The Idaho recorder. [volume] (Salmon City, Idaho) 1886-1927, 1907-05-23
BRYAN GIVES DEFINITION OF TRUST /!
The Character Of the -Four Kinds Of Trusts Explained Inside
History Concerning Northern Securities Merger.

The first step TO be taken In the
Investigation OF the trust question Il
TO define trust. The word had il
origin 10 the practice, begun a quar-.
ter OF century ago. OF depositing q
majority OF the stock OF several cor.
porations In the hands OF trustees,
who proceeded TO manage the corpor-
atoms as one. The word afterward
was used to describe any agreement
made among independent corpora.
tions for joint action In the restric.
tion OF trade, the division OF terri.
tory, or the fixing OF price OF terms.
The aim OF these various combina-
lions, more and more clearly defined
as different plans were adopted, was
monopoly. The essence of trust IA
to be found In its ability to eliminate
competition and control the market,
and for the purposes OF this article a
trust will be as6Red as corporation
MNAo IN conjunction
IONS controls u
onable it ap-
NE the terms
IsGso0s or sale or purchase.
The word approximately" Is used
because the evils o: monopoly may be
felt before complete monopoly is Sc.
cured, and the word purchase" as
well as the word ''sale," Is used be-
cause a trust may control the price
OF the raw material which II buys as
we'll as the price OF Its product.
The trust appears in four forms.
The Northern Securities company
presented the trust idea In It's most
advanced form. A corporation was
formed to purchase controlling In.
terest In three railroads, the Great
Northern, the Northern Pacific and
the Burlington. The main advan.
tage OF the Securities company was
that II decreased the amount OF
money necessary to enable a group OF
men to control the three roads. Ii,
for instance, one man obtained
interest In the Great
another man obtained a
interest In the Northern
Pacific and third controlling In.
terest in the Burlington, the three
would confer and elect the same set
Of men as directors OF the three COM
panies. These directors could elm
mate competition and so manage the
loads as to keep one from interfering
With the other, but they would have
20 retain a majority of the stock OF
Ill three roads in order to do 80.
The object OF the Northern Secur-
ties company was to enable the cap
talists to carry out the same scheme
II control with little more than
half of the investment. The North
I'm Securities company was to own
interest In the three
'oads, and the men who owned con-
interest In the securities
company would then control the rail-
Dads. To make the matter clearer,
ct US reduce 1t to figures. IL the
,hree roads had capital stock of
millions each, the syndicate
would have to own little more than
fifty millions OF the stock OF each
Dad, or something more than a
ana fifty millions all to-
,ether. The Northern Securities
company, however, with a catpital OF
hundred and fifty-oue millions,
ould, assuming the capital OF the
bree roads TO aggregate three hum
lred millions, purchase a controlling
interest, and the syndicate, by con-
rolling seyenty-six millions OF the
took OF the Securities company,
ould control one hundred and fifty
me millions OF railroad stock and
hus control the three roads. II, In |
tead Of capitalizing the Securities
ompany at hundred and Gfty-one |
the syndicate fixed the cap
tai at seyenty.slx millions and then |
ssued seyenty-hve millions IN bonds,
could control the railroads by
Iolding little more than thirty
light millions OF the Securities com I,
any stock.
The supreme court, fortunately for |
be country, held the Securities CON- /