Evening star. [volume] (Washington, D.C.) 1854-1972, 1899-10-18
Controller Dawes Speech on the
Subject Of Trusts.
CAUSE OF THEIR FORMATION
Federal Legislation May Be In
voked to Regulate Them.
SOLUTION OF THE PROBLEM

currency spoke last night before the an
nual meeting of the Merchants Club of
Boston on the subject of TRUSTS and Trade
Combinations" His speech is considered an
important one He said:
The rapidly changing form of the COM
| merce and manufacturing of the country
is bringing new questions before the peo-
pie for discussion and action. The past
year has witnessed an acceleration in the
general movement toward the concentra-
ton Of business enterprise in the United
States which has aroused public attention
| and created just demand for the more
| intelligent legislative treatment of existing
industrial conditions.
A general feeling Of public uneasiness
and apprehension has been caused by the
recent combination into single corporations
of a large number of heretofore independ-
ent and competing concerns for the pur-
pose of controlling entirely their respec
tive lines of trade and manufacture. Some
of the stronger of these corporations have
been organized without recourse to an is
sue of bonded Indebtedness, and in conse-
quence period of small earnings hereaf
ter will not of necessity involve them in
the demoralizing effects of mortgage fore
closure. The prospect that these stronger
corporations will fall to pieces of their own
weight, as have some heavily capitalized
that measure of competition exists which
secures to the consumer the benefit of the
savings incident to a limited combination
of productive effort and caDtal. we willing
ly recognize the advantage of the cheap
ened cost of production and distribution re-
sultng to the community from such combi-
nation.
Face to Face With a New Condition.
But in this country we are now face to
face with this new condition-that combna-
ton of effort and capital which, under
competition, has up to this time been stead
lily reducing the cost of certain articles to
the consumer has now reached a point
where by the combination of all the re-
naming competitors, the further reduction
of cost of these articles, If not the ques-
ton of an actual increase in the cost, is a
matter dependent upon the viii or caprice
OF those In charge of the combinations con-
trolling the business in these articles.
Such power. owing to various reasons
may not now be in the hands Of all such
corporations If, however, it is in the hands
of even a few, it is because of Industrial
tendencies which under the law of evolu-
ton, may bring similar power to an in
creasing number, and the possible results
of this condition properly challenge public
attention.
The organization of business corporations
Is. of course, for the purpose of profit, and,
other things being equal cannot expect
to sell at lower price. 1t is not fair to
assume, therefore, from the fact that fall
ing prices in certain lines of business have
been characteristic of an industrial system
under which competing corporations have
been growing larger. stronger, and fewer
in number that falling prices will continue
when the remaining corporations have COM
bined and destroyed competition.
From a public standpoint we are Justified
IN constituting the large capitalization Of
these corporations, equaling on the aver
age several times the cost of duplication
of the constituent properties, as conclusive
evidence of their purpose to secure, as far
as possible, for their stockholders the saw
ing in the cost of production and distribu-
uon which combination creates.
Inc principal objects which would natu-
rally be sought by those endeavoring to
entirely control for purposes of profit a
system of manufacture in the United States
would be to buy cheaper through the elm
nation of competing buyers OF raw ma
terial and to sell dearer through the elimi-
nation OF competing sellers of the finished
product In addition, they would seek q
proht from the savings resulting from sim
pnncatlon of the methods of operating the
machinery of production and distribution
II Is IN the former purposes and not in the
latter that there exists alike the necessity
ana Justllcation for governmental interfer-
ence.
Where the Remedy Lies.
Ihere are many who still think that the
remedy for any extortion or abuse which
such corporations may inict lies in a COM
petlnon which will Immediately spring up
"heh such abuses exist; but the ordinary
observer or present conditions realizes the
growing embarraSSments surrounding the
inception of competing efforts and while
lie dufnlls there are many Of these present
corporations whose power will be reguIat-
| cd II not by the actual existence, then by
me pract1cability of competition, he feels
that with an increasing number of such
| Col pOTatlOnS this is the fact
In looking for the causes Of present in
austrlal conditions, the fair and candid man
mas them beyond political parties and be-
yond the legislation supported by these
parties The growth of these commercial
| enterprises may have been retarded by
some legislation and accelerated by other
| tfe esal, but primarily it has had its
| lounoation In natural causes and has pro-
| ceeded In accordance with the natural laws
Oh progress under a competitive system.
II is human nature to seek to acquire,
anu II is human nature to combine to &C
| quire. 1t is human nature and not any
| poitical party which is responsible prim-
| arlly for the existence of the trust; vet |
| cannot agree with those who maintain that
| THIS Is not political question. That the
| socaiied trusts are the natural outgrowth
OF the practically unrestricted and unregu-
| lated law OF commercial competition and
not created by reason OF the former atti-
| tude OF any political party, I maintain: but
| maintain also that the question of the
| proper legislative treatment of these great
| Soiiipihdtions ana corporations FORMED for
| the purpose of monopolistic control of the
| production and distribution of some of the
| necessaries and comforts of life is one of
| the greatest and most practical which has
| ever confronted the political parties Of the
| nation L do not think that where there
| IS practically unregulated power on the
| part or a trust to control the prices of Ger
tain commodities there Is any considerable
portion of either political party which be-
| leVes that there should be no legislation.
| Fhe division which will manifest itself
among the people of the country will not
! De between the people who believe that
| something should be done and the people
VINO believe that nothing should be done,
put between the people who believe in SEEK
ing one remedy as against the people who
| believe In seeking another.
Rather than have in the hands of any
| corporation the power to absolutely fix the
| price of a necessary of life at arbitrary
| inquire. the people of the United States will
| eventually and rghtfully do one Of two
| things: they will enact legislation for the
protection of the people from extortion, by
| governmental regulation more or less ex-
| tended as public necessity may require
| or they will enact legislation for the en-
| forced creation of competition by the dis
| integration Of trusts.
With nothing less than one Of these two