Albuquerque evening herald. [volume] (Albuquerque, New Mexico) 1911-1914, 1912-04-08
ADM Illustrative
|. OFFICE NEEDED
TO REGULATE
COMBINES
g orporat ion Commissioner
Recommends Plan fer Fed
eral Supervision Of Inter
state Commerce.
ny evening Herald A. ?. Leased wlrsl

ny Evening Herald A. r. Leased wIsel
Washington, ID. c., April s-Tnat
\ ne solution OF the corporation prob
1em demands a permanent federal
administrative Office through which TO
supervise interstate corporate busi-
ness "a the strong recommendation
made In the annual report to the Sec
fetary OF commerce AMI labor of tho
commissioner of corporations, Her
pert Knox smith. His report Is as
follows.
Department OF Commerce and La
Dor, Bureau OF Corporations, WASH
pgton, April s, tei2.
Elr:--
The actual dissolution Of two great
Corporate combinations, ordered by
Die supreme court In the standard
8il company and American Tobacco
Hompany cases, has thrust forward tho
hole problem OF our policy toward
hdustrial corporations. IL Il was not
lain before, Il Is certainly clear now
Dat the federal government must
ave permanent administrative Of
Zee through which 20 supervise inter-
Inte corporate business.
There N little dispute rs 10 the OBJ
bct Of our corporate policy. We want
business machinery Of high efici-
|ncy. serving the best interests OF the
itizen and returning ample reward TO
he ability and industry OF those who
ise that machinery fairly But tho
means 60 this end are nov In debate.
Two great restraints may be im-
pgsod upon business. one is the au-
omatlc regulator, competition; the
bther. direct governmental interVen-
ion. II Is indeed true that under
|ome conditions even fair competition
|pay result IN combination. The fur
.hor question "a then raised. How
az i - desirable To enforce compe-
ltior nv dissolving such combination?
d'hat question, however. need not DO
discussed here.
Whatever shall be our ultimate pol
icy. however, whether of preserving
or OF direct government
bat regulation OF business operations;
pr whether, as Is perhaps more likely.
our policy will be combination or
these various principles, In any event
such a permanent administrative sys-
tenn Is necessary part Of II. That
system must have broad powers OF In
vestigation. taking continuous cOgniz-
ance OF the operations OF large In
dustriai corporations. such admins
tratlon IL necessary for either of tho
foregoing policies described, while II
does not exclude the others. BY pub
iicity and supervision it win preserve
competition and provide equal oppor-
tunity; by an expert knowledge OF
current business conditions Il will dis
play the working OF competition, and
the cases, II any. whore this fails 20
be OF benefit. II win always be In a
position TO furnish, through It's per-
manont force OF trained specialists.
the information needed for iogiela-
tion or regulation. IL VIII also nave
tho knowledge and data that may be
Required properly TO enforce compe-
tition and to carry out the intent OF
nny decree Of dissolution entered un-
der the antitrust law.
A convincing object lesson on the
nced OF such administrative system ia
now before us. The American Tobac-
30 company and the standard OH COM
pany having boon disintcgrated. the
fesultant units are now started on a
how career. These dlsintegrations
have been accomplished only after
aong litigation and az much expense.
rhe purpose was TO benefit the public
~ broad reform in economic eondi-
Hons. And yet the country has no ef-
Iective means OF ascertalning how far
the desired reform win really be car
.ried out. No one can foresoe the fu-
ture Of these new units In the two
great Industries, II viii be purely an
economic and financial process. No
judicial machinery Is adapted 20 han
lie this novel problem, Indeed, the
clrcuit court expressly refused the sug-
gestlon on the attorney general that
'ihe tobacco case be kept open for
slhree more years for such purpose OF
.upervislon.
Public interest requires that these
two groups of companies and any
Others Ia like circumstances, should be
'nt once obliged by law 10 submit 10
Constant inspection by a federal office
organized on lines similnr to those
Suggested above. In these two cases,
Which are but current examples OF "A
General principle, both public and pri-
bate rights arc involved. The public
Das no means OF following the de-
Iolopment OF competition therein
hrough succeeding years, nor have
be- security holders la these corpora
ons--cerininiy al least, those not
on the inside'-any means OF iudg-
BIZ the value OF their holdings under
BE Luvel conditions now operative
In short, under present conditions,
',el, as In Whatever future course
May hereafter be followed, perman-
nt administrative oins9 win bc ab.
4pil,rlN necessary, The vas' come
l.Nlt, nf corporate oNsinesa ami Hs
pnstantiy changing conditions makes
wholly impossible to enforce enec-
tely any real system OF restraint
rough tho courts alone.
Tho exact form OF such an admins
#ailvo ONCE s. a matter for further
etnilcd consideration The essentials
fe permanonoo, expert training. adj
illustrative flexibillty. effective inyes-
Eotion. and publicity, all covering
hose interstate Industrial corporations
hose size and operations make them
4 puzzle importance,
The bureau during the past fiscal
ar has been applying, within the
arrOw limits possible 90 a. the prln-