Evening star., 1939-04-24

SoyS ~ IVsolOuey OIlu VOuuO
Put q Stroit-Jocket
On Business
To the Editor Of The Star:
In the press of April 20, 1899, Senator
OMahoney, chairman of the so-called
Monopoly Investigating Committee, was
reported as saying at meeting of the
National Association Of Cost Account
ants that Federal charters for interstate
corporations are "the only way to solve
the unemployment problem, preserve the
competitive system for American busi-
ness and keep open the door of oppor-
tunity."
The Senator asked: "What can be
more reasonable than that the Federal
Government which has jurisdiction over
interstate commerce, should draw the
contracts under which it is conducted?"
And he asserted that If the Federal Gov
ernment could lay down the rules for
the conduct of corporations in their
charters, business could be set free from
the discretionary control Of Government
bureaucrats."
This picture Of the happy days to
come through Federal incorporation is
an insult to the intelligence of business
and reminds me Of the celebrated invi-
tation, will you walk into my parlor?
said the spider to the fly"
1t Is easy to foresee a recommendation
by the Senator's committee for bill in
which Congress would require all corpo-
rations engaged in interstate commerce
to apply for and secure Federal charters
as condition for continuing In business.
In order to avoid any question of un-
constitutional delegation of power, such
bill would probably set forth certain OBJ
jectives and principles designed to ac-
complish the purposes specified by the
Senator, and would require some board
ters with conditions and under rules and
regulations to be prescribed by the is
suing authority as necessary to give
effect to the objectives and principles
specified in the bill.
Manifestly, owing to the great number
",
finite variety and complexity of condi-
tions under which they operate, Congress
In the bill could only be very general
in providing what the charters should
contain. Therefore, details of the great
est Importance would necessarily be left
to the issuing authority. In such cir
cumstances it would seem misleading for
the Sonat0r tn fo1 oh
ness free from the discretionary control
of Government bureaucrats.
Let me give just one possible illustra-
ton: In order to fulfill one of the prom
lses OF the Senator, the solution of the
unemployment problem, it is highly
probable that the issuing authority would
provide in certain charters that the
number of employees should not be per-
mitted to fall below a certain number
except with the approval of the author
lty; that certain wages be paid and
hours worked; that certain welfare con-
dltlons be observed; that certain reports
be furnished to the authority, ETC., etc.
In view OF the greatly increased scope
given by the United States Supreme
Court. as now constituted, to the definition
OF the term interstate commerce" there
would not be many businesses of much
Importance that would not be affected
by such bill, and, as to the purely in
trastate businesses, the New Deal would
undoubtedly endeavor, as it has hereto,
lore done in some cases, to get the States
to enact similar legislation.
Think of the vast force of employees
and the great expense involved in an
effective administration of Federal
incorporation act! Think of the great
number Of inspectors required to see that
the provisions OF the charters were OBJ
served, with the consequent spying on
business! Already, according to the
press. the Department of Justice is plan
ming for great increase Of attorneys to
carry out its new campaign for the en-
forcement Of the existing antitrust laws.
Think OF the litigation that would follow
the enactment OF Federal incorporation
act!
The enactment Of such legislation
would put business into a strait Jacket,
and centralize in Washington the con-
troll Of practically all business. cannot
believe, fortunately, that such Demo-
Gratis as Representative Summers of
Texas, chairman of the Judiciary Com
mittee, would support such bill, for he
Is reported in the press of April 20,
1899, as having told conference of
United States attorneys that one of the
greatest dangers to this democracy is
decentralization of administrative pow
ers, and that democracy cannot survive
If "all governmental responsibilities are
concentrated in Washington"
It is well known that the fate of the
second New Deal effort to bring about
recovery by means of pump -priming is
hanging in the balance It would seem,
therefore, that Senator OMahoney. who
Is prominent in the New Deal, would at
this critical juncture avoid making any
statements likely to increase the un-
easiness of business and undermine any
tendency to confidence that may have
been starting.
Can business be expected to do any,
thing to promote recovery when 1t Is
confronted with all the possibilities of