The Washington times., 1911-10-18

When Attorney General Wickersnam
comes back to Washington, Friday, ne
will take up the big piece OF business
that may determine the whole future
Of Government policy toward the trusts,
decide whether the Sherman act will be
amended, and even be the determining
influence in the next Presidential cam
paign.
The American Tobacco Company's
plan Of reorganization will be taken up
by the Attorney General and his ad-
visers.
II, with the Americans attorneys and
the courts approval, they work. out q
plan that satisfies shareholders and
avoids disastrous market effects, then
It is expected by the Administration
that many other industrial combina-
tions will volunteer to reorganize on
the same general lines. avoid prosecu-
tion, and make the antitrust act auto
matically enforce itself.
in that event the Taft Administra-
tion would claim a great victory. and
Taft stock would go up.
The demand for amendment or sup
plenenting of the Sherman act would
Altogether, II is the critical business
OF the whole Taft Administrator
President Taft for two years has de-
fall by his Sherman law policy. He is
now confronting the final test on that
Issue, and IT'S fate is with the Attorney
General and his lieutenants.
Formulating Model Scheme.<
In many ways this will be the most
important piece of great business the
courts and the Department of Justice
ever have managed under the Sherman
law. It will be the formulation Of a
model scheme of .reorganizing great
industrial SO as TO get VI within the
law.
The Attorney General, who is in oma-
ba today, declares In a statement is-
established, and tnat the Government
will not consent to any plan which does
not effectively accomplish this. The
question, then, is easily stated.
Twenty-nine individual stockholders
were named as defendants in the To
bacco trust case. They controlled ma
jority. of its voting shares. In the re-
organization the American. company
turns over vast share OF its physi-
cal property to new concerns. and
takes their securities. which in turn
are passed on to the Americans share
| holders In exchange.
Thus there will be q group Of com.
panies, where before there was but one;
trolled by the same people, who con.
| trolled the one. But In the exchange OF
| securities, $40, 900 900 of the bonds of the
| for them will be substituted a consld.
| erable proportion of securities that will
have the voting power. This substitu.
ton of voting Tor non-voting securities
will have the effect of taking the actua
| voting control out of the hands Of the
twenty-nine individual defendants. The
aggregate of their holdings in the new
group of companies will make them
minority holders in each.
Practical Domination.
But, on the other hand. their holdings
will in all cases be Of such volume al
practically to assure domination. Thus
they will hold more than 35 per cent o.
American Tobacco stock, Al of the Lig.
gift & Myers Company. 40 Of the p
American Snuf Company. and so on.
Mr.. Hartman used to control vas,
| railroad systems with much less pro-
portion of holdings; so did and does the
| Vanderbilt family, SO do the Gould in.
terests-so do almost all the dominating
closely held minority of 90 to 40 pei
cent pitted against the widely dis.
tributed small holdings, has every ad
vantage in the battle for proxies and
control, and in experience controls;
DEPARTMENT T % OF OF Justice to decide
whether the substance of competition
is restored by this plan which has beer
submitted. The special assistant to th'
Attorney General, Mr., Reynolds. wht
tss handled this litigation throughout
subterfuge (which deserves expeditions
commitment to the scrap-heap.' Th'
| Attorney Generals comment suggest