Conservative.
TIIK TUUST OUUSTION.
( CONCLUDED. )
It is Fuid tlmt , ns a rule , the power to
control prices hns been discreetly used
by combinations. But the American
citizen does not want to bo controlled
without his consent. Left to his own
devices , a mrui might never think of
traveling outside his own country , but
if KOUIG arbitrary power compelled him
to stay hero , ho would chafe under the
restraint.
Most people would rather trust to
open competition than to trust to the
conscience of any trust.
Under the old condition of competi
tion , factories multiplied. The factory
made all the difference between the vil
lage and the city. The more labor em
ployed the bigger the town , the bigger
the town the more consumers , the more
consumers , the better the market for the
farmer , the better the market for the
farmer the more valuable tho-farm.
By combination factories are reduced
in number and business is centralized in
a few large towns. The transition from
competition to combination profoundly
airects the social life of our people and
has distinct relation to our form of gov
ernment. When the factory is shut
down the means of homo support is
gone and change of residence in search
of employment becomes necessary.
Small homes are sold cheap at forced
sales. Children are shifted from school
to school or 110 school ; their education
is interrupted or permanently suspended.
The massing of congested population in
largo cities is to the detriment of hu
manity. The number of unemployed
becomes a menace to order. Individu
ality is dwarfed ; the horizon of aspira
tion is narrowed to a struggle for main
tenance. The lines of caste become
stratified. The young man must stand
longer and longer , hat in hand , at the
outer door of corporate opportunity ,
waiting to be invited in and given a job ,
and former "captains of industry" in
middle and old age , when incapable of
proficiency in new employment , are
passed by. But , while it is true that
many situations are closed , it is also
true that proficiency was never better
rewarded than now.
In commenting upon conditions at the
close of the eighteenth century incident
to England's transition from hand loom
to factory , Mr. Leoky says : "The sys
tem which is rapidly spreading through
all industry of vast undertakings , sup
plied by small profits on an immense
sale , inevitably tends to widen divisions
of classes and greater contrasts of
wealth and poverty. "
Trusts are not the cause of combina
tions ; they are simply the result of com
bination. Combination frequently as-
sumes compulsory form. Industries
doing a healthy business , entirely satis
factory to themselves , are compelled to
join a consolidation. The penalty of
refusal is made plain to them. They
are made to realize that they cannot
separately resist the colossus of which
thny are invited to become a part. They
must consent to benevolent assimilation
or bo ground to death in unequal com
petition.
It is but fair to say that disadvantage
to labor from combination has been
doubted by high authority , and Mr
Gompers , president of the American
federation of labor , has expressed the
belief that combinations of producers
are necessary and their consequences at
least not harmful.
Involution of The Trust Corporation.
The beginning of the trust was
First The so called "agreement
among gentlemen , " by which producers
came to an agreement among them
selves as to how much they should pro
duce and at what prices they should
sell , each producer , however , running
his own business. But gentlemen failed
to keep their agreement , and prices had
their way , with some exceptions. It is
said that the cattle and meat market of
the United States is ruled by a few Chicago
cage , Kansas City and Omaha purchas
ing agents , representing well-known
packers , who , by agreement , never over
bid each other. If the seller refuses to
take the first bid he takes less if ho sells.
Independent butchers no longer exist ,
and the influence of this hog and cattle
oligarchy extends to the remotest hog
pen.
pen.Second
Second The next stop was the forma
tion of the so-called trust. "The word
'trust' was first used to mean an agree
ment between many stockholders in
many corporations to place all their
stock in the hands of trustees , and to
receive therefor trust certificates from
the trustees. " The trustee held the
stock , voted it , managed the business ,
and apportioned the dividends upon the
trust certificates.
Third The interstate-commerce act
became a law in 1887. This act was
preceded by a congressional investiga
tion , which led to a demand for govern
mental action.
Newspapers aroused public opinion.
Bills were introduced in every state
legislature aiming to forbid all manner
of combination in restraint of competi
tion. By the end of 1891 the federal
government , twenty-two states and one
territory had enacted anti-trust laws ,
and "courts have held with great unan
imity that combinations are illegal if
their purpose is to restrict production ,
raise prices or restrain trade , " and that
they are contrary to public policy and
void.
In 1890 the New York court of ap
peals , in the case of the people vs. the
North River Sugar Refining company ,
liold that at the instance of the attor
ney-general the state would forfeit the
charter of a corporation whoso stock
holders had entered into a trust v ith
the stockholders of competing corpora
tions for the purpose of forming a
monopoly.
The present corporate form of trust
combines was compelled by statutes and
court decisions. "Most of the great
trusts have been driven from their orig
inal mode of organization and have re
organized by convoying their property
to a corporation organized for the pur
pose of taking over the property. * *
The result has been that trusts for the
most part have reorganized and reap
peared in the form of gigantic corpora
tions. " ( Cook on Stock and Stock
holders. )
But while many states wore formu
lating severe laws against trusts other
states were facilitating their formation
by laws especially framed for that pur
pose , intending thereby to increase their
own revenues.
Citizens of state ' '
one may 'incorpo
rate a company in another state , even
for the purpose of carrying on the entire
corporate business in the state where
they live. " ( Cook on Stock and Stock
holders. ) And a stock company , by
reason of state comity , is free to trans
act business all over the country , with
the exception of quasi public corpora
tions.
New Jersey has drawn over the river
nearly all the corporations doing busi
ness in New York , "and now runs the
state government very largely on reve
nues derived from New York enter
prises. " New Jersey makes incorpora
tion easy , and West Virginia makes it
easier. Between them they have prac
tically monopolized the business of
making monopolies. Lately , too , Dela
ware has published its bid for the busi
ness of making corporations , alleging
specifically its claims of advantage over
Now Jersey.
Method of Transition From Trust to
Corporation.
When a trust wants to legalize itself
by becoming a corporation it (1) ( ) ap
points a steering committee ; (2) ( ) a char
ter is taken out under the laws of New
Jersey , West Virginia , or Delaware ; (8) ( )
the trustees under the trust become the
directors of the corporation ; (4) ( ) the offi
cers of the trust become the officers of
the corporation ; (5) ( ) trust certificates
are exchanged for shares of stock ; (6) ( )
an enormous capitalization is repre
sented by paper shares , which are dis
tributed to the public through stock
speculation ; (7) ( ) the board of directors
is divided into two chief departments ,
one having charge of the financial side ,
the other of the technical side of the
business ; (8) ( ) the board is further di
vided into committees on sales , pur
chases , supervision of special branches ,
and such other committees as may be