St. Johnsbury Caledonian. [volume] (St. Johnsbury, Vt.) 1867-1919, 1901-05-15
The Coming Test of Trusts.

In the past ten years SAYS the Satur-
dav Evening Post, we have been indus
triouslv organizing trusts. In the next
decade we shall be testing their strength.
A few years ago the line between public
and private management of industries
was sharply defined. The private indus
try belonged to an individual owner, or
to small group of owners associated in
a firm or corporation. 1t was an axiom
that for a business to be successful it
must be under the masters eye" Gov
eminent management was condemned
by the maxim that what is everybody's
business is nobody's business" An indi-
vidual voter, it was said, had not enough
interest in public affairs to make him
keep his servants up to their work. The
chief feature Of trust development has
been the tendency to wipe out this dis
tinction. The typical trust is a state in
itself, with the characteristics that were
formerly held to condemn the state man
agement of industries. 1t spreads over
as much ground as a government. Its
operations are as far as a governments
from the masters eve, and 1t may have
as many citizens as some kingdoms.
The most successful examples of con-
centrated control Of industries-the
Standard Oil Company and the Carnegie
Steel Company--haye been concentrated
in ownership as well as in management.
The Standard Oil Company has been
owned almost entirely by halt a dozen
men, and very largely by one person.
The controlling majority interest in the
Carnegie Steel Company has been owned
until recently by a single man. Thus these
great organizations have combined the
advantages Of vast operations and OF
vigilance OF the individual owner.
But how would it be if, as has been
all the railroads of the
United States, with perhaps two million
should be united? We
should have there genuine test of the
solidity of the trust system. 1t is hard
to see in what respect such a combina-
ton would retain any of the advantages
that used to be claimed for private as
to public management. The
influence of the individual stakeholder on
the proceedings of the officials would be
as small as that of an individual voter
upon the proceedings OF man in the
public service. Indeed, the corporate
form of organization is much less salts
factorily adapted to rejecting the will Of
vast numbers OF stockholders scattered
over immense distances than is the or
ganization of our government to reflect
ing the will of the citizens The Roman
Republic broke down through the imper-
lection of its election machinery. The
citizens in the provinces could not vote
unless they went to Rome and gathered
in one place, and so the elections were
left, in practice, to be decided by the
Roman mob.
The position of a great corporation,
scattered stockholders, is precisely |
similar. There are no representatives |
rom localities; each stakeholder must |
20 in person to the headquarters OF the
company on the day Of the annual meet
ug, if he wishes to make his influence
'ount. True, he can send proxy, but
he collection OF masses of proxies in the
lands of the men on the inside of the
is the exact counterpart OF
he Roman mob. 1t forms force
against which, as a rule, it is useless for
my outside stakeholder to contend.
The great Reinsurance companies are
n theory purely mutual. Every policy
holder has right to vote, and to run
or president of the company
he wishes. But how many
wall themselves of the privilege?
low many give their proxies with any
intelligent purpose of having them used
n certain way, rather than in indolent
esponse to the request of the manage.
nent?
When the present boom is over and the
Efficiency of the trusts is put to a
'enuine test. one of two things may
appen. Either the industries controlled
" these combinations may be well man.
ged, in which case there will be gener-
i feeling that the old arguments against
'ublic ownership have been disproved,
md a general demand for the transfer of
he quasi-public industries so organized
o the government will result; or they
will be i'll managed, in which case the old
mall employer with his personal inter
st in his business will again raise his
lead, and the trust system will fall to
pieces.