The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1904-12-21
GARFIELD HAS PLAN
TO REGULATE TRUSTS.
URGES A FEDERAL
CORPORATION LAW
Commissioner Garfield Makes His
Report on Work of His
Bureau.

Washington, Dec. 21.-Urging upon
the president and congress the need of
federal law for the incorporation of
concerns engaged in interstate COM
merce, James R. Garfield, commissioner
of corporations in the department of
| commerce and labor, thus summarizes
the work of his bureau:
Commercial and industrial condi.
tions present the foremost problems Of
today. Ehere exists a deep-rooted gen
eral feeling of dissatisfaction with ex.
listing conditions. Some causes Of dis
satisfaction are apparent, and the evils
very real and great.
The present legal conditions under
which corporate business is carried on
are extremely unsatisfactory. They adj
NIT Of and invite extreme abuse. They
are the result of forced growth under
divergent pressures, and in their pres
ent anomalous state represent the needs
or demands of special interests, and
are not permanent body, Of law
adapted to provide properly for all the
interests involved.
Furthermore, the Estate system
applied to interstate businesses, has de-
veloped additional and peculiar evils;
a diversity SO great as to amount in
operation to anarchy; an inevitable ten
dency toward the lowest level Of lax
| trous contest between state legislatures
| and commercial forces of national size
and power.
State System Inadequate.
emo satisfactory reform is to be
expected under the state system, of
incorporation.
command sufficient power to remedy
these conditions in it's control Of inter
state commerce, supplemented by sub
sidiary and incidental powers.
$50 far the commerce clause Of the
constitution has had a negative devel
opment5 only. both under congress and
by judicial Interpretation. With the
exception of the interstate commerce
act-the force Of which has been seri-
ously weakened by judicial interpreter
tion-and the navigation laws, there
has been no really affirmative attempt
to regulate interstate commerce. The
commerce clause has been chiefly used
to prevent the interference by states
with Interstate commerce.
| 'The creation Of this bureau affords
a means for getting essential facts. In
addition to the value to congress Of
such information, the publication Of
facts, the dissemination Of knowledge,
will bring into existence the influence
Of an enlightened public opinion which
properly applied would go far to de-
velop the sense Of public trust involved
in the control Of private wealth and
the sense Of PERSONAL responsibility on
the part Of officers or managers Of cor
porations. So. =
"The work Of the bureau can proceed
along the lines Of inquiry and report,
adding fact upon fact in proof Of exist
ing conditions, that no real remedy can
be expected until congress takes action
| H.
granted under the commerce clause Of
the constitution.
Possible Action by Congress.
"The possible congressional actions
"Delegation to the states Of control
over interstate commerce. This is be-
ieved to be unconstitutional, and Sec
ondly subject to all the objections ap.
plicable to the present Estate system.
."Compulsory federal incorporation
OF interstate commerce companies. This
is probably legally practicable, but it
involves radical industrial and political
changes by the Capitalization of power
in the federal government, and presents
serious difficulties because of it's effect
upon the authority of the states owe,
such corporations in matters of taxa
tion and local regulation. Any optiona
law of this character would not over
come these difficulties.
"Federal license or franchise for in
!, terstate commerce. Legally this il
, practicable; it, avoids the legal diff
: culties Of national Incorporation as wei
as the practical one of Capitalization
) Of power, and gives the national govern
1 ment direct regulation Of the agenoie
Q Of interstate and foreign commerce..
License Concentrations.
81 therefore beg to suggest tina
congress be requested to: consider tn
i legislative regulation Of Interstate an
o foreign commerce under license o
! franchise, which in general should ORC
l. vide as follows:
v " The granting Of federal franchis
g or license to engage in Interstate com
/, MERGE.
t '''The imposition Of all necessary re
q quirements as to corporate organizs
r ton and management as a conditio
precedent to the grant Of such fra1
I chise or license.
a "The requirement of such reports an
l. returns as may be desired as a. cond
- tion. Of the retention Of such franchis
q or license.
8. "The prohibition of all corporation
Y and corporate agencies from engagin
in interstate and foreign commerce
without such federal franchise
license
:, "The full protection Of the grantee
II Of such franchise or license who ODE
II the laws applicable thereto
): "The right to refuse or withdraw sue
u franchise or license in case Of viol,
!; tion Of law, with appropriate right {
y judicial appeal to prevent abuse {
rs rs power by the administrative officer.
" a+.E. '....