The commoner. (Lincoln, Neb.) 1901-1923, July 05, 1901, Page 5, Image 5
1wyfT'wigH'gwifH'y munpi, ' yQWHjM' tH; W'mmH!uyiwyf ji' HWPfl tfVW.'Jt"' 'W'ff-MWW 5 c the death of a trust manager is certainly worthy of consideration. The watering of stock is not only indefensible, but it -contradicts the arguments made by inter ested parties in defence of trusts. The favorite contention of promoters is that consolidation makes production more economical, and, therefore, tends to lower prices. But nearly every corporation tbat attempts a monopoly proceeds to capitalize tho expected savings, thus giving to the stock holders the advantage promised to the consumers. If a corporation plans to control any product, and estimates a saving of one million by the dis charge of travelling salesmen, it figures that that amount will pay fivo per cent interest on twenty million dollars, and it immediately increases the stock to that extent. A prospectus issued by the International Steam Pump company shows that the properties bought were estimated at less than twelve million dollars, while, the company was capitalized at twenty-seven and a half millions. The earnings for tho preceding year were esti mated at one million two hundred thousand. The prospectus adds, in conspicuous type: "A conser vative estimate of tho advantages derived from consolidation is believed to be one million three hundred thousand over the present earnings, which would make a total of future net earnings, with the estimated earnings based on ten months of the year's business, of two millions five hundred thousand, or six per cent on the preferred stock, and over eleven per cent on the common stock of the new company." The Many Cannot Inflate Values. The farmer is not able to inflate the value of his farm; the merchant is not able to inflate the value of the goods upon "his shelf; tho laboring man cannot put a fictitious value upon his ser vices. But a monopoly is able to collect dividends upon watered stock, and to secure Interest upon money never invested in the business. Why should it be tolerated? Why should a fictitious person, called a corporation, be granted privileges or be permitted to enjoy immunities denied to the nat ural citizen?,! It is inevitable that the ordinary in dividual, whether customer, merchant, or employe, must feel the evil effects of over-capitalization. If a farmer realizes only a small profit when he sells, but is compelled when he buys to pay the manu facturer a large profit, it is evident that he will fall behind in the race for a competency. If the merchant must sell at a profit fixed by competition, and buy at a price fixed by monopoly, and upon terms regulated wholly In the interests of the manufacturer, he will have to bear all the vicissi tudes of trade, and will find himself at a great disadvantage. Tho managers of the corporations will be Interested in keeping the stock at par, and in dull times there will be a perpetual contest be tween wages and watered stock. The same number of the North American Re view which contains Mr. Sage's article contains replies thereto by Mr. Hill of the Great Northern, Northern Pacific and Burlington Railroad combi nation, Mr. Schwab of the Steel trust, Mr. Flint of the Rubber trust, and Mr. Logan of the Envelope trust. But Lho testimony given by these gentlemen must be taken with that allowance -which is al ways .made for the testimony of witnesses. pecun iarily Interested. "V App'lcatlon ot Every Day Rule. In discussing the result to follow from the es tablishment of industrial combinations for the sup pression of competition, one can only apply the rules which are seen in operation every day. Hu man nature does not change much from genera tion to generation; selfishness is at potent an in fluence today as it was a century ago. Advance ment is not secured by the elimination of selfish ness, but by restraining excessive manifestations of it The , . Commoner. First, extortionate prices to the consumer will prevail. The same greed which leads trust mag nates to issue stock in excess of tho money in vested will lead them to make the dividends as large as possible, and tho same greed which leads them to Increase tho dividonds will lead them to repeat stock inflation indefinitely. Second, industrial monopoly Is likely to re sult in lessoned wages and in increasing friction between employers and employes. The larger the corporation the moro complete tho separation of the employe from the manager of the corporation, and the less the sympathy between those who toll and those who fix tho wages. Third, the enhancement of the price of trust made articles must" in the long run lessen the de mand for the product by lessening the ability of consumers to purchase. This in turn means cur tailment of production and a diminished derriand for labor. Fourth, under a system of monopoly all loss can be thrown upon .the laborers. Under competi tion the factory often runs at bare cost, or even be low cost, because suspension of work. might mean tho scattering of tho employes to other centres of industry. But when a corporation has control of tho market, it can close down without loss and leave tho employes in Idloness until the surplus is worked off at a high price. Thus a high wage per day, when there is employment, may mean a small annual income. Fifth, monopoly is likely to result in deterior ation of the product. Sixth, the opportunity to make onormous prof its by market fluctuations is apt to lead the man agers of monopolies to speculate at the expense of the ordinary stockholders, and suggests, a method of influencing public officials far moro potent than any form of direct bribery. Seventh, monopoly provides a few places -with excessive salaries, but denies to a multitude, of competent and deserving men the possibility, of Industrial and financial independence. It crowns a few with laurels, and condemns tho masses to hopeless servitude' Eighth, as imperialism substitutes a sullen subject for a bold and self-assertive citizen, so an industrial monopoly converts the ambltipus and progressive artisan Into a timid and servile de pendent. Ninth, with a complete monopoly we may ex pect that the control, descending with the stock from father to son, will create an industrial aris tocracy, as hostile to liberty as the landed aris tocracy which was overthrown, by our forefathers. Sound Principles Apply Generally. Whether a remedy needs to be applied depends upon the answer given to the inquiry in regard to competition. If competition is desirable, a private monopoly. is indefensible. If, on the other hand, tae suppression of competition is a thing to be de sired, some plan must be devised to make the sup pression complete. It would be obviously unfair for one portion of the community to be protected from competition while another portion was sub jected to it. No principle can bo accepted as sound which is not susceptible of general application. If the people decide that competition should be sup pressed, they must choose between private monop oly and socialism. I do not mean that system of socialism, now called extreme, which would place the government in control of all the forces of pro duction and distribution, but a still moro com plete system, which would make the state the ben eficiary of all service" rendered and the distributer of all compensation. Extinction of Private Monopoly. The extinction of private monopoly is, in my judgment, both desirable and possible. Tho cor poration is the. institution through -which the monopoly develops, and, as a corporation is pure ly a creature of law, the people can place on it such limitations as may be necessary for public wel fare and protection. The state has power to prer vent the creation of any corporation within its limits, or to fix the conditions upon which a cor poration may exist. It also has the power, or should have, to prescribe the terms upon which a foreign corporation may do business in the state. The distinction between the natural man and tho corporate person is so great that the state should have the power, if it has not now, to give its citi zens any necessary protection from corporations organized elsewhere. But tho stato Is not able to furnish a complete remedy, and, without taking away tho rights which tho stato now has, congress should give additional protection. Tho Sherman anti-trust law prohibits contracts entered into by Gopaijate persons or corporations for tho limiting of production, fixing of prico, or division of terri tory. While this law has not, according to tho belief of many, been enforced as it should have beon, It U not broad enough to reach a monopoly attempted by a single corporation. According to tho constitution, congress has power to regulate interstato commerce, and under this power it cer tainly has a right to defino a monopoly, and to provent such a monopoly from engaging in inter state commerco. It can deny to a monopoly the use of. the mails as it does to tho lottery. It can also deny to it the uso of tho interstato telegraph lines or railroad systems. It can require a corpor ation to establish to the satisfaction of the inter state commerce commission or of some other com mission created for the purpose, the fact that there is no water in tho stock, and that It is not at tempting lo monopolize any branch of .business, and it can provide for a revocation of the permit 01 license if tho conditions are violated. It can fix a maximum proportion between the business which any corporation engaged in interstate com merce .shall be permitted to demand tho total busi ness done in that line. It can fix tho maximum capitalization of corporations engaged in inter stato commerce, or the maximum dividends which they may earn. It can require a corporation to sell to all customers at tho same price and on the samo terms, and it can remove the tariff from trust-mado articles. These are a few of the rem edies that have been discussed. While congress cannot interfere with a domes tic corporation, it has supreme power over com merce between the states. The failure of con gress to pass necessary laws, and of officials to enforce existing laws, is due to the fact that mem bers of congress and executive officers aro itnder obligations to the trusts and monopolies for cam paign assistance. The people can put an end to private monopolies as soon as they undertake it In earnest and not before. ,T4 narseillaise. s (From the French, by Itoget de Halm,) Ye sons of Freedom, wake to glory; .rJEIark, hark, what myriads bid you rise! Your children, wives, and grandsires hoary . Behold their tears and hear their cries V Shall hateful tyrants mischief breeding, With hireling hosts, a ruffian band, Affright and desolate tho land, While peace and liberty lie bleeding! To arms, to arms, ye brave! Th' avenging sword unshcath! March on! March ont . M All hearts resolved on victory or death! Now, now the dangerous storm is rolling. Which treacherous kings confederate raise; The dogs of war, let loose, are howling, And lo! our walls and cities blaze! And shall we basely view the ruin, While lawless force with guilty stride, Spreads "desolation far and wide, With crimes and blood his hands embruing? Th' avenging sword unsheath! To arms, to arms, ye brave! March on! March on! All hearts resolved on victory or death! With luxury and pride surrounded, The vile insatiate despots dare, Their thirst of. gold and power unbounded, : To mete and vend the light and air! Like beasts of burden they would lead us, Like gods would bid their slaves adore; -But man is man, and who is more? Then shall they longer lash and goad us? Th' avenging sword unsheath! To arms, to arms, ye brave! March on! March on! All hearts resolved on -victory or death! O Liberty! can man resign thee, . Once having felt thy generous flame? Can dungeons' bolts and bars confine thee, Or whips thy noble spirit tame? Too long the world has wept, bewailing That falsehoods' dagger tyrants wield; But Freedom Is our sword and shield, And all their arts aro unavailing! To arms, to arms, yo brave! Th' avenging sword unsheath! .! March on! March on! All hearts resolved on victory or death! I - W-Mto,