The Fargo forum and daily republican. [volume] (Fargo, N.D.) 1894-1957, 1914-03-25

azure Oh COuCenIEGLlOu 10 In1O II InRSS~
legations have been made that would
ment regarding the relation of eff
cheney and magnitude. The only in
vestigation Of which I find record Is
that of Herbert Knox Smith concern
ing the steel industry. The former
commissioner Of corporations. as a re-
suit Of an elaborate inquiry reached
the conclusion that the large concen-
trations in the manufacture of steel
are very much more efficient han the
small ones, and for certain products
he gave the amount per ton. He stat
ed that the five great combinations,
United States Steel, Lackawanna,
Cambria, Jones-Laughlin, and Repub-
lie, have an advantage for pig iron
and steel billets from $3.50 to over IS
organizations. -
Thus. for iron and steel it has been
proved that a 500, 900, 900 combination
Is economically nor efficient than a
$40, 900, 900 combination. 1t has not
been proved that a 1000, 200, 900 COM
bination Is more efficient than a $780,
600, 900 combination. No investigation
has been made to determine this point.
Some one may assert that the United
States Steel corporation is not more
efficient than its four strong competi-
tors; / NAV assert. the contrary; and
we are exactly where we were before.
because we do not know the facts.
The question Is one for scientific in
vestigation: and 1t is to be hoped that
the federal bureau Of corporations will
do the work. Similar Investigations
should be made for other lines of in
dustry than steel, SO that W. may
have a scientific foundation upon
which to decide how far we shall per-
nit magnitude.
If, as a result Of investigation, it be
shown that the larger number Of or
PLANTATIONS, have not gone beyond the
magnitude which gives increased eff
cheney in production, then that mag
nitude should be retained. However,
it does not follow that a large organ
ization which has been highly efficient
in the manufacture of its goods has
sold them at reasonable rates. 1t does
not at all follow that the public has
secured a fair share Of the advantages
which result from their increased eff
cheney. Thus it does not follow that
The enormous profits Of the United
States Steel corporation during the
past dozen years. during which time
they have been able to put. back $780,
600, 900 into the business, have been
justified. 1t does not follow that the
colossal profits of the Standard Oil
Co.. have been fairly distributed be-
~" Z IllOSS SOllCCl llSU Ill Liz pIUOuC-
ton of oil and the public.
If, however, it De assumed that con-
siderable magnitude Is necessary to
give efficiency, n the problem Is one
of division of profits, its solution must
be along a different line from that, If
the greater umber of large organiza-
tons have surpassed the magnitude
which gives efficiency. In the former
case the organizations should not be
destroyed; but methods should be de-
vised by which the profits are fairly
distributed.
We pass now to the second premise
upon which We agree-the prohibition
Of unfair practices. 1t is undoubtedly
true that a factor in the attaining Of
MONOPOLY by some organizations and
great magnitude by others has been
such as rebates, underselling to de-
stroy competition, etc. This has led
many to believe that in order to pre-
vent unfair practices it is necessary
to amend the Sherman act, or to pass
a supplementary act which shall pro-
hibit as unreasonable every contract
and combination in restraint of trade.
however slight. This again is an as
sumption for which no one has given
adequate proof.
In the third place, a free field for
legitimate competition must be main
tanned. No steps should be taken
which will endanger this great slim
illus to industrial progress. However,
it has often been inferred that retain
ing legitimate competition will pre-
vent corporations; whereas, the truth
Is cooperation in business may be
just as advantageous to the general
J'ubl!c as is cooperation in education,
In social work, or other line of
human endeaVor. Cooperation is the
cry. of humanity in this twentieth
century, and commerce should not be
eliminated from sharing it's great
benefits. In our desire to retain Iegiti-
mate competition, Ye should take care
not to outlaw legitimate cooperation.
The Laws Relating to Concentration.
Before proceeding further In the dis
cussion. 1t will be well to consider
briefly the laws relating to concen-
tration. Monopoly has never been rec
ognized in this country by common
law, nor by statute law; neither has
it ever been SO recognized in England.
Cooperation in industry, both by
combinations and by contracts, has
been recognized by the laws Of both
countries. The distinction is funda-
mental. In England, in the middle
ages, both common and statute laws
were very stringent against combina-
tons n contracts In restraint of
trade. But parliament, more than six
ty years ago, wiped out all. the stat
utes aaginst such combinations and
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