The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1903-08-30

1
that the present trust laws are value
less We contend only so far as their
effectiveness to prevent combination is
concerned, their value, in our judgment
Is less than is generally supposed and
their scope and effect must OF necessity
be exceedingly limited. They are certainly
not sufficient as obstacles to prevent the
continued progress of combination which
has been going on at such rapid rate il
| this country for the last twenty years and
Is now going on, with temporary breath
ing spells now and then, at a more rapid
rate than ever, trust laws to the contrary
notwithstanding.
| Little, III our judgment, can be accom-
plished by directly prohibiting combina-
ton. You must make combination un-
profitable and then the prohibition is I'M
necessary. AS long as combination is pro-
| ftable the combiners will keep ahead OF
the legislators. Whatever may be the
ultimate outcome of the Northern Sc
curities case in the Supreme Court of the
| United States, is there any man who ex-
poets the Great Northern and the North
ern Pacific Railroads ever to be compe-
titors again? The courts may order a
distribution of the securities held by the
|
they will, and the securities will be dis
! tributed in accordance with the decree
of the court, but within twenty-four
| hours after their distribution they will
| find their way back into mammoth sa fe
| with a mammoth nav in a certain build
| ing corner of Wall and Broad Streets,
/ New York 1t is quite possible that the
principle of the Northern Securities case
/ 4 ~ oh
now exists under the name of the United
States Steel Corporation, and it is very
likely that an action similar to that
| brought in the Northern Securities cases
will be brought against the United States
Steel Corporation and with like result.
The court may order a distribution of
the securities that the United States
steel Corporation holds among the sep
arate corporations that have pooled their
| issues TO form the greater company, but
does any one believe that these separate
corporations will ever engage IN competI-
| ton with one another again? That same
mammoth safe, with that same mammoth
nav, would rake in the securities faster
than court receivers could distribute
/ them.
| Competition is the force that we must
save The destruction of competition IS
| the evil that must be prevented. We
might cover the statute books OF the
United States and OF every State IN the
| Union with Sherman Antitrust laws
made a hundred times more drastic, and
the elimination OF competition as an m
dustrial force would go on just the same.
! if not in one way then in some other. As
| long as competition is economically I'M
profitable and combination pays dividends,
competition will disappear and comblna-
| ton take its place.
| We must make combinations unproht-
| able.
| How?
/. We can tax them to death; or, If
| that is too radical a remedy, we can
| tax them until their growth and enlarge
ment is impeded.
| There are constitutional provisions re-
curing direct taxations to be uniform.
| and in view of these provisions 1t IS pro-
| badly impossible to discriminate IN the
matter of direct taxation against cor
porations holding large amounts of taxa
| bic property. The rate of direct taxa
| ton must be uniform.
There is, however, franchise tax I'M
posed by most of the States upon cor
poratons at the time of their lncorpora-
ton and annually thereafter. This iran
chise tax 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 it should be 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
United States Steel Corporation now has
a Capitalization of something over one
thousand millions. The graduation stages
might be slow and easy enough to please
the most conservative and yet result IN
a taxation of ten per cent upon the last
hundred millions. How long would the
limited States Steel Corporation commune
under that system of taxation?
Most great combinations, probably all
the combinations from which the people
have ANYTHING to fear. are engaged IN
some way in interstate commerce. The
Constitution of the United States gives
Congress Jurisdiction to regulate COM
merce among the several states, TINS
clause of the Constitution Is broad and
comprehensive enough to enable congress
to limit or restrict such commerce or to
impose such regulations and limitations
upon it as it sees fit. Congress may en-
act that no corporation shall engage IN
| interstate commerce. The greater IN
cludes the less, and it may prescribe What
corporations shall engage IN such com
merce and may rule out any corporation
unless it be chartered by the united
states itself and then require as one OF
the conditions of such charter that 1t
shall pay a graded license tax to the
United States government such as now
| imposed by some of the States except
GRADED the other way. This would make
such taxation uniform throughout the
United States and prevent the evils which
might result from a varying rate imposed
by the several States
| 2. We can compel them TO renoer pct
ter and cheaper service
| If the combination OF the Northern IA
cific and the Great Northern Railroads IS
great enough public disaster TO nave
warranted the attention which 1t has at
ltracted, it could have been prevented
| n,,.t oo;or +bao nv a hundred sherman