The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1903-08-28
TRUST AND COMBINES.
Discussed in a Report to the
American Bar Association.

Combinations are rapidly driving
out of business the small dealers and
the small producers. These two classes
heretofore have furnished the largest
number of petitioners in bankruptcy
courts. But now industrial combina-
tions of gigantic magnitude too large
for bankruptcy court to manage and
too rich to need ever to be called be-
fore it have been substituted The re-
port adds:
The modern combination primary
object is to control trade and COM
merce in plain articles of production
and substitute a more or less perfect
monopoly in place of a more or less
free competition. 1t changes entirely
the basis principle of commercial rela-
tions between man and man, and if
they are to continue to grow and de-
veIop in the future as in the past, will
render necessary most important
changes in the principle of our COM
mercial laws. Combination as an econ
omic force is fast coming to take the
place of competition. The producers
are combining, the transportation COM
panies are combining, tradesmen are
combining, workmen as well as en-
ployes are combining everything seems
to be coming into some form of COM
bination and everybody seems to be
combiner. The competition that still
remains is fast disappearing. Work
men are refusing to compete for jobs.
Labor unions are charging the spheres
erationS.
The union of the employers is still
stronger and more far reaching than
the union of the workmen- We are
now having combination of comoina-
ton The u. S. Steel corporation is a
combination of a dozen heretofore COM
peting producers who themselves were
combinations of still other producers:
and these in turn often combination OF
still others To ira Ee them back to
their beginning is like discovering all
the multitude of sources that go to
make up the volume of the swollen
Mississippi. The property which the
Iamalgamated copper company now CON
trolls was once 1000 mining claims,
each one very likely owned in common
by a half dozen miners. The depart
ment store trust has combined the pus-
mess of hundreds of merchants, some
portions of which they acquire by puT-
chase and others in some other way 1t
is estimated that the Standard Oil com
many has taken, by contract or by
force. the business of ten thousand cor
porations and merchants IN all parts
IF the union The few present great
railroad lines of the country have been
made up by the combination OF nun
dreds of sn. aller lines, some extensions
of one another and others competing
lines. ~+
perhaps the pet project of the great
American combines. has been to control
all the shios that sail the ocean. "A
hundred years ago there were hardy
two shins owned by the same individual
or corporation, and even fifty years ago
there was scarcely ship owner, mol
vidual or corporation that owned nan
dozen ships No one knows Dul eii1.
within the next ten years a greater >.
p Morgan will arise who will combine
into one all the industries of the land'
so that the workman who WORKS TOT
wages can find but one possible en-
of
find but one possible seller The steps
toward the formation of one universal
industrial corporation which shall
crowd out all other corporations ana
assume to itself all the industries of
the land have already been more than
half taken. 1t is not so far to go from
now to that end as we had to go to
reach the present industrial conditions.
A monopoly is economically desirable;
that is, for the monopolist. The United
States Steel corporation can produce,
no matter what it sell them for, It's
goods cheaper than the elements out of
which the combination is composed
ever produced them. The Standard Oil
company is economically holy, for 1t
pays 40 per cent. dividends. The sugar
trust is economically correct, for where
as the Individual sugar refinerS lost
money on small capitalization, the
sugar trust pays big dividends on
large capitalization. The raiload COM
panies are economically impregnable,
IOT ln6y pay Ii N1OTSdI > shipping
trust and Mr. Schwab's ship building
trust are failures they are exceptions
to the rule. We cannot therefore rely
on natural forces, on the laws of sup
ply and demand, or on economic con-
siderations, to limit the growth of mod
ern combinations. If they are unde
sirable, if the people of the American
nation are better off without them, or
with limitations put on them, they
must put these limitati ons on by the
action of their legislatures their con-
gress. and their courts.
The American bar must act and the
American Bar association must take the
lead. If the Northern Securities had
been allowed to go on the next thing to
follow it would naturally have been
United States Security company, which
would hold the majority of the stock
of every railroad where the American
flag flies.
The report proposed the following
remedies:
First, we can tax them TO death: or
if that is too radical we can tax them
until their growth and enlargement is
impeded. There are constitutional pro-
visions requiring direct taxation to be
uniform, and in view of these provisions
it is probably impossible to discriminate
in the matter of direct taxation, against
corporations holding large amounts of
taxable property.
There is. however, a franchise tax
imposed by most of the states upon cor
porationS at the time of their incorpOr-
alton and annually thereafter This
franchise is in almost all states in some
way graded as to tax the small cor
poration at a higher rate than the large
one. The first million dollars pays a
higher rate than subsequent millions. In
our judgment, the graduation should be
continued but should be a grading up
instead of down We would leave, per-
haps the first hundred thousand free and
the first million cheap, and raise the
rate with each succeeding million. The
u. S. Steel has a capitalization of over