Milford chronicle., 1955-07-08
is "BIG BUSINESS" BAD?

IT, MS IdIk mas D0GU SlilluldlcQ Dy Tie RIcdl
numbers of business mergers that have taken
place i'm late years. The issue, regardless of
cae's view of it, is obviously enormously i'm
portant An excellent discussion and review
appeared in a recent issue of the New York
Times Magazine, written by a world-famous
economist, Professor Sumner HI. SlichIer of
Harvard. He urges: LET us examine the
good and the bad aspects of bigness, and in
SO doing let US attempt to reach conclusions
concerning the kind of public policies that
would give the country both vigorous compe-
tition and high chronological efficiency"
Dr. Sichter's article cannot be adequately
covered In brief space, but certain points
deserve wide understanding. 1t is true that
big businesses are far bigger than they used
to be-the assets of the Is largest manufac-
turers today, expressed in dollars of constant
purchasing power, are six times as large as
the assets of their equivalents of 1900. But
other elements of the economy have grown
vastly too Dr. Slichter cites labor-'the 10
largest unions at present have Is times as
many members as the 10 largest unions in
1900"
Moreover, the situation varies greatly
from industry to industry. According to DR..
Slichter, Among 452 manufacturing indus
tries, in only 46 do the four largest compan-
les produce Is per cent or more of the out
put; while in 1873 industries the four largest
companies turn out less than 25 per cent of
the output" And bigness is not necessarily
permanent. For example, only one of the Is
largest manufacturers of 1900 is in that Sc
lect group today. This change, Dr. Slichter
says, is largely "a result of the rise of new
industries"
Then he deals with the marked change in
thinking on the subject of bigness. A tradi-
tional criticism was that big business behav-
ed snonopolistically and used its power to
prevent competition and keep prices high, and
was slow to expand. That criticism is rarely
heard these days, for it simply does not
square with the facts. Some of the biggest
businesses are engaged in the toughest COM
petitive scraps, are spending money at a
vast rate for expansion, and are doing every
thing conceivable to WOO the consumer So
present-day critics argue instead that big
firms are doing more than their share of
growing, and advocate, in DR.. Shelters
words: @0) that mergers of companies be
considerably restricted, and (2) that legal
limit be placed on the share of sales in an
industry that any one concern might be per-
mitted to make
DR.. Slichter finds that these "new argu-
ments- against bigness are extraordinarily
weak" A limit on size, he states, would in
terfere with the freedom of consumers to buy
the goods of their first choice" and would
have many other i'll effects. He believes that
mergers should be encouraged for the most
part, and prohibited only when the proposed
mergers concern large companies within the
same industry and the result would be weak
ening of competition. He especially favors
mergers of companies in different industries,
on the grounds that 'they usually invigOrate
competition.
At the same time, Dir. Slichter feels that
in various cases the division of companies,
on voluntary basis, into smaller units would
be advantageous to all concerned and should
- II
centive here-that stockholders be given GER
tain tax benefits when such division takes
place.
All in all, the problem is a complex one
1t is certainly true that arbitrary and mar
row restrictions on business growth would
be heavy brake on progress. At the same
time, almost everyone wants to prevent mon
opoly. And there is one point of the greatest
here, that is implied as we'll as
Stated throughout DR.. Shelters article =
monopoly and bigness are not necessarily the
same thing. Mere size is not a danger in it
self.
\CIVIL DEFENSE DRILL
1t is hard to tell just how much good
was accomplished by the civil defense drill
which saw the President and thousands of
government workers evacuated frem Wash
ington to TEMPORARY government site.
ne dflll was \cOnducted under Ideal con-
ditions and it would be foolish to hope that
such conditions would be duplicated under
actual attack. Everyone knew what to do,
what was expected eff him, and yet there
was confusion. Chaos would be compounded
if real attack should come
Nevertheless, it is good thing to have
every arrangement made to get the import
ant government agencies to "a safe place
where they can carry out their function of
directing the effort of the nation to recover
and strike back.
The United States wants to avoid>war If
it should come despite our efforts it is likely
that the enemy will strike the first blow 1t
is well to know that the first blow need mot
be the end of it all, that the country would
not be left without leadership, without
center around which to rally.
CENSORSHIP LIMITED
The Supreme Court recently refused to
set aside lower court rIlIiuu which liroifod