Evening star. [volume] (Washington, D.C.) 1854-1972, 1950-01-27
Business Heads Fear
Possible Attacks by
Justice Department
Statements Stir Alarm
On Cruckdown of Firms
Which Lead Industries
By David Laurence

By David Laurence
The old saying that the right
hand sometimes does not know
what the left hand doeth would
seem to apply in something more
than an theological sense to what
is going on nowadays in Wash
ington with respect to the admin
istration's attitude toward bust
ness.
At a time when President Tru-
man is speaking soothing words
to business so as to achieve a
momentum of great production of
tax dollars, there are serious mis-
givings and apprehensions among
business men about possible at
tacks on them from the direction
of the Justice Department.
Recently the department has
been denying that it is prosecut-
ing bigness as such. Nevertheless
certain other statements are is
sued which could intensity the
fears in the business world that
the Justice Department intends to
break down many an industry
where three or four companies
happen to have leadership.
Significant Declaration.
A significant declaration has
Just some, for example, from AS
sistant Attorney General Bergson,
who is the chief of the antitrust
division and the man who really
makes antitrust policies nova
days. He says in a speech this
week, carefully prepared for an
audience of lawyers at the annual
meeting of the section on anti
trust law of the New York State
Bar Association: e
Those of our pending cases
which have given rise to the as
sertion that we are attacking big
ness are directed against tradi-
tional restraints of trade and
monopoly power and its abuses,
ana NOT against Size.
''The existence of this monopoly
power, even though 1t may not
have been exercised. is violation
of the Sherman Act. AS the SUI
preme Court said in the American
Tobacco case, neither proof of
exertion of the power to exclude
nor proof of actual exclusion of
existing or potential competitors
is essential to sustain charge of
monopolization under the Sher-
man Act
I'm this connection, I might
caution you that although we have
never found a case involving mo-
nopoly power which had not been
exerted. you may be sure that If
such a case should come to our
attention, it will be brought"
View Challenged in Part.
At the very same meeting, this
view was challenged in part by
Prof. S. Chesterfield Oppenheim
of the George Washington Uni
versity Law School. who said:
1T must be emphasized that
neither the Supreme Court nor
any lower Federal court has yet
ruled that the mere existence of
an oligopoly structure in an in
dustry is a violation of the anti
trust laws. The American To-
bacco case decided In 1916 GER
tainly did not set forth any such
holding"
The "oligopoly" doctrine holds
that, because there is fewness in
an industry-three or four COM
panies doing a preponderant
amount of the total business
this means that. by following each
others production price in what
is known as price leadership"
competition is avoided and mo-
nopoly power is potentially ex-
erted.
There is basis" said Prof. OPP
penheirn, ''for the alarm of many
businessmen and their legal coun-
sci who feel that the agencies Of
antitrust enforcement will pur-
sue this new thinking about the
economic effects of bigness until
the distinction between oligopoly
and single-firm monopoly will be-
come a matter of such small de-
gree as to be reduced, for all
practical purposes, to legal and
economic semantics In procedure
and proof"
What Is emerging is q threat
to the continued operation of
large-scale units in business and
the possible fling of ANTITRUST
suits not for the actual exercise
of any monopoly power but be-
cause of theoretical possibility
that their economic behavior
even though Independent of one
another-could add up to mo-
nopoly.
The business executives in the
large companies argue the oppo-
site-that stability of price levels
Is in reality a truce between COM
petitorS which changing condi-
tions may upset at any moment.
They insist that to break down
the big companies and force their
volume of sales into the hands of
smaller companies will afford no.
body an incentive to expand and
thus the growth of American
business as whole will be stifled.
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