The Richmond Virginian. (Richmond, Va.) 1910-1920, 1913-07-13

railways were clearly Inevitable II we
were to have transportation, but rail-
ways after they are once built stay
put. You can't transfer railroad at
convenience; and you can't shut up
one part If IL and work another part.
IL is in the nature of what economists.
those tedious persons, call natural
monopolists; simply because the
whole circumstances OF their use are
SO stiff that you can't alter them.
Such are the analogies which these
gentlemen choose when they discuss
the modern trust.
1 admit the popularity of the theory
that the trusts have come about
through the natural development of
business conditions in the United
States, and that it Is a mistake to
try to oppose the processes by which
they have been built up, because those
processes belong TO the very nature
of business in our time, and that
therefore the only thing we can do,
and the only thing we ought to at
tempt to do. Is to accept them as
inevitable arrangements and make
the best out of II that we can by
regulation.
/ answer nevertheless, that this at
titude rests upon confusion or
thought. Big business is no doubt TO
a large extent necessary and natural.
The development of business upon
great scale. upon great scale of CO.
operation, is inevitable, and, let me
add. ia probably desirable. But that
Is very different matter from the
development OF trusts, because the
trusts have not grown. They have
been artinciaily created they have
been put together. not by natural pro-
CT sses, but by the will, the deliberate
planning will. of men who were more
powerful than their neighbors in the
business world. and who wished to
make their power secure against COM
petition.
The trusts do not belong TO the
period Of infant industries They are
not the products of the time, that
old lahorious time, when the great
continent we live on was undeveloped,
the young nation struggling % find tt
sell and get upon Its feet amidst older
and more experienced competitors.
They belong to O very recent and very
sophisticated age, when men knew
what they wanted and knew how to
get it by the favor of the govern
ment.
Did you ever look into the way a
| trust was made? IT Is very natural, in
! one sense, in the same sense in which
human greed IS natural. If I
! haven't efficiency enough to beat my
rivals. then the thing 7 am inclined
to do liz TO get together with my rivals
and say: Don't let's cut each others
throats let's combine and determine
prices for ourselves; determine the
output, and thereby determine the
prices. and dominate and control the
/ market" That is very natural That
has been done ever since freebooting
was established. That has been done
ever since power was used to estab-
lish control. The reason that the
masters OF combination have sought
TO shut out competition Is that the
basis OF control under competition Ia
brains and efficiency. I admit that
any large corporation built up by the
legitimate processes of business by
ECONOMY. by efficiency, is natural; and
I am not afraid of It. no matter how
big II grows. It can stay big only by
doing It's work more thoroughly than
ANYBODY else. And there is point Of
higness--as every business man In this
country knows. though some Of them
will not admit tt-where you pass the
limit of efficiency and get into the
region OF clumsiness and unwieldiness.
You can make your combine so extern
sive that YOU can't digest ii into q
single system you can get so many
parts that you can't assemble them as
YOU would an effective piece of ma
!chinerv The point of efficiency Is
overstepped in the natural process Of
development oftentimes. and Il has
been overstepped many times In the
artificial and deliberate formation Of
trusts.
A trust Is formed In this way; n
few gentlemen promote" it-thst Is
to say. they get II up. being given
enormous fees for their kindness,
which fees are loaded on 70 the I'M
dertaking in the form of securities
of one Kind or another. The argu-
ment OF the promoters Is, not that
every one who comes into the com
bination can carry on his business
more efficiently than he did before:
the argument is: we Will assign to you
as your share In the pool twice, three
times four times. or five times what
Won could have sold your business
for to an individual competitor who
would have to run II on an economic
and competitive basis We can af-
ford TO buy II at such n figure be-
cause We are shutting out competi-
ton. Wa can afford 10 make the
stock Of the combination half dozen
times what Il naturally would be and
nav dividends on II, because there
will he nobody to dispute the prices
we shall fix
Talk Of that as sound business
Talk Of that as inevitable It is based
upon nothing except power. IT Is
not based upon efficiency 1t is no
wonder that the big trusts are not
. prospering In proportion to such COM
petitors as they still have in such
parts Of their business as competi-
tors have access to; they are pros
Sering freely only In those fields to
which competition has no access.
Read the statistics Of the steel trust,
II YOU don't believe II. Read the
statistics CT any trust. They are con-
sfantfv nervous about competition,