Waterbury evening Democrat., 1905-11-29
CORPORATION PROBLEM
How Judge Peter s. Grosscup
 Would Solve It.
PEOPLE MUST BE THE OWNERS

Chicago Jurist Favors Actual Cone
 troI by Stockholders Under Nation
 al supervisioE-Regard Two Glasses
 of Securities as Sufficient - Would
 Interest Labor.
 Judge Peter s. Grosscup of the Unit ed States circuit court of appeals Of Chicago believes he has found the so- lution for the control of great corpora tions. He proposes plan for their "peopleization"-tha Is, their actual control by stockholders-under the su- pervision of the government. In an elaborately developed argument in the December number of the American H. lustrated Magazine, from which this summary of the article is compiled by the Chicago News, he shows that cor porations are gradually not only adding to their great holdings of property, but are practically owners of the immense wealth of the country.
 "The butcher of t9dayys. he says, is a corporation. The loaf of bread as it comes to us on the table Is almost ex- clusively a corporation product. From whatever point of view, visual to the mind and eye, we may look at it. the domain of property. covered by the corporations, stands out as the great central fact in the industrial life of the century that is just opened"
 Judge Grosscup does not hesitate to say frankly that the corporation of to- day Is not safe field for the small in- vestor. It is it's tremendously complex organization that makes It particular ly unsafe, for, he says, there never was any need for the labyrinthian constuc- tions that seem to be the order of the day-securities so oyerlying each other and often so involved that no one not an expert in buying security can To- cate his claim. It is this state of af- fairs-this fear of being bunkoed-that leads the small investor to put his mon ey in savings bank.
 Judge Grosscup points out the way whereby the corporations can be made not only safe, but so simple that the average investor can understand their organization and see clearly what he is getting for his money when he invests He also places corporations in their proper light. He shows how they are the creatures of the lava line or two fin the statute books-and then puts forward his "peopIeization" plan.
 The conclusions arrived at by the iurist are as follows:
 First.-The beginning of the way out is national incorporation.
 second-The new corporation must be constructed on simple lines. Two classes of securities ought in every case to be suf5cient-the security that represents ac- tual cash paid in or its equivalent in prop erty and the security that may be Issued from time to time as the value of the such increased value. The corporation that cannot be financially launched upon lines thus piainly put before the eye ought not 10 be launched at all. for here. as else where. mystery means not something es- sential to success, but something open to uses other than the corporations success.
 Third.-Provision should be made to in- terest labor in ounership. The securities issued on account of increased value should be issued only as the increase is shown. not by prediction or expectation, but by such experience as proves the fact and provision should be made that such securities may be divided equitably be- tween the capital invested and the labor put in and expedients be adopted to en- courage corporations formed on that ba- sis.
 Fourfh-The corporation. being trustee for its owners. the government must be watch that the trust is executed Under supervision. something Ike the watch the government holds over the national banks. personal schemes would be reduced to 6 minimum And what is more. corporate of personal and moral responsibility.
 Fifth-Provfsfon shoud be made for q government sxchazEe. or . private sx- change under Eovernusut Eupervision. through which the securities of natioual Tn this way woald be drawn a distinctly visible line between the securities of nz- tto1al corporations and securfttss in cor poratio1s that refuzs to nattonalizs = q line that would soon he uncerstcod zs the wiling to bs fzifhful trustees q ths esnsrss fzithful at the szns tine to thsi-