When the Federal Government undertakes the improvement of a navigable stream, it rarely if ever happens that it does not thereby either create water-power or increase potential water-power already existing. It is evident, therefore, that those riparian owners who own existing water-power grants are directly benefitted by the improvement in the navigable water. Whenever the Federal Government protects the headwaters and the water-shed on which the stream depends, it is conferring a direct benefit upon the owners of water-power property along the line; and so with all the other improvements.

You have heard the eloquent Ex-Governor of Louisiana explain what the interest of that State is in the intervention of the Federal Government in the regulation of the Mississippi river. There are few places throughout this country where the owners of water-power grants and those who are interested in all the other uses of flowing water have not appealed to the Federal Government for financial aid or for a.s.sistance not financial which that Government alone can effectively render. It must be apparent that in rendering that a.s.sistance the Federal Government creates property of value, or enlarges the money value of property already existing. No hardship, then, is done if the owners of this property are required to contribute to the original cost. Not only so, but there can be no justice in the proposition which requires the taxpayers of the United States as a body to pay the cost of the improvement or the protection of any stream when as a matter of fact the people who own the property immediately along the stream will get, in direct money value, a larger benefit than the cost of the improvement.

There are many reasons besides these why the Federal Government _must_, in the very nature of things, be the effective agency to do many of the things which the States can never effectively do, no matter if the whole subject were turned over to them this afternoon. On the other hand, I wish to call attention to the fact, which I believe to be established by experience, that whenever a local community is once aroused to an intelligent appreciation of its interests and its rights, that local community will better and more effectively regulate local service and local rates than any more remote governmental agency whatever. Herein lies the advantage of local home rule. Now, I am not talking about railroad rates connected with interstate commerce, or about other things which affect more than the local community, but about those things which affect merely particular localities. If a water-power company starts in alongside of a great industrial community and that community is built up so that its industries depend on it, that community itself, once thoroughly aroused and intelligently educated upon the question, will far more effectively regulate those rates in the interests of the public, while at the same time dealing fairly with the corporate or private interests involved, than would the State or the Federal Government. That seems to me a broad, practical proposition which experience has justified.

Now, let us apply the principle to the water-power situation. And my whole purpose in speaking is merely to call the attention of this Congress to a method of treating this question, which will, in my opinion, meet both situations. It is not a novel suggestion; in one of the very last of the water-power grants made by Secretary Garfield, the essential provisions of it were at least hinted at and a preliminary provision made. In my humble opinion, the Federal Government should control the water-power grants on streams that are navigable or where the Government itself controls the riparian property. It should make grants for definite periods of time and should provide for compensation.

That compensation as a broad, general rule should be applied to the improvement and protection of the stream and the watershed from which the water-power has been derived, or to other streams and watersheds of like character, for all uses of the water, whether for irrigation on the one hand or for water-power on the other. There should be periodical readjustments of the rate of compensation. In the beginning, and especially in an experimental enterprise, the rate of compensation should be exceedingly low. There should be, as President Taft himself said here in his speech, a readjustment of the rate, say every ten years; and the person or the corporation invited to invest money should be given proper protection in that readjustment. Capitalist and industrial pioneer should be treated not only fairly but liberally, that vigorous development may result. On the other hand, such a grant should contain this provision, or be subject to this fundamental legal limitation, that the grantee, by acceptance of the grant, acquiesces and will acquiesce in any reasonable regulation of the service and of the rates which may be charged the public that may be provided by the State or by any delegated agency of the State. In that way, the thing in which the local community (the State, its munic.i.p.alities or minor communities) has the greatest interest will be amply protected and left free to act in its own interest.

Now, what will be the result practically? At the end of the first ten-year period the question of readjusting the compensation will arise.

If the local government has not adequately protected private interests, if it has not regulated the rates so that the people are obtaining power upon fair terms and the corporation restrained from making extortionate profits, all the Federal Government will have to do will be simply to increase the compensation. If, on the other hand, the fundamental question is being taken care of and the community in which the water-power is generated and distributed is receiving it at fair terms, the compensation can be left where it is or only slightly increased, depending entirely on the situation.

And this has another side? The Federal Government may possibly at times not be looking after some public interests in particular localities as well as it should, for these same Federal officials who are elected by the method suggested by our friend from Louisiana are the men who are going to control a large part of the regulation of the rates by the Federal Government; so anyone who believes that the delegation of this question to either Federal or State authority is a final solution is equally mistaken in either case. But the method which I suggest will work automatically, because if either State or Nation is alive to the people's interests they will be protected either by the imposition of proper compensation or by the appropriate reduction of the rates.

(Applause)

Chairman CONDRA--Fellow-Delegates, Ladies and Gentlemen: In taking note of the remarkable representation from all over the country in this Congress, we should not forget that our President, Mr Bernard N. Baker, is from Baltimore, right on the Atlantic coast and in a southern State; and I desire to say, with a great deal of satisfaction, that a large part of the success of this Congress is due to his unflagging efforts.

(Applause)

We shall close our formal program for the day with a brief address by Colonel James H. Davidson, whom I now have the pleasure of introducing.

Colonel DAVIDSON--Mr Chairman, Ladies and Gentlemen: I shall only detain you a few minutes to make some suggestions which seem to me pertinent.

Many delegates in this Congress seem to have it fixed in their minds that Federal control would settle the questions before us, and other delegates, from the Far West, seem to claim that the States should control absolutely; and to my surprise and great pleasure, I find that the representatives of southern States, like Louisiana and Mississippi, are favoring Federal control. I say to you, Mr Chairman and Delegates to this Congress, that this question is large enough and broad enough to enlist all the statesmanship in the Federal Government and in all the States composing the Union (applause). Reference has been made to that great struggle of nearly fifty years ago, in which I took part for nearly five years from private soldier to brigade commander as a full colonel (being one of but five who advanced in rank from private soldier to a full colonelcy); and I cannot stand up and ask as an American for State rights as against the Federal Government (applause). But it seems to me, Gentlemen, that there is enough for each and all of us to do; and if we, as States, neglect the duties that devolve upon us under the police powers, which all the States have, of regulating internal affairs, including these manufacturing corporations and monopolies, we are weak and are not making full use of the great privileges conferred upon us.

I was interested very much in the discussion by Ex-Governor Pardee; and he pointed out a fact which indicates to my mind that Federal control _alone_ is not sufficient. He says that 6,000,000 acres of the most valuable timber lands that ever grew on this continent were conveyed to the Southern Pacific Railway, in a certain sense in trust, to be conveyed to actual settlers at not less than $2.50 per acre, but that no actual settlers ever went upon that land. It is not charged that the State of California was in any way responsible. There was a case where the Federal Government, and the Federal Government alone, was involved; and yet that valuable property pa.s.sed into the hands of that railroad which is the imperial controller of almost everything in California. In the course of the discussion yesterday in reference to the regulation of oil and gas lands it was stated that in California alternate sections had been conveyed to that great organization, and was out of the control of the Federal Government. That is another case where, if California, a sovereign State, had dealt with those things at the proper time and at the inception, it might have been saved some of the great burdens that now rest upon the people of that State.

They speak of four great water-power companies in California, and two water-power trusts. I thoroughly investigated that subject, spending over six months on it three years ago, and I found that water was king in California, yet the water is owned by these four imperial companies.

One-half of my life and of my most valuable treasure is my son and his family, now in the San Joaquin valley; and every crevice and canon, in the mountains, almost, has been pre-empted by these great water-power combinations, and it costs fifty dollars per horsepower per annum for the use of it for pumping or for any other purpose. If the State of California had been alert, and had had proper regulation, it would have seen to it that these monopolies could not take possession of all these canons and control the water-power against the interests of the people.

A board of most distinguished army engineers reported two or three years ago that the cost of generating one electrical horsepower at the falls of Saint Anthony--within ten miles of where I stand--was less than $6 per annum, and that in the city of Minneapolis to generate one horsepower by steam costs $42. Is there any reason why these great monopolies that can generate horsepower by water at an expense of from five to six dollars--and I think in California at less--should put it to the people at fifty dollars per horsepower? I hope that one of the results of this Congress will be earnest cooperation between the States and the Federal Government. Let each one be alert.

When the Civil War broke out and President Lincoln called for 75,000 men, the Governors of the different States in the North did not hesitate, nor the Governors in the different States in the South; they immediately began calling for volunteers, making all arrangements to take care of the soldiers, and not an hour was lost. Governor Alexander Ramsey, of Minnesota, tendered a regiment to President Lincoln within an hour after the firing upon Fort Sumter (applause). It was a day for the earnest cooperation of all the States with the Federal Government. And we are confronting a condition of that kind, commercially and legally, today; and it needs cooperation, without bickering and without lack of confidence, in the most earnest manner, to pa.s.s such State laws as are proper and right, and to pa.s.s such laws of Congress as will (so far as the General Government has not parted with its rights) control the streams, the lakes, the waters, and the various natural resources in the West. (Applause)

Chairman CONDRA--It is now long after six oclock; and the Congress is adjourned, to rea.s.semble tomorrow morning at 9.30.

_FIFTH SESSION_

The Congress was called to order in the Auditorium, Saint Paul, on Wednesday, September 7, 1910, at 9.30 a.m.

President BAKER--Ladies and Gentlemen: The State Delegations are requested to hand the Secretary, soon as possible, the names of their nominees for Vice-Presidents of the Congress.

The Committee on Resolutions are anxious to have all resolutions submitted to them at the earliest possible moment in order that they may receive full consideration.

It has been arranged to renew the Call of the States tomorrow afternoon.

The first Call of the States was made on Governors' Day (the Second Session), when preference was given to the Governors. Delegations are requested to have a speaker from their State prepared to respond to the call at the Thursday afternoon session.

Now that Delegations are a.s.sembled, the Right Reverend Samuel Cook Edsall, Bishop of the Protestant Episcopal Church for Minnesota, will ask the blessing of our Heavenly Father.

INVOCATION

_O, Almighty and everlasting G.o.d, Who art the giver of every good and perfect gift, we render unto Thee our most humble and hearty thanks for all the blessings which Thou hast vouchsafed unto our country, for our resources of soil, forest, mine, and stream, which Thou hast given into our hands; and we humbly beseech Thee that Thou wilt give unto the President of the United States, the Governors of our States, our legislators in National Congress and in State Legislatures, and unto all those who are in authority, as well as unto all the people whether in public or in private station, the graces of unselfishness and wisdom; that they may rightly use these bounties to Thy honor and glory and for the good of all mankind; and that Thou wilt so bless and guide the deliberations of this Congress that by all that may be here said and done our minds may be illumined and our hearts stirred to righteousness and obedience to Thy law--through Jesus Christ our Lord. Amen._

President BAKER--Ladies and Gentlemen: We have with us today a truly representative man of our Southland, Mr W. W. Finley, President of the Southern Railway Company, who will address us on "The Interest of the Railways of the South in Conservation." (Applause)

Mr FINLEY--Mr President, Ladies and Gentlemen: The interest of the Railways of the South in Conservation and the interest of the people of the South in Conservation are identical. I will go farther, and state my unqualified conviction that any economic or governmental policy that is, in the last a.n.a.lysis, to the best interest of the people of any community is to the best interest of the railways by which that community is served. Conversely, my conviction is equally strong that any economic or governmental policy that is harmful to the railways is harmful to the communities served by them.

Therefore, Mr President, in all that I say on the topic a.s.signed to me--"The Interest of the Railways of the South in Conservation"--I must be understood as presenting what I believe to be the interest of the southern people.

I am not sure that the expression "Conservation of natural resources" is everywhere understood in its broadest sense. I think that to some minds it conveys only the narrow idea of the withdrawal from present use of some part of those resources. However important that kind of Conservation may be in some localities and under some circ.u.mstances, I do not believe there is much occasion for its application in the part of the United States for which I am expected to speak--the States south of the Ohio and Potomac rivers and east of the Mississippi. I would define the type of "Conservation of natural resources" that should be applied in that section as being the wise use of those resources. In some cases it may involve a measure of present self-denial, as when, in the case of an owner of forest lands, it impels him to cut only the matured timber and leave standing immature trees that have a present market value; but, in that case, it leaves him with an a.s.set which increases in value with each year's growth of the standing timber. In some cases Conservation may mean the use of resources so as to obtain the maximum present profit, as in the case of soils; for I believe that I am supported by the best scientific and practical authority in saying that soils not only preserve, but increase, their productivity when so handled, in the application of fertilizers, the rotation of crops, and the growing of live stock, as to yield the maximum present profit.

The South is interested in the application of Conservation to the wise use to its soils, its minerals, its timber, and its streams.

Notwithstanding the wonderful industrial development of the South since 1880, it is still pre-eminently an agricultural section. It is a section, therefore, in which the conservation of the soil is of the highest importance. There is a prevalent belief that the productivity of the soils in those parts of the United States that have been longest under cultivation has been seriously impaired. Statistics do not confirm this belief. Estimates of productions of staple crops per acre have been compiled in the United States only since 1867, and, as there are often wide fluctuations between successive seasons--due to differences in rainfall and temperature--the period covered has not been long enough to afford a basis for definite conclusions. There is also the fact that all available figures are estimates, and consequently are not exact. On their face, however, they do not prove a decline in productivity. This may be ill.u.s.trated by comparing the production of wheat per acre for ten-year periods since 1867. In the decade from 1867 to 1876 the average for the United States was estimated at 12 bushels; from 1877 to 1886, 12.5 bushels; from 1887 to 1896, 12.7 bushels; from 1897 to 1906, 13.8 bushels, and for the three years since 1906, 14.6 bushels. So far, then, as these figures can be relied upon, they tend to show an increase in productivity, especially as an a.n.a.lysis by groups of States shows the larger and more uniform increases to have been in some of the older sections of the country.

Similar figures for corn do not show an increase for the United States as a whole, but they show very little decrease. From 1867 to 1876 the average production of corn per acre was estimated at 26.2 bushels; from 1877 to 1886, 25.1 bushels; from 1887 to 1896, 24.1 bushels; from 1897 to 1906, 25.4 bushels, and for the three years since 1906, 25.8 bushels.

It is proper to note, in connection with the apparent decline in the fourth decade as compared with the first, that the poorest yield in the entire period was in 1901, when abnormal weather conditions brought the estimated average for the United States down to 16.7 bushels, thus pulling down the average for the entire decade. It is also proper to note that Dr Whitney, Chief of the Bureau of Soils in the United States Department of Agriculture, in discussing these figures, expresses the opinion that, on account of a readjustment of the basis of the Department's estimates in 1881 as a result of the reports of the census of 1880, the figures before that year, both for wheat and corn, were relatively too high.

Estimates of cotton yield per acre have been made by the United States Agricultural Department since 1866. Ten-year averages for the full decades up to 1905 are as follows: 1866 to 1875, 176.4 pounds of lint cotton per acre; 1876 to 1885, 171.4 pounds; 1886 to 1895, 175.9 pounds; 1896 to 1905, 182.6 pounds, and for the four years since 1905, 183.1 pounds. These figures are subject to the same question as to their accuracy that apply to the estimates of wheat and corn production, but, on their face, they do not indicate any impairment of the productivity of the cotton soils of the South. It is noteworthy that the larger and more uniform increases in yield per acre shown by the Department's figures are in the older cotton States.

While statistics of crop yields in the United States do not cover a sufficient period to be of great value in determining the effect of long use on soil productivity, some light is thrown on the subject by comparing yields per acre in the United States with those in other countries where lands have been under cultivation for centuries. Thus, for the ten-year period from 1897 to 1906, inclusive, the average yield of wheat per acre in the United States was 13.8 bushels, in France 19.8 bushels, in Germany 28 bushels, and in the United Kingdom 32.2 bushels.

In Germany, statistics are available from 1883 to 1906, inclusive, showing increases in the average yields of wheat from 18.2 to 30.3 bushels, of rye from 15.4 to 25.1 bushels, and of oats from 27.6 to 55.7 bushels. Similar figures might be cited for other European countries, but perhaps the most conclusive statistics are those collected by Kellerman, a German student of this question, who gives the yield per acre for a large number of German estates, covering long periods of time. I shall cite but one of these--a Schmatzfeld estate with records extending back to 1552. In the period between 1552 and 1557 the annual yields reduced to bushels per acre, were, wheat 12.5, rye 13.2, barley 14.2, and oats 14.8. In the period from 1897 to 1904 these yields were, wheat 45.1, rye 34, barley 50.4, and oats 69.1.

Taking all these figures together, I believe the conclusion is inevitable that, while abuse of soils may impair their productivity, their wise use increases it, and the longer they are properly used the more productive they become. Proper use, such as conserves and increases soil productivity, involves the most approved cultural methods, the application of such fertilizers as may be required for varying soil conditions, the raising of live stock, and, above all, the scientific rotation of crops. There can be little question that the most unwise use to which a soil can be subjected is the raising of the same crop for a long series of years. Some very interesting experiments in continuous cropping and crop rotation, covering a period of sixty-five years, have been carried on at Rothamsted, England. On one plot potatoes were grown for fifteen years. At the end of that period the soil was in such condition that it would not grow potatoes at all. It was then planted in barley, and produced an excellent yield. Another crop followed the barley, and the soil was then in condition to grow potatoes again. On this same experimental farm wheat has been sown for fifty years on the same land without fertilizers, and the yield has gone down from 30 bushels to 12 bushels. On another tract wheat has been grown continuously for fifty years with the use of a complete fertilizer, and an average yield of about 30 bushels has been maintained. On another tract wheat has been grown for fifty years in rotation with other crops and an average yield of 30 bushels has been maintained, showing that, for growing wheat on that particular soil, rotation was equivalent to fertilization. As might be expected, the Rothamsted experiments show the best results where fertilizers are used in connection with rotation, and justify the conclusion that under continuous use, with proper rotation and an intelligent use of fertilizers, soil productivity can be largely increased.

This is a matter of particular interest to the South, because with our advantages of soils and climate we have an ideal region for soil conservation through crop rotation and intensive farming. There is a quite general impression throughout the North that, except for a few localities in which early fruits and vegetables, tobacco, and sugar cane are grown, the South is a one-crop region devoted exclusively to cotton.

This is entirely erroneous. There are many localities in the southeastern States where cotton is not grown at all, and every acre of land in the cotton belt is suited for growing other crops as well.

Cotton will continue to be the great staple crop of the South, and with the ever-increasing demand for cotton goods of all kinds, its cultivation will become increasingly profitable, but the southern cotton planter is learning the value of crop rotation; diversified farming and live-stock raising are becoming more general, and the increased supply of cotton demanded by the world will be produced by increasing the average productiveness of each acre as well as by increasing the acreage.

Other things being equal, the conservative use of a raw material, whatever it may be, consists in its manufacture, in the locality of production, through all the stages of preparation for the final consumer. Manufacturing in the South has reached its present growth and is being still further developed on the basis of this kind of conservation of raw material. Industrial development in the South on a large scale may be said to date from about 1880, prior to which time only relatively a small proportion of the raw materials available in that section were advanced through even the first stages of manufacture before being shipped to other localities. It is natural that, at first, only the coa.r.s.er, and what may be termed the preliminary, processes should have been undertaken. This was the first step in the conservation of raw materials by their manufacture near the source of supply. The South has gone far in that direction, and has already started on the second step, which is the use of the products of primary manufacturing as the raw materials for secondary industries. But a large proportion of southern cotton mill products, lumber, pig-iron, and other commodities, advanced through the first stages of manufacture, are still shipped out of the South to serve as the raw materials of industries in other localities which convert them into articles ready for the final consumer; and southern coal is shipped to serve as the raw material for power and heat in other parts of the United States and, to some extent, in foreign countries. This is a waste of energy which, under ideal conditions of Conservation would be avoided; and I am glad to be able to say that the present tendency of industrial development in our section is in the direction of its elimination. Substantial progress has already been made in the building up of secondary manufacturing along some lines, and I believe that the most noteworthy progress of southern industrial development in the immediate future will be in this direction, carrying with it an increase in the volume of primary manufacturing through broadening the market for its products.

One of the most valuable of the natural resources of the South is its timber. It is also a resource of which the intelligent conservation will benefit, directly and indirectly, the largest number of people. We have in the southeastern States large and growing industries which use wood alone, or wood in combination with iron, steel, and other materials, as their raw materials. Some of these industries, such as the manufacture of furniture, have enjoyed a phenomenal growth in the past 30 years.

There is every reason to expect that this growth will continue and that the variety of wood-working industries will be increased, with the result that they will require an increasing supply of raw materials. As the timber consumption of the United States is now in excess of the annual growth, and as other sections are drawing on our southern forests, it is obvious that if these southern wood-working industries are to survive and are to be handed down to future generations, immediate and effective steps should be taken for the conservation of southern forests. This is the more important for the reason that the same steps taken to insure a perpetual supply of raw material for our wood-workers will tend to stream and soil conservation by increasing stream-flow in periods of drought and by lessening the destructiveness of floods which erode the soil of the upper watersheds and deposit gravel and silt on overflowed lands and in the beds of the navigable parts of the streams.

If we were thinking only of the present time, there would be no occasion for us to concern ourselves with the conservation of our timber supplies. We have ample for the present generation. It is because timber is a crop of slow growth, requiring more than a lifetime to mature most of the species, that timber conservation, if it is to be effective and is to provide for the needs of those who come after us, must be handled along exceptional lines. It is not the duty of a private owner of forest lands to conserve them unless it is at least as profitable for him to do so as to clear all the timber off of them; but it _is_ the duty of the Government to consider the welfare of future generations as well as of that now living.

The conservation of southern timber supplies is a matter that concerns not only the people of our own section, but those of the entire United States as well. It is a matter of National concern, as, owing to the depletion of their forest resources, the people of other parts of the country must look to the South for an increasing proportion of their timber supplies. It is a recognition of this National interest in the southern forests that has strengthened the support of the proposition for the acquisition by the Federal Government of large tracts of lands in the Appalachian region to be converted into National forests (applause) from which the timber shall be marketed under a system that will result in the perpetuation of the forests. It may be that our Federal Government has no power, under the Const.i.tution, to acquire lands for the purpose of forest conservation; but it is charged with the supervision, improvement, and conservation of our navigable streams (applause), and the evidence as to the effect of forests on stream flow was so conclusive as to lead the House of Representatives, during the last session of Congress, to pa.s.s a bill providing the establishment of National forests for the protection of the watersheds of navigable streams. This bill is to be voted on in the Senate on the fifteenth of next February. Whether this plan or some other may be adopted, I think it is of the utmost importance that the campaign of education as to the necessity for the speedy and general adoption of the most approved methods of scientific forestry, which is being so ably carried on by the National Forest Service, should be continued (applause). This is quite important, if the best results are to be attained, because, whatever may be done by the Federal Government, much will remain for the States and for private owners of forests and woodlots to do. If the States and private owners are to do their share, the owners of forest lands, the users of forest products, State legislators, and the people generally should be educated as to the dependence of our future supplies of timber on wise conservation.

The private investor in forest lands buys them with the expectation of making a profit on his investment. He naturally wants to make the largest possible profit, and to do it as soon as possible. Heretofore, partly as a result of prevailing systems of taxation and the lack of efficient fire protection, self-interest has impelled the investor in timber lands to clean up his holdings to the last dollar's worth of merchantable timber, and to get off the denuded land as quickly as possible, selling it for whatever it might bring. In the early years of our history, when, except in the prairie regions, lands for cultivation could be obtained only by clearing them of timber, this wholesale cutting was more justifiable, and, in some cases now, in locations where the value of the land for agricultural purposes is greater than its value for timber production, it may be the proper method. We have reached the point, however, when, especially with reference to our mountain forests, it may seriously be questioned whether, as a matter of dollars and cents, this method is the most profitable to the forest owner. In view of the present prices of lumber and the practical certainty of advancing prices in the future, I am disposed to believe that we have now reached the point where it will pay the private owner of any considerable body of timber on land having relatively a low agricultural value to adopt conservative methods of forestry (applause).