintaining a government republican in form. Consequently we are bound to have a state government, we are bound to have officers of states, we are bound to have county officers, we are bound to have a school system; because upon the education of the children of this country depends the maintenance of this republic, and the burden is cast upon the people of the states, and is not upon the Government of the United States. Then we must remember that all this is done for what purpose—for the purpose of making good government, for the purpose of making a government republican in form. It is just as essential that the voter in a United States election should be educated as it is that in the state elections he should be educated. The qualification would be the same, and hence when all this burden is thrown upon the state, it seems unfair to the state. In my state over 5,200 teachers have to be maintained, schoolhouses have to be built at enormous cost of millions and millions of dollars, and many other burdens are cast upon the state. What right have you to limit one of our natural resources and say that the state cannot tax that because it happens to be upon Government land and the Government cannot dispose of it? You can readily see that if you do not give the state the power of taxation upon the property which is there contained, it is sapping the very foundation of the state, and that is what, in the name of a conservation policy, is applied to the western states. We are just as anxious as you are to conserve our water power and to conserve everything else. We have, as you know, coal which helps out the water power very much. If the water power goes dry through certain seasons of the year, we have vast numbers of acres of coal land which can operate an electric plant right at the mouth of the pit, and aid our development of water power that much more. Should we find that if this policy prevails of making a tax upon every ton of coal that is taken from our lands, it means another burden that is placed upon us. It means an exemption from taxation forever for all these coal lands. There has been certified from the Geological Survey of the United States Government that there are now in the state of Colorado alone public coal lands to the extent of 9,425,000 acres. I want to say that that land has been withdrawn from entry until reclassified, and in reclassification such enormous prices have been put upon it that lands that formerly were valued at $20 an acre have been made in some instances as high as $400 an acre, and that means that our coal lands are not going to be developed. A tax of ten cents a ton upon coal would be an enormous expense upon our state. According to that same Geological Survey report, there are 371,000,000,000 tons of coal in the state of Colorado– billion, not million. That means enough to supply the world, at the present rate of consumption, for 300 years. That is what it means. It seems light to talk about ten cents a ton on coal, but when you make that a tax of ten cents a ton on 371,000,000,000 tons, it would make a tribute which Colorado would have to pay to the National Government of $37,000,000,000. Ten cents a ton on 371,000,000,000 tons of coal is $37,000,000,000, and that is ten times as great as the debt of the public was at the close of the Civil War. Yet, by this policy, that is what Colorado would have to contribute. That is the tribute which we would have to pay. With this clause in the Constitution, we find that we do not have an equal treatment. No state has been required to contribute to the National Government in these matters. The natural resources of Ohio, of Indiana, of Illinois, of Missouri, of Kansas have not been taxed, and not until you get to what they thought was a God-stricken country do we find a suggestion made that these people should be burdened with this extra amount of government. (Applause.) I am taking up too much time. I would like to discuss many of the phases of this question, because it is of most vital importance to the people of my state. I want to close by reading a statement made by one of the great Justices of the Supreme Court of the United States. We claim that these are local matters and we claim that the Government of the United States would act unfairly to us when it has not acted unfairly to the other states of the Union; that she has no control of our streams, because we have not a navigable stream in the state, and because of the fact that there

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are certain things under the formation of our government
which were recognized as belonging to the states. When I say
this refers to one of the Justices of the Supreme Court of the
United States, I recognized that he was one of the very great-
est that has ever been there. He lived among you for many
years and died only recently. I refer to the Hon. John M.
Harlan. (Applause.) This is what he said—heed the advice
of the Justice; heed his advice because under that we will
maintain harmony and good government:

“The National Government for national affairs, state gov-
ernments for state affairs, and then there will follow a devel-
opment which is great indeed. That is the rock upon which
our Government is founded.” I thank you for your atten-
tion. (Applause.)

MR. FRANCIS CUttle, of California—Mr. Chairman, may I
ask the last speaker a question?
CHAIRMAN FISHER—Senator Shafroth, are you willing to
answer a question?
SENATOR SHAFROTH-Certainly.
MR. FRANCIS CUTTLE-I would like to know if the Federal
Government does not return to the several states at this time
thirty-five per cent of the receipts for the national forests for
school and road purposes?
SENATOR SHAFROTH-Not thirty-five, but I think twenty-
five per cent.
MR, FRANCIS CUTTLE-And ten per cent additional under
direction of the Secretary of Agriculture?
SENATOR SHAFROTH-I do not know about that. (Loud
applause.)
Let me ask you, when this is within the jurisdiction of our
state, what right you have to impose any burden upon us? In
the tax that was imposed by Great Britain, as to which the
Colonies rebelled, it was provided that all that tax should be
spent in the defense and for the benefit of the colonies; but the
colonies did not want to have this matter determined by Eng-
land. (Applause.)
I want to say there is at the bottom of this entire thing the
question of maintenance of government, for you in your forest
lands, in your coal lands, in your water powers. Look what
Qur state would have to contribute as to water power—from
$1,000,000 to $2,117,000 a year, and none of that comes back
to the state under any proposition I have seen. (Applause.)
None of the tax placed upon coal lands, in any suggestion I
have heard, comes back to the state, but even if it did, it goes
beyond the jurisdiction of the United States with relation to it.

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