The Marlboro democrat. [volume] (Bennettsville, S.C.) 1882-1908, 1890-01-31

How tho Copper Monopoly IL Sustained.
why Farmers Cnnnot Form n Trust.
A trust is an agreement among inter
estcd parties to control prices Of tho nrti-
Giles which they handle i'll Tho
parties concerned may be either persons,
stock companies or corporations. For
rcasons, afterwards shown, tho parties
in u trust arc usually corporations.
Tho trust agreement may have many
forms while aiming at its primary OBJ
jcct Of controlling prices. If there wcro
three men, each in business for himself,
who controlled among them tho cntiro
product of a certain article, a trust
might DO formed by cach Of them honor
ably agreeing not to sell his manufac-
lures below Il certain sum, or, not to sell
his manufactures except III certain To-
c~alities. This would practically be q
trust, and a perfectly legal one at that.
There is nothing illegal OF immoral in
men verbally agreeing to sustain prices
or to restrict output. provided they stop
ut that point.
A moro usual form Of trust, however,
is that formed by a number of corpora
tons. There are two ways in which this
40 viz Oh0 IL w oSlcC CiEuV CkCH COI-
poration will combine to manage it's own
affairs, but that in cases of necessity,
tho concerns which mako profits will
transfer some portion of their earnings
to those that make none. This was tho
chrysallis form Of many Of the present
full blown trusts. As an arrangement
between corporations, this was perfectly
legal i'll itself, though it could not bc put
in tho form OF a binding contract.
Tho full-blown trust is mado by tho
pooling Of interests Of the shareholders
Of more than n corporation. For ex-
ample, the sugar trust comprises all tho
roiincrs Of that article except ono in the
United States, and several Of these re-
tincrs wero in the form of Incorporated
companies. Before tho trust was formed
other r~ciincrs llastcncd to incorporate
themselves and their associates.
When all were ready, tho uga trust
was formed. A number of trustees, rep.
rcscnting eacl, Of the larger interests
involved, were first selected. TO these
trustees wero coniidcd by tho shnrchold-
crs in tho various corporations tho en-
trio script which represented their inter.
est in IL refinery. Tie trustees ut once
locked up these share certificates and is
sued against them now certificates, call
cd trust certificates. in which the receipt
of the shares WAS acknowledged.
These trust certificates represented a
proportional share Of all tho refinerics
comprised in tho trust. Each Of these
refinerics was previously valued, and
this valuation was added on to the total
Mount Of the sun for which trust GER
tificntcs were issued.
In this form Of trust there is something
illegal, though not very much. Acor-
poration is III its very nature more or
less Of II monopoly. 1t is a kind Of legal
lied conspiracy among a number Of men
to do something which mono of them
could do separately. In oldcn timca
corporations were regarded in this light,
and had to pay large sums to the king
or to tho state for their charter Of incor-
poration.
Even i'll these modern days tho state
docs not rccklcssly confer privileges Oh
favored individuals. Corporations arc
expressly prohibited 10y law from en-
ga8ing in any other pursuits than those
for which they have been incorporated.
III most eases they arc forbidden by tho
state to a.nnlgnmatc with similar bodies
or take any otlcr steps at the dictation
Of a majority Of tho stockholders which
might impair or render powcrless tho
rights Of the minority. SO that Il com
bination, which really amounts to ANAL
gamat.on. Of several corporations, with
out the express sanction Of the state, is
illegal, and can DO punished, so far as tho
corporation is concerned, by the forfeit
ure Of its charter.
But tho real objection to trusts does
not lie in their combating together, or in
tho pooling of their interests. It lies in
the illegal methods which nre too often
used by such combinations to crush out
competition. If two parties, A and B.,
sell sugar III a village, it is perfectly legal
and perfectly justifiablc that a should
underscll b in tho price Of his sugars.
But it is neither legal nor justifiablo for
a to enter into II conspiracy with G., ID,
Il and Il, all doing business in other
towns, to sell sugar at Il profit in thcir
respective towns III order to give q certain
proportion Of those profits to A, in order
that lie may undcrseIl 3 ut u loss to him
self, until b is ruined and has to go out
of business.
The usual effect aimed NJ IN combin-
ing different concerns is to save some Of
the expenses Of management, and So
turn out products ut q cheaper ratio.
But rs full blown trusts arc illegal, their
management is expensive, and also tho
corporations from which tho trust was
evolved still remain in form, though
not In substance, rs before. There are
still boards Of directors to register the
DEGREES Of tho trust magnates, the chair
man still signs his name and the secrc-
tary still atllxcs tho common seal of tho
corporation. For these futile services,
good payments are made.
So that trusts in this present form do
not save any money in expenses Of man
agement. Tho suppression Of compcti.
ton and the limitation of production arc