The Minneapolis journal., 1905-11-21
GROSSCUP OFFERS
A TRUST REMEDY
United States Judge Says National
Incorporation Will Solve
the Problem.
Would Have Government Elk.
change Handle Securities Of
i National Corporations.

i National Corporations.
Special to The journal.
New Yok, Nov. 21-Judge Peter S:
Grosscup Of the United States court Of
appeals is the author of notable artl-
Gle in the December number OF the
American Illustrated Magazine under
the heading 'Who Shall Own Amer1,
ca?n He states the proposition 'Shall
the prosperity and property of America
belong to the individual Americang''
and offers solution.
Judge Grosscup calls attention to the
fact that creatures OF the government
corporatious-have grown to such great
pro portions that there are at least two
in the United States now whose fiscal
operations exceed the collections and
disbursements of the federal govern
ment amounting every year to over
$1,000 100000. If there were any way
of disentangling the transactions that
are strictly corporate from the entire
body Of the country's business, it would
be found that the corporate transactions
exceed in magnitude perhaps mine to
one all other business transactions of
our people put together; that the diff
ference in magnitude between the bust
ness transactions Of hundred years ago
and the business transactions of today
IS almost exactly measured by what the
corporation has injected into the bust
hess activities of our people.
Two Great Domains.
He calls attention to the fact that
there are two great domains Of proper
ty:. One is the domain Of the tillable
soil, the proprietorship in which is so
widely individualized that it can be
truthfully said of the farms of America
that they belong to the people. The
other Is the domain Of CORPORATE proper
ty born out Of the loins Of the state
then abandoned and left to shift for it.
self. These two determining currents
In .our, national life, the policy which
controls the distribution Of the landed
domain and the absence Of policy regard
Ing the domain now covered by the cor
poration have run in directions exact
ly opposlte--the one out to the open sea
of permanent republicanism, the other
back to the Businesses of feudal condi-
tiens.
Judge Grosscup then proceeds to de-
scribe the process by which great cor
porations are created out Of nothing
by taking possession Of the earnings
and savings of the people and subject
ing them to the chance disposition and
cunning of the man who first gets upon
the ground.
National Incorporation as Remedy.
The effect of this he SAYS, is to ex-
clude the people from ownership in this
new domain Of corporate wealth, altho
as matter of fact the money which
the corporations control is the savings
Of the people. His problem is to find
some way by which these corporations
may be controlled. He deprecates mad
theorles-state socialism or mere state
control. His remedy is national incor
poration, and on that point he writes
as follows:
"I am for national INCORPORATION
Mr.. Bryan. Commissioner Garfield ani
possibly Mr.. Roosevelt, favor what i:
called federal license. The object Of
federal license is to bit and curb thu
present corporation to the end that i
trave! not ungoverned in the matte
Of prices ! am for national incorpora
tion as against federal license, not be
cause the two are nearly alike, as SOM
people suppose, but because in the EN-
to be attained. they are wholly unlik
national incorporation being the onl,
method that will directly and effective
ly go to the root of the disease, tn
peopleization of the ownership Of tn
tion of the future deal fairly with tn
people in the matter of prices. But
set above that, as the supreme obiec
to be attained, this other thing: Tha
the people Of the country be brough
back into the ownership of the propert
Of the country. And to attain thi
the nation must have it's hand, not sin
ply in the guidance Of existing CO..
porations, but in the construction of th
new corporation.
Simplicity Must Rule.
"Contributory to this work of r,
construction, few general principle
that the new corporation must be col
structed on lines Of simplicity.
'There. never has been need, fro
any sound financial or economic poi1
Of view, for the labyrinthian constru
tions that seem the order of the day
securities SO everything each other an
often so involved, that no one not a
claim. Two classes Of securities oug]
in every case to be suffcient-the S
curity that represents actual cash pa
In, or its equivalent in property, al
the security that may be issued fro
time to time as the value of the pro
such increased value. The corporate
that cannot be financially launcht
upon lines thus plainly put b
fore the eye ought not to be launcht
at all, for here, as elsewhere, mystic
means not something essential to su
cess, but something open to uses 9th
than the corporation g success.
Effect on Corporations.
simplicity in the issue, Of securiti
such as I have pointed out would n
interfere with any legitimate financi
need Of the corporation. The corp,
alton could still borrow money at stat
rates of interest, issuing bonds secur
by mortgages upon the properties. B
such bonds would be part of the
curity that represented actual cash ps
in, or its equivalent in property, a
for all time, and thru all change a
consolidation, such bonds, together wi
the stock securities originally rep
sented by cash or property equivale
would be the fundamental securities,
which interest or dividends must
paid before the second class of securit
could share in the earnings-these s
ondary securities representing the
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