New-York tribune., 1910-01-14
PRAISES NEW BILL
rs IT CONSTITUTIONAL
James NJ. Beck Calls 1t Most
Important of Years.


sistant Attorney General of the United
States. in which place he engineered the
action against the Northern Securities
merger case, expressed the opinion yester-
DAY that the proposed national corpora
tions law, apart from the question of consti-
tutfonality, was the most important piece
OF constructive leglation that had been
drafted in years
On the subject of constitutionality Mr.
Beck said that while no one could predict
with certainty the result of a test case the
inevitable tendency toward Capitalization
in recent years led him TO believe that the
Supreme Court would consider 1t a very de
batable question He said he was In favor
of every plan which had as its object the
unifcation of governmental control over
commerce. and added that he believed the
great corpora tions would be immensely
benefited by the provisions Of such law
| as has been proposed by the President and
his advisers
The proposed national corporations law
| Is, in my Judgment. the most important
| piece of constructive legislation that has
been submitted for public consideration for
! many years" said Mr.. Beck. After the
vague. ambiguous and, in many respects.
! n,ischievous phraseology of the so-called
| Sherman antitrust law it is positive re-
| lief to consider the draft of a statute which
| substitutes for mere destructive prohibition
a legislative programme whose purposes
| are constructive
THE proposed law raises in the most
vital way the question which Is as old as
| the government. whether the federal govern
ment has the power to create corporations
except as means to carry out some purely
governmental function, as for example, the
! pOStOff1ce or fiscal Svstem
In the closing days of the constitutional
| Convention James Madison proposed that
| Congress be given power to grant charters
| of Incorporation where the interest of the
| United States might require and the legis-
| latfve provisions of individual states may
| be incompetent Rufus King objected on
| the ground that such power would be used
| in Philadelphia and New York for the es-
| tablishment of bank-then the object of
| state jealousy-or that it might be used in
other states TO create mercantile monopo-
lies James Wilson thought that the lat
ter power already included in the power
TO regulate trade. Colonel Mason wished
the power, if given. to be limited to the
construction of canals.
QUESTION IN DISPUTE.
The proposition was voted down. but
whether it was because of hostility to the
already included in the power to regulate
foreign and domestic trade has always
been a subject of dispute. Subsequently
came the great controversy over the United
States Bank, the charter of which was sus-
tanned by the Supreme Court on the ground
that the power to create corporations was
rot substantive power but merely an in
cldental means and as such could be util-
lied to promote the fiscal operations of the
government.
THE serious question remains, however.
whether Congress can create a corporation
as means of exercising it's power to regu-
late foreign and domestic trade which in
itself is not so much a governmental agen-
cy, like the fiscal system, as ii is power
of police regulation.
"A few years ago / think most students
OF constitutional law would have held that
no such power exists, but the inevitable
tendency toward Capitalization, due TO the
irresistible economic forces, has been so
swift that the power to create corporations
to engage in interstate and foreign trade
can certainly be considered as fairly de-
batable, although no one can now predict
with any certainty the decision of the Su-
preme Court upon this very debatable ques-
tion. Such decision must he secured by
test case before there will be any gem
| erdl OlSpOSltlOn on Inc part or state
porations engaged in Interstate commerce
to avail themselves of national corpora
tion law.
PRAISES PROPOSED LAW.
Apart from this question of constitution
ality, the law, drafted by the admins
traton, seems TO be drawn with equal mod
Grafton and skill Personally. / am very
much in favor of every plan which has the
|
commerce as its object. If 1T were not
for the extraordinary growth Of our natu-
raj resources. the prosperity of America
would soon crumble under it's present sys-
tenn of divided and double authority over
| the agencies of trade and commerce. In
! every other federated government the CEN
| trail power is exclusive over trade and com
merce, which is properly treated as a ma
| tonal unit. and believe the same unifica-
| tion must ultimately come in this country.
when the Constitution was formed the
| division between domestic and interstate
| commerce was entirely practicable for geo
graphical barriers and the lack of any ade-
| quate methods of communication naturally
| divided domestic from interstate trade In
| deed. there was very little of the latter
| But to-day, through economic causes which
work Independently of constitutional pro
an individual unit. and the attempt to seq
| regate them artif1cially into domestic and
| interstate commerce runs so counter to the
| inevitable unhcation of commerce that
sooner or later our present somewhat arti-
! fetal division of commerce into domestic
! and interstate must conform to existing
! conditions.
CONSTITUTIONAL REVOLUTION
1T must, however, he added that this
| plan for a national corporation, when taken
| into consideration with the tax on corpora
| tons opens possibilities which little
| short of A constitutional revolution. The
federal government has already shown by
it's prohibitory tax upon the circulating
notes OF state banks that il could, if it
desired, drive most OF the state banks ont
! Of existence. while creating a chain of fed
| eral banks.
while 1t is wholly improbable that any
such plan is within the contemplation of
the administration. yet the possibility must
be considered that the federal government
| might, If the proposed law be constitu-
tional, create corporations the hand
70 engage in interstate and foreign com
merce and simultaneously. by a prohibitory
tax upon state corporations. effectualy
! drive the latter out OF existence
! PERSONALLY, 7 think that the great cOr-