New-York tribune., 1910-01-08

management 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 product and it's good quality
TO attract custom, and their business Is
a profitable one. they violate no law. II
their actual competitors are small in COM
parison with the total capital invested, the
prospect of new investments of capital by
others in such a profitable business is suf-
ficiently near and potential TO restrain
them in the prices at which they sell their
product. But If they attempt by use of
their preponderating capital and by a sale
of their goods temporarily at unduly low
prices to drive out of business their COM
petitors. or If they attempt by exclusive
contracts with 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 re-
sources and the extent of their output
compared with the total output as means
competition, then they disclose a purpose
to restrain trade and to establish a mo-
nopoly and violate the act.
OBJECT OF THE LAW
The object of the antitrust law was to
suppress the abuses of business of the kind
described. 1t was not to interfere with a
great volume of capital which. concen-
trated under one organization. reduced the
cost of production and made its profit
thereby, and took no advantage of its size
by methods akin TO duress TO stiie COM
petition with IL.
/ wish to make this distinction as en-
phatic as possible, because | conceive that
nothing could happen more destructive to
the prosperity of this country than the loss
or that great economy In production which
has been and will be effected in all manu-
facturing lines by the employment OF large
capital under one management. l do not
mean 10 say that there is not limit be-
yond which the economy of management by
me enlargement of plant ceases; and where
thls happens, and combination continues
beyond this point the very fact shows in
tent to monopolize and not to economze-
=, Inc original purpose OF many cOmbina-
Eons or capital in this country was not con-
reducing the cost of production. On the
contrary the history of most trades will
snow al times feverish desire TO unite by
purchase, combination or otherwise all the
plants In the country engaged in the manu-
iacture or a particular line of goods. The
idea was rife that thereby monopoly could
be effected and a control of prices brought
about which would inure to the profit of
those engaged in the combination. The
or such combinations. Their projectors
found that the union of all the plants did
not prevent competition, especially where
proper economy had not been pursued in
the purchase and in the conduct of the
business after the aggregation was COM
plete. There were enough, however of such
successful combinations to arouse the fears
or good. patriotic men as to the result OF
a continuance of this movement toward the
concentration in the hands of a few of the
absolute control of the prices of all manu-
factured products.
Inc ANTITRUST statute was passed in 1890,
ana prosecutions were soon begun under II.
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 manufaCtur-
ing plants for the refining Of sugar and did
not include that of direct and intended
restraint upon trade and commerce in the
sale and delivery of sugar across state
boundaries and in foreign trade The result
OF the sugar Trust case was not happy, in
tEilt II gave other companies and combina-
tlons seeking a similar method of making
profit by establishing an absolute control
ana monopoly in particular line OF manu-
1acture sense Of immunity against prose-
cutions in the federal jurisdiction and
where that jurisdiction Is barred in respect
nensurate with the boundaries of the coun-
try no state prosecution is able to supply
the needed machinery for adequate restraint
or punishment.
Following the Sugar Trust decision, how
ever, there have come along in the slow
but certain course of judicial disposition
cases involving a construction of the anti
trust statute and its application. until now
they seem to embrace every phase of that
the American public and to the government
for action. They show that the antitrust
act has a wide scope and applies TO many
ComDlnauonS in actual operation, render
ing them unlawful and subject to indict-
ment and restraint.
"REASONABLE'' RESTRAINT.
The Supreme Court in several of it's deci-
sions has declined to read into the statute
the word unreasonable" before restraint
OF trade" on the ground that the statute
applies to all restraints and does not in
tend to leave to the court the discretion
to determine what is a reasonable restraint
of trade. The expression restraint of
trade" comes from the common law, and
at common law there were certain cove
nantS incidental to the carrying out Of a.
main or principal contract which were
said to be covenants in partial restraint of
trade, and were held to be enforceable he
cause reasonably adapted to the per-
formance of the main or principal contract.
And under the general language used by
would seem that even such incidental
covenants in restraint of interstate trade
were within the inhibition Of the statute
and must be condemned. In order to avoid
such result, l have thought and said
that it might be we'll to amend the statute
70 exclude such covenants from its
condemnation. A close examination of the
later decisions of the court. however. shows
quite clearly in cases presenting the exact
question that such incidental restraints
or trade are held not to be within the
law and are excluded by the general state
ment that. TO be within the statute, the
effect upon the trade of the restraint must
be direct and not merely incidental or in
direct The necessity, therefore, for an
amendment of the statute so as to ex-
cude these incidental and beneficial Gov
enants in restraint of trade held at COM
mon law TO be reasonable does not exist
In some of the opinions of the federal
circuit judges there have been intimations
having the effect. If sound, to weaken the
force OF the statute by including within
II abSurdly unimportant combinations and
arrangements, and suggesting therefore the
wisdom of changing its language by limit
ing its application 10 serious combinations
with intent to restrain competition or con-
troll prices A reading of the opinions of the
Supreme Court, however makes the change
unnecessary, for they exclude from the
operation of the act contracts affecting
interstate trade in but small and Incl
dental way and apply the statute only to
the real evil aimed at by Congress-
The statute has been on the statute book
now for two decades. and the Supreme
Court in more than dozen opinions has
construed it in application to various
phases of business combinations and in
reference to various subjects matter. II
has applied IL 10 the union under one con-
troll of two competing interstate railroads,
to joint traffic arrangements between sew
erai interstate railroads, TO private manu-
facturers engaged in a plain attempt to
control prices and suppress competition in
states. and to many other combinations
affecting interstate trade. The value of a
statute which is rendered more and more
certain in its meaning by a series of de-
cisions of the Supreme Court furnishes
strong reason for leaving the act as IL is, TO
accomplish It's useful purpose, even though
IL IL were being newly enacted useful sug-
gestions as to change OF phrase might be
made.
WOULD NOT DISTURB BUSINESS
1t is the duty and the purpose of the Ex-
ecutive to direct an investigation by the De-
partment of Justice. through the grand