Evening star., 1933-06-05
The Political Mill
By C. Could Lincoln.

The constitutionality Of the admins
trations industrial recovery bill may
not trouble the legislators. 1t Is GER
tainly likely to be aired in the courts,
to authorize under this proposed law q
group of manufacturers or other pro-
ducers to SGT up q code, including
prices, production. hours Of labor, wages
and methods Of doing business. and to
compel all the producefs In this par
ticular line Of business to conform to
that code. To the layman, and to some
of the lawyers. this looks like a large
order. How far can Congress delegate
to private industry such powers? The
purposes Of the legislation are declared
to be, and undoubtedly are. of the best.
1t Is proposed to compel manufacturers
to abandon unfair practices Of compe-
tition, to pay O living wage, to shorten
hours of labor and to limit production
in some way 30 that there will not be
a glut Of the market. But where is
this kind Of regulation of private in
dustIy by government going to end?
Who Is going to pay the bill? There
seems not the slightest doubt that the
public, the consuming public, will foot
the bill. But where all this Is going to
end Is another matter and not so easy
to predict.
Included in the bin Is the so-called
licensing provision, by which concerns
are compelled to obtain from the Gov
eminent licenses to do business, after a
code" has been set up by the industry
itself and approved by the Govern
Sc t%r,,a hn fa
Finance Committee, rearing up on its
particular provision from the bill. But
the Democratic leaders are moving
heaven and earth to have the pro-
vision restored, holding that 1t Is the
heart, or the teeth, of the measure. II
this licensing feature be taken out OF
the bill, then concerns would be able
to 90 ahead and do business without
complying with the "code" set up for
them, it Is contended. Whether they
would in reality be able to stand up
against a great majority of their COM
petitors, banded together in the code
agreement, remains to be seen.
y 4
The trend Of the bill Is to break down
competition and to disregard the anti
trust laws. The trend is to make ef-
fective still larger combinations in the
business and industrial world than exist
today, although most of the troubles
Of the country are due to too great CEN
tralization Of business and industry as
it is. The country Is not suffering
from too much antitrust law, but from
the failure to inforce the antitrust
laws. Industry and business has be-
come more and more series OF huge
re 0f
chain stores have wiped out the small
and Independent merchant. More and
more huge industrial corporations have
eliminated the independent manufac-
turer.
How is the consuming public to fare
under the workings of this proposed
legislation? Apparently one Of the chief
desires of the proponents Of the bill
is to increase wages, provide for mini
mum hours of labor and improve work.
ing conditions. The bill goes much be-
yond what would be necessary to ac-
complish those things.
While the bill may result In an IN
crease In wages and reduction IN
the hours Of labor, there is the chance,
due to the other agreements allowed,
that 1t may result in q greater disparity
between the return to labor and to
capital. Few men are in business from
philanthropic motives-they are In busi-
ness to make money. With the oppor-
tunity afforded Of increasing prices as
a result of agreements among them
selves, with which agreements all COM
petitors must comply under the sane
lion OF the Government, the price in
crease may be much greater than the
increased return to labor. In order to
prevent this and determine among the
manifold industries Of this country and
the numerous members Of each indus
try fair prices and fair profits would
require a veritable army Of employees,
and then, when such were arrived at,
II any effort were made to be thorough
in the matter, the conclusions prob
ably would be obsolete because of
changed conditions.
4
The Government already has an
agency to see that competition In busi-
ness and industry be fairly conducted
the Federal Trade Commission. This
agency has labored indefatigably to
carry out the provisions Of the law
under which 1t was created. It's in
quiries have been Of great value. The
made in its investigation of
public utilities and the power trust"
have been such as to bring about i'm
portant reform legislation. This agency
has recently been designated in the new
securities law-enacted so that the
people may really know what is back
Of the. securities which are offered to
them for purchase. One section of the
industrial recovery bill sets forth that
after the President shall have approved
a code set up by an industry, looking
to standards of fair competition" any
violation of this code shall be deemed
an unfair method of competition in
commerce within the meaning of the
Federal Trade Commission act. Viola
tions Of the code shall be punishable
by fine Of not more than $500 for
each offense.
A subsection of the bill, however, in
stead of leaving it to the Federal Trade
Commission to determine whether there
has been q violation of one of these
codes set up by the industries and to
start proceedings to prevent such a
would leave this to the United
States district attorneys. This seems
an unwise provision. The Federal
Trade Commission has been free from
party politics, for one thing, and po-
lIl1luCACCo nave CO2lc1dCl-
able effect in dealing with alleged
violations of the proposed codes" of
competition to be set up by the in
dustries themselves. If the law is to
be enacted, this subsection could be
eliminated with considerable benefit.
The Trade Commission Is equipped to
make the necessary investigations and
is familiar with that kind of work, and
the law under which it works, to a
degree not possible in the Office Of a
district attorney.
i y
In the past in this country 1t has
been the contention that when a man
ventures his capital. skill and labor in
a business he should be allowed to run
it within the law as he desires and
sees fit, and not as the majority of
those engaged in the same business or
some governmental agency want him to
run it. 1t is by the individual innova-
ton. both as to methods and practices,