"The rates the railroads may charge the public for transportation are now largely fixed by this Government board.

"Out of every dollar received by the railroads from the public nearly onehalf is paid directly to the employees as wages; and the money to pay increased wages can come from no other source than the rates paid by the public.

"The Interstate Commerce Commission, with its control over rates, is in a position to make a complete investigation and render such decision as would protect the interests of the railroad employees, the owners of the railroads, and the public."

A QUESTION FOR THE PUBLIC TO DECIDE.

"The railroads feel that they have no right to grant a wage preferment of $100,000,000 a year to these employees, now highly paid and constituting only one-fifth of all the employees, without a clear mandate from a public tribunal that shall determine the merits of the case after a review of all the facts."

The physical labor of clearing the copy through the agencies and sending the electrotypes is an interesting phase of the story. Each agency had certain States to handle. The American Press Association made the electrotypes and distributed them to the papers on order from Mr. Fayant through its 17 branches. At the same time the orders were sent out from the agencies who will also attend to the checking and billing.

Since the duration of this drive is not known, of course, the amount of money to be spent can not be estimated.

If the average rate of the 17,000 publications being used were only 10 cents an inch, it would cost over a hundred thousand dollars to run the 60 inches once. But, of course, the average rate is much more than 10 cents. Perhaps 20 cents, or even 25 cents, would come nearer to being correct.

The railroads are contributing to the fund on a pro rata plan that is based on their earnings.

The national conference committee of the railways may have some opposition from the Interstate Commerce Commission, but it is contended that the companies have a perfect right to tell their story to the people. On the other hand, the brotherhoods have the same right. If they would employ advertising to tell their side of the controversy, it would, indeed, be a new way of conducting a wage war.

Mr. CARTER. What did it urge? Here is the copy [exhibiting]. It urged, first, compulsory abritration; it urged Federal inquiry of a railroad strike; it urged a reference of all matters to the Interstate Commerce Commission, and, gentlemen, these railroads paid several million dollars just simply to educate public opinion along lines favorable to this bill.

Mr. HAMILTON. When did they start that?

Mr. CARTER. June 29, 1916, is the date of this article taken from Printer's Ink.

Mr. HAMILTON. The President seems to have been acting exactly in conformity with that.

Mr. CARTER. Well, I have heard people say they could not help but use Gold Dust after reading it so many times on the fence posts. Mr. HAMILTON. But what I am saying is that it would seem that the President has been acting exactly along that line.

Mr. CARTER. I do not know what is in the President's mind, but I imagine in many a man's mind the hypnotic influence of this advertising has produced the impression that there should be compulsory arbitration. Here is the evidence, and it is made a part of the record, as to how the American people were hypnotized into believing that the railroad employees should be subjected to compulsory arbitration.

The CHAIRMAN. During the time you were before the President all that advertisement was going on?

Mr. CARTER. I do not know when it commenced.

Mr. HAMILTON. But the President recommended these identical things in his message to Congress.

Mr. CARTER. Well, I have nothing to say about that.

Mr. O'SHAUNESSY. We are considering this matter on its merits, and not with regard to what has been recommended.

Mr. CARTER. If the President is as human as I know him to be, he is as susceptible to the hypnotic influence of what anybody says as you or I.

Now, what happened? Before this advertising campaign began, the editorial and news columns of the newspapers were mostly neutral. Many of them were friendly. But if you want to investigate something, as a congressional investigation, you will find that almost invariably when that money went through the doors of these newspapers into the countingroom, in payment for this advertising, the editorial pages took up the fight on behalf of the railroads.

If there is a gentleman from Texas on your committee, he will probably remember the case of the I. & G. N. Railroad, which some years ago went into the hands of a receiver. A receiver was appointed (Mr. Thomas Campbell, subsequently governor of the State) and in his investigation as to how the railroad company had been run he found that the I. & G. N. had been paying to the Galveston and Dallas News $25,000 a year. I am making this statement from memory. It occurred years ago. In 1892 they investigated further and found that this newspaper published a little article with reference to the arrival and departure of trains, and received that money for that advertisement. But it is significant that the railroads in Texas never wanted anything that those papers did not support. The newspapers of this country are now suborned-and I use that word advisedly-by the money that has been spent by the railroads in advertising their campaign to rob the railroad employers of their liberty, and all of you of your independence. I say that the condition has arisen where if you do not want to do as they want you to do, they will defeat you in your home district.

If you have any doubt of that, find out what happened to Gov. Hunt, of Arizona, simply because he sympathized with the workmen in certain strikes. Investigate into the amount of money that was sent into Arizona from other States to defeat him. Go out among the members of these brotherhoods and see how many were hired in the last campaign, at prices ranging from $10 to $100 a day, to spread this propaganda of the railroads. Those are the things that are not only going to rob the railroad employees of their constitutional heritage, but rob every honest man of a right to say what he thinks, because he will be betrayed by the spotters that are bought up by those with whom you do not agree. I say that because I know it is true. Just conduct an investigation to see how much money was spent in Illinois--and I say Illinois, because I live there-if you do not believe it, and in New York during the last campaign. Leading members of these brotherhoods were imported from Tennessee at $100 a day, and they spent months campaigning in New York, showing that the eight-hour law was injurious to the men. I heard a man say the other day that he had been offered $100 a day to do that. Those are the conditions that confronted us, and those were

the conditions that caused the Marconigrams read this morning to be transmitted to sea that were absolutely false. The money referred to in Printer's Ink there refers to what the newspapers were urged to do against us. That condition will continue to exist until there is a law passed to prohibit newspapers transmitting by means of the Federal mails their publications when they contain articles received in the manner this one was handled. They are, however, to-day, so strong and powerful that I will confess that it will take a very courageous Congress to make any such investigation. Now, we will pass to the conscription law. Beginning on page 11, and extending through to page 14. If it be necessary for military expediency or for a preparedness measure to make it possible for the Federal Government to seize the railroads in time of war or threatened war, I do not believe that there is a railroad man in this country who would object thereto. You would not have to conscript him. He would be glad to work for the Government and help win the war by his efforts in transporting troops, as you say the purpose of this bill is. But what do you say here?

"Or any emergency requiring the transportation of troops," etc. Why, anything can be an emergency if you have a man in the White House who wants to make it mean that way. For instance, a strike is an emergency. Here is a bill that conscripts railroad employees and makes them scab on themselves and punishes them for not doing it. If this is a military measure, introduce it as a military measure. Don't hang it onto a bill to suppress strikes, because that very act gives it away. It is not a military measure. It is an auxiliary measure for suppressing strikes, the rest of H. R. 19730 being for that purpose.

My time is nearly up and I am going to say a few words and then close. This bill, if enacted, will be accepted by the railroad employees as being the consummation of the wishes of the railroad employers. Such publications as the Railway Age-Gazette have been preaching the doctrines of this bill for 10 years. The men in control of the railroads-those high up; those men who depend entirely on the banks for their jobs, have been advocating almost identically what you propose here, for years. The Railway Age-Gazette asked me to participate once in a symposium-I suppose a mental feastand I remember writing an article six or seven years ago against compulsory arbitration, and some of the railroad officials writing in favor of it. They have been insisting upon it for years. Why do they insist on it? Because they always get men of their own kind on the arbitration boards.

The CHAIRMAN. Mr. Carter, when I first came on this committee, something like 20 years ago, the men then were for arbitration and the railroads opposed it. At first, when the labor organizations were not so strong, they were opposed to it, but as the organizations have grown stronger their attitude seems to have changed.

Mr. CARTER. I think there is a great deal to that. I mean that when the men find themselves helpless, from an economic viewpoint, any remedy will be welcomed. But we must not view it from any standpoint of extraordinary extremity. The railroad officials-I will not say the railroad officials, but the railroad companies want the Interstate Commerce Commission to have complete jurisdiction over wages, over hours of employment, and working conditions.

Preferably, they say they would like to have a wage commission like the Interstate Commerce Commission. Do you suppose they would advocate that if they did not know that people who were sympathetic with them would be appointed to such position? Do you suppose they would advocate such a solution of such problems if men like Lee and Gompers and I should get on those commissions? No. The American public has recognized that the servant class is not eligible for places of honor and places of responsibility. Only those who belong to the master class are eligible. A few of the servant class get into Congress, but very few, and they generally defeat them very soon by the use of money. We are not like other countries, where they have a large element of the labor class represented in their legislative bodies. Here we have but a few. In England the labor element is strong and the same thing is true in Germany, but in this country the average man smiles when you talk about a labor man aspiring to a high official position. He has been educated to the belief that the rights of property are above the rights of the human being himself.

Mr. HAMILTON. Do you separate agriculture from labor?

Mr. CARTER. It is according to what it is. If I were a farmer and employed a lot of hands to do my work and I lived in town and ran a better automobile than some of the other farmers ran, I would be an employer. I would think, if I went out there and walked behind a plow, I would be a laborer. I have done the latter kind.

Mr. HAMILTON. I venture the opinion that many members of Congress have had that latter experience.

Mr. CARTER. Then, you don't want to let it be known that you are a workingman-you had better not.

Mr. HAMILTON. Every man is proud of it.

Mr. CARTER. I will say to you that if a laboring man aspires to an appointment on these commissions public opinion disqualifies him. Let us see about this.

Mr. BARKLEY. How about Mr. Clark?
Mr. CARTER. That is the one exception.

Mr. REYBURN. It is one out of seven.

Mr. CARTER. That is about the chance we would have.

Mr. DOREMUS. I do not know of anyone in Congress who has not worked, or else they make the people think they have worked, or they will not be elected.

Mr. CARTER. I want to read some correspondence that passed between Mr. Stone and myself on the one hand and the Federal Board of Mediation and Conciliation on the other, and then perhaps you will understand why I appear to be so radical.

This first telegram bears date of April 29, 1915, and was sent from Chicago to Washington and was addressed to the Federal Board of Mediation and Conciliation, being signed by Stone and Carter:

Please advise by wire quick if you knew prior to Charles Nagel's appointment as arbitrator that he was trustee of Busch's estate and that said estate had large holdings of railroad stocks and bonds.

The reply this is to Stone and me and signed by the Federal Board of Mediation and Conciliation:

We can not recognize the right of anyone to ask of this board or its members a statement of its or their knowledge of the business connections of an arbitrator selected by the board, after due notice to the parties of such selection and the acceptance by them of his service.

Here is another telegram to Stone and Carter from the Federal Board of Mediation and Conciliation:

The fact that Mr. Nagel was a trustee of the Busch estate was known to the members of the United States Board of Mediation and Conciliation and also to Assistant Commissioner Hanger. It is not recalled that any of us knew he was a director of the Union Trust Co., of St. Louis, and of the Northwestern Mutual Life Insurance Co. before his appointment, but a knowledge of that fact would have been favorable rather than otherwise to his appointment. We had no knowledge of what the assets of the Busch estate or the companies consisted.

You doubtless had as much information regarding Mr. Nagel's business connections as any member or officer of this board prior to his appointment, and you had ample time to make further inquiries before the organization of the arbitration board and the acceptance of his services, and certainly before the extension of the life of that board, which was the act of yourselves by agree. ment with the railroad representatives independently of the Board of Mediation and Conciliation. The foregoing statement is not made for the purpose of escaping any responsibility on the part of any member or officer of this board for Mr. Nagel's appointment, for nothing was known before his appointment, nor has been brought to our knowledge since his appointment, which, in our opinion, disqualifies him as an arbitrator, and our confidence in his ability and integrity remains unchanged.

Here is the reply to the Board of Mediation and Conciliation from Stone and Carter:

We received your telegram of April 29 stating in substance that it was none of our business what the Board of Mediation and Conciliation knew of Charles Nagel's railway connections before his appointment as a neutral arbitrator. We also have your telegram of this date stating that nothing has been brought to your knowledge with reference to Nagel's railway connections which would, in your judgment, disqualify him as a neutral arbitrator. We regret that we did not know of your understanding of neutrality before we signed the arbitration agreement. You state by inference that we knew of Nagel's railway and corporate connections before his appointment. There is no foundation in fact for any such inference. We relied on your board to protect the interests of both parties by the appointment of two neutral arbitrators.

I omitted one telegram here which shows that just before that telegram was sent we discovered that as director of the Union Trust Co. of St. Louis he held $12,500,000 worth of the first mortgage bonds of the St. Louis, Brownsville & Mexico Railroad. That was one of the railroads that was in the arbitration, and if the award was in our favor it would have affected those bonds-at least the railroad company said it would, and that was their main line of defense. We found he held millions and millions of the bonds, either as director or trustee. The Board of Mediation said they did not know it, but if they had it would have better fitted him.

I have reached the conclusion that in any arbitration proceeding the workingman can not get a square deal. We can not get it; that is why we are done with the Erdman Act.

Let us see what happened the other day in the switchmen's arbitration proceedings. The President, Mr. Wilson, did not hesitate to say that he did not think the eight-hour day was an arbitrable question. We knew it was not. We will prove it. The eight-hour day is not an arbitrable question. Here is what the last arbitration said:

It seems to be clearly established that under existing conditions, and probably even under conditions of traffic less strenuous than the present, it will not be possible to make an actual working eight-hour day effective in the case of more than a small percentage of the switching crews, not more than 10 per cent during the first year.