Page:Harvard Law Review Volume 32.djvu/568

532 532 HARVARD LAW REVIEW "The State insists that the enactment of the statute may be justified as *a declaration of public policy.' In substance, the argvmient is that the rate was imposed to aid in the development of a local industry and thus to confer a benefit upon the people of the State. The importance to the conmaunity of its deposits of lignite coal, the infancy of the in- dustry, and the advantages to be gained by increasing the consumption of this coal and making the community less dependent upon fuel sup- plies imported into the State, are emphasized. But, while local interests serve as a motive for enforcing reasonable rates, it would be a very different matter to say that the State may compel the carrier to main- tain a rate upon a particular commodity that is less than reasonable, or — as might equally well be asserted — to carry gratuitously, in order to build up a local enterprise." In the next case in the same volume,^^ the Supreme Court applied to passenger rates the principle that it had just applied to rates on coal; i. e., it held that passenger rates must yield the company a profit, irrespective of the profitableness of the company's entire business. " It would not be contended that the State might require passengers to be carried for nothing, or that it could justify such action by placing upon the shippers of goods the burden of excessive charges in order to supply an adequate return for the carrier's entire service. And, on the same principle, it woiild also app.ear to be outside the field of reasonable adjustment that the State should demand the carriage of passengers at a rate so low that it would not defray the cost of their transportation, when the entire traflSc under the rate was considered, or would provide only a nominal reward in addition to cost." ^^ The rule, which these cases so clearly establish, that each serv- ice must pay its own costs, should be understood in this sense: " Norfolk & Western Ry. Co. v. Conley, 236 U. S. 605, 609 (1915). ^^ In each of these cases the Supreme Coiu"t added a curious caveat. In the Northern Pacific case it said: "If in such a case there exists any practice, or what may be taken to be (broadly speaking) a standard of rates with respect to that traffic, in the light of which it is insisted that the rate should still be regarded as reasonable, that should be made to appear." 236 U. S. 585, 599 (1915). In the Norfolk and Western case it said: "If in any case it could be said that there existed other criteria by reference to which the rate could still be suppnjrted as a reasonable one for the transportation in question, it would be necessary to cause this to appear." 236 U. S. 605, 609 (1915). But the court does not appear to have had in mind any "practice," "standard," or "criteria" by reference to which it might be proper, on occasion, to violate the requirement of a reasonable return, and the implied dicta that such conditions might conceivably be discovered detract little from the force of the decisions.