Arizona republican., 1910-01-08

the combination has been to put the capital and plants of various indi-
 viduals, firms or corporations, en- gagged in the same business, under { the control of trustees.
 Monopoly destroys competition ut terly, and the restraint of the full and free operation of competition has a tendency to restrain commerce and trade. A combination of persons, for merly engaged in trade as partner ships or corporations or otherwise, of course eliminates the competition that existed between them. but the incl
 dental ending of that competition is
 not to be regarded necessarily as a direct restraint of trade, unless of
 such an embracing character that the intention and effort to restrain trade are apparent from the circumstances. or are expressly declared to be the object of the combination.
 A mere incident of restraint of trade
 and competition is not within the in
 hibition of the act. but it is where the
 combination or conspiracy or contract
 is inevitable and directly a substan- tial restraint of competition. and so a
 restraint of trade. that the statute is
 violated
 KIND OF TRUSTS AIMED AT. It is possible for the owners of
 business manufacturing and selling
 useful articles of merchandise so to
 conduct their business as not to vio-
 late the inhibitions of the antitrust law and yet to secure themselves the benefits of the economies of manage
 ment and of production due to the concentration under one control of large capital and many plants. If
 they use no other inducement than
 the constant low price of their prod
 uct and it's good quality to attract custom. and their business is a prof itable one, they violate no law. If their competitors are small, in comparison with the total capital in
 vested. the prospect of investments of capital by others in such a profitable business is sufficiently near and po- tential to restrain them in the prices at which they sell their product. But if they attempt by use of their prepondering capital and by sale of their goods temporarily at unduly low prices. to drive out of business their competitors. or is they stlltillpN DN Hltu their patrons and threats of non- dealing except upon such contracts. or by other methods of a similar char acter to use the largeness of their resources and the extent of their out put, compared with the total output as a means of compelling custom and frightening off competition. then they disclose a purpose to restrain trade and to establish monopoly and vio- late the act.
 The antitrust statute was passed in 1890 and prosecutions were soon be- gun under it. In the case of the United States vs. Knight. known as the sugar trust case" because of the narrow scope of the pleadings. the combination sought to be enjoined was held not to be included within the prohibition of the act, because the averments did not go beyond the mere acquisition of manufacturing plants. the refining of sugar, and did not in clude that of a direct and intended restraint upon trade and commerce in the sale and delivery of sugar across state boundaries in foreign trade The result of the sugar trust case was not happy. in that if gave other companies and combinations seeking a similar method of making profit by establish 1 ing an absolute control and monopoly l in a particular line of manufacture, a l sense of immunity against prosecu- tions in the federal jurisdiction | and where that jurisdiction is | barred in respect to a business which l is necessarily commensurate with the | boundaries of the country. no state prosecution is able to supply the need i ed machinery for adequate restraint or l punishment
 Following the sugar trust decision | however, there have come along. in the slow but certain course of judi l cial disposition. cases involving a con- 1 struction of the antitrust statute, and | its application, until now they seem | to embrace every phase of that law which can be presented to the Amer l ican public, and to the government | for action. They show that the anti trust act has a wide scope and ap. | plies to many combinations in actual | operation, rendering them unlawful | and subject to indictment and re- straint.
 The supreme court. in several of | its decisions, has declined to read into the statute the word "unrea sonable" | before restraint of trade" on the | ground that the statute applies to all | restraints, and does not intend to leave | to the court the discretion to deter mine what is a reasonable restraint of trade.
 It is the duty and the purpose of | the executive to direct investigation | by the department of justice, through | the grand jury or otherwise. into the history. organization and purposes of all the industrial companies with re- spect to which there is any reason- able ground for suspicion that they | have been organized for a purpose. and are conducting business on a plan | which is in violation of the antitrust | law
 I recommend the enactment by con- gress of a general law providing for the formation of corporations to en- gage in trade and commerce among | the states and with foreign nations. Such law should provide for the is- sue of stock of such corporations to an amount equal only to the cash | paid in on the stock: and if the stock ha iSc,,a5 for pronerfy then at a fair