concurring.
I
We concur with the Court’s judgment that the rate order of the Federal Power Commission, issued after a fair hearing upon findings of fact supported by substantial evidence, should have been sustained by the court below. But insofar as the Court assumes that, regardless of the terms of the statute, the due process clause of the Fifth Amendment grants it power to invalidate an order as unconstitutional because it finds the charges to be unreasonable, we are unable to join in the opinion just announced.
Rate making is a species of price fixing. In a recent series of cases, this Court has held that legislative price fixing is not prohibited by the due process clause.1 We believe that, in so holding, it has returned, in part at least, to the constitutional principles which prevailed for the first hundred years of our history. Munn v. Illinois, 94 U. S. 113; Peik v. Chicago & N. W. Ry. Co., 94 U. S. 164. Cf. McCart v. Indianapolis Water Co., 302 U. S. 419, 427-*600428. The Munn and Peik cases, decided in 1877, Justices Field and Strong dissenting, emphatically declared price fixing to be a constitutional prerogative of the legislative branch, not subject to judicial review or revision.
In 1886, four of the Justices who had voted with him in the Munn and Peik cases no longer being on the Court, Chief Justice Waite expressed views in an opinion of the Court which indicated a yielding in part to the doctrines previously set forth in Mr. Justice Field’s dissenting opinions, although the decision, upholding a state regulatory statute, did not require him to reach this issue. See Railroad Commission Cases, 116 U. S. 307, 331. For an interesting discussion of the evolution of this change of position, see Swisher, Stephen J. Field, 372-392. By 1890, six Justices of the 1877 Court, including Chief Justice Waite, had been replaced by others. The new Court then clearly repudiated the opinion expressed for the Court by Chief Justice Waite in the Munn and Peik cases, in a holding which accorded with the views of Mr. Justice Field. Chicago, M. & St. P. Ry. Co. v. Minnesota, 134 U. S. 418. Under those views, first embodied in a holding of this Court in 1890, “due process” means no less than “reasonableness judicially determined.” 2 3In accordance with this elastic meaning which, in the words of Mr. Justice Holmes, makes the sky the limit3 of judicial power to declare legislative acts unconstitutional, the conclusions of judges, substituted for those of legislatures, become a broad and varying standard of constitutionality.4 ***We *601shall not attempt now to set out at length the reasons for our belief that acceptance of such a meaning is historically unjustified and that it transfers to courts powers which, under the Constitution, belong to the legislative branch of government. But we feel that we must record our disagreement from an opinion which, although upholding the action of the Commission on these particular facts, nevertheless gives renewed vitality to a “constitutional” doctrine which we are convinced has no support in the Constitution.
The doctrine which makes of “due process” an unlimited grant to courts to approve or reject policies selected by legislatures in accordance with the judges’ notion of reasonableness had its origin in connection with legislative attempts to fix the prices charged by public utilities. And in no field has it had more paralyzing effects.5
II
We have here, to be sure, a statute which expressly provides for judicial review. Congress has provided in § 5 of the Natural Gas Act that the rates fixed by the Commission shall be “just and reasonable.” The provision for judicial review states that the “finding of the Commission as to the facts, if supported by substantial evidence, shall be conclusive.” § 19 (b). But we are not satisfied that the opinion of the Court properly delimits the scope of that review under this Act. Furthermore, since this case starts *602a new chapter in the regulation of utility rates, we think it important to indicate more explicitly than has been done the freedom which the Commission has both under the Constitution and under this new statute. While the opinion of the Court erases much which has been written in rate cases during the last half century, we think this is an appropriate occasion to lay the ghost of Smyth v. Ames, 169 U. S. 466, which has haunted utility regulation since 1898. That is especially desirable lest the reference by the majority to “constitutional requirements” and to “the limits of due process” be deemed to perpetuate the fallacious “fair value” theory of rate making in the limited judicial review provided by the Act.
Smyth v. Ames held (pp. 546-547) that “the basis of all calculations as to the reasonableness of rates to be charged by a corporation maintaining a highway under legislative sanction must be the fair value of the property being used by it for the convenience of the public. And in order to ascertain that value, the original cost of construction, the amount expended in permanent improvements, the amount and market value of its bonds and stock, the present as compared with the original cost of construction, the probable earning capacity of the property under particular rates prescribed by statute, and the sum required to meet operating expenses, are all matters for consideration, and are to be given such weight as may be just and right in each case. We do not say that- there may not be other matters to be regarded in estimating the value of the property. What the company is entitled to ask is a fair return upon the value of that which it employs for the public convenience. On the other hand, what the public is entitled to demand is that no more be exacted from it for the use of a public highway than the services rendered by it are reasonably worth.”
(1) This theory derives from principles of eminent domain. See Mr. Justice Brewer, Ames v. Union Pacific Ry. *603Co., 64 F. 165, 177; West v. Chesapeake & Potomac Telephone Co., 295 U. S. 662, 671; Hale, Conflicting Judicial Criteria of Utility Rates, 38 Col. L. Rev. 959. In condemnation cases the “value of property, generally speaking, is determined by its productiveness — the profits which its use brings to the owner.” Monongahela Navigation Co. v. United States, 148 U. S. 312, 328, 329. Cf. Consolidated Rock Products Co. v. Du Bois, 312 U. S. 510, 525-526. But those principles have no place in rate regulation. In the first place, the value of a going concern in fact depends on earnings under whatever rates may be anticipated. The present fair value rule creates, but offers no solution to, the dilemma that value depends upon the rates fixed and the rates upon value. See Mr. Justice Brandeis, Southwestern Bell Telephone Co. v. Public Service Commission, 262 U. S. 276, 292; Hale, The Fair Value Merry-Go-Round, 33 Ill. L. Rev. 517; 2 Bonbright, Valuation of Property, pp. 1094 et seq. In the second place, when property is taken under the power of eminent domain the owner is “entitled to the full money equivalent of the property taken, and thereby to be put in as good position pecuniarily as it would have occupied if its property had not been taken.” United States v. New River Collieries Co., 262 U. S. 341, 343. But in rate-making, the owner does not have any such protection. We know, without attempting any valuation, that if earnings are reduced the value will be less. But that does not stay the hand of the legislature or its administrative agency in making rate reductions. As we have said, rate-making is one species of price-fixing. Price-fixing, like other forms of social legislation, may well diminish the value of the property which is regulated. But that is no obstacle to its validity. As stated by Mr. Justice Holmes in Block v. Hirsh, 256 U. S. 135, 155: “The fact that tangible property is also visible tends to give a rigidity to our conception of our rights in it that we do not attach to others less con*604cretely clothed. But the notion that the former are exempt from the legislative modification required from time to time in civilized life is contradicted not only by the doctrine of eminent domain, under which what is taken is paid for, but by that of the police power in its proper sense, under which property rights may be cut down, and to that extent taken, without pay.” Somewhat the same view was expressed in Nebbia v. New York, 291 U. S. 502, 532, where this Court said: “The due process clause makes no mention of sales or of prices any more than it speaks of business or contracts or buildings or other incidents of property. The thought seems nevertheless to have persisted that there is something peculiarly sacrosanct about the price one may charge for what he makes or sells, and that, however able to regulate other elements of manufacture or trade, with incidental effect upon price, the state is incapable of directly controlling the price itself. This view was negatived many years ago. Munn v. Illinois, 94 U. S. 113.” Explicit recognition of these principles will place the problems of rate-making in their proper setting under this statute.
(2) The rule of Smyth v. Ames, as construed and applied, directs the rate-making body in forming its judgment as to “fair value” to take into consideration various elements — capitalization, book cost, actual cost, prudent investment, reproduction cost. See Mr. Justice Brandeis, Southwestern Bell Telephone Co. v. Public Service Commission, supra, pp. 294-295. But as stated by Mr. Justice Brandéis: “Obviously 'value’ cannot be a composite of all these elements. Nor can it be arrived at on all these bases. They are very different; and must, when applied in a particular case, lead to widely different results. The rule of Smyth v. Ames, as interpreted and applied, means merely that all must be considered. What, if any, weight shall be given to any one, must practically rest in the judicial discretion of the tribunal which makes the deter*605mination. Whether a desired result is reached may depend upon how any one of many elements is treated.” Id., pp. 295-296. The risks of not giving weight to reproduction cost have been great. Southwestern Bell Telephone Co. v. Public Service Commission, supra; St. Louis & O’Fallon Ry. Co. v. United States, 279 U. S. 461. The havoc raised by insistence on reproduction cost is now a matter of historical record. Mr. Justice Brandéis in the Southwestern Bell Telephone case demonstrated how the rule of Smyth v. Ames has seriously impaired the power of rate-regulation and how the “fair value” rule has proved to be unworkable by reason of the time required to make the valuations, the heavy expense involved, and the unreliability of the results obtained.6 And see Mr. Justice Brandeis concurring, St. Joseph Stock Yards Co. v. United States, 298 U. S. 38, 73; dissenting opinion, McCart v. Indianapolis Water Co., 302 U. S. 419, 423 et seq.; Mr. Justice Stone dissenting, West v. Chesapeake Potomac Telephone Co., supra. The result of this Court’s rulings in rate cases since Smyth v. Ames has recently been summarized as follows: “Under the influence of these precedents, commission regulation has become so cumbersome and so ineffective that it may be said, with only slight exaggeration, to have broken down. Even the investor,7 on whose behalf the constitutional safeguards have *606been developed, has received no protection against the rebounds from the inflated stock-market prices that are stimulated by the ‘fair-value’ doctrine.” Bonbright, op. cit., p. 1164.
As we read the opinion of the Court, the Commission is now freed from the compulsion of admitting evidence on reproduction cost or of giving any weight to that element of “fair value.” The Commission may now adopt, if it chooses, prudent investment as a rate base— the base long advocated by Mr. Justice Brandéis. And for the reasons stated by Mr. Justice Brandéis in the Southwestern Bell Telephone case, there could be no constitutional objection if the Commission adhered to that formula and rejected all others.
Yet it is important to note, as we have indicated, that Congress has merely provided in § 6 of the Natural Gas Act that the rates fixed by the Commission shall be “just and reasonable.” It has provided no standard beyond that. Congress, to be sure, has provided for judicial review. But § 19(b) states that the “finding of the Commission as to the facts, if supported by substantial evidence, shall be conclusive.” In view of these provisions, we do not think it is permissible for the courts to concern themselves with any issues as to the economic merits of a rate base. The Commission has a broad area of discretion for selection of an appropriate rate base. The requirements of “just and reasonable” embrace, among other factors, two phases of the public interest: (1) the *607investor interest; (2) the consumer interest. The investor interest is adequately served if the utility is allowed the opportunity to earn the cost of the service. That cost has been defined by Mr. Justice Brandéis as follows: “Cost includes not only operating expenses, but also capital charges. Capital charges cover the allowance, by way of interest, for the use of the capital, whatever the nature of the security issued therefor; the allowance for risk incurred; and enough more to attract capital.” Southwestern Bell Telephone Co. v. Public Service Commission, supra, 262 U. S. at p. 291. Irrespective of what the return may be on “fair value,” if the rate permits the company to operate successfully and to attract capital all questions as to “just and reasonable” are at an end so far as the investor interest is concerned. Various routes to that end may be worked out by the expert administrators charged with the duty of regulation. It is not the function of the courts to prescribe what formula should be used. The fact that one may be fair to investors does not mean that another would be unfair. The decision in each case must turn on considerations of justness and fairness which cannot be cast into a legalistic formula. The rate of return to be allowed in any given case calls for a highly expert judgment. That judgment has been entrusted to the Commission. There it should rest.
One caveat, however, should be entered. The consumer interest cannot be disregarded in determining what is a “just and reasonable” rate. Conceivably, a return to the company of the cost of the service might not be “just and reasonable” to the public. The correct principle was announced by this Court in Covington & Lexington Turnpike Co. v. Sandford, 164 U. S. 578, 596: “It cannot be said that a corporation is entitled, as of right, and without reference to the interests of the pub-*608lie, to realize a given per cent upon its capital stock. When the question arises whether the legislature has exceeded its constitutional power in prescribing rates to be charged by a corporation controlling a public highway, stockholders are not the only persons whose rights or interests are to be considered. The rights of the public are not to be ignored. It is alleged here that the rates prescribed are unreasonable and unjust to the company and its stockholders. But that involves an inquiry as to what is reasonable and just for the public. If the establishing of new lines of transportation should cause a diminution in the number of those who need to use a turnpike road, and, consequently, a diminution in the tolls collected, that is not, in itself, a sufficient reason why the corporation, operating the road, should be allowed to maintain rates that would be unjust to those who must or do use its property. The public cannot properly be subjected to unreasonable rates in order simply that stockholders may earn dividends.” Cf. Chicago & Grand Trunk Ry. Co. v. Wellman, 143 U. S. 339, 345-346; United Gas Co. v. Texas, 303 U. S. 123, 150-151.
This problem carries into a field not necessary to develop here. It reemphasizes, however, that the investor interest is not the sole interest for protection. The investor and consumer interests may so collide as to warrant the rate-making body in concluding that a return on historical cost or prudent investment, though fair to investors, would be grossly unfair to the consumers. The possibility of that collision reinforces the view that the problem of rate-making is for the administrative experts, not the courts, and that the ex post facto function previously performed by the courts should be reduced to the barest minimum which is consistent with the statutory mandate for judicial review. That review should be as confined and restricted as the review, under similar statutes, of orders of other administrative agencies.
Some of these cases arose under the Fifth, some under the Fourteenth, Amendment. Nebbia v. New York, 291 U. S. 502 (state statute authorizing a rnillr control board to fix minimum and maximum retail prices for milk); Mulford v. Smith, 307 U. S. 38 (federal statute imposing penalties on tobacco auction warehousemen for .marketing tobacco in excess of prescribed quota); United States v. Rock Royal Co-op., 307 U. S. 533 (federal statute authorizing Secretary of Agriculture to fix minimum prices to be paid producers for milk sold to dealers); Sunshine Coal Co. v. Adkins, 310 U. S. 381 (federal statute authorizing Bituminous Coal Commission to-fix maximum and minimum prices for bituminous coal); United States v. Darby, 312 U. S. 100 (federal statute fixing minimum wages (and maximum hours) for employees engaged in production of goods for interstate commerce); Olsen v. Nebraska, 313 U. S. 236 (state statute fixing maximum compensation to be collected by private employment agencies).
See Polk Company v. Glover, 305 U. S. 5, 12-19. Cf. Chambers v. Florida, 309 U. S. 227, 235-238.
“As the decisions now stand, I see hardly any limit but the sky to the invalidating of those rights if they happen to strike a majority of this Court as for any reason undesirable.” Baldwin v. Missouri 281 U. S. 586, 595.
To hold that the Fourteenth Amendment was intended to and did provide protection from state invasions of the right of free speech *601and other clearly defined protections contained in the Bill of Rights, Drivers Union v. Meadowmoor Co., 312 U. S. 287, 301-302, is quite different from holding that “due process,” an historical expression relating to procedure, Chambers v. Florida, supra, confers a broad judicial power to invalidate all legislation which seems “unreasonable” to courts. In the one instance, courts proceeding within clearly marked constitutional boundaries seek to execute policies written into the Constitution; in the other, they roam at will in the limitless area of their own beliefs as to reasonableness and actually select policies, a responsibility which the Constitution entrusts to the legislative representatives of the people.
McCart v. Indianapolis Water Co., supra.
“The relation between the public utility and the community cannot be expressed in terms of a simple, quantitatively ascertainable fact, for the relation involves numerous and complex factors which depend on compromise and practical adjustment rather than on deductive logic. The whole doctrine of Smyth v. Ames rests upon a gigantic illusion. The fact which for twenty years the court has been vainly trying to find does not exist. ‘Fair value’ must be shelved among the great juristic myths of history, with the Law of Nature and the Social Contract. As a practical concept, from which practical conclusions can be drawn, it is valueless.” Henderson, Railway Valuation and the Courts, 33 Harv. L. Rev. 1031, 1051.
“Such valuation proceedings, as heretofore conducted, are excessively costly, require a long period of time, affect adversely the *606corporation’s credit, interfere with its financing upon favorable terms, and frequently cause the postponement of extensions and improvements to the great detriment of the public. Unless and until there is some change in the legal principles which must be applied in determining fair value, however, the industry cannot escape from this situation.” Report of the Committee on Valuation, American Electric Railway Assoc., 1924, p. 20.