Pittsburg dispatch. [volume] (Pittsburg [Pa.]) 1880-1923, 1892-04-25
CONTROL OF CORPORATIONS.
Matthew Marshall Once More Apologies
for Trusts-His Ideas on Their Forma-
ton and the Necessity of Their Befne-A


ESPECIAL TELEGRAM TO THE prsPArcHJ
NEW YORK, April A.-"The Control OF Cor
porations" is the title Of Matthew MarshalI's
article for to-morrow's Sun, which reads as
follows:
The tendency Of capital toward aggrega-
tion into large masses, to which I referred
last week, in speaking of the so-called trusts
which are q distinguishing feature of the
development of modern industry, has at the
same time made the control of these masses
of capital an object of ambition as we'll as q
source of profit. In the early days of corpo-
rations in this country comparatively small
amounts were invested in each one. They
were founded by men who were well ac-
quainted with one another. and it was un-
derstood at the outset that their affairs were
to be conducted by officers then designated,
and who, like the members OF private
partnership, were to retain their places for
life. or during good behavior. In fact. they
were really partnerships. incorporated only
for the purpose Of avoiding personal liabil-
ity.
When changes were made in their man
agement they were usually made with the
consent OF all concerned, because without
such consent changes were all but impossi-
Bile. The capitals OF the companies being,
as have said, small, and their shareholders
stock was easy to retain. but difficult to
acquire. Thus they remained in the same
hands year after year, and often descended
from fathers to sons, like any other prop
erty.
How Consultations Were Begun.
This primitive simplicity could not with
stand the growth Of the country's wealth
and the necessity of ever-enlarging means
for the development Of its resources. The
consolidation of numerous little railroad
companies owning short connecting links Of
nQd n n ri,cr ha
entire line. which was demanded by the ex-
igenctes Of travel and transportation, was
another powerful element of corporate ag-
grandizement. Thus the New York Central
Railroad Company was formed in 1858 out
of the companies which severally owned
the pieces Of road between Albany and
Buffalo. 1t was followed by similar con-
Detroit, and of those between Detroit and
Chicago. These companies were initiated
elsewhere, and were the result in the gigan-
tic railroad systems of the present day, the
affairs OF which occupy SO much of the
public attention. A like necessity had led
to the formation of the so-called industrial
trusts, and for all that can see the process
is uesCined to go on still further.
What may be called corporation politics
has, under these new conditions. assumed
an importance almost equal to the affairs OF
nations; j.. just now the leading topic a Of in
minent in the course of the present week in
the Union Pacific Railway Company. A year
ago, to the surprise of everybody, Mr.
Charles Francis Adams retired from the
Presidency Of that company and was sue
ceeded by Mr.. Sidney Dillon, as the repre-
sentative Of Mr.. Jay Gould. Now, it is said,
r to make way 1or
who are as little satisfied with MI. Gould's
management as Mr.. Gould was with Mr..
Adams.
A Lively Canvass for Proxies.
Week before last we heard of movement
for supplanting the ancient dynasty which
has so long ruled the Delaware and Hudson
Canal Company by members of the modern
house of Vanderbilt, but as the present oc-
cupants of the throne are indisposed to with
draw lively canvass for proxies is going
on, the result of which will appear at the
election of directors May 10. The Richmond
Terminal reorganization scheme seems to be
hampered by a similar struggle for control
of the property involved, and Its fate prob
ably depends more on the result of the
struggle than on its own intrinsic merits.
Occurrences of this kind are, indeed, not
absolutely new: It is now nearly 80 years
since the New York Central Railroad, after
having been for years the private property,
as it were. of a few Albany macnates, was
wrestled from them by the late Commodore
Vanderbilt by the aid Of the millions he had
amassed in running steamships. Tho strug-
giles for the control of the Erie Railroad
Company are historically famous, and some
to sasy saye
those OF play upon the stage. How. in
more recent years. the Reading Railroad
property, the New Jersey Central, the New
York and New England. the so-called Nickel
Plate, the West Shore and many others Of
equal Importance have passed from one set
OF hands to another by revolutions as sud-
Spanish-American Republics most of my
readers do not need to be told. The inn
portant point is that these revolutions no
longer excite alarm or even surprise. They
are accepted as normal contingencies in cor
poration affairs and are taken as matters of
course.
A Universal Law Illustrated.
In this latest phase Of corporation life, so
to speak, we have but another illustration
of the universal law that like causes tend to
produce like results Civil society, as we
see it about us, is the final outcome of many
years of progress and development. From
the family of the savage it proceeded
through the tribe to the nation, and then
the consolidation of nations into
empires and republics. The same mutual
attraction which keeps the members Of a
family together keeps men together in
larger bodies. and the same necessity for
mutual help and defense which preserved
the tribe from distntegration guarantee the
permanence OF the nation. The ideal to
which the world is moving Is universal
brotherhood, though We are yet long way
from the goal, and l do not expect that it |
will be reached in time. For the present |
the interests OF the one country are adverse |
in many respects to those of all other |
countries, and much statesmanship and |
are exercised in defending each |
one against the aggressions of the others.
So it is with corporations. They have |
arisen out OF the industrial and financial |
necessities of the human race, and their re-
ations to one another resemble those of |
civil societies. If nations have their wars
and their treaties and their compacts, SO
panies and in the contests for the direction
af their affairs there are the same opportu-
mites for intrigue and maneuver that are
employed in winning high places in the |
State The collection and disbursement of |
the millions of dollars of revenue of great |
for example, the employment and |
of its thousands of servants. and
,he patronage of it's purchases, like those of |
nation, afford abundant room for the exer-
Else OF the talent for command, and require
quality of it not inferior to that employed |
II civil government.
Merely Matters OF Entertainment.
But while to the public at large these
chances and changes and careers OF corpor-
ltions are only matters OF entertainment,
ike the other news of the day, and while its
,hief solicitude is that corporate aggrand-
cement shall not be pushed so far as to
'aise unduly railroad rates and the prices OF
such as sugar, whisky, coal
md cordage, the very considerable number
If small stockholders who have bought their
took for the sake of dividends, without
thought of controlling the affairs OF their
get little or no commiseration.
Yet it is upon these people that the
BURDENS imposed by their rulers weigh di-
ectly. Nominally they have votes and may
protect themselves by using them, but really
hey are AS helpless as the subjects of the
russian Gar. They buy In under one ad-
and before they know 1t a new
they may have good reason to
,e profoundly dissatisfied, but the only