Omaha daily bee., 1911-09-24
REGULATION PLAN
FOR THE TRUSTS
System of Commission is Proposed
by the Famous Attorney from
St. Paul.
PLANNED BY FRANK B. KELLOGG
Before PaIimpsest Club Trust Buster
Outlines His scheme for Max
ing MOnOpoIistic Com
bines Harmless.

A federal commission to regulate all
large corporations is advocated by Frank
b. Kellogg, famous trust buster of st.
Paul. The Palimpsest club gave a dinner
at the Omaha club Saturday evening in
honor of the Minnesota lawyer, and he
was called upon to speak on the relations
of the government to the very large and
monopolistic combines Of capital Mr..
Kellogg, famous for his work on behalf
of the government in several trust dis
solution suits. including the Standard
Oil case and the merger suit against the
Union Pacific and the Southern Pacific,
outlined a policy of constructive reform
which would give the government a sys-
tenn Of machinery capable OF mastering
the difficulties of corporation control
The members of the Palimpsest club, an
organization of business and professional
men interested in intellectual and govern
mental affairs. was his only audience.
The club numbers many of MIR. Kel-
losg's personal friends. as he was often
visitor to Omaha when he was con-
nected with the legal department of the
Chicago Great Western railroad.
He voiced his suggestions as follows:
IT think congress should pass a law
containing, among other things. the fol-
lowing regulations and provisions:
"First--It should provide for volun-
tary system of federal Incorporation and
license. I do not believe in making this
compulsory, for the reason that many
large Industrial corporations are now in
corporated under state laws in such
manner that 1t might be difficult to re-
incorporated under federal law. These
corporations which have been dissolved
under federal decisions-like the Standard
OIL, Tobacco and Powder trusts and other
similar concerns-could easily reincor-
porate or form several corporations TAX
ing over branches of their business Con-
gress should place a limit upon the size
of such corporations and the amount of
the business of the country they may
control.
Second--I would provide for a compul-
sorry license, which shall be the alter
native of federal Incorporation, requiring
corporations engaged in interstate com
merce other than railways and purely
transportation companies to take out a
license containing substantially the same
restrictions and provisions which | shall
suggest as to federal Incorporation. The
object OF the federal license OF incorpora-
tions Is that great aggregations of CAPT
tai which may threaten the independence
of other industries, may control prices
transportation and the finances of the
country. shall be reasonably regulated so
as to prevent injury TO the public by such
vast accommodations OF wealth. When q
corporation seeks a legislative charter un-
der which 1t may amass the great indus
NJ
be subject to searching examination to see
If these powers are abused, and It should
be subject to restrictions and control
Third-I would compel each separate
federal corporation or licensed company
70 engage in but one business and would
not allow It to hold stock In corporations
conducting other business and enterprises.
Another important provision would be a
clause prohibiting common directors and
officers of separately owned and natur-
ally competitive corporations,
Prohibit Control of Money.
FOURTH would also provide that no
corporations formed pursuant to this act
or so licensed shall have power to use
it's surplus for any purpose other than
for the transaction OF It's business for
which 1t was organized. but not to pro-
hibit it from depositing its money in
banks, subject to check. as ordinary de-
posits are made 1t is common knowl-
edge that these trusts amass great sums
OF money as surplus They can, through
these vast sums, control the banking
business, the circulating medium through
which the people OF this country must do
business. Such concentration Of wealth
Is dangerous. II would be very easy for
a corporation with a great surplus 10
create panic or to unduly raise or de-
press the price OF securities The circu-
lating medium Of the country on which
every one must do business. should not
be subject TO the whim or caprice or the
greed Of any set OF men. The should be
prohibited from using other moaeys
through stock ownership for any Of these
purposes, or from controlling railway
transportation lines, financial institu-
tions or other industries. deem this one
OF the most important features OF a fed
eral incorporation and a federal license
lTonffnrnaH ~. UFos,uth