onstruction came, after the
financial panic of 1873, to a practical standstill throughout the United
States; and if the Granger States did not get their share of the very
small total increase during the five years following the panic, it was
due solely to a conspiracy on the part of the railroad managers to
misrepresent and pervert the legislation of these States. The laws, as
has already been stated, were finally repealed, not because the people
had tired of them or regarded them unwise or unjust, but because it was
hoped that the commissioner system would prove more efficient. It was
offered as a compromise measure and was accepted as such by the railroad
managers, who, in their eagerness to rid themselves of the restrictions
imposed by the Granger laws, gave every assurance of complete submission
to the requirements of the proposed legislation.

Mr. Hadley even goes so far as to defend railroad pools. "Unluckily," he
says, "we place these combinations outside of the protection of the law,
and by giving them this precarious and almost illegal character we tempt
them to seek present gain, even at the sacrifice of their own future
interests. We regard them, and we let them regard themselves, as a means
of momentary profit and speculation, instead of recognizing them as
responsible public agencies of lasting influence and importance." We can
partially account for this author's defense of pooling when we are
informed that he accepts it as an axiom that "combination does not
produce arbitrary results any more than competition produces beneficent
ones." Referring to railroad profits, Mr. Hadley says: "The statement
that corporations make too much money is scarcely borne out by the
facts. The average return of the railroads of this country is only four
per cent., the bondholders receiving an average of four and a half per
cent., the stockholders of two and a half per cent. True, much of the
stock is water, not representing any capital actually expended; but,
even making allowance for this, it is hardly probable that the roads are
earning more than five per cent. on the total investment. This assumes
an average cost of $45,000 per mile, implying that about half of the
stock and one-sixth of the bonds are water." Mr. Hadley would probably
have come much nearer the truth if he had assumed three-fourths of the
stock and one-fourth of the bonds to be water. Even Mr. Poor, who
certainly cannot be accused by railroad men of being in