Evening star., 1939-02-06
Monopoly
Continued From First Page.)

(COnLlnueQ from F1TSC FdRe)
expenditures being only $780,
900 900.
This 1887 total income of the 308
companies. DR.. Davenport added,
was only slightly less than total in
come of the United States Govern
ment.
The insurance income of that
year amounted to rs per cent of
the national income.
The life insurance assets have
never shown a yearly decline " the
witness remarked. In this respect
they are unique among our flnan-
cial institutions. Since records have
been kept their total yearly income
never has fallen below their total
expenditures. Even in the three
worst years of the depression these
assets increased by about $780,
100000"
Showing $4,000, 100000 business
on their books at the end of 1887,
the 308 listed companies reflect a
$500 per cent growth since 1890
as the Nations population increased
by 100 per cent. 1t is estimated. the
witness said, that about 64,000,000
Americans now are insured.
Metropolitan Largest.
With assets of S4,720,000,OO0, the
Metropolitan is the biggest life in
surance company in the world, DR..
Davenport showed by chart. Pru-
Dental, New York Life, Equitable
Assurance and Mutual Life follow
in that order, with the five named
controlling 54.4 per cent of the total
assets of the business.
Another aspect of this concen-
tration of control" DR.. Davenport
said, lis the fact that six of the
largest, controlling $50 per cent Of
total assets, are in the New York
area, while 10 more, with 17.2 per
cent of additional assets, are in
New England"
In size, Metropolitan Life is sec
ond only to the American Tele-
phone e. Telegraph Co., among
United States corporations, the wit
ness said.
The full significance of such as
sets is not revealed by figures only"
DR.. Davenport concluded. But
more than so per cent of these in
surance assets are in cash and Sc
curities. In this form, they repre-
sent great influence on our econ
omy"
BY contrast, he pointed out, the
bulk of assets of other corporations
usually is in the form of non-liquid
properties.
Thorough Investigation.
Before the committee ends its in
quiry into the $4,000, 100000 in
Surance business, it was cautioned
by Chairman William o. Douglas of
the Securities and Exchange Com
mission it will range from Wall
Street to Main street, from the
capital markets and financial CEN
ters of the East into the farm lands
of the West and South"
The S. E. c. has conducted the
preliminary examination.
~ "All " ODdOly Lib 10 III UllllC
to consideration of the extent
to which insurance company in
f1uence permeates areas of national
Importance, such as the capital mar
kets, the supply of mortgage funds
available to farmers, railroad re-
organization, and perhaps the
financing of low-rent housing" said
Mr.. Douglas. 1T will of necessity
demand inquiry as to the future of
investment banking and, indeed, the
extent to which insurance COM
panies have come to dominate Sc
curity issuers, underwriters and in
vestors.
These are not boundaries of our
making. They inhere in the char
acter Of the insurance business"
Companies Commended.
Chairman Douglas commended the
companies for their cooperation
with the commission and added:
Il want to make clear that this
inquiry does not attack (and in no
way questions) the adequacy of the
reserves of any insurance company
within its scope. No policyholder
need have any concern that any
fact brought out in this inquiry will
in any way jeopardize the protection
which he counts upon through his
insurance policy"
Reminding the committee that
the last previous study of the in
surance business had been made
by the so-called Armstrong Commit.
tee, of which Charles Evans Hughes,