Monopolies and the People

by Charles Whiting Baker

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TABLE OF CONTENTS.

• [The Problem Presented] [1]
  • A new use for the word "Trust," [1]
  • The people's knowledge of trusts, [2]
  • Remedies for trusts, [2], [3]
  • Trusts a species of monopoly, [3]
  • The problems which monopoly presents, [4]
  • An impartial investigation necessary, [4]
  • The question to be discussed from different standpoints, [5]
  • A scientific method for solving the problem, [5.]
• [Trusts and Monopolies in Manufacturing Industries] [7]
  • Definition of a trust, [7]
  • The first trusts and their successors, [8]
  • Description of the organization of the linseed-oil trust by one of its founders, [9]
  • The action of trust-makers perfectly natural, [14]
  • Actual effect of trusts upon the public, [15]
  • Profits of the linseed-oil trust, [16]
  • Decreased market for goods controlled by trusts, [17]
  • Control of the labor market by trusts, [17]
  • The causes which have produced trusts, [18]
  • Production on a large scale the most economical, [20]
  • The Standard Oil Trust's defence of its work, [21]
  • Its profits, and the cause of its low prices, [22]
  • Industries in which trusts have been formed, [23]
  • Andrew Carnegie's views of trusts, [24]
  • The trust at once a benefit and a curse, [25.]
• [Monopolies of Mineral Wealth] [26]
  • Mining, the first monopolized industry, [26]
  • Monopolies in iron-ore production, [27]
  • Monopolies in other metals, [28]
  • The French Copper Syndicate, [29]
  • The effect of its action on consumers of copper, [31]
  • Profits of the richest copper mines, [32]
  • Anthracite-coal production, [33]
  • The anthracite-coal pool, [34]
  • Coal monopolies in the West and South, [36]
  • Monopolies in petroleum and natural gas, [40]
  • Other monopolies of this class, [41.]
• [Monopolies of Transportation and Communication] [42]
  • Transportation only a necessity in modern times, [42]
  • The importance of railway traffic, [43]
  • Railway transportation a vital necessity, [43]
  • Shipping points where competition exists very few, [44]
  • Consolidation and its benefits, [45]
  • Intensity of competition in railway traffic on trunk lines, [47]
  • Its inevitable effect, [48]
  • The necessity of pools or traffic agreements, [49]
  • Their history, [50]
  • The Interstate Commerce law, [51]
  • The effect of stimulating competition, [52]
  • The evils charged to railway monopolies, [52]
  • Evils due to wasteful competition, [53]
  • Monopolies in other forms of transportation, [54]
  • Monopolies on natural highways, [56]
  • Monopolies of bridges, [56]
  • The telegraph monopoly, [56.]
• [Municipal Monopolies] [59]
  • City dwellers dependent upon monopolies, [59]
  • Suburban passenger traffic, [59]
  • Street-railway monopolies, [60]
  • Water-supply monopolies, [61]
  • Competition and monopoly in gas supply, [62]
  • T. M. Cooley on municipal monopolies, [64]
  • Prices, cost, and profits of gas supply, [64]
  • Monopolies in electric lighting and in telegraph, telephone, and messenger service, [66]
  • Other monopolies beneath city pavements, [67]
  • Monopolies in railway terminals, [68]
  • Monopoly in real estate, [69.]
• [Monopolies in Trade] [71]
  • Absolute control not essential to a monopoly, [71]
  • History of trade monopolies, [72]
  • Monopolies in country retail trade, [73]
  • In city retail trade, [74]
  • In wholesale trade, [75]
  • Co-operation of trusts and trade monopolies, [75]
  • Monopolies in the grocery trade, [76]
  • Monopolies in meat, [77]
  • A general view, [78]
  • Monopolies among purchasers, [78]
  • "Corners" and monopolies, [80]
  • Commercial exchanges and speculation, [82]
  • Warehouse monopolies, [82]
  • Insurance monopolies, [83]
  • Trade monopolies artificial, [84]
  • Their unjust acts, [85]
• [Monopolies Depending on the Government] [87]
  • Government monopolies in ancient times, [87]
  • Government monopolies established for the benefit of the people, [88]
  • Copyrights, [88]
  • Patents, [89]
  • Evils arising from the patent system, [90]
  • Monopolies based on patents, [91]
  • The Bell telephone monopoly, [92]
  • Government subsidies, [94]
  • Relation of the tariff to monopolies, [95]
  • Origin of the protective tariff, [96]
  • The tariff a secondary cause of trusts, [98]
  • Reductions in the tariff as a remedy for trusts, [99]
  • Monopolies carried on directly by Government, [100.]
• [Monopolies in the Labor Market] [102]
  • Classes of labor considered, [102]
  • Monopolies of capital and monopolies of labor compared, [103]
  • Locomotive engineers' strike on the Chicago, Burlington, and Quincy Railway, [105]
  • Effect of labor monopolies upon the people, [105]
  • The history of labor, [107]
  • The first trade-unions, [108]
  • Laws against them, [109]
  • Labor organizations from the laborer's standpoint, [110]
  • "An injury to one the concern of all," [110]
  • Preserving the self-respect of the laborer, [111]
  • Repeal of unjust laws, [113]
  • A defence for the action of labor monopolies, [114]
  • The underlying cause of labor monopolies, [116]
  • Limits to the power of labor monopolies, [118.]
• [Monopolies and Competition in other Industries] [119]
  • Occupations of the people, [119]
  • Proportion of the people in any way benefited by monopolies, [120]
  • Proportion deriving the principal profits from monopolies, [122]
  • Monopolies in the professions, [123]
  • Monopolies among the servant classes, [124]
  • Agricultural industry, [125]
  • Can monopolies be established there? [126]
  • A proposed farmers' trust, [127]
  • The Grange and the Farmers' Alliance, [128]
  • Killing the competition of oleomargarine, [129]
  • Monopolies among agricultural laborers, [130]
  • Proportion of the people benefited and proportion injured by monopolies, [130]
  • Monopolies in the use of capital impossible, [131.]
• [The Theory of Universal Competition] [133]
  • The general effect of monopolies, [133]
  • Two sorts of remedies suggested, [134]
  • Study of the laws of competition necessary, [135]
  • The growth of civilized society outlined, [136]
  • The interdependence of modern society, [137]
  • The theory of civilized industry, [137]
  • Supply and demand and the unequal rewards of men's industry, [138]
  • The theoretical perfection of our social system, [141]
  • "Competition the life of trade," [142]
  • The orthodox school of political economy, [143.]
• [The Laws of Modern Competition] [145]
  • Competition defined, [145]
  • Competition in corn-raising, [146]
  • In paper-making, [147]
  • In railway traffic, [149]
  • The laws governing competition deduced, [150]
  • Monopoly defined, [155]
  • Natural agents in production, [156]
  • Different classes of competition, [157]
  • The three salient causes of monopoly, [159]
  • The proper remedy for monopoly, [160.]
• [The Evils Due to Monopoly and Intense Competition] [162]
  • The theoretical perfection of human industry, [162]
  • Over-production not a fault of production, [163]
  • The ideal distribution of wealth, [164]
  • The law of supply and demand, [165]
  • Evils due to monopoly: the congestion of wealth, [166]
  • How great fortunes are made, [168]
  • Monopolized industries and speculation, [169]
  • How monopolies reduce the income of small capitalists, [170]
  • Monopolies the cause of over-production, [171]
  • Monopolies and poverty, [173]
  • The Church and the laboring classes, [173]
  • Intemperance, [174]
  • Reforms must go hand in hand, [174]
  • How monopolies keep men in idleness, [175]
  • The waste of competition, [176]
  • Waste due to parallel railway lines, [177]
  • The waste of competition and financial crises, [178]
  • Wasteful competition in other industries, [179]
  • Waste by strikes of labor monopolies, [180]
  • False remedies for the disease, [181.]
• [Ameliorating Influences] [183]
  • Two classes of palliatives to the evils of monopoly, [183]
  • Reduction in price to increase demand, [184]
  • The influence of Christianity, [185]
  • Its promise as a remedy, [186]
  • A social system based on nobler attributes than selfishness, [187]
  • The tendency of modern society, [188]
  • The possibilities of altruism, [189]
  • Direct and indirect charities, [189]
  • The benevolent spirit in business enterprises, [190]
  • The proper attitude of the Church toward monopolies, [191]
  • The fraternal spirit opposed to competition, [192]
  • Monopolists to be judged charitably, [193]
  • Unjust judgment of labor monopolies, [194]
  • Enmity toward monopolists no cure for monopoly, [195.]
• [Remedies for the Evils of Monopoly] [196]
  • Schemes for bettering society, [196]
  • The doctrine of individualism, [197]
  • The doctrine of societism, [198]
  • The defects of each when unmodified by the other, [199]
  • Societism a necessary accompaniment of civilization, [200]
  • The interdependence of mankind, [201]
  • Does societism threaten liberty? [201]
  • Government for the benefit of the whole people, [202]
  • The dangers of government action to aid special classes, [202]
  • Remedies for monopoly: the creation of new competitors, [204]
  • Its practical result, [205]
  • Remedies by prohibiting consolidations, [205]
  • Their inevitable effect, [206]
  • Government the only agent to prevent monopoly, [207]
  • Why direct action by the government is impossible, [208]
  • Indirect action and its probable results, [208]
  • The Interstate Commerce law as an example, [209]
  • The proper remedy for monopoly not abolition, but control, [210]
  • The relative advantages of government and private management of industry, [211.]
• [The Sovereign Rights of the People and of their Representative, the Government] [213]
  • Questions brought up by the preceding conclusion, [213]
  • The rights of property holders, [214]
  • Property in the products of labor an inherent right, [215]
  • Property in natural agents and public franchises a matter of expediency, [216]
  • Eminent domain over natural agents still held by the public, [217]
  • The laws of competition applicable to determine when this right should be exercised, [220]
  • Absolutely perfect equity impossible, [221]
  • Does private ownership of land work injustice? [222]
  • Fundamental difficulties in dealing with monopolies not dependent on natural agents, [223]
  • Why a remedy for their evils is essential, [224]
  • The basis of the people's authority over these monopolies, [225]
  • Government regulation with private management the only feasible plan, [225.]
• [Practical Plans for the Control of Monopolies] [227]
  • Economists should unite on the principles already propounded, [227]
  • Practical details a matter of opinion, [227]
  • A plan for the equitable and permanent adjustment of the railway problem, [228]
  • The ownership and operation of the railways, [229]
  • Their securities as investments and for use in connection with the currency, [230]
  • Readjustment of outstanding securities, [231]
  • Lending the government's credit to private corporations, [232]
  • How rates of fare and freight should be fixed, [233]
  • How the incentive to economy is retained, [234]
  • How to avoid strikes, [237]
  • Principles to be observed in establishing government control of monopolies, [238]
  • Plans for the control of mineral monopolies, [238]
  • State ownership with private operation, [239]
  • Plans for controlling municipal monopolies, [240]
  • The control of other monopolies, [244]
  • The dangers of special legislation, [244]
  • Government control of manufacturing enterprises not feasible, [245]
  • Taking trusts within the pale of the law, [247]
  • Enforcing publicity, [247]
  • Enforcing non-discrimination, [248]
  • Direct action to prevent extortion by the monopoly, [251]
  • Potential competition to prevent extortion, [252]
  • Reform of corporation laws, [254]
  • The contrast between this plan for controlling trusts and existing law, [255]
  • Reductions in the tariff as a remedy for trusts, [256]
  • Plans for the control of labor monopolies, [257]
  • Strikes an injury to labor, [258]
  • Removal of other monopolies as a cure, [258]
  • What shall fix the rate of wages? [259]
  • Cooperative ownership, [260]
  • Fraternal benevolence most needed here, [261]
  • A definite relation between monopolies and the people, [262]
  • Conclusion, [263.]

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I.
THE PROBLEM PRESENTED.

The word "trust," standing for one of the noblest faculties of the heart, has always held an honorable place in our language. It is one of the strange occurrences by which languages become indelible records of great facts in the history of the world, that this word has recently acquired a new meaning, which, to the popular ear at least, is as hateful as the old meaning is pleasant and gratifying.

Some future generation may yet be interested in searching out the fact that back in the nineteenth century the word "trust" was used to signify an obnoxious combination to restrict competition among those engaged in the same business; and that it was so called because the various members of the combination entrusted the control of their projects and business to some of their number selected as trustees. We of the present day, however, are vitally interested in a question far more important to us than the examination of a curiosity of philology. We are all of us directly affected to-day by the operation of trusts; in some cases so that we feel the effect and rebel under it; in other cases, so that we are unconscious of their influence and pay little heed to their working.

It is but a few months since public attention was directed to the subject of trusts; but, thanks to the widespread educational influence of the political campaign, at the present day the great proportion of the voters of the country have at least heard of the existence of trusts, and have probably some idea of their working and their effect upon the public at large. They have been pointed out as a great and growing evil; and few speakers or writers have ventured to defend them farther than to claim that their evil effects were exaggerated, and predict their early disappearance through natural causes; but while remedy after remedy has been suggested for the evil so generally acknowledged, none seems to have met with widespread and hearty approval, and practically the only effect thus far of the popular agitation has been to warn the trust makers and trust owners that the public is awakening to the results of their work and is likely to call them to account.