FEDERAL CONTROL OF INTRASTATE RAILROAD RATES 301 President is authorized to initiate rates, and it necessarily follows that the question of state power may arise either with respect to rates so initiated or with respect to rates which have been left unchanged by the Railroad Administration. But the Director- General of Railroads, by his General Order No. 28,^ advanced substantially all transportation rates and fares of railroads under federal control, so that the important issue from the practical viewpoint is as to the power of the states to control rates initiated by the President. And consideration will first be given to this question. It is to be noted first, that the authority devolved upon the President to initiate rates is not restricted by the terms of the act to interstate rates; in fact, there is no reason why it should be so restricted. The act is passed, not under the power to regulate commerce, but under the war power, and if it is desirable that the President initiate rates — an obvious necessity — no reason can be suggested which makes the exertion of this power less necessary sonable and just and shall take effect at such time and upon such notice as he may direct, but the Interstate Commerce Commission shall, upon complaint, enter upon a hearing concerning the justness and reasonableness of so much of any order of the President as estabUshes or changes any rate, fare, charge, classification, regulation, or practice of any carrier under Federal control, and may consider all the facts and circumstances existing at the time of the making of the same. In determining any question concerning any such rates, fares, charges, classifications, regulations, or practices or changes therein, the Interstate Commerce Commission shall give due consideration to the fact that the transportation systems are being operated under a unified and coordinated national control and not in competition. "After full hearing the commission may make such findings and orders as are au- thorized by the act to regulate commerce as amended, and said findings and orders shall be enforced as provided in said act: Provided, however, That when the President shall find and certify to the Interstate Commerce Commission that in order to defray the expenses of Federal control and operation fairly chargeable to railway operating expenses, and also to pay railway tax accruals other than war taxes, net rents for joint facilities and equipment, and compensation to the carriers, operating as a unit, it is necessary to increase the railway operating revenues, the Interstate Commerce Com- mission in determining the justness and reasonableness of any rate, fare, charge, classification, regulation, or practice shall take into consideration said finding and certificate by the President, together with such recommendations as he may make." "Sec. 15. That nothing in this act shall be construed to amend, repeal, impair, or affect the existing laws or powers of the States in relation to taxation or the lawful police regulations of the several States, except wherein such laws, powers, or regula- tions may affect the transportation of troops, war materials, Government supplies, or the issue of stocks and bonds." ' Issued under date of May 25, 1918.
