Bryan daily eagle and pilot. [volume] (Bryan, Tex.) 1909-1918, 1914-02-26
BUREAU REPORT
ON CORPORATIONS
Does the Monopolistlc System Con.
tain Within Itself the Seeds
Of Decay?

Washington, Feb. 26.-DOes the m,
nopolistic system contain in itsele
the seeds of its own decay?
That question Commissioner Josep
/ +. Davies, of the Bureau Of Corpora
, tions declared, in his annual repor
made public today, Federal investi
cation now under way hopes to an
swer.
In review of a working program
for the bureau Commissioner Davies
points out that aside from an economic
study of the trust question, retail
price maintenance is one of the ques
tions to be taken up. Trusts, theii
efficiency and reforms, however, are
to comprise the principal work for the
coming year. The need of some Fed
eral body for the purpose of investi-
cation and publicity in trust affairs,
whether II be the Bureau of Corpora.
lions as now organized. or a commits
sion as proposed in the pending aa-
ministration bills in Congress, Com
missioner Davies emphasized.
In his report he discussed the mo-
nopoly question at length, saying in
part:
''The question Is whether the trust
form of organization is really eff
cient. II it be found that smaller
competitive units in industry can pro-
duce commodities more cheaply, or
even as cheaply as monopolistic units,
and that they have other and greater
advantages than those claimed for the
monopolistic or trust system, then
the problem is finally settled in favor
of the competitive system, and the
chief argument for the regulation of
monopoly is destroyed This is a SCI.
entific question of fact, and II is the
plan of the bureau to investigate this
question.
While from a government point of
view there are various aspects of the
trust question which are of great i'm
portance, such as the relation OF
trusts to popular government and their
effect on the social and economic con-
ditions of labor, there are two aspects
of il which are particularly within the
domain of the bureau, namely, the eff
feet upon the cost of production and
distribution and the effect upon the
price to the consumer.
at is contended by some that with
the increase in the size of industrial
enterprises there goes a reduction in
the cost of extraction, manufacture
and distribution, and that such reduc-
ton in cost is accompanied by lower
prices to the consumer and does not
involve a reduction in wages or an i'm
pairment of the conditions of labor.
Even if these claims were true the
question would still remain, of course,
whether the evil resulting from large
combinations would not be greater
than the alleged advantages of cheap
er production and distribution. 1t is !
on the other hand, that the |
source and origin of monopoly is
found chiefly in the desire to exploit
the general public by stock Jobbing
for the immediate profit of
he promoters, or for the purpose of
obtaining control of the market and
sxacting unduly high prices from the
consumer.
Many large combinations have
allied and demonstrated their econom-
C inefficiency. Combinations which
ave obtained control of the market
nd it is admitted, have prospered, but
his is alleged to be due to their mo-
opolistic position, and not to superior
Efficiency. According to those w:o
old this view, there is point beyond
'hich the increase in size of opera
ions does not result in an increase in =
and efficiency, but rather in .
)ss and waste, so that the maximum
Efficiency is not attained by large
but instead by concerns
moderate size. If this latter con-
,ntion is true, then, as has been said, {
lie monopolistic system contains in T
self the seeds of its own decay 7
Again, some of those who dispute s
le superior efficiency of large com 6
nations contend that this claim is |
ade merely as blind for the pur-
ose of selling watered stock. They
" that such organizations are estab-
shed for the purpose either Of get
1g control of the market and exact
g excessive prices from consumers,
of issuing large amounts of watered :
ock for the purpose of selling sucn
ock to the public. In the first case,
is argued such combinations are not [
ncerned with the promotion of
eater efficiency, but merely with OBJ
ming a monopoly; in the seconc @
Sc, they are chiefly concerned with
ling the stock, and as they cannot
i'm IN tho panara1 rnblio that a. haa