The Mitchell capital. (Mitchell, Dakota [S.D.]) 1879-1918, 1903-09-04
American Bar Association
Meeting Considers Cures
for Trusts.
o TAX GIG COMBINES
After Long Discussion Of the Rep ort 1t
Is Recommitted With Instructions
to Report on Forcing Law
breakers to Obey Law.

observation-disclosures Hagerman, Mis-
souri,.
Secretary-John Hinckley, Maryland.
Treasurer-Fred w. Wadhams, New
York.
Hot Springs, Va. Aug. 31.-The
American Bar association mad a warm
nebacc over the report OF the commit
tee on commercial laws, which sug-
gested remedies for the growth of
trusts. At the evening session the re-
port was recommitted with instruc-
tons to contine it to those conlbina-
tons which exist in defiance of law.
The committee on commercial law,
In dealing With the trust question,
says this is the important question now
before the American bar. 1t says COM
binations are rapidly driving out of
business the small Nealers and the
small producers. These two Aliases
heretofore ave furnished the largest
number Of petitioners in bankruptcy
courts. But now industrial combina-
ions of gigantic magnitude, too large
for a bankruptcy court to manage, n
fore it, have been substituted. The re-
port adds
The modern combinations primary OBJ
iect is to control trade and in
plain articles of production, and substitute
. more or less perfect monopoly in place of
4 more or less free competition. 1t changes
entirely the basic principle of commercial
relations between man and man, and If
they are to continue to grow and develop
In the future as in Che past Will render
necessary most important changes In the
principles of our commercial laws. Com
biration as an economic force is fast COM
Ing to take the place of competition. The
producers are combining, transportation
companies are combining, tradesmen are
combining, workmen as well as employers
are combining; everything seems to be
coming into some form of combination,
and everybody seems to be a combiner.
The competition that still remains is fast
disappearing. WoTkmen are refusing to
compete for jobs. Labor unions are en-
tending their operations. The union Of
the employers is stin stronger and more
far reaching than the union of the work
men. We are now having combinations
and combinations. The United States Steel
corporation is a combination of a dozen
heretofore composing producers who
err producers, and these in turn often
combinations of still others. To trace them
back to their beginnings is like discovering
RIl the multitude Of sources thai go to
make up the volume of the swollen Missis-
sippi. The property which the Amalgam-
ated Copper company now controls was
each one likely owned in common by a
half dozen miners, The department store
trust has combined the business of hum
which they acquired by purchase, and
others in some other way. 1t is estimated
that the Standard Oil company has taken,
by contract or by force, the business of
10000 corporations and merchants tn all
parts of the union. The few present great
railroad lines of the country nave been
mate VI by the combination of hundreds
of smaller lines. some extensions Of one
another, and others of the competing
lines.
Shipping Trust, a Pet Combine,
The ambition OF the shipping trust, per-
haps the pet project of the great American
combines, has been to control all the ships
that sail the ocean: A hundred years ago
there We're hardly two ships owned by the !
same individual or corporation, and even
dfty years ago there was scarcely a shin
owner, indiyidual or corporation. that
but that within the next ten years a
greater man than J. Ferpont Morgan will
arise who will combine into one organi-
cation all the industries, SO that the work.
man who works for wages can find but one
possible employer, and the purchaser of
wares but one possible seller. The steps
toward the formation of one universal in
dustrial corporation which shall crowd ont
all other corporations and assume to IT.
self all the industries of the land, have al
ready been more than haif taken. + is
not so far to go from now to that end
as we had to go to reach present indus
trial conditions.
A monopoly is economically desirable.
that is for the sInonopoiist. The United
States Steel corporation can produce no
matter what It sells them for. its goods
cheaper than the elements out of Whici,
he combination is composed ever nrodiIraa
them. The STANDARD ga company is eco
dividends. The sugar trust is-economicallv
correct, for whereas the Individual sugar
cshners lost money on snlail capitalization,
the sugar TRUST pays big dividends on a
large capitalization. The railroad combi-
nations are economically ~impregnable, for
they the pay. Il Mr, Morgan,s Shipping trust
failures they are exceptions to the rule.
We cannot. therefore, rely on natural
FORCES, on the laws OF supply and demand,
the growth of modern, combinations, If
they are undesirable, il the people of the
out them or with limitations put on them
they must put those limitations on by the
action OF their legislatures, their con-
must act. and the American Bar a~ssocia-
must act, and tie American Bar a~soscia-
ton must take the lead. If the Northern
Securities corporation had been allowed
would naturally have been a United
States Securities company which would
hold the majority of the stock of every
railroad where the American flag flies.
How to Remedy Matters.
The report proposes the following
remedies:
l. We can tax them to death. or If that
is too radical a remedy we can tax them
Until ,mnia their gEowth and enlargement are
Visions requiring direct tax s a to Pre- be-
uniform, AND. in view OF these provisions
~ 10 p1Opdoiy fIlp0SSlD!e TO discriminate
In the matter of direct taxation against
generations holding large amounts of
taxable property. There Is, however, a
franchise tax imposed by most of the
states upo Corporations at the time of
their Incorporating, and annually there
after. This franchise tax Is In almost
all states in some way graded SO as to
tax the sIpall corporation at a higher
rate than, the large one. The first 81, O0o. 800
pays a higher rare than subsequent mill
lions: In our Judgment the graduation
should be continued. hat it should be a
grading up. instead Of down. We believe
perhaps the. first Slo0,O0Osfree and the first
100000 cheap. and raise the rate with
each succeeding sl,oO0.e0o. The United
States Steel corporation has a capitaliza-
ton Of oyer sT,ooa, 100000 The gradation
stages might be slow and easy enough to
please the most, conservative, and vet re-
SUI IN q s,t ta IA dor Of 10 per cent. upon
United States Steel corporation Continue
under tharsystem OF taxation?
z We can compel them to render better
and cheaper service If the combination
OF theSN Northern Pacific and the Great
Northern railroads Is SO great public dis
aster to haYs warranted the attention