The Birmingham age-herald., 1907-04-28
DISSOLUTION AND
 ITS PREVENTION Trusts Are Discussed By Will
 liam J. Bryan FIRST DEFINES TRUSTS Appears in Four Forms-Northern se- curities Company Is Given as
 Most Advanced Form
 of Species.
FIRST DEFINES TRUSTS

trust, says MT. bryan in the May Reader.
 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 interest in three railroads: the oireae Northern, the Northern Pa cine, ana the Burlington The main ad- vantage 0 the Securities company was that 1t decreased the amount of money i necessary to enable a group of men to control the three roads. The Northern Securities company, with capital or d hundred and hrty-one millions, could, as suming the capital of the three roads to aggregate three hundred millions, purchase a controlling interest, and the syndicate, by controlling seventy-sx millions of the stock of the Securities company, could control one hundred and tifty-one millions of railroad stock and thus control the three roads. If, in- stead of capitalizing the Securities com- pany at a hundred and hfty-one millions, the syndicate fixed the capital at seventy six millions and then issued seventy-fve millions in bonds, it could control the | railroads by holding a little more than thirty-eight millions of the Securities company stock The supreme court, fortunately for the country, held the Se- curities company an unlawful combina- tion, although the decision rests upon rather an unsubstantial foundation, since the court stood five to four. MT. Bryan, argues that it would be safer to pro- ceed at once with the passage of a law that would make it unlawful for any corporation to hold the stock of another corporation. While Congress has no power to interfere with state corpora tions so long as they confine their opera tions to the state of their origin, 1t Is within the scope oe the powers of Con gross to prescribe the terms upon which | x1I Gfn shall engage in interstate commerce.
 Second Form.
 The second form of trust that of the du- pication of directorates, is not a new evil although it is a growing one. Our insurance companies and railroads have given many illustra tions of the vicious ness of this system. Construction com panies, formed from the directors of the | railroad companies, have footed the treasuries that they were supposed to guard, and equipment companies, formed from railroad directors have grown rich at .he expense of the railroad. The rem ee for this form of the trust is to pro- hibit the election of any person as a di- rector or other official of two or more corporations which are either competi | tive or engaged in transacting business vita each other.
 1 The following plan is suggested by MT. | Bryan If it were not lawful for one l | with any other corporation in which any l of it's directors were also directors the inducement to form these interlocking combinations would be removed. Such legislation would be in the interest of innocent stockholders.
 Third Form.
 The third form in which the trust ap- pears is found in the combination of a number of separate corporal tions under a contract which controls the various parties to the contract and prevents them from entering into competition with each other. This Is the trust at which the pro- visions of the antitrust law were aimed, and 1t deserves less attention now than In the years past, because being the most familiar form of the trust it is most likely to be exterminated. It is use less to attempt to prevent combinations by fines levied against corporations when the fines are small compared with the sums made by combination. Imprison- ment, however is a real punishment, and the trust magnates will become scarce as soon as tho penitentiary doors close upon a few of the large offenders.
 Fourth Form.
 The fourth form which the trust as- sumes is the single corporation which buys up enough factories to give it con trol of a given business. This is the forrl which the future trust Is most like ly to assume, and 1t Is the most difficult one 10 redcn. MT Bryan asserts tnat every argument that can be made against the principle involved in any other form of trust can be made against the single corporation which secures a controlling influence over any line of business, and no time should be lost in attacking the single corporation trust.
 Ihe protective tariff and the railroad rebate have been tue mainstays of the industrial monopoly The former has kept cut the foreign rival and the latter ha3 enabled the trust to drive It's com petitors from the field A reduction of import duties would lessen the ability of the trust to extort from consumers, and a law authorizing the admission, duty free, of articles entering into competi- tion with the products of a convicted trust would act as powerful deterrent to monopolistic combinations.
 The Conclusion.
 MT. Bryan concludes his article in The Reader as follows: The time is at hand when the public must deal with the sim gle corporation which aspires to a mo- nopoly of the market. Fortunately our dual form of government furnishes means of applying complete remedy. The states exercise the right to create corporations, but the federal government is supreme in the sphere of interstate commerce. A federal statute of few lines will provide for an interstate li- cense and forbid a state corporation 70 do DuSlDeSS OulSlde or the state of it's origin without securing such license A few more lines will set forth the con ditions upon which the license may be secured-conditions which will make private monopoly impossible. If Con gross can withdraw from a lottery com pany the right to use the mail or tic express lines for the carrying of lottery ticket, it can withdraw from would-bc monopoly the right to employ the rail- roads, the mails or the telegraph lines to aid it's conspiracy against the people
 lnis remedy was first suggested about seven years ago; it was then embodied in the democratic national platform of 1900: 1t has since been indorsed by the head of the bureau of corporations and more recently by the President. There can scarcely be any doubt of the consti- nationality of such a statute when it is remembered that the private monopoly has always been an outlaw
 The License System.
 The license system would enable the government to impose any reasonsbl conditions and the most effective condi- ton would be one arbitrarily fixing the proportion of the toal product that the licensed corporatfon would be permitted to control. Experience would determine what that proportion should be-
 If is necessary to draw a distinction