Evening star., 1938-01-04

message 10 congress, PreSloenC
Grover Cleveland declared that COR
porations should be the carefully re-
strained creatures Of the law"
Later, in 1905, President Theodore
Roosevelt. speaking to Congress, de-
clared. The fortunes amassed through
corporate organizations are now so
large, and vest such power in those
that WELD them. that it makes 1t 4
matter of necessity to give to the SOW
ereign-that IS, to the Government,
which represents the people as a whole
some effective power Of supervision
over their cooperative use -. Such
regulation and supervision can only
be effectively exercised by sovereign
whose jurisdiction is co-extensive with
the field Of work of corporations
that is, by the National Government" "
, Later. President William Howard
Taft once sent Federal incorporation
bill to Congress with q special mes
sage. And in 1919, President Woodrow
Wilson specifically declared:
We should formulate q law reuuir-
ing Federal license OF all corpora
tions engaged in interstate commerce
and embodying In the license, or in
the conditions under which 1t is to
be issued, specific regulations designed
to secure competitive selling and pre-
vent unconscionable profits in the
methods of marketing"
These and similar recommendations
have never been followed, not only
because some States chiefly concerned
in the revenue to be derived from issu-
ing irresponsible charters have resisted
1t, but because individual business men
have been led to believe that their in
terests are identical with the interests
of big corporations. Moreover, the be-
lief has been entertained by the man.
ayers Of both big and little corpora
tions as we'll as by persons doing
business as individuals. that Federal
incorporation law would mean more
Capitalization Of government and con-
sequently more bureaucratic interfer-
ence with the free. independent, pri-
vate enterprise. Both Of these ideas are
in error.
Big Corporations Dominant.
Let us first discuss the relative posi-
tlons OF the big and little corporations.
Within the past year the Twentieth
Century Fund, Inc, foundation Gre
ated by group of wealthy individuals
for the purpose Of studying present.
day economic conditions, published q
small book entitled big Business, Its
Growth and It's Place"
Among the amazing facts revealed
in this book was that in 1893 all the
corporations in the United States with
assets of less than $50, 900 each, though
in number they constituted ~ per cent
or almost half of all profitable COR
porations. received less than ~ per
cent OF the total income.
On the basis Of property owned
rather than of taxable income, the
record was even more surprising.
There were 2l1.586 corporations with
assets of less than $50, 900 each. These
constituted 54 per cent of all the cor
porations. But all their assets CON-
b1ned amounted to only IA per cent
Of all corporate assets.
That was one end of the scale. At
the other end the 594 largest corpora
tions constituting less than one-fourth
of l per cent (0.15 per cent to be
exact) of the total number owned
approximately 50 per cent Of all the
assets. In other words, we find the
position Of the big corporations and
the little corporations almost exactly
reversed. The big fellows constituting
less than per cent of the number
owned more than half OF the assets
and the little fellows, constituting 81
per cent Of the number. owned scarcely
per cent of the assets.
Who Is going to contend that this
Is healthy situation for free, inde-
pendent, private enterprise? Who Is
going to contend that the interest of
the little fellows is identical with that
Of the big fellows?
Big Corporations Grow.
1t Is no answer to say that the own
ership of the big corporations is dis
tributed among 10000, 900 or $4,000 900
stockholders. Most Of them own
amounts that are Insignificant. Al
most none Of them exercise any influ-
ence in the management. and even
large owners, in contests with manaee-
ment, sometimes find it dificult to