The Washington herald., 1911-12-06

fecting any combination between any oI
| the companies in violation of the statute
| by way Of resumption of the old trust
| Each of the fourteen companies is en-.
| Joined from acquiring stock in any ol
| the others. All these companies are en-
Joined from having common directors or
officers, or common buying or selling
agents, or common officers, or lending
money to each other.
Size of New Companies.
Objection was made by certain indie
pendent tobacco companies that this
settlement was unjust because it left
companies with very large capital in ac-
tive business. and that the settlement
that would be effective to put all on an
equality would he a division of the capital
and plant of the trust into small fraC-
tionS in amount more nearly equal to
that of each of the independent COM
panies. This contention results from a
misunderstanding of the antitrust law
and its purpose. 1t is not intended
thereby TO prevent the accumulation of
large capital in business enterprises in
which such a combination can secure
reduced cost of production. sale. and dis
tribution. 1t is directed against such an
aggregation OF capital only when its pur-
pose is that of sitting competition en-
hanCing or controlling prices, and estab-
fishing a monopoly. II We shall have
by the decree defeated these purposes
and restored competition between the
large units into which the capital and
plant have been divided, we shall have
accomplished the useful purpose Of the
statute.
ConfiscntiOn Not the Purpose of the
statute.
1t is not the purpose OF the statute
to confscate the property and capital OF
the offending trusts. Methods Of punish
ment by fine or imprisonment of the in
dividual Offenders by fine of the corpora
tiOn, or by forfeiture of its goods in
transportation, are provided, but the pro-
ceeding in equity is a specific remedy to
stop the operation OF the trust by in
junction and prevent the future use of
the plant and capital in violation of the
statute.
Effectiveness of Decree.
l venture to say that not in the history
of American law has a decree more ef-
feCtive for such purpose been entered
ny court than that against the tobacco
a I. I
his judgment approving the decree:
The extent to " UhiCh il has been neCes-
Sary to tear apart this combination and
force il into new forms with the attend
ant burdens ought to demonstrate that
the Federal antitrust statute is A dras-
tic statute which aCCOmpliShes effective
results: which so long as il stands on the
statute books must he obeyed. and which
rannOt he disObeyed without inCurring
far-reaChing penalties. And. on the other
hand. the successful reconstruction of
this organization should teach that the
effect of enforcing this statute is not TO
destroy, but TO reconstruct; not to de-
molish. but to re-create, in accordance
With the condition which the Congress
has declared shall exist among the people
NJ the United States"
Common stock Ownership.
1t has been assumed that the present
pro rata and common ownership in all
these companies by former stockholders
If the trust would insure continuance
IF the same old single control of all the
companies into which the trust has by !
lecree been disintegrated. This is erro- !
leous and is based upon the assumed in !
efficacy and innOCuousness of judicial in |
functions. The companies are enioined |
lave different managers. directors, pur- |
'hasing and sales agents. If all or many !
II the numerous stockholders, reaching .
ntO the thousands, attempt to secure |
'OnCerted action of the companies with |
view to the control of the market,
heir number is so large that such an
.ttempt could not we'll be concealed, and |
IS prime movers and all its participants
would at once to subject to contempt
nary character. The immediate result of
he present situation will necessarily be
Ctivity by all the companies under diff
erent managers, and then competition
must follow, or there will be activity by
ne company and stagnation by another !
)nly a short time will inevitably lead to !
change in ownership of the stock. as
II opportunity for continued cooperation
luSt disappear. Those critics who speak
+ this disintegration in the trust as a
lere change of garments have not given
onsideratiOn TO the inevitable working of
he decree and understand little the per-
Onal danger of attempting to eVade or
et at naught the solemn injunction of a
ourt whose object is made plain by the
ecree and whose inhibitions are set
orth with a detail and comprehensive
ess unexampled in the history of equity
Il
OIuntRry Reorganization of Other
Trusts at Hand.
The effect of these two decisions has
d TO decrces dissolving the combination i
manufacturers of electric lamps, a
outhern wholesale grocers' association, !
ny interlocutory decree against the I
owder trust with directions by the cir I
lit court compelling dissolution, and I
ther combinations of a similar history
re now negotiating with the Department
Justice looking to n disintegration by I
ecree and reorganization in accordance :
ith law. II seems possible to bring !
bout these reorganiZations without gen. I
al business disturbance. =
Ovement for Repeal of the Anti
trust Law.
But now that the antitrust act is seen s
be effective for the accomplishment OF I
e purpose of its enactment, we are met q
: a cry from many different quarters
r its repeal 1t is said to be obstruc- 4
re of business progress, to be an at n
mpt to restore old-fashioned methods of !,
competition between small 8
hts, and to make impossible those use a
] combinations of capital and the re- 4
ction of the cost of production that
e essential to continued prosperity and s
rmal growth. n
In the recent decisions the Supreme c