The midland journal. (Rising Sun, Md.) 1885-1947, 1902-02-14
Commissioner Phillips On the Rail-
road and Other Trusts.

The report of the Industrial Commits
sion to Congress was made public on
Saturday. In its majority report the
commission recommends Federal pros
ecution for violation of the antitrust laws;
uniform State legislation against trusts
and combinations i'll restraint of trade;
stringent Federal and State laws making
penal aud criminal rate discrimination to
destroy local competition; State legisla-
ton to prevent over.capitalization; pub
1icity for corporations.
Thomas W. Phillips, a member of the
commission from Pennsylvania, breaks
away from the majority and with the
utmost candor and detail quotes the adj
missions of trust magnates themselves 10
point out the serious menace to the re
public of these great combinations of cap
ital. In his minority report he concurs
in the general recommendations of the
commission, but declares that the report
is not sufficiently specific to serve as a
guide for Congress and the State Legis-
latures. The following are extracts from
Mr.. Phillips report:
American railroads, whose monopoly
character is daily becoming more appar-
emit, are stocked and bonded for about
81, SOC, 200, 900, and had net earnings
from operation after paying taxes, 1900
1901, of $5o7, 9o6,7Io. This means that
these securities are today worth in the
market over SIC, 900, DOC, 900. If we adj
to this the 81, ooo, 900, 900 of water, gas,
electric light. street railway and tele-
phone securities probably worth that
much in the market, and the s., ooo. 900, :
600 of securities of our so called trusts, to
say nothing of the telegraph, there looms
up valuation of industries more or less
monopolistic in character of ST., 1000, 900,
ooo or probably one-fifth of what the
present census will find to be the esti-
mated true value of all property in this
country. This mouopolistic growth has
come about almost entirely since 1860. {"
Upon the subject of discrimination he
says: "From the investigations of the
commission it is apparent that the most
potent factor in establishing and main
tanning monopolies has been preferential
or discriminating rates of freight by coui-
mon carriers given by rebates or other
wise. One of the oldest monopoles,
though not uominally in the hands of
single corporation or trust, is that which
controls anthracite coal. This business
furnishes conclusive proof of the power
of the railroads through discriminating
rates to establish a monopoly. The facts
with respect to this have beeen clearly
brought out i'll the report of the COM
mission. BY discriminating against in
dependent operators the railroads have
forced them TO sell their property, until
at the present time more than nine-tenths
of the anthracite coal deposits is owned
and more than three-foprths of the entire
yearly product is mined by eight lines Of
railroad that are substantially in entire
union of interests.
He quotes from the Pacific Railway
Commission TO show that the Union Pa
cific Railroad had granted to the Stan
dard Oil Company such large sums in
rebates as TO make its entire territory in
accessible to other shippers. and from the
auditors of the Pennsylvania Railroad to
show their company gave discriminating
rates to the Standard Oil Company
amounting against single rival company
in one year to f24,o 900.
1.-THE evidence shows that it is not safe
to trust private combinations with the
public wealth. 1t may reasonably be
apprehended that the more recent COM
binations will follow the practices of the
older trusts The United States Steel
Corporation exceeds all these. in that it is
a combination of combinations. The
stock of the original corporations was
watered when they were organized and
again watered when they entered the
giant combination. 1t is estimated by
practical men that the actual Investment
in its plants and transportation equip
nent does not exceed one-third of its
actual capitalization of $1,000, ooo. 900
upon which its profits i'll the first nine
months of its existegce were S4,77o, 298.
-1n another most important industry
that of meat pscking-there aye practiccd
at the present time the same methods as
those which have built up the more dan
gerous monopolies 10 the past "
Mr.. Phillips says that in the face OF
testimony like the foregoing it is not
surprising that the people are widely de-
nandiase remedial legislation on this
subject, and 10 the case of the railroads
suggests goverHaeAt ownership. He piles
up evidence from sweTa testimony of trust
officials to show that maIy trpsts, with
out hinderance from State or national
authorities are engaged in destructive
competition to crush out small rivals.