The Tabor independent. [volume] (Tabor, S.D.) 1913-19??, 1914-03-12
EFFICIENCY OF BIG
TRUSTS QUESTIONED;
SOLUTION IS NEAR
inquiry May Show that Tho Monopo.
lies Contain Within Themselves
the Seeds Of Their
Own Decay.

monopolistio system contain In itslef
the seeds OF it's own decay? -
That question Commissioners Joseph
-. Davis, Of the bureau Of corporations,
declared, In his annual report made
public today, q federal investigation
now under way hopes to answer #
In q review Of q working program for
the bureau Commissioner Davis points
out that aside from an economic study
Of the trust question, retail price
maintenance is one of the questions to
be taken UP. Trusts, their efficiency
and reforms, however, 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 1t be the
bureau OF corporations as now or
ganized, or a commission rs proposed
In b pending administration bills In
congress, Commissioner Davis en-
phasized.
In his report he discussed the
monopoly question at length, saying In
part:
"The question IL whether the trust
form OF organization is really efficient
II 1t be found that smaller competitive
units in industry can produce com
cheaply as monopciistic units, and that
they have other and greater adj
vantages than those claimed for h
monopolistic or trust system, then the
problem IL finally settled In faver Of
the competitive system, and the chief
monopoly is destroyed. This is a
scientific question Of fact, and It Is the
plan Of h bureau to investigate this
question.
while from q governmental point Of
view there are various aspects Of the
fPI11t nfiaaffnn which ora ~ ovnof I'm.
portance, such as the relation Of trusts
to popular government and their effect
on the social n economic conditions
OF labor, there are two aspects OF 1t
which are peculiarly within the domain
OF h bureau, namely, he effect upon
the cost Of production and distribution
and the effect upon the price to the
consumer.
'It 10 contended by some thai with
the increase in the size Of Industrial
enterprises there goes a reduction In
the cost Of extraction, manufacture.
n distribution. and that such re-
duction in cost IL accomplished by
lower prices to the consumer and does
notsinyolve q reduction In wages or an
impairment OF the conditions Of
labor.
Ever II 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 cheaper pro-
luction and distribution. It Is contend
I'd. on the other hand, that the source
md origin of monopoly is found chiefly
n the desire to exploit the general pub
ic by stock Jobbing schemes for. the
Immediate profit Of h promoters, or
or The purpose Of obtaining control Of
| he market and exacting unduly high
| rices from the
Many large combinations have failed
Il "a 1nnnnnotrofn tod hhatr nnnNrnnnfn tnnf-
lIiency. Combinations which have OBJ
,ined control of the market and. it Is
| omitted. have prospered, but this Is
legged to be due to their monopolistiC
| ~NSition, and not to superior efficiency
| uCording to those who hold this view
| lere is a point beyond which the in
| reaSe in size Of operations does no.
9sult in an increase in economy anc
| Lficiency, but rather in loss and waste
, that the maximum efficiency is MOI
tanned by large combinations, but IL
tead by concerns Of moderate size. ] .
ais latter contention be true, then, a.
las been said, the monopoiistic system
7ontains In itself the seeds Of its own
tecay.
Again, some of those who dispute
he superior efficiency of large com-
Jinations contend that this claim is
made merely as a blind for the purpose
IF selling watered stock. They say
that such organizations are established
for the purpose either of getting cor.
troll of the market and exacting excess
sive prices from consumers, or Of is
suing large amounts of watered stock
for h purpose of selling UGH stock to
the public. In the first case, II Is
argued such combinations are not or
cerned with the promotion Of greater
efficiency butt merely with obtaining q
monopoly; in the second case they are
chiefly concerned with selling the stock,
and as they can not claim to the gen.
eral public that 1t has a great value
due to- monopoly, they are obliged to
find another selling argument, namely,
superior efficiency.
"Of almost equal Importance with the
determination OF this question OF COM
parative efficiency is that Of the price
policy Of such large industrial combin-
atoms as have achieved a substantial
control Of the market. Those who al
lege that such Industrial enterprises
result in greater economy and eff
cheney in production often overlook the
equally important question whether or
not they absorb all the benefits Of suc
economies in increased profits without
conceding any share thereof to labor in
higher wages, or to consumers In rela-
lively lower prices or improved quality
OF goods, etc. The determination of
the facts in respect to this question also
might not be such as to establish broad
generalizations or CONCLUSIONS, but the
Importance Of having the facts In non
II W. IA.a