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DECEMBER 8, 1911
The Commoner.
methods for stifling competition and
effecting monopoly, should be
described with Buffiicent accuracy in
a criminal statute on the one hand
to enable the government to shorten
its task by prosecuting single mis
demeanors instead of an entire con
spiracy, and, on the other hand, to
serve the purpose of pointing out
more in detail to the business com
munity what must be avoided.
Federal Incorporation Recommended
In a special message to congress
on January 7, 1910, I ventured to
point out the disturbance to busi
ness that would probably attend the
dissolution of these offending trusts.
I said:
"But such an investigation and
possible prosecution of corporations
whose prosperity or destruction
affects the comfort not only of stock
holders but of millions of wage earn
ers, employees, and associated trades
men must necessarily tend to disturb
the confidence of the business com
munity, to dry up the now flowing
sources of capital from its places of
hoarding, and produce a halt in our
present prosperity that will cause
suffering and strained circumstances
among the innocent many for the
faults of the guilty few. The ques
tion which I wish in this message to
bring clearly to the consideration
and discussion of congress is
whether, in order to avoid such a
possible business danger, something
can not be done by which these busi
ness combinations may be offered a
means, without great financial dis
turbance, of changing the character,
.organization, and extent of their
business into one within the lines of
the . law under federal control and
supervision, securing compliance with
the anti-trust statute. 4
"Generally, in the industrial com
binations called 'trusts,' the princi
pal business is the salo of goods in
many states and in foreign markets;
in other words, tno interstate and
foreign business far exceeds the busi
ness done in any one state. This
fact will justify the federal govern
ment in granting a federal charter
to such a combination to make and
sell in interstate and foreign com
merce the products of useful manu
facture under such limitations as
will secure a compliance with the
anti-trust law. It is possible so to
frame a statute that while it offers
protection to a federal company
against narmful, vexatious, and un
necessary invasion by the states, it
shall subject it to reasonable taxa
tion and control by the states with
respect to its purely local business.
"Corporations organized under this
act should be prohibited from acquir
ing and holding stock in other cor
porations (except for special reasons,
upon approval by the proper federal
authority), thus avoiding the crea
tion under national auspices of the
holding company with subordinate
corporations in different states, which
has been such an effective agency in
the creation of the great trusts ana
monopolies. ..,.
"If the prohibition of the anti-trust
act against combinations in restraint
of trade is to be effectively enforced,
it is essential that the national gov
ernment shall provide for the creation
of national corporations to carry on
a legitimate business throughout the
United States. The conflicting laws
of the different states of the union
with respect to foreign corporations
make it difficult, if not impossible, for
one corporation to comply with their
requirements so as to carry on busi
ness in a number of different states
" I renew the recommendation or tne
enactment of a general law providing
for the voluntary formation of cor
porations to engage in trade and
commerce among the states and with
foreign nations. Every argument
which was then advanced for such a
law, and every explanation which
11
was at that time offered to possible
objections, have been conflrmod by
our experience since the enforcement
of the anti-trust statute has resulted
in the actual dissolution of active
commercial organizations.
It is oven more manifest now than
it was then that the denunciation of
conspiracies in restraint of trade
should not and does not mean the
denial of organizations largo enough
to bo intrusted with our interstate
and foreign trade. It has been made
more clear now than it was -hen that
a purely negative statute like the
anti-truBt law may well bo supple
mented by specific provisions for the
building up and regulation of legiti
mate national and foreign commerce.
Government Administrative Experts
Needed to Aid Courts in
Trust Dissolutions
The -drafting of the decrees in the
dissolution of the present trusts,
with a view to their reorganization
into legitimate corporations, has made
it especially apparent that the courts
are not provided with the adminis
trative machinery to make the neces
sary inquiries preparatory to re
organization, or to pursue such in
quiries, and they should be em
powered to invoke the aid of the
bureau of corporations in determin
ing the suitable reorganization of
disintegrated parts. The circuit court
and the attorney general were great
ly aided in framing the decree in tho
Tobacco trust dissolution by an ex
pert from the bureau of corporations.
Federal Corporation Commission
I'roposeu
I do not set forth in detail tho
terms and sections of a statute which'
might supply the constructive legis
lation permitting and aiding the for
mation of combinations of capital
into federal corporations. They
should be subject to rigid rules as to
their organization and procedure, in
cluding effective publicity, and to tho
closest supervision as to tho issue of
stock and bonds by an executive
bureau or commission in the depart
ment of commerce and labor, to
wfilnli in Hmnc: of dnilM t.hfiV mlcht
well submit their proposed plans for
future business. It must be dis
tinctly understood that incorpora
tion under a federal law could not
exempt the company thus formed and
its incorporators and managers from
prosecution under the anti-trust law
for subsequent Illegal conduct, but
the publicity of its procedure and
tho opportunity for frequent consul
tation with the bureau or commis
sion in charge of the incorporation
as to the legitimate purpose of its
transactions would offer it as great
security against successful prosecu
tions for violations of the law as
would be practical or wise.
Such a bureau or commission
might well bo invested also with tho
duty already referred to, of aiding
courts In tho dissolution and re-cre-
-.!-. ni fxiiofa wlfMn th law. It
should be an executive tribunal or
the dignity and power of the comp
troller of the currency or the Inter
state commerce commission, which
now exercise supervisory power over
important classes of corporations
under federal regulation.
The drafting of such a federal In
corporation law would offer ample
opportunity to prevent .many mani
fest evils in corporate management
today, including irresponsibility of
control in the hands of the few who
are not the real owners.
Incorporation Voluntary
I recommend that the federal
charters thus to be granted shall be
voluntary, at least- unti experience
justifies mandatory provisions. The
benefit to be derived from the opera
tion of great business under the pro
tection of such a charter would at
tract all who are anxious to keep
within the lines of the law. Other
largo combinations that fail to tako
advantagoof tho federal Incorporation
will not have a right to complain If
their failure Is ascribed to unwilling
ness to submit their transactions to
the careful official scrutiny, compe
tent supervision and publicity atton-
dant upon tho enjoyment of such
a charter.
Only Supplemental Legislation
Needed
Tho opportunity thus suggested
for federal Incorporation, it seems
to mo, is suitablo constructive legis
lation neodod to facilitate tho squar
ing of groat industrial enterprises to
tho rule of action laid down by tho
anti-trust law. This statute as con
strued by tho supromo court must
continuo to bo the lino of distinction
for legitimate business. It must ho
enforced, unless wo are to banish In
dividualism from all business and re
duce it to one common system of
rogulation or control of prices like
that which now prevails with respoct
to public utilities, and which when
applied to all business would be a
long stop toward state socialism.
Importance of tho Anti-Trust Act
Tho anti-trust act i3 the expression
of tho effort of a freedom-loving
people to preserve equality of oppor
tunity. It is tho result of the con
fident determination of such a people
to maintain their future growth by
preserving uncontrolled and unre
stricted tho enterprise of tho indi
vidual, his Industry, his ingenuity,
his intelligence, and his independent
courage.
For twenty years or more this
statute has been upon the statute
book. All know its general purpose
and approved. Many of its violators
were cynical over its assumed impo
tence. It seemed Impossible of en
forcement. Slowly the mills of tho
courts ground, and only gradually
did tho majesty of tho law assert
itself. Many of its statosmon-authors
died before it became a living force,
and they and others saw tho evil
grow which they had hoped to
destroy. Now Its efllcacy Is seen;
now its power is heavy; now its
object is near achievement. Now we
hoar tho call for Its repeal on tho plea
that it interferes with business pros
perity, and wo are advised in most
general terms, how by some other
statute and in some other way the
evil we are just stamping out can bo
cured, if wo only abandon this work
of twenty years and try another ex
periment for another term of years.
It is said that the act has not done
good. Can this be said in the faco
of the effect of the Northern Securi;
ties decree? That decree was in no
way so drastic or Inhlbitlve In detail
as either the Standard Oil decree or
the Tobacco decree; but did It not
stop for all time the then powerful
movement toward tho control of all
the railroads of the country in a
single hand? Such a one-man power
could not have been a healthful In
fluence In the republic, even though
exercised under the general super
vision of an interstate commission.
Do we desire to make such ruthless
combinations and monopolies lawful?
When all energies are directed, not
toward tho reduction of the cost of
production for the public benefit by
a healthful competition, but toward
new ways and means for making per
roanent in a few hands the absolute
control cf the conditions and prices
prevailing in tho whole field of indus
try, then individual enterprise and
effort will be paralyzed and the spirit
of commercial freedom will be dead.
WILLIAM H. TAFT.
White House, December 5, 1911.
' UGRrrrtct
yry
...C0ME 8cu TO
AMEfl'CA'S market nutDEMS.
Ctkheat Soq. Siatt j tmen4 br J. a. 1 a v.
FHOM THE PEANUT FIELDS OF VIRGINIA
IU IH6 OKAKOE DROVES OF FLORIDA
Raffle Fruit and Vegetable! for Bljt Profit.
H-ilthfol climate fettllo toil-plenty 0I atei
pilicj lowcny xtmu kboeli aaJ cbmcbn
Qui k ttjiMjVMUlloji to Mr maikc-u. Neat town.
In Manatco Counly on tho West Coal of
nunuH ra i io 3 ciopi a year net $500
10 aiiwv per ar ie. wiila NOW lot IWaf
uaud Booklet.
J. A. PRIDE, Gen. Ind. Agl,
UVWQStQ Air Ult Hr.
..t- .. .:.. 1 1..
rrw.jw ou'w to norwu. vau v..
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$8Xi$!K57rN.
Jt- rT.M
l-rjtiVwljr
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17a 111 von lira r1
pjf beitpil;! Wr.U
or wttkljr prle 1UI
and ttfcicncti.
M.SABEL&SONS
LUUIHTIUJC, KT.
I8. $&V
X.
Si
Dealers In Fwi(Hli:t, Wool Fl!iT?5"i
EiUblUlMdlUA. " WW
&t f,friiISSLaaa
'jrti
DAKOTA BEATS THE WORLD
Oormlnntos quicker, Mat urn earllor. Knnd loriny.
Five Kitnplo pnrkctJ! ofG Ixml klnda for your nocUoii
10 coat. Cirmlnr Inv,
L. N.CRILL SLED CO., ELK TOINT, SOUTH DAKOTA
NO SHOW
Jones "Do you think the horse
will survive the automobile."
Brown "Not if it gets in its
way Woman's Home Companion.
"7Vlx
FENGEM.
NCE3T!
Farm
I'oultrr and
jkwn. 6-lnch Moy Fcnco 10e. 7 Inch
Farm Konco 23 I Ie. CaUloun free.
COILED QPRINQ fENCB CO.,
x 234 winoiiettor, Indiana.
VA T J NTS HK$l!S.KH
1 HPHrcrtnMn I nfcntnhllHy tUintriUrl lillt
1'noW. and 1 M of Invention Wanted, rerit'rco.
Vlt'TOK J. JIVAN.S & CO., WttMliliiKtoa. I), a
FARMERS NEEDED S3SSRSS8
and lli.o jrrovo 'i (Joodwill. AuiiIoICu1mir11.
Sro our plan. SuutaKoMUroveCoIMnnliiBhmn, Ala.
&Gmm
firiEiuaMSH
RRMKIIY tent on fJICK TKI1U II
Itcutr tend tlMi II rot. don't.
Clve liiDrri Office. Ual'l CU.Ui
Cvmptnj,Hl'Jtlkl At., HidafJ.O,
Kemember that every dollar
deposited with a guaranteed state
bank In Oklahoma advanccM tho dato
when all bankB, utato or national, will
fjuaranteo their depoKltorw, and tlTua
put an cnd to Iohboh BUHtntncd by dlfiiui
trous bank failures. We solicit your
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tion to abKolutc Hafety, afford you tho
bent of facilities. Interest on tlmo and
Havings deposits. Write for our new
booklet.
Guarantee Static Bank
JIUSKOGKK, OKLAHOMA
M. G. HASKELL,
Vice President
M. C. SELLS,
Cashier.
OF AGRICULTURAL LANDS
B
7 FARMS 7
74, 100, 140, 161, 131, 150 and
ICO acres In tho corn belt in
the rain belt. 2 to 4 miles to
Washington, Kan. Every farm
has some bottom land. 5 sets of
buildings.
YOUR CHOICE
YOUR PRICE
YOUR OPPORTUNITY
One-half of purchase price may
be left on tho land.
Send for 16-page catalogue.
These farms will bo sold in the
City Hall, at
Washington, Kansas
DECEnmER 20Tn, 1011
at 2 o'clock p. m.
G. WERTMAN
Auctioneer and Sales Manager I
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LiMiiiiftiIrtfirgKgtoi'1 fffifo tiVwiiiiMMi
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