, ' . * , *
Conservative. 5 *
I I
gular ns it may be , the same fnct exists
today , aud legislators and nudges de
claim against combinations , apparently
in earnest , when they themselves belong
to combinations and know well that the
business of the country cannot be carried
on without them. Call the combination
a partnership , and it is all right ; call it
a corporation , and it is barely tolerated ;
call it a trust , and it is a crime ; yet the
difference is only in name. Even part
nerships were not entirely allowed to
escape unchallenged. As late as the
17th George III , statutes were enacted
making it a penal offence for any num
ber of persons above five to associate
either by covenant or partnership for
dealing in bricks , coals , and other com
modities. The reason for such laws was
always the same : that such covenants
and partnerships tended to increase
prices , to repress competition , and to
monopolize business.
It is necessary only to refer to the
frenzy into which association by moans
is of joint-stock companies
A Niilnuncc.
panies threw our
English ancestors. The Act of 1719 re
cited that "to open books for public
subscription and getting persons to sub
scribe was dangerous and mischievous , "
and enacted that "the combining of
persons and capital and the issuing of
transferable stock was a public nuis
ance. " The offenders wore subjected
to a forfeiture of all lands and goods
aud to imprisonment for life. This law
remained upon the statute-book until
1825. Few persons , however , were con
victed under it , and none punished.
In spite of the law , jnint-stock asso
ciatious multiplied in England. They
were a necessity of business , and neces
sity knows no law. So far from de
stroyiug competition and raising prices ,
their effect was exactly the reverse.
Competition increased , prices were
lowered , and business and wealth were
created. Today they are acknowledged
by all economists to bo a leading instru
mentality in England's business pros
perity. If these laws had been strictly
enforced , England would still be in the
barbarism of the fourteenth century.
Business , commerce , aud trade ore the
necessary precursors of civilization ; and
under such laws , rigidly enforced , busi
ness , commerce , and trade were impos
sible. But slightly enforced as they
were , their effect may be learned from
the preamble to the statutes by which
finally all laws of that nature were re
pealed , namely , that by interfering with
business they had increased prices and
thus had produced the effect they were
intended to prevent.
The conflict between law and free
dom of association in Euglaud reached
the beginning of the end with the re
peal of the statute against laborers , in
1825. dt approached its termination
with the repeal , in 1844 , of forty statutes
which had been created to protect prices
by preventing so-called offences against
trade , including combinations , and it
endpd when joint-stock asHociation laws
were passed conferring upon each and
every individual the absolute right to
associate for business purposes , without
restriction as to number of persons ,
amount of capital , or the nature of the
business. This bat.tle . was fought in
England for five centuries ; and liberty
of association did not triumph until it
had been demonstrated by long and bit
ter experience that association was
essential , that its tendency was not
evil , and that laws against it created
the evils which they sought to prevent
Trusts or business associations are
seldom spoken of without reference to
the great battle against monopolies.
Kings and legislators , while creating
and punishing absurd and imaginary
offences against trade , wore busily en
gaged at the same time in creating and
selling monopolies to their favorites.
They sold to one the privileges denied
to another ; nay , more , in some cases
the severe laws against associations and
other offences against trade were enacted
to protect monopolies. It is notorious
that the infamous Bubble Act , making
the formation of joint stock associations
a penal offence punishable with im
prisonment for life , was enacted for the
purpose of protecting the monopoly
granted to the. South Sea Company
against competition by voluntary asso
ciations. The struggle against monopoly
was a struggle for freedom of associa
tions , and against laws which impeded
that freedom. It was a battle not only
against exclusive privileges of trade , bur
also against exclusive privileges of com
billing for the purposes of trade. The
battle against monopolies was not won
until the net was passed enabling any
five or more persons to form joint-stock
associations and to issue transferable
shares the identical thing which for a
century had been a crime punishable
with imprisonment for life.
The battle of trusts in England has
been fought and won. The benefit and
right of association
Trusts In England. , .
for business pur
poses without limitation has been recog
nized and legalized. The law has lately
been announced in a celebrated case to
be that although the effect of combina
tion is to check competition , the means
it uses is competition ; that parties com
bined to do lawful business are not un
lawfully combined ; that it is perfectly
legitimate to combine capital for all
purposes of trade for which capital may ,
apart from combination , be legitimately
used in trade ; that the statutes repeal
ing the many acts relating to combina
tions and to prevent increase of prices
were a confession of failure in the past
and the indication of a new policy for
the future ; that the policy of law as at
present declared by the legislature is
against all fetters on combination and
competition unaccompanied by violence
or fraud or other like injurious acts ;
i M.n - - , . , , . . , _ , . , . „ , , . ' ;
yr.'Tj ,
that persons thus combined may carry '
competition to any lengths that indi
viduals may do ; that to limit combina
tions would bo impossible , and would bo
another method only of trying to sot
boundaries to the tides.
The same battle has boon fought and
won also in all the commercial countries
of the European continent. Joint-
stock associations may bo formed by
any who may desire , for any business , _ _ , ' & , ] { *
purpose. It may bo said the same laws *
exist in this country. It is true they do " J
exist , or rather have existed until lately , Hj
in many of the states ; but ours is a i %
federal government , and a corporation '
of one state has no rights which another ' '
state is bound to respect. The aim of - fa
the trust , in the proper souse of that ' - ,
' *
word , was to use the corporations of 4
different states as agencies in a joint * !
business. If corporations could have * '
been formed under the federal law , a
trust never would have been heard of.
Until corporations can be formed with
rights in all states , hostility to trusts is
a menace to legitimate business , and
prevents that large liberty of associa
tion which the magnitude of our com
merce demands.
It seems unaccountable that in this
country and this ago there should yet be
lingering doubts
Prosperity. "
of the benefits of
association in business. It is useless to
discuss the question , because business is
impossible without association. Our
continent is largo , the railway and tele
graph have brought together the most
remote points , our production is enor
mous , the world is our market , and
combinations of capital , persons , and
skill must be sufficiently great to meet
the demands of our trade. The last
twenty-five years have been notable for
the number and magnitude of business
associations. Instead of competition
being destroyed , it was never bo strong
and effective. Prices have been de
creased to a wonderful extent. Indi
vidual prosperity was never greater , the
wages of labor never higher , and the
condition of laborers never so good.
While contending that association
decreases prices , I must necessarily -
acknowledge that
Competition. . , . .
it makes competi
tion by individuals difficult. If it did
not , it would not benefit the public.
The only way to check competition is
to lower prices , and the only way to
encourage competition is to raise prices ,
[ f it is the policy of this country to pre
vent advantages over industry as carried
on by separate individuals , the railroad ,
the telegraph , the corporation , and all
our great commercial partnerships must
bo destroyed , and business must bo
relegated to its pristine condition before
these great instrumentalities were in
vented. But so long as association is
free competition cannot bo destroyed.
Competitors must , however , adopt the
methods and pursue the paths of prog-