Delaware gazette and state journal. (Wilmington, Del.) 1883-1902, 1895-07-25
TRUSTS AND OTHER CORPORATIONS.

From Large Combinations Of Capital
Tor Industrial Purposes.
The journal IF Commerce, q newspaper
whose opinions are always entitled to
respect. has lately published articles de-
nouncing Trusts, with the warning that
these combinations are distinctly un-
American and are leading us straight
into socialism. Readers OF our columns
VIII acquit us OF any intention to defend
trade combinations as such II we say that
the arguments Of the journal Of Com
nercs no not seem to cover the whole
situation. Many Of its assertions need
definition. That paper, for example,
says: III u few great monopolistlc com.
binaiions can arrogate to themselves the
right to tax the great body of consumers
for their own benefit, il will become
easier TO convince people that the bust.
ness so conducted Should be done for
the profit Of the Commonwealth" II
Immediately occurs TO the reader to ask,
first, nre these trusts committing com.
mercialrobbery, after this fashion? and
next, If they are, would the State get
the same profits IL the business were
made over to its y
The question Of the profitableness OF
huge Trusts or corporations and its
equity is one fiercely disputed and not
capable Of exact settlement as yet. Mere
denunciatlOn helps but little. Is the
Standard Oil making too much money
II Is grasping monopoly with an un-
savory history but under Its control the
price OF refined oil to consumers has
been reduced to but nth of the old
| quotations, and meanwhile the cost OF
refining 1.-THE difference between crude
and commercial oiD has declined from
seventeen cents In 1870 to less than five
cents in recent years. Could individual
refners have accomplished so much 7
and If not, should our complaint be
against the combination as a business
enterprise or against its legal form and
| old methodist A further question in.
volved is the commercial right of C r.
| poration to a large profit in any case.
Upon this point many of us are still in
bonds to the old idea that what is equit-
able for a partnership Is unlawful for a
company doing the same work, and that
the profits Of the latter should not be
allowed 10 exceed the usual rate Of
interest on loans secured by safe col
lateral-a theory whose error we have
before pointed out.
This right Of a company or combina-
ton Of companies to profit Is the more
readily granted as tho public is proper
tlonately benefited, and this is one OF
| the main tests pf soundness Of what the
Journal Of Commerce. denounces as com.
meTcial .Americanism. Let US sup.
pose that all the shoe manufacturers OF
New England form trust; IL done
under Legitimate conditions, and II
thereby we all could buy shoes at 81
less per pair, should we be warranted in
denouncing that. combination as com
lncrclally nnjustltiableg We are ask.
ing the question, and not at the moment
trying 10 answer it, merely to indicate
that there is another side to this per.
picking corporation problem which
many writer's overlook. We would re,
mind our readers of the English gas
companies, whose charters allow Of
larger dividends only as the price OF ga:
TO consumers is reduced. While we can,
not formulate an arithmetical ratio
which shall form standard in such
cases, II is question whether the prin
clple is not at the bottom Of much OIL
our industrial progress.
"Four-hfths of the capital stock" con
tinues the Journal Of Commerce, speak
ing OF huge corporations, usually rep
resents their ability TO crush out competi
ton, and has no other value whatever
II our supposed combination of shoe
makers, while reducing the price OIL
shoes, make a good profit, it is foreign
To THE argument whether that profit take:
the form of high dividends or small
dividends OH watered capital We much
prefer the former plan, but that need
not blind an observer to the fact that Q
large part Of the water In corporations
is due 10 the wish 10 pay to shareholder
prollt which the owners believe to u
but commensurate 10 the risks. The
crushing out of competition" is also Q
matter to be settled by the evidence II
each case, rs for illustration, whether
tho crushing as done by the large cor
poratlon is worse in its effects thar
would have been the relentless compe
tition between the individuals in thei
strife for the survival Of the tiltest. Then
again, the question is always prope
whether competition is really crushed o.
| NNN'SsJ AAbAO 81 oCNpAt bhHk' OnlH luOst
with exceptional capital and skill car
enter into 1t. If the latter, then there il
evidence that the combination has really
cheapened cost and in SO far has offerec
a good excuse for its existence.
The case OF the American Cotton OF
20. is an example, Without enterinl
into any examination Of this company
adolescence a trust, now corpora
tloh--'it is but fair TO say that it Is In NJ
proper sense monopoly. So long a
we grow 1900, 900 bales OF cotton yoarly
80 long will it be impossible to corner
cotton seed Anybody can buy the seed
crush 1t, refine the oil and sell ii; no
could the Cotton Oil 60. stop him ex
cept by underselling him. The Unitet
states courts have decided that no mo
nopoly exists where nothing prevent
the establishment Of u rival plant; anC
the decision has some worth as a com
mercial as well as legal opinion.
But, 1t will be said, these huge cor
porations tend to suppress indiyiduelsm
md are, therefore, against the lhcorie
IaF which our country stands. There /,
aJmething in this rs things are now, anC
yet 1t mag be that the evolution of the
corporation will ia time distinctly favol
mdividualisn. The greater the company
tue more diverse its operations, the NOR
dependent its success upon popula
favor, the more sensitive it may grow L
individual merit among its officers ant
employees, and the more amenable it
huge interests to the demands of til,
people at large. Upon the whole, th,
proper attitude of thinking men toward
our corporation problem should not b,
one OF denunciation or of ilattery, bu
rather of expectancy, waiting for de
yelopments, with q readiness to &C
when action seems beyond a doubt to b,
necessary, but with u refusal to attacl
on insufficient evidence or on narrow
grounds.
A Heroic Cat.
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