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.
The truth is, as we shall see later, that it is a difficult matter to
apply an effective remedy of any sort to the trusts by legislation,
without running counter to many established precedents of law and
custom, and without serious interference with what are generally
regarded as inalienable rights. Yet we are making the attempt. Already
legislative and congressional committees have made their tours of
investigation, and bills have been introduced in the legislatures of
many of the States, and in Congress, looking to the restriction or
abolition of trust monopolies.
It is the wise surgeon, however, who, before he takes the knife to cut
out a troublesome growth, carefully diagnoses its origin and cause,
determines whether it is purely local, or whether it springs from the
general state of the whole body, and whether it is the herald of an
organic disease or merely the result of repressed energies or
wrongly-trained organs. So we, in our treatment of the body politic,
will do well to examine most carefully the actual nature of the diseases
which we seek to cure, and discern, if we can, the causes which have
brought them on and tend to perpetuate them. If we can discover these,
we shall, perhaps, be able to cure permanently by removing the ultimate
cause. At any rate, our remedies will be apt to reach the disease far
more effectually than if they were sought out in a haphazard way.
The crudest thinker, at the first attempt to increase his knowledge of
the general nature of trusts, discovers that the problem has a close
connection with others which have long puzzled workers for the public
good. Trusts ally themselves at once in his mind with monopolies, in
whichever form he is most familiar with them, and are apt to be classed
at once, without further consideration, as simply a new device for the
oppression of the laborer by the capitalist. But the man of judicious
and candid mind is not content with any such conclusion; he finds at
once, indeed, that a trust is a combination to suppress competition
among producers of manufactured goods, and he calls to mind the fact
that other combinations to suppress competition exist in various other
lines of industry. Surely when the governing motives are so similar, the
proper remedies, if remedies are needed, cannot be greatly unlike. And
though, taking the country as a whole, trusts have occupied more
attention lately than any other form of monopoly, the problem of
railroad monopoly is still all-absorbing in the West; in every city
there is clamor against the burdens of taxation levied by gas,
electric-light, street-railway, and kindred monopolies; while strikes in
every industry testify to the strength of those who would shut out
competition from the labor market. These and similar social and
industrial problems are quite as important as the problem of trusts, and
their solution is becoming every day more urgent and necessary. If we
neglect them too long, or carelessly adopt some unsuitable or unjust
remedy, who knows the price we may pay for our folly in blood and
treasure?
The problem before us, then, as we see it from our present standpoint,
is the problem of monopoly. What is it? Whence comes it? What are its
effects? And, most important of all, what ought we to do about it?
Surely questions whose correct answer is of such importance to the
welfare of each person and to the very existence of society demand the
careful consideration of every thinking man.
Let us then take up this problem and give it the fairest and most candid
investigation possible. In order to do this, let us remember that _the
truth_ is the object of our search, and that it will be necessary, if
the conclusions from our investigation are to be of value, that we
divest ourselves, so far as possible, of all preconceived opinions
founded, perhaps unconsciously, on the statements or evidence of
incompetent authorities, and also of all prejudices. Let us, in
searching for facts and principles, examine with impartiality the
evidence and arguments which each side presents, and judge with candor
between them.
The author wishes to make an earnest personal request to the reader who
is minded to follow the discussion through the following pages, that he
will in good faith attempt to do this thing: that he will lay aside for
the present his opinions already formed, as the author himself has
conscientiously aimed to do while pursuing this investigation, and give
a fair hearing to both sides of the question. A complicated machine can
only be understood when it is viewed from different standpoints. So,
here, in order to find the truth, we must examine trusts from the
standpoint of the trust maker as well as from that of the consumer; and
trade unions, from the standpoint of their members as well as from the
ground of employers and of the public at large. We shall indeed meet
much error by this method of study, but is it not proverbial that there
are two sides to every question? It will be our task to study these
opposing views and sift from them the truths for which we seek.
In taking up now the problem before us, let us adopt the true scientific
method for its solution. We must first find out as fully as possible the
actual facts with regard to monopolies of every sort and the competition
which monopoly replaces. Next, by discussing and comparing the evidence
obtained, we may be able to discover the natural laws by which
competition and monopoly are controlled; and finally, with our knowledge
of these, we will try to discover both the source of the evils which vex
us and the proper methods for ameliorating, curing, or preventing them,
whichever may be found possible.
Such is the outline of the investigation before us, which it may as well
be said here could easily be extended and amplified to fill many
volumes. The author has preferred to prepare the present volume without
such amplification, believing that the busy men of affairs, to whom a
practical knowledge of the subjects herein treated is most essential,
have, as a rule, no leisure for the extended study which the volumes
into which the present one might easily be expanded would require. He
trusts, however, that brevity will not be found wholly incompatible with
thoroughness; and that the fact that much which might have properly been
included in the book is omitted, will not be taken as a necessary
indication that the conclusions arrived at are without value.