Evening star. [volume] (Washington, D.C.) 1854-1972, 1909-08-24
HARTMAN At HOME TALKS OF THE TRUSTS
Fnancer Arrives in New York Address by President of Ma
on Kaiser Wilhelm II. tiona Bar Association
SENDS WIRELESS MESSAGE TAXING THE CORPORATIONS
His Condition Good Recent Legislation Congress and
Makes Prophecy Its Effect
EXPECTS BUSINESS POWER COMPANIES
of Good
Complete Cure
Address by President of Ma
tional Bar Association.
TAKING THE CORPORATIONS
Recent Legislation by Congress and
It's Effect.
POWER OF HOLDING COMPANIES
Varity Of Topics to Be Discussed
During the Session-Prominent
Men Present.


DETROIT, Mich. August 24.-The an
nual meeting OF the American Bar Asso-
citation opened here today with the read
ing OF his annual address by Frederick w.
Lehman Of ST. Louis, Mo-, president OF
the association Mr.. Lehman dwelt main
Is on the noteworthy changes In statute
law made in the states and by Congress
during the year.
Among the delegates at the meeting are
many OF Americas leading lawyers. and
among the distinguished visitors arc Sec
retary Of War Dickinson. Georges Barley.
advocate of the court Of appeals OF Paris.
France, and Sir Frederick Powell. the
English jurist The visitors and delegates
number about $50.
Following the presidents address the re-
port Of the secretary was read, showing
large increase In the membership. Since
1908 the membership has grown from l,SUO
to more than $3.50
The association now includes representa-
tives from all the states. Alaska. ARIZONA.
Hawaii, New Mexico and the Philippine
read a paper on French Family Law"
! and Judge Julian w. Mack of the circuit
court of Cook county. H.. will present one
on Juvenile Courts"
the delegates.
Significance Of Excise Tax.
The excise tax upon corporations i'm
posed at the special session OF Congress
has significance far beyond its revenue
features. according TO President Leh-
mann. president Of the American Bar AS
! sociation. who delivered his annual adj
| dress at the meeting of the organization
| today.
"It is OF highest Importance as tho
opening door 70 regulation which will
| broaden with the years" said Mr.. Leh-
mann. There Is in this no invasion OF
merely private afralfs. 4 business con-
private business. Corporate powers are
not natural rights and the general welfare
! is the only justification for the grant OF
them. The right Of public supervision
tnheres In them and is as broad as the
interests that may be affected"
Mr.. Lehnann declared that the trust 10
snsoiete. NOBODY now is 50 ignorant or
SO defiant OF law to think of forming
| one" said he. And It. is very easy to
do much better. Out of the ashes o. the
trust has sprung the holding company
the trust In an improved perfected form.
The holding company does and Is designed
to do exactly what was done by the
trust, and does 1t more efficiently. Is it
under the ban Of the law? Certainly not
| In all of the states
Prohibition Does Not Prohibit.
Mr.. Lehman mentioned the prohibition
in Montana against trusts. Having
slain the senile and debilitated trusts
they made invulnerable through legiti-
| macy its youthful and sturdy successor.
the holding company said he. Tho
| speaker said these two laws stand to-
gether, with the result that any industry
| or business of the state may be legally
| monopolized, provided 1t is well and thor
oughly done. and no hal. l.-way measures
are employed. This condition of the law
exists In other states, he asserted.
But the holding company is not the
ull and final development Of Industrial
combination continued Mr.. Lehman.
This is reached in the single corporation
with unlimited power OF capitalization
and direct ownership of the business and
properties with which II deals. Here is
eliminated even the disturbing element
of minority interests in constituent COM
panies. Yet states which prohibit trusts
ard assume to prohibit 1:1onopolies set
no bounds to the capitalization OF their
corporations fix the limit so high that
under it many industries may be COM
pletely engTossed.
'.The result OF such legislation is simply
to prevent combination where the appear
ance Of competition is maintained and
to sanction it where the combination ts
open. avowed and most effective. That
certainly was not tho popular purpose.
The movement against trusts WAS
against the monopoly OF industry or
business. however accomplished. and the
more thoroughly it was done the greater
was the objection to 1t. The assurance
that the economies resulting from COM
bination would cheaper production and
that this would go to the benefit of the
consumer was never accepted.
No Faith in Benevolent Despotism.
"Our people have no faith in beneS-
olent despotism. They know that power
tends to abuse. A corporation large
enough to engross an industry cannot be
trusted TO a generous or even just use
OF its mastery. An enlightened self-inter-
est may find its real and lasting advan-
tage in moderation, but self-interest does
not mean acknowledgements. Recent dis
closures show that greed has not changed
its nature and still grows by what ii
feeds upon. The complete absorption OF
a rival is not beyond capacity, and the
crumbs of a false balance are not be-
meath its covetousness.
'No state can deal with the problem
singly and master 1t, and there has
been. and can be. no concert of action
between the states.
The great industrial corporations are.
In practical effect as much agencies OF
interstate commerce as are the great
carrier companies. If the production of
commodity is under one cont. oil, COM
merce In that commodity is under the
same control but, unfortunately. produc-
tion is held not to be within the COM
rnerce clause Of the federal Constitution,
and so combinations to engross production
may be effected. because the general
government cannot prevent them, and the
states In which they are located w IL not.
But something can be done under the
taxing power
Significance of Federal Tax.
Mr.. lehman then referred TO the sig
nifcance Of the federal tax on corpora
tons.
Continuing. the speaker said: Almost
the first law enacted by the First Con-
gress Of the United States at its first
session was one levying duties upon i'm
ports. the pul poses declared by the act
being the support of government. the
discharge of the debts of the United
States and the encouragement and pro-
lection Of manufacturers.' and We have
never been without such a law. What
may thus be aided by the government
may also be regulated. for there IL no