The Washington times., 1911-12-14
BRANDE|S ASSA|LS
TRUSTS, SAYS CURB
Should ||I.I !. Be APPLIED
Noted Lawyer Urges Regu-
lation Through Supple
mental Laws.

4 In one OF the most remarkable state-
ments thus far given before the Senate
Committee on Interstate Commerce, in
the course Of its inquiry into the prob
lem of how to deal with the corpora
lions. Louis D.. Brandeis. Of Boston,
today laid down the doctrine that regu-
iation IL. essential to preserve competi-
hon, to curb the strong and to protect
fhe weak. and that the Sherman law,
now inadequate. difficult Of application,
and unsatisfactory, should be allowed
70 remain. but should be supplemented
With provisions TO remedyrits defects.
Mr. Brandeis appeared In support of
the competitive view OF the problem of
handling the corporations as opposed
70 the opposite theory. which has been
advocated BY some Of the prominent
captains Of industry. He supported the
Ia Toilette bill now pending before the
senate; upheld competition In Industry
pn economic, social, and political
grounds, and declared against the the
ory that there are natural monopolies in
INDUSTRY, and that so-called natural
monopoiies must not be interfered with.
That the much-talked-of economies
Of monopoly are delusion; that monop-
oily products are DETECTIVES: that the
steel monopoly is an injury to the ex-
port trade; that there is q real. live
menace to this country in the money
trust: that the trusts have hurt ana
degraded labor and not helped 1t; that
me Trusts are great factors in contrib
upns 20 social unrest-these were
among the striking assertions made by
M brandsts, who compelled the
close attention Of the % commit
zee. He took up some Of the trusts
individually. as the Tobacco trust, the
shoe Machinery trust. and the Steel
trust ana spoke plainly Of their methods.
# Believe In Law.
Supporters OF the La Follette- b,t,-,.
said MI, Brandeis. "believe in the
Sherman law; believe In competition in
industry. on economic, social, and Do
htical grounds They. agree that only
unreasonable restraints Of trade should
be prohibited. But they believe the law
10 inadequate. difficult Of application,
end unsatisfactory in its remedy.
Regulation II essential to preserve
competition. just as regulation lis nec-
essary 70 preserve liberty. we curb
The strong to protect the weak. In the
realm Of business. factory laws, iiinita-
tons Of the hours and conditions of
labor. restrictions on the right Of con-
tract pure food laws, meat inspection
laws. and postal fraud prosecutions
similarly limit freedom.
,rarssry ssrs are Tvi no nat pstprSl monopeiies in
Io! by truthless and uncomfortable
vioiations OF law. by criminal rebating,
bribery and corruptions which brought
y wealth with which to destroy COM
Petitors by price-cutting and like prac-
q
"The Steel trust acquired control, not
through greater efficiency, but by buy
ang plants and ore supplies at fabulous
q natural growth. 0...
Economies DslusiyG
"The economies of monopoly afe su-
perfcial and delusive. The efficiency
Of monopoly is at best temporary. Un-
doubtedly. competition involves waste,
but what human activity does moi?
small to be efficient. 1t may also be
too large. The danger IL greater. OF
monopoly producing too large q unit
for efficiency, than Of competition maxi
"Most trusts that have .succeeded Sc.
cured monopolistic positions, cna bling
them to hx prices. Note the Standard
OH, Shoe Machinery, Tobacco, Steel.
na MOST an t1us.s sar whiss ssSsss d,a not ,ecur.
actual monopoly. but control through
price aSreements with competitors, have
failed to hold .theiy ground against the
indspendents; ~ the Sugar. Steel. and
''Most Of the efficiently managed
trusts have had TO limit the size Of their
own units for production and distribu-
tion; - q the Tobacco. OH. and Steel
Charging that defective quality of
product Is vne result of monopoly, Mr..
Brandeis pointed out that In 1902 there
were seventy-two derailments on our
after : decade Of Steel trust control in
rail making. there were 24s. Following
. recent disaster caused by a raii
breaking; the Interstate Commerce
accident to dsfective quality Of rails. ii
The same charge against the trusts
rails has been made repeatedly by rail-
way experts. A few years ago the De-
the defective quality Of fencing wire.
Injury To Export Trade.
"a British View of the steal Corpo-
ration" In the December Atlantic
Monthly. furnished text for Mr.. Brsn-
.deis' charge that the rise in cost of
production of steel Is costing this co,,n-
try Its foreign market. The writer de-
clares that under the trust the industry
mas Deen IN unnStural COnoltlon; CoStS
and prices Of raw material have been
inflated, economy arres' ed. and. while
vast new plants have been built, capi-
tai charges, rents. royalties. costs of
raw material and general manufacturing
expenses have risen 30 high az to mako
export business In composition with
other countries impossible.
From 1899 to 1908 the cost Of making
pig iron has increased from $3.50 $1i per
ton, and other products In proportion.
jExtravagant prices wers paid for many
plants. Ridiculous royalties on ores
were paid, In order to obtain monopoly.
An enormous load of bonds was piled
on the industry. The demand does not
nearly equal the producing capacity, yet
a healthy export trade is Impossible.
ago." pursued the writer, "that We
should have one-third of Americas fur
naces standing idle, while alleged played
out Britain and Germany worked prac-
tically at full capacity, and exported
nearly 10000 900 tons a year7 Ten oil
twelve years ago there seemed every
prospect that America would lead In
steel exports; but It -emains bad
third In the race
The writer declared that in 1910 British
exports led In Americas more than In
1900, while German exports, which, In
1900. were 30 per cent below those OF
America, are now about three times thoss
Of America. In Britain and Germany the
cost OF producing iron and steel has not