The Yakima herald. [volume] (North Yakima, W.T. [Wash.]) 1889-1914, 1911-07-05
THE STEEL TRUST

How far the government is to go in
the prosecution of trusts or combin-
ations in restraint of trade is a prob
lem that may we'll occupy the minds
of the greatest of our statesmen. In
the report to President Taft made by
Comm ssioner of Corporations Smith
Yesterday regarding his investigation
of the steel trust, is found the fact
that while it is true that restriction
Of competition was the prime object
of the organization of this billion
dollar corporation, on the other hand,
had not this amalg amation of COM
peting companies been effected. the
competition between the giants"
would have been ruthless and per
haps destructive.
There is Il distinction and a great
one, between eliminating competition
and restraining trade. Eliminating
competition merely means amalgam-
atng competitors into one orGaniza-
ton which then proceeds to prod ace
and sell the product ON a more econ
omical basis. 1t only becomes re-
straint or trade when the means
taken to effect the amalgamation be-
come those OF coercion and duress,
CT when, after its organization tive
new corporation uses the power n
its hands to increase prices Above the
normal
II is obvious mat the elimination Of
competition renders very tempting
the allurcmcnts to restrail .r1de and
hN prices. The path is so easy that
it is almost inevitable An addition
uC only five per cent to the prices K
effected gradually may rAuee No COM
men. and mean millions o. dollars IN
the {, fer of the corporation Strong
indeed must he it's Off GERS; at clear
th"b notions of the push, nature Of
their work and duty to the public. II
they do not, either consciously or UNI
consciously, use the power that is in
Their hands for the increase Of their
profits.
il would appear from the r. JOY, uf
Commissioner Smith that at the time
Of its formation the tangible prop
erty Of the trust was valued at only
sos 600. 0O0. while it was capitalized
at Sl,4o2,o0u,o00, more thar half Of
its stock being water. Since that
tine. however, the earnings Of tine
company have been reinves'el i'm its
property So that today the tangible
assets are close to its Capitalization
While on the one hand Idis shows
enormous profits which would lead II
crce to the suspicion of eXorbitnat
r. COS, on the other, it sh pWs a com,
mendsble desire ON the par of the
officers of the trust 10 prodncn a bet
terment of its property as rapidly a:
possible.
The factor that win doubtless
move the investigators Of the trust Il
look with a great deal Of favor upor
this organization is hat it wa
formed amicably: that it sprani
from desire on the part of the grea
steel men Of the couutrv 20 avo!'
competition between go steel plants
This is. Of course. altogether aIdr
from the point whether or rot Their
has been regulation of prices abov
what the traffic should reasona ~
bear. In case there has been no re
sr~aint n trade by means Of any pac
or agreement as to prices has tn
government any remedy? In othe
words, does our present anti "trus
legislation cover the case Of cor
poration which practically control
an industry by producing so per cen
OF the product of that industry, bu
commits no acts to restrain or ia an