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Veto of the Monopoly Bills.

To the Gentlemen of the Senate:

I herewith return without my approval Senate bill No. 138, entitled An act concerning street railroads and to repeal a certain act therein named.

Also Senate bill No. 137, entitled An act concerning elevated railroads and to regulate the same.

I have also returned to the House without my approval House bill No. 618, entitled An act to regulate the granting of franchises and special privileges by cities, villages and incorporated towns.

While these three bills relate to different subjects they all involve the same principle and are subject to the same fundamental objections in this, that they legalize monopoly. In giving my reasons at length for withholding my approval, I deem it best to point out the objections to the three bills in order to more clearly show the principle involved, so that in case your honorable body should decide to amend the measures you can the more readily meet the difficulties presented.

The law now provides that corporations may be formed for ninety-nine years, but a city council can only grant an ordinance to operate a street railway in a street for twenty years. The purpose of this limitation is to enable cities at certain intervals to impose such conditions in respect to revenue, or accommodations, or rates of fare as may be deemed necessary to protect the public interests. Now, each of the first two bills gives a city council power to grant an ordinance for the full life of the corporation, that is, ninety-nine years, so that it would be in the power of a city council to give away to a street railway not only the rights of this generation, but the rights of future generations, and these bills make no provision for securing to the public any compensation or protection in return.

Second. The law now provides that an ordinance to build a street railway in a street can only be granted on condition that the company will pay all damages which owner of abutting property on the street or public ground may sustain by reason of the building of such road, such damage to be ascertained by court proceedings under the laws relating to eminent domain. Bill No. 138 repeals this provision.

Third. There can be no competing street railway unless it can get into the heart of a town. In large cities, especially in Chicago, all of the downtown streets are already occupied. As a street railroad gets no title or exclusive right to a street, it has happened in the past that a new company was given a license by the city to put down a second track for a few blocks on a street already occupied. In such a case each of the rails of the second road is laid a few inches from the rails of the old road, so that the cars have practically to move over the same ground. But Section 5 of Bill 138 contains a proviso which would enable an old company to prevent such a privilege being granted to a second corporation if it in the slightest degree delayed or interfered with the old company's operations.

Fourth. Both of these bills, 137 and 138, expressly provide that any


property holder can enjoin any new company from beginning work, by alleging that it did not have a petition signed by the owners of a majority of the frontage before the city council granted an ordinance. None of the old companies were subject to this provision, as it was generally held that the attorney representing the State could alone maintain such a suit. But under this new provision an old company could get some resident property holders to commence a large number of suits in the different State courts, and some non-resident property owners to commence suits in the United States court, and thus not only tie up any new company in the courts for years, but wear it out before it could lay down a rail. Legislation to protect a property holder is very much to be desired, but legislation which is manifestly intended to enable corporations to use a property holder as a convenience in order to establish or perpetuate a monopoly can never benefit the public.

Fifth. These bills provide that no company shall have the right to even go into the court and condemn any part of or anything pertaining to any of the existing roads, or of any road which may be built under privilege already obtained, so that, when applied to Chicago, no matter how much the city may grow in the future, no new or competing road can be built, because the existing roads have been so located that it will be impossible for a new line to get into the heart of the city without at some point having to strike and, to a limited extent at least, interfere with an existing road. Should a loop be built in Chicago for the elevated roads on streets now contemplated it would then be impossible for any new road to get into the heart of the town. This clause of the bills was evidently intended to prevent any further effort at competition and thus to practically give a monopoly for a century, and that without giving the public anything in return.

Sixth. Again, each of these bills contains a provision which expressly authorizes consolidation on the part of any number of roads, so that they can in the end all come under one management. That is, this provision expressly legalizes monopoly. It is true there is a clause in Bill No. 137 which says that competing lines shall not consolidate, but practically there are no competing lines in Chicago now, and, as the other provisions of the bills will prevent any competing road from being built, it is evident that this clause does not signify anything. Taking all of the provisions of the two bills, it is evident that they were intended to create, and it they become laws will create, a monopoly in Chicago of both the street railway and the elevated railway business for nearly a hundred years to come.

House Bill No. 618 provides that before a city council can grant a privilege to lay gas pipes or to string wires for conducting electricity a petition must be presented, signed by the owners of a majority of the land frontage of each block or any street or alley in which it is proposed to lay such pipes or string such wires.

All of the old gas companies have their pipes in the streets of Chicago and several new companies recently formed have their permits to put in pipes and string electric wires where they choose, and consequently would not be affected by this bill. A brief examination of this measure shows that it it were to become a law it would be in the power of the existing companies to prevent for all time any new or competing company from putting down pipe or stringing any wires, for they would only need to prevent the new company from getting the signatures of the owners of a majority of the frontage of one


block on any street proposed to be occupied by the new company. Had the bill provided in express terms that the existing companies should for all time have a monopoly of furnishing gas, electric light, etc., in the city of Chicago it could scarcely have been more effective. So that this bill, like the other two, aims to legalize monopoly.

In considering these three bills the fundamental question arises at the threshold, whether we have reached a point in our career where we are willing to legalize what during our whole history and by all civilized nations has been condemned. Are we prepared to reverse the entire policy of all government on this question, and that too without securing any compensation. It is true that in some instances other governments have sold special privileges or granted monopolies and the State derived a consideration for them, but this was at the beginning of an enterprise and not after it was established. On the contrary, making a monopoly has for years been a crime punishable by both fine and imprisonment in England and in this country. It is the business of government to protect all interests alike, and if any interest is to receive special attention it should be the weaker and not the more powerful.

Again, these bills would instantly increase the value of the properties of the various corporations interested many millions of dollars, to say nothing of the future, and all this without any effort on their part. It is a flagrant attempt to increase the riches of some men at the expense of others by means of legislation.

It may be true that there is now in Chicago practically a monopoly in all of the lines of business covered by these bills and it may also be true that this condition will continue whether these bills become a law or not, but there is a great difference between enduring an evil which can not be avoided and deliberately taking it into your arms.

Some of the largest, most conservative and best governed cities of Europe and America now furnish their inhabitants gas, electric light and even street car service, and do this at greatly reduced rates and yet derive a large revenue from this source, just as Chicago now does in furnishing water. If we had a law permitting cities to do the same in this State, then, if these bills were adopted, the people could at any time free themselves from the monopoly by building or acquiring plants and furnishing the service themselves, or, if the corporations could be compelled to pay a part of their gross earnings into the treasury, then the public would get some compensation. Or if any citizen who suffers from the exactions of monopoly could on certain conditions go into a court of record and get protection against excessive charges the case would be different. It is asserted that combinations do not injure the public, but I remember that about eight years ago gas sold at one dollar per thousand feet in Chicago. Then the trust was formed and the price was at once advanced to a dollar and a quarter. It has also been argued that the entire trend of modern civilization is toward concentration and consolidation and that no power can arrest this force; that all the anti-trust laws are a dead letter and have accomplished nothing; that while the law may now forbid one corporation from combining or consolidating with other corporations, yet men who own stock in one corporation cannot be prevented from owning stock in other corporations and consequently a number of corporations cannot be prevented from acting in harmony or working together; that great concentrations of capital can and will control any situation and that consequently it is idle to talk about


competition in large cities in any business in which monopoly is possible; that in Chicago we have had monopolies for many years in the lines of business covered by these bills and that this condition will continue whether these bills become a law or not. It is sufficient to say in answer to this argument that, if it is true, then it simply shows the necessity for finding some other way of protecting the public, and it furnishes no excuse for an unconditional surrender by the government to the corporations. If it is true that the days of competition are over, then some other method of protecting the public should be placed on the statute books before the State legalizes that which it has condemned for centuries. If the corporations involved require legislation to properly protect them then it should be promptly passed with just limitations.

But to pass these bills under existing conditions and without any limitations would be to fasten a collar on the future and to levy tribute on generations yet to come, and all this simply to further enrich a few private individuals. It is idle to say that the bills can be repealed in the future, for, if the existing corporations are now able to get affirmative legislation of this character, they can easily prevent its repeal. Besides, a repeal could not affect any privileges which any corporation might in the meantime have acquired under them. I am therefore obliged to withhold my approval from each of these bills, because they attempt to reverse the theory and traditions of government by legalizing monopoly and make no provisions for protecting the public.

Second. Because their effect would be to increase the riches of some men at the expense of others by legislation.

Third. Because they would shackle a great city. I love Chicago and am not willing to help forge a chain which would bind her people hand and foot for all time to the wheels of monopoly and leave them no chance to escape.