Arizona republican., 1902-10-15

destroy competition. insufficient per
 sonal responsibility of officers and di-
 rectors for corporate management. ten dency to monopoly and lack of appre-
 citation in their management of their relations to the people. for whose bene-
 fit they are permitted to exist
 "Overcapitalization is the chief of these and the source from which the
 minor ones flow. It is the possibility
 of overcapitalization that furnishes the
 temptations and opportunities for most
 of the others. Overcapitalization does
 not mean large capitalization or capi-
 talization adequate for the greatest
 undert; ;akings. It is the imposition upon an undertaking of a liability without a corresponding asset to repre-
 sent it. Therefore overcapitalizatior
 is fraud upon those who contribute
 the real capital either originally or by
 purchase. and the efforts to realize dividends thereon from operations Is a
 fraudulent imposition of burden upon
 the public. When a property worth d
 million dollars upon all the sober tests
 of value is capitalized at five millions
 and sold to the public. it is rational Io
 assume that its purchasers will exert every effort to keep its earnings up tc
 the basis of their capitaliza tion. When the inevitable depression comes. wages
 must be reduced. prices enhanced. or
 dividends foregone. As prices are nat
 urally not increased but lowered in dull periods. it usually resolves itself into
 question of wages or dividends.
 While this condition may exist under
 any circumstances, it is exaggerated by
 overcapitalizati tion in the Illustrating n five tn -ha nj ffalf cod
 securities enter into the general budget of the country. are bought and sold rise and fall and they fuctuate be-
 tween wider ranges. and are more sen
 sitive in proportion as they are further removed from intrinsic values. and. In short. are liable to be storm centers 9f financial disturbances of far-reaching consequence. They also. in the same proportion increase the temptation to mismanagement and manipulation by corporate administrators.
 WHAT THEY MUST NOT DO. Corporations and joint stock or other associations. depending upon any statu- tory law for their existence or privi- leges. trading beyond their own states. should be required to do business in every state and locality upon precisely the same terms and conditions. There should be no discrimination in prices: no preferences in service Such cor porations serving the public as carriers | and in similar capacities should be lccmpelled to keep the avenues of com
 merce free and open to all upon the | same terms and to observe the law as to it's injunctions against stifiing com petition. Moreover. corporations upon
 which the people depend for the neces- saries of life should be required to con
 duct their business so as regularly and reasonably to supply the public needs They should be subject to visitorial
 supervision and full and accurate in formation as to their operations should
 be made regularly at reasonable inter
 vals. Secrecy In the conduct and re
 suits of operation is unfair to the non-
 managing stockholders. and should. as
 we'll for reasons of state. be prohibited by law.
 "If these serious evils were eradicated | and a higher measure of administrative responsibility required in corporate officers a long step would be taken | toward allaying the reasonable appre- hension that the unchecked aggression of the trusts will result in practical
 monopoly of the important business Oc the country"
 Having gone over the laws for the control of combinations and cited in
 stances of the exercise of control Mir Knox says:
 "If the states are a nation for some purposes. as Jefferson said. with full (Continued on Fourth PaEeD