f Natural Tendency to Monopoly in Many Lines of Production and Trade. (1) STATEMENT. There has been an evolution of industry. This is demonstrated by history. Every one admits it. In many lines of industry the size of the plants has increased, while their number has diminished. This has existed in many cases where no legal privileges have been granted. This tendency is, therefore, a law of nature, and consequently it will continue until the plants become so large that to in crease them further will not further reduce the cost of production. This is admitted by all, and there is no political party that aims to stop the reduction in the cost of production so LONG AS COMPETITIVE PRICES EXIST. It is only when the monopoly stage is reached that the Government should step in and restore competitive prices, or regulate the prices, or own and operate the monopoly. (2) TENDENCY TO CO-OPERATION. We have seen that in many industries there is a natural tendency to increase the size of the plant in order to reduce the cost of production, but there must come a time when the competing plants will be so large that to further increase their size AND CONTINUE COMPETITION will not decrease the cost of production. When this stage is reached, will not the proprietors of the great competing plants agree upon prices, thus doing away with competitive prices and thereby increase their profits? In other words, is it not a fact that there is a tendency in human nature to co-operate where it is profitable to do so? Undoubtedly this is true. An exami nation of history shows in most cases where competing plants have become large and correspondingly few in num ber that the proprietors have entered into agreements with each other whereby competition has been more or less eliminated and their profits increased. The writer believes that in any industry where there is a tendency to in crease the size of the plant, the proprietors have already or eventually will enter into agreements shutting off competition. This reduces the cost of production and increases the profits, even though the prices charged the public are not raised. But these prices are raised and thereby the profits are increased in both directions. (3) REMEDIES. a Policy of Reform Parties. Those who read history in the manner above outlined are divided as to the immediate remedies. But nearly all are agreed that in the present undeveloped stage, A STAGE LARGELY DUE TO THE FOSTERING OF MONOPOLY BY LEGISLATION, THE FIRST THING TO DO, after capturing the Federal Government, IS, IN SO FAR AS POSSIBLE, TO REMOVE THE CAUSES OF MO NOPOLY. For example, freight discriminations should be abolished, and also the tariff duties which sustain monopolies. The remedies offered in the Democratic Platform aim to remove the causes without interfering with the growing size of industrial organizations, except to prevent monopoly. The platform demands that all freight discriminations shall be removed; that all such import duties as result in monopolies shall be repealed, and that all other causes which produce monopoly shall be abolished, except, of course, that there shall be no interference with the grad ual growth in the size of competing plants. The words of the platform are: "Corporations should be protected in all their rights, and their legitimate interests should be respected." But to prevent monopoly it is proposed that "corporations engaged in interstate commerce" shall be obliged to take out a license from the Federal Government, and that one of the conditions shall be that the corporation is "not attempting to monopolize any branch of business or the production of any articles of merchandise." To enforce this and other provisions against monopoly, it is declared that "the whole constitutional power of Congress over interstate commerce, mails, and all methods of interstate communication, shall be exercised by the enactment of governmental laws upon the subject of trusts". If, after a fair trial, it is found that in one or more branches of production and trade, the monopoly feature cannot be suppressed, THEN THE NEXT STEP WILL BE TO REGULATE PRICES JUST AS IT IS PRO POSED ΤΟ DO WITH THE RAILWAY MoNOPOLY. If necessary, the same machinery for regulating can be applied. But that is a future possibility, and something with which we have no need to deal in this campaign. TODAY THE TRUSTS AND OTHER MONOPOLIES ARE IN NOWISE CONTROLLED IN THE INTERESTS OF THE PEOPLE, BUT IN THE INTEREST OF THE OWNERS OF THOSE MONOPOLIES. In this campaign the people are to advance and take the first line of entrenchments, namely, elect to office the party that is pledged to regulate the railway monopoly and take down the import duties that are causing monopolies, and turn against the monopolies in all other possible ways the whole of the Federal Government, with the aim of restoring competitive prices. That is the line of action in this campaign. The future possibilities or probabilities must be met in a later campaign. Step by step is the way of progress. (b) The Ideal of the Socialist Party. On the other hand, the Socialist Party, while believing with the other Reformers that private monopoly must not be permitted to exist, declares that the method of obtaining equal rights and due protection of the weaker, is to let the condition of affairs grow more and more intolerable until the people take to them (c) Mr. Bryan's Attitude It is sometimes urged by partisan Populists that four years more of Republican misrule would so aggravate economic conditions as to make reforms easier. No one can afford to aid in making matters worse in the hope of being able to make them better afterwards, for in doing so he assumes responsibilities which he may not be able to remedy. No Populist, however sanguine, believes it possible to elect a Populist President at this time, but the Populist party may be able to determine whether a Democrat or a Republican will be elected. Mr. Chairman, the Populist convention, which your committee represents, thought it better to share OWN AND OPERATE THEM IN COMMON. This is the Revolutionary Method, as it is termed, in contradistinction to the Reform Method-the advance step by step. In the words of Mr. Bryan in his speech accepting the Populist nomination: as to Social Progress. with the Democrats in the honor of securing some of the reforms desired by your party than to bear the odium of remaining neutral in this great crisis or of giving open or secret aid to the Republican party, which opposes all the reforms for which the Populists contend. Those who labor to improve the conditions which surround their fellowmen are apt to become impatient, but they must remember that it takes time to work out great reforms. Let me illustrate by calling your attention to the slow growth of public opinion in support of the proposition to which there has been practically no open oppo sition. President Johnson, in 1868, recommended a constitutional amendment providing for the election of United States Senators by a direct vote of the people, but his recommendation met with no response. About twelve years later General Weaver, then a member of Congress, tried to secure the passage of a resolution submitting such an amendment, but his efforts were futile. In 1892 the resolution recommended by President Johnson and urged by Congressman Weaver finally passed the House of Representatives, but it has not yet reached a vote in the Senate, and now, after eight years more of public discussion, the proposition for the first time received the indorsement of the national convention of one of the great parties. If the fusion forces win a victory this fall we shall see this reform accomplished before the next Presidential election, AND WITH ITS ACCOMPLISHMENT THE PEOPLE WILL FIND IT EASIER TO SECURE ANY REMEDIAL LEGISLATION WHICH THEY MAY DESIRE. (d) Attitude of the The holders of great monopoly privileges (secured to them by Federal laws or by the absence of Federal action) are striving to prevent the regulation of the prices charged by the railway monopolies, and are striving also to prevent the restoration of competitive prices in production and trade. This demonstrates that their aim is to foster private monopoly-to create and maintain private monopoly by use of the Government. During the past year the brother of John D. Rockefeller told an intimate friend it was his belief that private monopoly would continue and that the number of owners would become less and less until one man would practically control all the industries of the country, and that this man would do it so well the people would ask him to take charge of the Government also. THIS IS THE LOGICAL OUTCOME OF THE TENDENCIES IN THE FEDERAL GOVERNMENT OF THE PAST TWENTYFIVE YEARS. To the same effect as the foregoing prophecy of William Rockefeller are the principles advocated by Arthur C. Hadley, Professor of Economics at Yale University and now its President. He has repeatedly declared that the private individuals who control the trusts should realize that they are, as to the people of the country, trustees. One of the means Professor Hadley advocates for the enforcement of this trusteeship is social ostracism. Those who do not come up . to the standard should not be received in society. This general line of policy which Professor Hadley advocates was commented upon by Professor John Commons in a written debate before the American Economic Association at its last annual meeting. Among other things he said: Professor Commons' Reply to President I can see how the modern economist who sees these new developments [Monopoly Developments and Boss Politics], without seeing any democratic solution for them, should in a noble and fearless Spirit BECOME COURT PREACHER TO THE POLITICAL BOSSES AND THE IRRESPONSIBLE TRUSTEES. He says to them: Natural selection has preserved you as the survival of the fittest. It has given these Asiatics, these workingmen and farmers, into your keeping. Remember your position is one of trust. You are free from competitors. There is no legal penalty for abuse of power. You are not responsible to them. I do not know what God will do in the matter. But anyhow, be good to them. Show them sympathy and justice. If you do not I shall denounce you. He Now, in speaking thus I admit that I exaggerate the position of President Hadley, as he views it. But I see no other outcome of his position, and in a question of this kind we are all to be judged by the practical outcome of our teaching. I have no doubt that an economist who takes this position will accomplish great good for society as a whole. will have an influence in politics. notice that he will shut out from political influence all the economists who do not have the ear of the bosses and the trusts. He is the defender of the institutions by which these men have gained power. As such he has their ear. he makes a distinction between the good man and the bad man who possesses the power, between their good and bad use of their power. As such he is their needed critic. But other economists who do not indorse the necessity of abso But . lutism or trusteeism, if they are to have POLITICAL INFLUENCE, must get it through those classes who resist these absolutist institutions. If they can show that there is another solution to the problem, if they can show that there is a safe and rational method by which these excluded classes can share in the control of these institutions and by which the prosperity of the whole will be at the same time promoted, then the other classes will take up their arguments and will use them as the social justification of their class struggle. Professor Commons, the man who fearlessly stated the above, is working today for the election of William J. Bryan and for a Congress composed of Senators and Representatives elected on the Democratic, Populist and Silver Republican tickets. He believes that that is the path of progress. He says in effect: "Let us secure control of the Federal Government, and then work out the solution of the problem step by step. Remove the causes of monopoly, enforce the law against monopoly, and in so far as practicable extend the people's power. over the law by means of the referendum, the initiative and proportional representation." (e) Attitude of the McKinley Administration. The greater portion of the monopolies under private control have developed during the McKinley Administration. ALL THE OWNERS OF THESE PRIVATE MONOPOLIES ARE ASKING FOR A CONTINUANCE OF THE ADMINISTRATION. They are fighting with all their power the Reform parties. President McKinley and the Senators and Congressmen who are with the Administration, have refused to restore to the Commerce Commission its power to prevent discrimination in railway rates, and have refused, also, to remove the tariff duties from monopoly products; nor does President McKinley enforce the present laws against monopoly. The Administration has attempted to deceive the people by introducing in Congress a bill for an amendment to the Constitution of the United States giving greater power to Congress and the President and taking from the States all power to regulate monopoly within their borders. With this record, President McKinley in his Letter of Acceptance refrains from recommending any legislation that will take the props from the monopolies and restore competition. He does not ask that railway discriminations be prevented, thereby establishing equal rights between shippers; nor does he ask that protected monopolies be opened to foreign competition. He simply asks that the present causes be left in operation and that the law attempt to RESTRAIN the existent monopoly giants. The following are his recommendations in his Letter of Acceptance, and all he has to say about monopolies: M'Kinley's Letter of Acceptance. Combinations of capital which control the market in commodities necessary to the general use of the people, by suppressing natural and ordinary competition, thus enhancing prices to the general consumer, are obnoxious to the common law and the public welfare. They are dangerous conspiracies against the public good, and should be made the subject of PROHIBITORY OR PENAL LEGISLATION. Publicity will be a helpful influence to check this evil. Uniformity of legislation in the several states should be secured. Discrimination between what is injurious and what is useful and necessary in business operation is essential to the wise and effective treatment of this subject. Honest co-operation of capital is necessary to meet new business condition and extend our rapidly increasing foreign trade, but conspiracies and combinations intended to restrict business, create monopolies and control prices should be effectively restrained. Hanna Says "There are No Trusts." Sept. 18th, 1900, Senator Marcus A. Hanna, chairman of the Republican National Committee, in a noon-day speech at the Commercial League, Chicago, declared: Now, then, about this trust question, a few words more. I would like to have Mr. Bryan or any other Democrat tell me what a trust is. I don't believe there is a trust in the United States, for every State law and national law will destroy any trust that comes within its jurisdiction; and the only laws, State and national, that have ever been put upon statute books were enacted by the Republican party. [A Voice-Never en forced.] Yes, they are enforced. [Voices -Put him out.] No, don't put him out. I don't want to put anybody out. We have no objection to the Democratic party being opposed to trusts, but they have got no patent on it. (Laughter.)-Chicago Tribune. September 19. The day after Mr. Hanna made the above statement, Mr. Bryan said in a public address: I read in the morning's paper a speech made by Mr. Hanna yesterday, in which he said there are no trusts. When I used to want humorous reading I would go to those books which contained a collection of the writings of humorists. But now, when I want to read something funny I read Mr. Hanna's serious campaign speeches. There are no trusts! Can you expect the Republican party to destroy the trusts when the leader of the Republican party says there are no trusts? Summary. We have now considered the natural tendency to monopoly and have contrasted the policies advocated by the Democratic party, the Socialist party and the McKinley Administration, including in the last the attitude of the trust magnates. These aim to perpetuate their own power by continuing to control the Federal Government. Their policy of ruling the many and filching from them their earnings is thought by such men as President Hadley and hosts of others, to be THE INEVITABLE FUTURE FOR THE AMERICAN PEOPLE. It is true that the tendency in this direction has continued since Lincoln's day, but the great majority of the American people are not yet willing to give up-they believe that private monopoly can be overthrown. Those who believe this, or who wish to make the attempt to secure freedom for themselves and their posterity, with scarcely an exception will vote for Wil liam J. Bryan and the Reform Congressmen, and for such members of the Legislature as will elect Reform Senators. Some of the radicals are declaring that Mr. Bryan and his fellow-workers in the fusion parties are not advocating the proper remedies-that nothing short of a revolutionary change in the shape of the immediate ownership and operation by the Government of all the means of production will save society from the despotism of private monopoly and gov ernment by the few. To such, and also to those who are fearful lest the tendency to monopoly marks the overthrow of civilization, I submit the following historical review of monopoly: TRUST |