Atlanta Georgian. [volume] (Atlanta, Ga.) 1912-1939, 1914-01-28
By WILLIAM RANDOLPH HEARST.

By WILLIAM RANDOLPH HEARST.
F'rom Hearsts Magazine. December, 1919
tn HERE are two compelling reasons
for careful thought and intelligent
legislation in regard to combination.
One reason is found In the fact that
combination is continually increasing in
spite Of the utmost efforts of IT'S opponents
TO end IT,
The second reason is found in the fact
that combination displays quite def
mite advantages as disadvantages. and the
necessity for preserving those advantages
is as urgent as the necessity for elimi-
mating the disadvantages
The advantages Of combination are the
advantages Of better organization, more
effective operation and cheaper produc-
ton.
The disadvantages OF combination arise
mainly from the misuse OF the power OF
combination, which has developed into
monopoly
", then, combination is inevitable and
in the main desirable, we must by care
ful thought discriminate between the sd-
vantages and disadvantages OF combina-
ton, and by intelligent legislation permit
the legitimate development of the 'adVan-
tages Of combination and prevent the mis-
use Of the power Of monopoly
The growth of combination along harm
ful lines OF coercion and oppression. or
along even the legitimate and beneficial
lines Of natural development, is likely
eventually TO result in monopoly.
As matter of fact, the ultimate aim
oily, and Trust may be described as
combination that has reached the stage
OF virtual monopoly
oVERcAPlTALlZATioN FORBIDDEN.
The conspicuous evils OF the Trusts are
oppression OF employees, coercion OF
agents and competitors. and extortion
from the public
Another evil OF Trust conditions is the
capitalization Of the power to Cypress, to
coerce and to extort.
An essential and initial step in the
movement TO remedy Trust evils is the
prevention of overeapitalization, which in
way stimulates and necesstates trust
oppression, coercion and extortion.
A Trust that capitalizes it's nronopolis-
tic power to overwork and underpsy it's
employees must overwork and underpay
it's employees in order to pay interest on
it's capitalization.
A Trust that cspitalizes its metropolis
tic power to coerce it's agents and its RI
walls must coerce it's agents and its rivals.
A Trust that capitalizes its monopoiis
tic power to extort high prices will and
must practice its monopelistie power to
estort high prices.
capitalization of Trust matters, then, is
one Of the abuses OF the Trusts and one
Of the incentives to Trust abuses.
But there is an evil even more threaten
ing than the capitalization of the Trust
power to coerce and extort and that is
the capitalization OF this power.
A Trust that eapitalizes its power to
eoerce and extort is an evil; but Trust
which oVerospitaIizes these powers is a
svVindls.
A Trust that is capitalized beyond tho
value of it's properties is capitalized for
purposes Of coercion and extortion, but a
Trust which is capitalized even beyond
the value of its monopolistc powers to
coerce and extort is overcapitsiized for
the purpose of swndiine the public, and
will inevitably swinde the public
The only way to prevent the evil and
inevitable results OF illegitimate capltali-
cation OF this kind is TO prevent this kind
of illegitimate capitalization.
GOVERNMENT SUPERVISION NEEDED.
Either the continued existence or the
collapse of such Trust is a calamity.
and the punishment of its promoters de
sirable as that may be. is not so much a
requirement the prevention OF the
formation OF suche enterprises
Both the capitalization of the power to
plumber and excessive capitalization for
purely speculative purposes can be pre-
vented and must be prevented.
To prevent Legitimate and injurious
oVeroapitazation, as many corporations
as possible, and all corporations il pos.
sibe, should be induced to submit their
pima of corporation to governmental au.
thority.
This governmental authority Ia the in
terests of the investing public and In the
interests OF the consuming public and in
the interests OF sound business methods
and stable business conditions should
compel every corporation to capitalize