The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1905-01-01

other hand, EVIL unqueStlondDly results
from social interference with what
properly belongs to the individual So
ciety ought not to leave the telegraph
and the railway to the management
and control of individuals; nor vet
OughtNSOciety to step in ana collect IN
dlvidual debts or attempt to direct in
dividual industry"
Therefore. the best results for all
for society-will be realized by draw
ing a dlAtinct line between public
and private activity, and evils must
Iresult-have resulted-from ignoring
this line. This view leaves us still
strong believers in personal liberty.
we still believe that men ought to be
free and independent; we still believe
in industrial freedom we still believe
that to be the ideal society in which
these rights are guaranteed. but we
must now deny that such q society can
be realized through the rule of laissez
faire-- unlimited competition, for We
have seen that the interests of indt-
vtduals are not always the interests
of society. Competition is not a wholly
evil principle. as the socialists say. nor
lis it wholly beneficent one, as the
let-alone-orS say: 1t has its limitations.
and the failure to recognize them has
brought upon US the evils of monop-
oily. and the failure. on the other
hand. to recognize the proper sphere
of government has deprived US of the
undoubted advantages of monopoly.
We are indebted to DR.. Adams and
DR.. r. l. Ely and other economists
of the new school. for searching an
alysis of industries which clearly
points out those which are adequately
controlled by competition and those
which are superior to the control of
competition. With the first class we
have little to do in this enquiry. Here
government has nothing TO do
save regulate the abuses of competi
ton. Common sense sees that there Is
no need OF government farming or
government merchandise. But com
mon sense will just as readily recog
niZe that government has something
to DO with the second class.
Monopolies constitute this second
class, for a monopoly is defined to be
business that is superior to the con-
troll of competition. Monopolies fall
mainly into two diViSionS-natural mo-
nopolies and artificial monopolies. Ar
tificial monopolies owe their existence
directly to legislative grants of ex-
elusive privileges. Patents and copy
rights are perfect types. A natural
natural monopoly almost defines it
self; it arises from the very nature or
things-from peculiar economic con-
ditions. Natural monopolies usually
enjoy exclusive privileges in the use
of natural pportunities-land. The
railway is the perfect type here. There,
is no competition in railway business.
Warfare there is in plenty. Thus we
speak of war of rates--not competi-
ton. An existing railway. since it oc-
cupies exclusively an advantageous
right of way is free from competition.
because when it becomes necessary TO
meet the needs of growing business.
it is cheaper to improve and extent the
existing line than to build a new one.
When Il parallel line is built, it is for
the purpose of sharing the enormous
profits of the first. and a fight ensueS
between the two which inevitably ends
in combination-and there is monop-
oily still.
/ think another class should be ado
ed. wnICn 4 would call the parasitic
There are certain monop~
ohes. which do not seem to fall with
in either of the classes just mentioned.
but scrutiny will reveal a close con-
nection between them and the naturaI
nopolies-especially the transporta
ton monopoiles. Indeed they owe
their origin and their existence 10
special, privileges granted them by
some natural monopoly. Take Stand
ard Oil. That discriminating freight
rates and secret rebates have been the
most potent factor in the growth or
this monstrous trust, a reading OF
Henry ID. Lloyd's wealth VS.. Com
and Miss Tarbell's His
tory of Standard Oil" will convince
the most skeptical. And when you
note the close interrelations between
the railway and the anthracite coal.
the steel. the copper and other trusts,
you are forced TO the conclusion that
The railway, the transportation monop
oily (and not. / venture TO say, a pro-
tective tariff, is the prolific mother
Here is the problem. Large slices
have already been cut off from the field
Of competitive industries and still
larger slices are being cut off. The
area of competition is gradually de-
creasing. the fertile field of monoply
is constantly growing. The trusts
are multiplying. and we see that
freedom is thus being
gradually destroyed largely through
the agency of a transportation mo-
noply which is itself superior to the
control Of competitions. Is it not
equally cleGr that in order 10 pre-
serve free competition and industrial
freedom in their proper sphere, we
must destroy the monopoly of trans
portation?
But i'm order to destroy the monopoly
y
is not desrable--to destroy the trans
portation monopoly There is no mo-
noply of communication by mail in
the United States, and yet the post |
office is a perfect monopoly. The rea- |
son is. the post office is operated by |
the government for the equal benefit |
Of ALL All have equal right to its |
services, aud none has special privi- |
leges in them. AS with the post Of |
f1ce, so ought it to be with the rail-
way. Each is natural monopoly; |
each furnishes a service necessary to !
society; but, while the post OFFICE |
under government operation, actual |
zes in it's own sphere the ideal OF |
equal rights and opportunities, the |
railway, controlled by greed, is |
menace TO industrial freedom.
We may now see that the true |
inc between public and private &c
-iyitieS comedies with the line be- |
tween competitive and non~competi- |
tive industries, and that the true rule |
Of governmental interference is this. |
rhe government ought to control those |
those only-that are
to the controlling influence |
IF competition Nor can we escape !
he conclusion that, if industrial free |
lOm is to be saved the government 7