Contemporary American History, 1877-1913

by Charles A. Beard

On this distinction between big business and trusts Mr. Wilson built up his theory of governmental policy. The trust, he said, was not a product of competition at all, but of the unwillingness of business men to meet it—a distinction which some were inclined to regard as academic. Because the formation of no great trusts had been unaccompanied by unfair practices, Mr. Wilson seemed to hold that no such concern would have been built up had unfair practices been prohibited. Obviously, therefore, the problem is a simple one—dissolve the trusts and prevent their being reëstablished by prohibiting unfair practices and the arts of high finance.

Indeed, such was Mr. Wilson's program. "Our purpose," he says, "is the restoration of freedom. We purpose to prevent private monopoly by law, to see to it that the methods by which monopolies have been built up are made impossible." Mr. Wilson's central idea was to clear the field for the restoration of competition as it existed in the early days of mechanical industry. "American industry is not free, as it once was free; American enterprise is not free; the man with only a little capital is finding it harder to get into the field, more and more impossible to compete with the big fellow. Why? Because the laws of this country do not prevent the strong from crushing the weak."

"Absolutely free enterprise" was Mr. Wilson's leading phrase. "We design that the limitations on private enterprise shall be removed, so that the next generation of youngsters, as they come along, will not have to become protégés of benevolent trusts, but will be free to go about making their own lives what they will; so that we shall taste again the full cup, not of charity, but of liberty." The restoration of freedom for every person to go into business for himself was the burden of his appeal: "Are you not eager for the time when the genius and initiative of all the people shall be called into the service of business?... when your sons shall be able to look forward to becoming not employees, but heads of some small, it may be, but hopeful business, where their best energies shall be inspired by the knowledge that they are their own masters with the paths of the world before them ... and every avenue of commercial and industrial activity leveled for the feet of all who would tread it?"

Mr. Wilson's economic system seems to be susceptible of the following summary. The great trusts are "unnatural products," not of competition, but of the unwillingness of men to face competition and of unfair practices. Big business is the product of genuine services to the community, and it should be allowed to destroy whom it can by fairly underselling honest goods. The enemy is, therefore, the trust; it is the trust which prevents everybody who would from becoming his own master in some small business; it is the trust that has taken away the "freedom" which we once had in the United States. The remedy is inevitably the dissolution of the trusts, the prohibition of unfair practices in competition—then will follow as night the day that perfect freedom which is as new wine to a sick nation. With competition "restored" and maintained by government prosecution of offenders, no one need have a master unless he chooses.

Mr. Wilson's opponents saw in this simple industrial program nothing more than the old gospel of Adam Smith and Ricardo—the gospel of laissez faire and individualism. They asked him to specify, for example, into how many concerns the Steel Trust should be dissolved in order to permit the man with brains and a few thousand dollars capital to get into the steel business. They asked him to name a catalogue of "unfair practices" which were to be prohibited in order to put competition on a "free and natural" basis. They asked him to state just how, with the present accumulation of great capitals in the hands of a relatively few, the poor but industrious person with small capital could meet the advantages afforded by large capitals. They inquired whether England in the middle of the nineteenth century, with this perfect industrial ideal and free trade besides, presented the picture of utopian liberty which the new freedom promised.

To this demand for more particulars, Mr. Wilson replied that he was not discussing "measures or programs," but was merely attempting "to express the new spirit of our politics and to set forth, in large terms, which may stick in the imagination, what it is that must be done if we are to restore our politics to their full spiritual vigor again, and our national life whether in trade, in industry, or in what concerns us only as families and individuals, to its purity, its self-respect, and its pristine strength and freedom."

For the concrete manifestation of his general principles Mr. Wilson referred to his practical achievements in New Jersey, although at the time of the campaign he had not yet put through his program of trust legislation—a fact which was not overlooked by his opponents. He referred to his public service commission law, modeled on that which had been in effect for some time in Wisconsin. "A year or two ago we got our ideas on the subject enacted into legislation. The corporations involved opposed the legislation with all their might. They talked about ruin,—and I really believe they did think they would be somewhat injured. But they have not been. And I hear I cannot tell you how many men in New Jersey say: 'Governor, we were opposed to you; we did not believe in the things you wanted to do, but now that you have done them, we take off our hats. That was the thing to do, it did not hurt us a bit; it just put us on a normal footing; it took away suspicion from our business.' New Jersey, having taken the cold plunge, cries out to the rest of the states, 'Come on in! The water's fine.'"

In another place, Mr. Wilson summed up his program of redemption in New Jersey: a workman's compensation act, a public service corporations law, and a corrupt practices act. This program of legislation was viewed by Mr. Wilson as an extraordinary achievement. "What was accomplished?" he asked. "Mere justice to classes that had not been treated justly before.... When the people had taken over the control of the government, a curious change was wrought in the souls of a great many men; a sudden moral awakening took place, and we simply could not find culprits against whom to bring indictments; it was like a Sunday School, the way they obeyed the laws."

It was on his theory of the trusts that Mr. Wilson based his opposition to all attempts at government regulation. Under the plan of regulation, put forward by the Progressives, said Mr. Wilson, "there will be an avowed partnership between the government and the trusts. I take it the firm will be ostensibly controlled by the senior member. For I take it that the government of the United States is at least the senior member, though the younger member has all along been running the business.... There is no hope to be seen for the people of the United States until the partnership is dissolved. And the business of the party now intrusted with power is to dissolve it." In other words, the government was, in his opinion, too weak to force the trusts to obey certain rules and regulations, but it was strong enough to take their business away from them and prevent their ever getting together again. Apparently, Mr. Wilson did not expect to find that cordial coöperation from the national trust magnates which he found on the part of New Jersey public service corporations when he undertook to regulate them.

Mr. Wilson's political program was more definite. His short experience in New Jersey politics had evidently wrought great changes in his earlier academic views. In 1907, he thought that the United States Senate, "represents the country as distinct from the accumulated populations of the country, much more fully and much more truly than the House of Representatives does." In the presidential campaign, he advocated popular election of United States Senators, principally on the ground "that a little group of Senators holding the balance of power has again and again been able to defeat programs of reform upon which the whole country has set its heart." He did not attack the Senate as a body, but he thought sinister influences had often been at work there. However, Mr. Wilson declared that the popular election of Senators was not inconsistent with "either the spirit or the essential form of the American government."