reasonable degree of detail the profits of the larger combinations would, in case of the abuse of their power, so stimulate competition against them, either actually or potentially, that consumers would to a great degree be protected against excessive increase in prices.

At the same time the laborer, through his fulness of knowledge regarding the financial condition of his employer, would be enabled to make his demands at times when it would be wise to grant them, and would avoid the mistakes too frequent at present, of striking on a falling market when his employer's losses are such that he stands ready to close his establishment if any excuse is offered him.

The degree of publicity needed and the method of its enforcement as regarded by others who recommend publicity, can perhaps be shown best by the study of the bill drawn for Governor Roosevelt, The New York Business Companies' Act: 1900.*

It is interesting to note, too, that Mr. Bryan, while advocating national regulation, has also publicity in mind as a chief remedy for the two great evils of stock watering and monopoly. * See Appendix D.

A national government license, he thinks, should be secured, before a corporation should be allowed to do business outside the State of its origin.*

This is not the place to go into a detailed discussion of the legal questions regarding the scope of federal legislation as compared with that of the States, nor to discuss the amendment to the Constitution of the United States proposed by the Judiciary Committee of the House of Representatives at the last session of Congress. It is purely a legal question as to whether publicity can be enforced at present by the federal courts or under a law passed by Congress without an amendment to the Constitution.

It may be said, however, that if three or four. of our largest States, such as New York, Pennsylvania, Illinois, and Massachusetts, were to enact laws along somewhat similar lines, which should afford the greatest facilities to corporations organized honestly for the purpose of conducting a legitimate business, while at the same time they should compel a reasonable degree of publicity regarding both the organization and the management, much could be accomplished, * See Appendix E.

even though the legislation were not uniform in all the States. Our States can impose conditions upon which they will permit foreign corporations to do business within their borders, except so far as that business is of an interstate nature. A few of our larger States so uniting, would control so large a part of the business of the nation that, if their provisions regarding the legitimate employment of honest capital were liberal and fair, corporations organized with speculative ends in view would be so discredited that the larger part of their evils would be swept away.

Through this publicity thus secured, we might well secure other information which would lead as time went on to regulation more definite and more rigorous. But for the time at least, it is probably unwise to enter upon any measure beyond those mentioned, until our information is somewhat more complete. remains beyond doubt, as soon as our knowledge is sufficiently definite regarding the workings of these organizations, a taxing power which can compel, and that readily, a distribution of any surplus profits to the community. It is probable, however, that before this remedy would

There

need to be applied to any rigorous degree, this same distribution, as soon as the conditions were fully known, would be made more equitably and more justly under the simple pressure of public opinion, through lessening prices and higher wages. That result, however, desirable as it is, and one upon which our eyes should be fixed as the ultimate goal, is one which can be secured by legislation without grave harm to our delicate industrial machinery only through the knowledge that comes from a wider and longer experience.

CHAPTER XII

INDUSTRIAL COMBINATIONS IN EUROPE *

The study of industrial combinations under the differing conditions in Europe serves to confirm to a material extent the conclusions reached in preceding chapters. It is probable that in Germany and Austria, if not even in England, industrial combinations cover as many different industries, and control as large a portion of the manufactures in each industry as is the case in the United States.

On the other hand, in England only is the form of combination generally that of a single corporation owning many separate establishments. In all of these countries are found numerous combinations of the primitive form mentioned in the earlier chapters, which are merely agreements-often local in their nature— among different manufacturers or dealers to limit

*Material for this chapter was gathered primarily for the United States Industrial Commission in Europe in the summer of 1900. Printed material has been collected since.