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In this discussion the word "trust" is accepted as meaning any aggregation of capital in corporate hands, so large as to be an important factor in any branch of industry. This is an abuse of the word, and has its origin in the fact that the earliest attempts to combine competing masses of capital which excited public apprehension were organized in the form of trusts, in which trustees controlled a plurality of corporations by holding the legal title to most of their stock. The application of familiar principles of the common law by the courts proved fatal to this form of organization. Individual corporations, however, soon arose, representing aggregations of capital as great or greater than any of the trusts had controlled, and the name of "trust" is indiscriminately applied to them in popular language. It is freely used by careless or prejudiced minds with the implication of illegality, which properly applies to the trust organization. But it is impossible to restore the term to its correct use, and with this explanation we must accept it.

A tendency to form these vast aggregations of capital has been singularly active of late. About five years ago began an extraordinary awakening of the spirit of enterprise throughout the civilized world. There had been a long period of comparative stagnation in most branches of industry, limiting invention, experiment, new construction, and the activity of speculation in general. But under the stimulus of overwhelming accumulations of saved capital in all markets seeking profitable investment, of new discoveries and large production of the precious metals, of revolutionary invention, especially in developing and applying electric power, there was a rapid and almost sudden outburst of speculative energy in Europe and America. It was natural that its forms should be profoundly impressed with that spirit of association which is the basis of civilization. This tendency had been foreshadowed in the social and political life of all civilized countries through the last half of the

Nineteenth Century. The most characteristic feature of universal history during that period has been the combination of States and nations into vast empires, of divided races into political units conscious of their kindred, of factions into parties, of workingmen within their industries into differentiated and interdependent groups, and outside of these industries, into Unions with vast aims and impulses; in short, the great inventions by which the barriers. to intercourse were broken down had been the symbol of the entire social life of civilized humanity, from the diplomatic and administrative forces of government down to the parody upon true combination which is represented by the schools of Socialism.

Accordingly, it is a simple truth of social science that the formation of the trusts under this spirit of association is simply the application in the industrial world of the true law of progressive civilization. I cannot here justify this assertion in detail. It is, however, admitted by all intelligent students of the subject that the so-called "trusts" have already taken their place among the most beneficent forces of our industrial and commercial life. No measure can be made of the degree in which they have economized production, cheapened commodities, raised the average standard of comfort in life, organized intellect in all departments of practical work, opened new ways to ability and honorable ambition, and contributed to adjust the relations of labor to employers. But in each of these ways a work so important as to be revolutionary has been begun under their influence, and none can question that the natural tendency of their development, unless some counteracting forces be found which fatally interfere with it, must be steadily to increase the obligations to them of society at large.

How, then, are we to account for the widespread hostility felt toward the trusts? What is there in them, or in their influence and tendencies, to justify apprehensions of danger from them, either to the economic or to the moral and political interests of society? The hostility to them rests largely on an undefined dread which seems to have its origin in the vague declamations of demagogues, or in the prejudice of minds which are rebellious towards the entire organism of our industrial society. The cry of "Monopoly!" against the trusts is repeated and emphasized in a thousand forms and has great influence in exciting such prejudice. Yet no

serious student finds any foundation for a legislative attack upon large combinations of industrial capital in a real apprehension of monopoly. In fact, the popular and political tendency to respond to the denunciations of the great corporations as monopolists is certainly a temporary phenomenon, which is already beginning to disappear, and which must give place to more serious grounds of opposition if hostility to their existence is to be the permanent policy of any enlightened people. Students of high authority, however, have discovered and emphasized evils which have been associated with the recent growth of the great corporations. These are presented by public men claiming to be statesmen as a sufficient reason for indiscriminate attacks upon all corporations of this class. These evils are described in great detail as seen from different points of view, but for our purposes they may be summed up as substantially covered by two heads: first, improper discriminations in price of service by public service corporations between great industrial combinations and private shippers, resulting in the aggrandizement of the trusts at the expense of smaller and independent industries. Indeed, in several instances it is asserted with apparent reason that these discriminations have been the principal means of building up the power of certain trusts. Secondly, an evil which has essentially characterized the movement towards combination during recent years is commonly indicated by the word "over-capitalization," which really is used to point out all kinds of dishonest practices in the formation of trusts, by which their shares have been given to the public at inflated values, and promoters vastly enriched at the expense of investors. In short, the word commonly implies all the swindling processes in the production and manipulation of securities, which are facilitated by the vast volume of these combinations, in connection with the carelessness, the want of intelligence, and especially the low moral standard which are so general among investors and in the mercantile community at large.

These are the realities under the vague and often shadowy complaints which are made of the trusts. But careful reflection shows that all these evils really lie, not at all in the nature of the trusts themselves, but in the nature of the people who control them and deal with them. These forms of wrong have existed

as long as commercial immorality itself, and have become conspicuous in connection with the trusts solely because they become greater and more dangerous when perpetrated on so large a scale as that which has been opened to them in these combinations.

It is the business of government to prevent evils of these classes. Holders of a public franchise must administer it with equity, respecting the equal rights of all citizens. The police power of the government is as much bound to compel this course and to prevent unjust discrimination as it is to protect any form of private property against robbery. Fraud by direct or indirect misrepresentation of value, by deception wrought on a large or small scale, through forms of organization or falsehoods of bookkeeping, must be prevented, and, if perpetrated, must be punished with all the energy of which the strong arm of society is capable. Whether such wrongs are wrought in the handling of small or of great affairs makes no difference in principle; it is one of the first duties of organized society by its governments to suppress such wrongs, and if it fails to do so the fault lies in itself. But it must be carefully kept in mind that these classes of wrongs, like all other crimes against property, are and have been from the first direct violations of laws long established, and which it is the recognized duty of the courts to enforce. There is absolutely nothing in the nature of a large corporation to affect in any degree the character of these acts. There is nothing in the extent of the combinations of capital which have arisen in recent years to make these wrongs more dangerous in their nature, or more frequent. The growth of wealth, of course, holds out to fraud a greater promise of reward, and by increasing the temptation to wrong increases the necessity of vigilance against it, and of a thorough enforcement of the laws; but it has no tendency to make any new principles of law necessary. Fraud of every kind, in the organization and administration of the greatest of conceivable corporations, is in its nature the same as fraud in the most trivial dealings between individual citizens. If by reason of the great interests with which it deals it excites apprehension lest it be found impossible to suppress it, the reason must lie in a fear lest the government be too weak to execute the laws against the rich and powerful.

That an agency can be abused is not sufficient reason for

destroying it. Railroads, if mishandled, may be instruments in many ways, not only of fraud, but of danger to life. This proves the obligation to regulate them and to hold their administrators rigidly to their duty, but not to tear them up. Equally true is it that the trusts, which are becoming the great means of facilitating the advance of industry and improving the industrial organization of society, may be abused. In many instances, doubtless, the process of their formation and development has been tainted with fraud, and their organization has sometimes been controlled by interests not in harmony with the good of society at large. But what they need is regulation, and not destruction. Let all unfair discrimination be suppressed, let misrepresentation and fraud in the financial conduct of these great masses of capital be prevented, and the sources of just reproach against them will be stopped. They will then be recognized as beneficent and potent agents in the development of all national wealth and of social organization.

The more we reflect upon the conditions now confronting our industrial society and the period of transition through which it is passing, the more profoundly we shall be convinced that the essential defect is in the government itself, and is of a two-fold character. In the first place, it fails in its aims. It is an unquestioned fact that selfish aims, personal interests, class preferences, have to an extraordinary extent submerged statesmanship in our politics. So true is this that if in any public position a man appears whose actions and speech indicate an unreserved devotion to the public interests, with entire independence of local or class preferences, he is wondered at as a strange phenomenon. Such a man is noted as a theorist, a sentimentalist - as anything but a practical politician. It is hardly conceivable that a man of this stamp could obtain leadership in any party, or even a position as a representative candidate of any great political group. In the second place, government is defective in the misdirection of its efforts, through prejudice. Nothing more illogical, nothing more inconsistent with the principles of our institutions can well be imagined than the statutes by which trusts have been assailed in our State and National Legislatures; unless it be the curious absurdities of legislation which have not yet been adopted, but are strenuously advo

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