4
i
tory to the 'disposition of, tho government of tlio
United States.
The government and disposition of territory so
acquired belong to the government of the United
States, consisting of the president, tho senate
elected by tho states, and tho house of representa
tives, cho.ien by and immediately representing tho
people of the United States. Treaties by. which
territory is acquired from a foreign state usually
recognize this. ':..
It is clearly recognized In the recent 'treaty
with Spain, especially in tho ninth article,, by
which "Tho civil rights and political status-.of -the
native inhabitants of tho territories hereby ceded
to tho United States shall bo determined by the
congress.
By the fourth and thirteenth articles pf tho
treaty, the United States agree that, for ten years,
Spanish ships and merchandise
Terms of shall be admitted to the ports of
(he Peace the Philippine islands on the
Treaty. same terms as ships and mer
chandise of the United States,
and Spanish scientific, literary and artistic works,
not subversive of public order, shall continue to be
admitted free of duty into all the ceded territories.
Neither of these provisions could bo carried out if
the constitution required the customs regulations
of the United States to apply in those territories.
In the absence of congressional legislation, the
regulation of the revenue of the conquered terri
tory, even after the treaty of cession, remains with
tho executive and military authority.
So long as congress has not incorporated tho
territory, into the United States, neither military
occupation nor cession by 'treaty
.Cngress Hust niakeg the conquered territory
incorporate domestic territory, in " the sense
Territory. of the revenue laws. But those
laws concerning "foreign coun
tries" remain applicable to the conquered territory
until changed by congress. . Such was the unani
mous opinion of this court,, as declared by Chief
Justice Taney, in Fleming v. Page, 9 How. 603, 617.
If congress is not ready to construct a com
plete government for the conquered territory, it
may establish, a temporary government, wliich is
not subject to all the restrictions of tho constitu
tion. Such was,, the effect of the act of congress of
April 12, 1S00, c. 191, entitled "An act temporarily
to provide revenues and a civil
TheForaker government for Porto Rico, and
Act Not for other purposes." By the third
Domestic. section of that act, it was ex
pressly declared that the duties
thereby established on merchandise and articles
going into Porto Rico from the United States, or
coming into the United States from Porto Rico,
should cease in any event on March 1, 1902, and
sooner if the legislative assembly of Porto Rico
should enact and put into operation a system of
local taxation to meet the necessities of the gov
ernment established by that act.
The system of duties, temporarily established
by that act during the transition period, was with
in tho authority of congress under the constitution
of the United States.
W
Industrial Combinations.
Eclow will be found an article written by
Mr. Bryan recently for Collier's Weekly and
produced by the courtesy of that paper:
In considering industrial combinations, the
subject naturally divides itself Into the condition
to be considered, tho probable result of present
tendencies, and the remedy.
Tho word "trust" used to designate large cor
porations, does not accurately describe tho thing
complained of. In tho beginning combinations in
restraint of trade were formed by an agreement be-
The Commbner.
tween separate companies, whereby the stock was
hold in trust by an association which controlled
several corporations At present there is no deposit
of stock in trust, but in place of tho old system
wo find a great corporation owning and controlling
a number of plants. A distinction should be made
between a corporation, however large, and a mon
opoly. In fact, it is impossible to consider what is
known as the trust question without keeping in
mind the proportion which the output of tho cor
poration under discussion bears to the total output
of all factories in the United States. For instance,
if we have one hundred woollen factories scattered
ovoj tho country, producing together the total
aomunt of domestic woollens manufactured in tho
United States, a combination whereby two, or five,
or even ten, were joined under one man
agement would present a very different situation
from that which would bo produced by the consoli
dation of all of them into one corporation The
monopoly feature appears whenever a corporation
is sufficiently powerful to control the market. The
fundamental question to be considered, therefore,
is whether competition is desirable or undesirable.
I shall speak of this later in discussing remedies,
but it must always be borne in mind that the elim
ination of competition is, temporarily at least,
beneficial to the man who has the monopoly. This
cannot bo doubted, but is it not detrimental both
to the consumer and to the laborer?
Rights of tlio
Laborer.
The consumer has certain needs which must
be , supplied; under competition, he is protected
from' extortion' by the opportunity which he has
to purchase tho article offered him at the lowest
price. Under1 monopoly lie has no choice, but must
take what is' offered him at the price fixed by the
seller, A skilled laborer has a 'right to demand
from" his employer full valu'e for his services.
When there are many employers, each pecuniarily
interested in securing the best service, the laborer
is better protected than he is when there is but
one employer. The labor organization is an aid
to the laboring men in securing reasonable hours,
just compensation, and fair conditions. At present
the labor organization is practically the only pro
tection the wage-earner has, but the labor .organi
zation, however perfect and complete, is no match
for an absolute industrial monopoly. Workmen
with families dependent upon them could not-livo
long without work, neither could they afford to
engage in another line of work whore their special
training would be of no advantage. The pressing
every-day needs of the body make a contest of en
durance between flesh and blood on the one side
and capital on the other very unequal.
Impossible '.
Competition.
The man who attempts to manufacture an ar
ticle in competition with a thoroughly established
monopoly has before him a difficult, if not an al
most impossible task. To recur to the above illus
tration, if all the woollen mills now in existenco
should be gathered under the control of one cor
poration with a capital of half a billion, who could
compete with it successfully? If a person amply
supplied with capital to conduct under ordinary
conditions a successful mill were to compete with
a monopoly, such monopoly would be able, at a
very small expense to itself, to undersell him in
his particular field, while maintaining prices in
other parts of the country. If an organization of
equal capital attempted rivalry, it would first have
to overcome the advantage which the established
industry had secured by the advertisement of its
wares, and then, if it were successful, tha country
would have moe woollen plants than necessary
to supply tho demand, and more skilled laborers
than would be required for the work.
Safe's Note '
of Warning:.
Private monopolies have always been regarded
as unlawful, and there are numerous instance
whore the people have overthrown them when
their exactions become intolerable. Mr. McKinley
has condemned the trusts, although, it must be
confessed, with ever diminishing emphasis.. Orr
ganized capital has been making such gigantic
strides toward tho control of industry during tho
last few 'months that even those who have been
in tho habit of belittling reformers, and accus
tomed to regard all criticism of corporations as
evidence of discontent, are becoming .alarmed; Mr.
Hussell Sage has never been considered ademar
gogue, nither has he shown himself unduly hpstilo
to capitalists as a class; his note of warning,
therefore, is the more significant. Jn a recently
published article in the North American Review
he thus describes the industrial situation as it ap
pears to him:
"Tho chief owners of the Standard Oil busi
ness have grown so enormously wealthy that, in
their individual as well as in their corporate capac
ity, they dominate wherever they choose to go.
They can make or unmake almost any property,
no matter how vast. They can almost compel any
man to sell them anything at any price."
He fortifies his own observations by quoting
the language of Henry Clews, another Wall Street
operator. This presents one phase of the question.
When combinations of capital "can make or un
make almost any property, no matter how yast,'
and when they can "almost compel any man to
sell them anything at any price," then they cease
to be private affairs and become matters of public
concern. The question is not whether the public
has a right to interfere with the manner in which
these combinations use their own property, but
whether the public will allow them to appropriate
or destroy the property of other people.
Of the new steel company, Mr. Sage says:
"The consolidations of today begin at the very
outset with capitklizations'that cast all past ex
periences iiito the shade, and 'that almost stagger
the imagination. The steel combination now form-:
ing, we are told, is to start off with a capitaliza
tion of $1,000,000,000. This is more than one-half
of the national debt. It Js one-seventieth of the
entire wealth of the United States. The total
money in circulation in the United States, accord
ing to the treasurer's statistics, is $2,113,294,938.;
It will be seen, therefore, that this company's is
sue of securities will represent practically one
half of the entire volunle of money in America. In
a year or two, if precedents count for anything,
this capitalization will be very largely increased!
and that in spite of the fact that stockholders in
the steel company, which was the b.asis of the new
combination, got three shares of stock in the new
company for one In the old scores of millions be
ing thus added to tho interest-earning securities
in the United States, by merely the stroke of a pen;
When wealth is created in that way, what security
is there for tho whole scheme? Not another fur
nace added to the plant; simply a lifting process,
and what was one million before is three millions
now. The great experience and strength of tho
men who produced thiB change will make us ac
cept the new valuation, and that is all there is in
it.
"If any of the men in whom we very properly
have this confidence should die suddenly, every
thing would be disorganized. Even as it is, things
may break at a critical period, and then we shall
have to find a new level with considerable trouble
and agitation to ourselves. Just at present, no
one can say, with anything like accuracy, where
wo stand."
Underestimated
Capitalization
This corporation was being formed when Mr.
Sage's article was written, and he underestimated;
the capitalization, but his remarks in regard to the
watering of stock are in point; the illustration
used to set forth the magnitude of tho corpora
tions Is apt, and his comment upon the effect of
,j i
