Perth Amboy evening news., 1922-06-22

WASHINGTON, June 1.-TWO
new experiments designed TO estao-
lish business facilities to take the
place of the old-fashioned trust
condemned by the Sherman law as
monopolistic and in restraint OF
trade, are being tried out in the
United States. The oldest single
problem of the American govern
ment in the regulation or business
has been the suppression OF mali
cious combinations. Perennlally'
the private business interests seek
out a new way of combination as
soon as the government breaks up
an old one. Recently, government
officials have adopted the policy OF
working in cooperation with busi-
ness in an effort to discover means
of cooperative effort which VIII
not be malicious.
Economists and some government
officials take the position that there
is such a thing as benef1cent COM
bination of business interests. n
great problem is to make laws ana
regulations which will produce the
benefits of concerted business and
repel the evils of monopoly.
The two latest experiments are,
first: the plan of an agreement,
4 personal al Ddlults o
| officer of the government and the
Individual members of IN Industrial
group or trade, whereby joint action
may be had along beneficent lines
and without general conspiracy;
and, second, the agreement within
a group in business or Industry 10
operate between two extremes,
under the general auspices OF gov
eminent supervision, but avoiding
absolute definite agreement.
The outstanding purpose OF all
trusts, monopolies and comblha-
lions is to fix prices. The motive Is
to create a business situation where-
in the predominant element con-
trolls the price the public must pay
for a given product.
The old-fashioned malevolent
trust operated in this way: 1t would
accumulate a strong fighting cap
ital. With this backing 1t woul re-
duce prices so low that independent
and weaker competitors would be
forced out of business. Then when
the field was clear, it would increase
prices to a point where huge prohts
would accrue. This is the sort Of
trust the Sherman law forbids.
The Heir OF the Trusts
The trade association is declared
by tr~ust-busters to be
the heir of the old-fashioned trusts
An association in, for instance, the
leather industry, would be made up
of ostensibly competing independent
leather manufacturers. They would
furnish to a general headquarters
a statement of the prices they in
tend to charge. Each member would
see the trend being followed by the
other members with the result mat
a tacit understanding would ensue
and concerted action leading uitl-
mately to a m~onopolistic control OF
the prices would follow. This sys-
tenn was broken up recently by the
Supreme Court of the United States
which declared a priee-fixing trade
association. even though composed
of Independents was, in erect, a
monopoly in restraint of trade.
The first experiment is being made
by Secretary of Commerce Hoover.
He believes that the emergency oil
the coal strike makes concerted ac-
ton among coal operators and
dealers desirable and believes 1t Ii
better for the public to have prices
fixed on a fair basis than to have
wild competition which would run
prices of coal up 10 extortionate
lAtkElEs lhtICIOAOg hO hoc
the plan of making, personally. an
agreement with each individual that
he will charge no more than a given
maximum price for coal which Mr.
Hoover and his federal experts have
determined is a fair price. In this
case, the dealers do not deal witt
each other. through any sort of an
association. By dealing individually
with Secretary Hoover IL Is claimed
the law is not violated. yet the pub
lie has the benefit of concerted ac'
tion to control the price on a rela'
lively low level.
should the plan work success
fully, 1t Is possible It may be en-
ployed in other industries. resulting
in the creation of a new sort Of
~benehcent trust.
The second experiment is beint
TRIED by the Federal Trade Com
} mission. Chairman Gaskill Of tina
body has notified certain trade as
sociations that while they may no
asrse, either directly or indirectly
Ito charge certain prices. there ma,
be a general understanding tina
prices will be charged between
named maximum and a named mini
mum.