The Nebraska Independent September 6. isot
than the failure to enforce the law against rich
criminals while it is rigidly enforced against petty
offenders. But it is not sufficient to enforce ex
isting laws. If ten corporations conspiring to
gether in restraint of trade are threatened with
punishment, all they have to do now is to dis
solve their separate corporations and turn their
property over to a new corporation. The new
corporation can proceed to do the same thing
that the separate corporations attempted, and yet
not violate the law. We need, therefore, new
legislation and the republican party not only fails .',
to enact such legislation, but fails even to prom
ise it. The democratic party must be prepared to
propose legislation which will be sufficient.
"Recent investigations have brought to light
the fact that nearly all the crookedness revealed
in the , management of our large corporar
tions have been due largely to the dupli
cation of directorates. A group of men
organized, or obtained control of, several corpor
ations doing business with each other and then
proceeded to swindle the stockholders of the va
rious corporations for which they acted. No man
can serve two masters, and the director who at
tempts to do so' will fail, no matter how, much
money he makes, before his failure is discovered.
Many of the trusts control prices by the same
methods. The same group of men secure control
of several competing corporations and the man
agement is thus consolidated. It is worth while
to consider whether a blow may not be struck at
the trusts by a law making it illegal for the same
person to act as director or officer of two cor
porations which deal with each other or are en
gaged in the same general business.
"A still more far-reaching remedy was pro
posed by the democratic platform of 1900, namely,
the requiring of corporations to take out a federal
license before engaging in interstate commerce.
This remedy is simple, easily applied and com
prehensive. The requiring of a license would not
embarass legitimate corporations it would scarce
ly inconvenience them while it would confine,
the predatory corporations to the state of their
origin. Just as a federal license to sell liquor
leaves the possessor of the license to sell only in
accordance with the laws of the state in which
he resides, so a corporate license granted by a
federal commission would not interfere with the
right of each state to regulate foreign corpora
tions doing business within its borders.
"If corporations were required to take out a
federal license the federal government could then
issue the license upon the terms and -conditions
which would protect the public. A corporation
differs from a human being in that it has no nat
ural rights and as all of its rights are derived
from the statutes it can be limited or restrained
according as the public welfare may require. The
control which congress has over interstate com
merce is complete and if congress can prevent the
transportation of a lottery ticket through the
mails, by the express companies or by freight, it
can certainly forbid the use of the mails, the
railways and the telegraph lines to any corpora
tion which is endeavoring to monopolize an article
of commerce, and no party can long be credited
with sincerity if it condemns the trusts with
-words only and then permits the trusts to employ
all the instrumentalities of interstate commerce
In the carrying out of their nefarious plans. It is
far easier to prevent a monopoly than. to watch
it and punish It, and this prevention can be ac
complished in a practical way by refusing a license
to any corporation which controls more than a
certain proportion of the total product this pro
portion to be arbitrarily fixed at a point which
will give free operation to competition.
"The tariff question is very closely allied to
the trust question and the reduction of the tariff
furnishes an easy means of limiting the extortion
which the trusts can practice. While abso
lute free trade would not necessarily make
a trust Impossible, still it is probable
that very few manufacturing establishments
would dare to enter into a trust if the president
were empowered to put upon the free list articles
competing with those controlled by a trust.
While I shall take occasion at an early day to
consider the tariff question more at length, I
can not permit this opportunity to pass without
expressing the opinion that the principle embod
ied in the protective tariff has been the fruitful
source of a great deal of political corruption as
well as the mother of many of our most iniquit
lous trusts. It is difficult to condemn the manu
facturers for uniting to take advantage of a high
tariff schedule when the schedule is framed on
the theory that the industries need all the protec
tion given and it is not likely that the beneficiar
ies of these schedules will consent to their reduc
tion so long as the public waits for the tariff to
be reformed by its friends.
"But one of the worst features of the tariff,
levied not for revenue, but for the avowed pur
pose of protection, is that it fosters the idea that
men should use their votes to advance their
own financial interests. The manufacturer has
been assured that it is legitimate for him to vote
for congressmen who, whatever their opinions on
other subjects may be, will legislate larger divi
dends into his pockets; sheep growers have been
encouraged to believe that they should have no
higher 'aim in voting than to raise the price of
wool; and laboring men have been urged to make
their wages their only concern.
"For a generation the 'fat' ' has been fried
out of the manufacturers by the republican cam
paign committee, 7 and then the manufactur
ers have been reimbursed by legislation. With
the public conscience educated to believe that this
open purchase of legislation was entirely proper,
no wonder that insurance companies have used
the money of their policyholders to carry, elec
tionsno wonder that trusts have hastened to
purchase immunity from punishment with liberal
donations! How can we draw a moral distinction
between the man who sells his rote for five dol
lars on election day and the manufacturer who
sells his political influence for fifty or a hundred
thousand dollars, payable in dividends? How
can we draw a moral line between the senator
or congressman elected by the trusts to prevent"
hostile legislation and the senator or congress
man kept in -congress by the manufacturers to
secure friendly legislation? The party that
justifies the one form of bribery can not be relied
upon to condemn the other.
"There never was a time when tariff reform
could be mere easily entered upon, for the man
ufacturers by selling abroad cheaper than at
home, as many of them do, have not only shown
their ingratitude toward those who built the tariff
wall for them, but they have demonstrated their
ability to sell in competition with the world. The
high tariff has long been a burden to the con
sumers in the United States and it is growing
more and more a menace to our foreign commerce
because it arouses resentment and provokes re
taliation. ,
"The railroad question is also Interwoven
with the trust question. Nearly all the private
monopolies have received rebates or secured other
advantages over competitors. Absolute equality
of treatment at the hands of the railroads would
go far toward crippling the trusts, and I rejoice
that the president has had the courage to press
the question upon congress. While the law,, as it"
was finally distorted by the senate, is not all that
could be wished, it deserves a fair trial.
"Rate regulation wak absolutely necessary fc
and it furnishes some relief from the unbearable
condition which previously existed, but we must
not forget that the vesting of this enormous pow
er in the hands of a commission appointed by
the president introduces a new danger. If an
appointive board has the power to fix rates and
can, by the exercise of that power, increase or
decrease by hundreds of millions of "dollars the -annual
revenues of the railroads, will not the
railroads feel that they have a large pecuniary
interest in the election of a president friendly
to the railroads? Experience has demonstrated
that mun'cipal corruption is largely traceable to
the fact that franchised corporations desire to ccn-"
trol of the city council and thus increase divi
dends of the franchised corporations. If the
railroad managers adopt the same policy,
the sentiment in favor of the ownership of the
railroads by the government is likely to increase
as rapidly throughout the country as the senti
ment in favor of municipal ownership has in
creased in the cities. "
"I have already reached the conclusion that
railroads partake so much of the nature of a
monopoly that they must ultimately become pub
lic property and be managed by public officials
In the interest of the whole community in ac
cordance with the well defined theory that public
ownership is necessary where competition. is Im
possible. I do not know that the country is ready
for this change; I do not know that a majority
of my own party favor it, but I believe that an
increasing number of the members of all parties
see in public ownership the only sure remedy for
discrimination between persons and places and
for extortionate rates for the carrying,of freight
and passengers.
"Believing, Tiowever, that the operation of all
the railroads by the federal government .would
so centralize the government as to almost oblit
erate state lines, I prefer to see only the trunk
lines operated by the federal government and the
local lines by the several state governments. Some
have opposed this dual ownership as impractic
able, but investigation in Europe has convinced
me that it is entirely practicable. Nearly all the
railroads of Germany are owned by- the several
states, the empire not even owning trunk lines,
and yet the interstate traffic is in no wise ob
structed. In traveling from Constantinople to
Viennaone passes through - Turkey, Bulgaria,
Servia, Hungary and a part of Austria without a
change of cars. And yet,, each country owns and
operates its own roads and different languages
are spoken on the different divisions of the lines;
Sweden and Norway each owns its railroads,
but they have no trouble about interstate traffic,
although their political relations are somewhat
strained. The ownership and operation of the
local lines by" the several state governments is
not only feasible but it suits Itself to the condi
tions existing in . the various states. In ' those:
states where the people are ripe for a change the
local lines can be purchased or new lines be built
at once, while private ownership can continue
in those states in which the people still prefer
private ownership. Some states have been more
careful than others to prevent the watering of
stock and in the acquiring of roads each state
can act according to the situation which it has
to meet.
"As to the right of the governments, federal
and state, to own and operate railroads there
can be no doubt. If we can deepen the water in
the lakes" and build connecting canals in order
to cheapen railroad transportation during half of
the year, we can build a railroad and cheapen
rates the whole year; if we can spend several
hundred millions on the Panama canal to lower
transcontinental rates, we can build a railroad
from New York to San Francisco to lower both
transcontinental and local rates. The United
States mail is increasing so rapidly that we shall
soon be able to pay the interest on the cost of
trunk lines out of the money which we now pay
to railroads for carrying through mails. If any of
you question the propriety of my mentioning this
subject I beg to remind you that the president
could not have secured the passage of the rate
bill had he not appealed to the fear of the more
radical remedy of government ownership and
nothing will so restrain the railroad magnates
from attempting to capture the interstate com
merce commission as the same fear. The high
handed manner in which they have violated law
and ignored authority, together with the corrup
tion discovered In high places has done more to
create sentiment in favor of public ownership
than all the speeches and arguments of the oppo
nents of private ownership.
"I t have referred to the railroad question
as a part of the trust question because they are
so interwoven that it is difficult to consider one
without the other.
"Just a word more in regard to the trusts.
Some defend them on the ground that they are
an economic development and that they can not
be prevented without great injury to our indus
trial system. This may be answered in two
ways: First, trusts are a political development
rather than an economic one; and, second, the
trust system can not be permitted to continue
even though it did result in a net economic gain.
It is political because it rests upon the corpora
tion and the corporation rests upon a statutory
foundation. The trust, instead of being a natural
development, is a form of legalized larceny, and
can exist only so long as the law permits it to
exist. That there is an economic advantage in
production on a large scale, may be admitted but
because a million yards of cloth can be produced
in one factory at a lower price per yard than one
hundred thousand yards can be produced in the
same factory, it does not follow that cloth would
be produced at a still lower price per yard if all
the cloth consumed in the United States were pro
duced in one factory or under one management.
There is a point beyond which the economic ad
vantage of large production ceases. The
moment an Industry approaches the posi
tion of a monopoly it begins to loso in
economic efficiency, for a monopoly discourages
invention, invites deterioration in quality and de
stroys a most potent factor in production, viz.:
individual ambition. But the political objections
to a trust overcome any economic advantage
which it can possibly have. No economic advan- '
tage can justify an Industrial despotism or com
pensate the nation for the loss of independence
among its producers. Political liberty could not
long endure under an industrial system which per
mitted a few powerful magnates -to control the
means of livelihood of the rest of the people.
. "Landlordism, the curse of Europe, is an in
nocent institution in comparison .with the
trust carried to Its logical conclusion.
The man who argues that there is an
economic advantage in private monopoly Is aid
ing socialism. The socialist, asserting the eco
nomic superiority of the monopoly, insists that
its benefits shall accrue to the whole people, and
his conclusion can not be denied if the superiority
of monopoly is admitted. The democratic party, if
I understand its position, denies the economic
as well as the political advantage of private mon
opoly and promises to oppose it wherever it man
ifests itself. It offers as an alternative, competi
tion where competition is possible and public
monopoly wherever circumstances are such as to