The evening herald. [volume] (Albuquerque, New Mexico) 1914-1922, 1914-02-21
NEED BODY To
REGULATE
TRUSTS
Must Be Some Federal Bureau
for Investigation and Pub
licity Says Commissioner Of
Corporations.
MONOPOLY SYSTEM
MAY DIG OWN GRAVE
ing Leased WIRE ~ evening Herald. !

lhg Afaaeo Wire W Evening hefatu'l
Washington. Feb. 2i.-Docs the
'monopoiistic system contain In itself
the seeds Of liz own decay
That question Commissioner Joseph
T.. Davies. OF the bureau Of corpora
lions. declared. In his annual repor,
made public today. n federal inves
tigation now under way hopes ~
answer.
In a review of a working program
for the bureau Commissioner Davies
points out that aside from an eco
monte study OF the trust question, re-
tail price maintenance u one Of tho
questions to be taken up, Trusts.
their efficiency and reforms, how.
ever. are To comprise the principal
work for the coming year. The need
of some federal body FOR the purpose
of investigation and publicity IN trust
affairs, whether Il be the bureau VI
corporations as now organized, or a
commission as proposed In the pend
ing administration bills In congress.
Commissioner 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
Client II IL be found that smaller
competitive units In Industry can
produce commodities moro chcaply.
or even as cheaply as monopolistic
units. aud that they have other and
greater advantages than those claim
ed for the monopolistic or trust sys-
tenn. then the problem Is finally set
tied In favor OF the competitive sys-
TEN. and the chief argument FOR the
regulation OF monopoly is destroyed.
This is a scientific question OF fact,
and II II the plan 90 h bureau To
investigate this question.
while from a governmental point
Of view there are various aspects OF
the trust question which are of great
Importance. such AS the relation of
trusts 60 popular government and
their effect on the social and eco
uomic conditions of labor. there are
two aspects OF Il which are peculiar
ly within the domain of the bureau
namely. the effect upon The cost of
production and distribution and the
effect upon the price Ia he con-
sumner
1t rs clntendod 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 re-
duction In cost Is accompanied by
lower prices In the consumer and
does not involve a reduction in wages
or an impairment of the conditions Of
labor.
Even Il these claims were true
the question would still remain. OF
course. whether the cVil resulting
from large combinations would not
be greater than the alleged a1vant-
ages OF cheaper production and dis
tribution. u IL commended, on the
other hand. that the source and ORR
gin OF monopoly Is found chiefly In
the desire Co exploit the general pub
Tic by stock-jobbing schemes for the
immediate profit Of the promoters,
or for the purpose Of obtaining con-
troll Of the market and exactlng un-
duly high prices from the consumer.
MANY large combinations have
failed and demonstrated their eco
nomic inefficiency. Combinations
which have obtained control of the
market Il Is admitted. have
prospered. but this Is alleged To- be
due Ia their monopolistic position.
and not To superior efficiency. Ac-
cording 10 these who hold this view.
there is a point beyond which the
Increase In size Of operations does
rot result IN an increase In
and efficiency. but rather In loss and
waste. 80 that the maximum eff
Cheney is not attained by large COM
bi%nations. but instead by concerns Of
moderate size. 10 this latter conten-
tion be- true, then. as has been said.
the monopolistic system contains In
itself the seeds OF is own decay.
Again. some Of those who dis
pute the superior efficiency Of large
combinations contend that this claim
h. made merely as a blind for the
purpose Of selling watered stock.
They say that such organizations are
established for the purpose either Of
getting control Of the market and ex-
acting excessive prices from con-
sumers, or OF issuing large amounts
~ watered stock for the purpose of
selling such stock Go the public. In
the first case, u Is argued such com
blnatlons are moi concerned with tbs
promotion Of greater efficiency hut
merely with obtaining a monopoly.
IN the second case they are chiefly
concerned with selling the stock. and
as they can not claim To the general
public that Il has a great value due
20 monopoly. they are obliged TO find
another selling argument, namely.
superior efficiency.
"of almost equal Importance with
the determination Of this question OF
comparative efficiency Is that of the
price policy Of such large Industrial
combinations as have achieved a
substantial control II the market.
Those who alleEe that such indus
trial enterprises result In greater
economy and efficiency IN production
often overlook the equally important
Question whether or not they absorb
Isli the benefits OF such economies IN
Increased profits without ~conceding
any share thereof 10 labor in higher |