The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1907-07-26
SHERMAN LAW IS
FOUND WANTING
Address of Charles 6. Dawes
to the Wisconsin State
Bankers Association.
ACT CANNOT BE ENFORCED.
BLIGHT UPON PROPER PROG
RESS OF COUNTRY.

DdHkCIS &SSOtidtlOI GlEtt lDhdg Oh Inc
Defects of the Sherman Antitrust Law"
He said in part:
THE Sherman antitrust law makes
criminal all agreements in restraint of
trade, whether they are inherently GRIM
inal or not. It makes in these general
terms something criminal without further
definition Now this is the day of the
trade agreement in the United States.
We have national, city, state and district
agreements in restraint of trade, and they
are not agreements for the purpose of
eXtorting an unreasonable price. / would
not for moment defend an agreement in
restraint of trade which had for its pur-
pose the eXtortfng from the public of an
unreasonable price. 1t should be under
the ban of the law. 1t should be made
criminal, as the Sherman antitrust law
makes il criminal. But the trouble with
the Sherman antitrust law is that it
makes equally criminal an agreement in
restraint Of trade which is inherently in
nocent, which may be for the benefit of
the pubic, which may be simply for the
purpose of preserving natural rights,
which may be at any rate not injurious
10 the public. Take, for instance, an
agreement among competitors to compete
only upon pure goods as distinguished
from adulterated goods, unquestiOnably
in the interest of the public and vet il
Is criminal under the Sherman antitrust
law today, as criminal as an agreement
among competitors to combine for the
purpose of eXtorting an unreasonable |
price. Take an agreement among manu-
facturers to preserve high standards in
manufactured articles That agreement is
criminal under the law. Take an agree
ment among competitors on perishable
goods designed to prevent an Oversupply
AT a particular point Of perisha BILE com
modiues like meat and fruit, where, If
they were allowed to accumulate, loss of
wealth would be the result. which is in
furious to both the producer and the COM
munity. Such agreements as that are
criminal under the law.
Two Kinds of Agreements.
THE point wish to make is that there
are two kinds of agreements in restraint
OF trade, those which are beneficial to the
public as well as those which are injur-
1ouS. An agreement in restraint of trade
not to sell below cost is not of necessity
disadvantage and of injury to a com
munity, for certainly we have heard a
great deal recently about great institu-
tons underseling for a period OF time In
certain localities, selling below cost for
the purpose of crushing out competition
in order that they may exercise a mOnOD-
oily and raise the price. A great many
OF these agreements in restraint of trade
are for the purpose of existence not of
eXtOrtlon, of letting a reasonable amount
or competition exist. Under the laws of
trade and commerce as we have them to-
cay competition Is running riot in this
country, as we hear all over the country
criticism of the kind of competition that
these great institutions are giving some
try. And yet anything on the part of the
small institutions designed to prevent that
sort OF crushing out competition which
is building up the true monopoIies of the
" nited States is as guilty under the Sher-
4 man antitrust law, is as criminal as any
other kind of agreement designed to ex-
tort from and injure the people of the
United States
Law Is Indefinite.
The Sherman antitrust law makes
criminal in these general terms any
agreement in restraint OF trade in the
United States or with foreign nations.
Now. it is indefinite in its description of
a crime And being indefinite in its de-
scription of the crime, the business COM
munity is in doubt as to what is criminal.
Now, when it is in doubt as to what is
criminal, when the nature of the crime
Is not fixed in the minds of the business
community, the scrupulous man refrains
from action and the INSCRIPTIONS man
takes it with greater impunity. The scrup-
ulOus man TefrainS from entering into any
combination of trade, however beneficial
II may be to the public, or however nee
essary II may be to his business for he
does not desire to take any risks with the
law. The inscriptions man violates
that law with greater impunitV for ex-
perience has shown us that in this coun-
try and every other country that any law
which makes equally criminal an innO-
cent act with guilty act is inevitably
DIFFICULT OF enforcement The result is
that the Sherman antitrust law today
discriIninates against purely useful, bene-
fetal agreements in restraint of trade,
and encOura ges-directly encourages
injurious agreements in restraint of
trade 1t initiates against the scrupulous
business man; it initiates against the
good trade agreement and in favor of the
bad trade agreement. 1t actually puts
a premium upon a consolidation and con-
centration up to a certain point. for pro-
Vided all competition is not destroyed Ii
encourages the consolidation of compet-
rat tn rfsafr inf
because they can do legally then as a cor
pOFatlOn through that cOnsOldatiOn-they
can get the substance of trade agree
ment by that methOd-that which would
be illegal and criminal if done as sepa-
rate corporations under a trade agree
ment The very effect of that law has
been to encourage the more rapid crush
ing out of competition in this country.
Some Serious Consequences.
IN addition to this effect which the
Sherman antitrust law has there are
one or two other very serious conse-
quences which follow from that law Of
necessity, law framed in such general
terms making equally criminal an act
which is inherently innocent with one
which is inherently guilty, of necessity
under such an act such wide latitude OF
discretion is given to the executive Of
ficerS of government in their right to pro-
coed against persons and corporations
that in the enforcement OF this law the
appearance of favoritism Is made inevita-
BILE. The Sherman antitrust law is as
Stunning criminal before trial, a trade
agreement. This is as wrong in connec-
ton with business as it would be 10 as
sumo criminal before trial any individ-
ual charged with an offense under the
laws of the United States, and it is be-
cause of this inclusion of acts which are
Inherently innocent with acts that are
Inherently guilty that we have not had
and cannot have any such thing.as a gem
eral enforcement of the law under the
Sherman antitrust law. Surprising we
should have a general enforcement and
we should have no laws upon our books
which are not susceptible with profit to
the community of general enforcement
surprising we should have the general en-
forcement of the Sherman antitrust law
what would be the result? The tendency
would be on the part Of the good man in
business, If prevented from making those
sort of agreements which will allow him
TO exist, to sell out his business to those
who will take risks with the law which
Is a public injury. Or 1t might lead him
TO sell out his business to those who will
compete with each other again, cutting
up these large businesses and thereby les
SEEMING the economy of production and the
distribution which is a public injury.