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CONSOLIDATIONS UNDER THE TEXAS ANTI-TRUST LAW.

Sometimes the law compels the doing of the thing it says shall not be done. The anti-trust law of Texas forbids the consolidation of corporations. Some two years ago there were in San Antonio four corporations; now there are two. A very awkward and expensive course was taken by the state to force this consolidation. The history of the procedure is instructive.

Some New "ork capitalists, looking for good investments, found in San Antonio four companies occupying the field:

1. San Antonio Gas Company.

2. San Antonio Street Railway Company. 3. Mutual Electric Light Company.

4. San Antonio Edison Company.

The works of these companies needed overhauling and reconstruction to bring them up to date; this required capital. It was calculated, by doing this and consolidating the several corporations so as to eliminate unnecessary expenses and duplications of service, that a reasonable profit could be earned on the capital as increased by the new investment. The stockholders of the companies were bought out, the companies were consolidated, and the new capital was ready for investment. At this point the state instituted quo warranto proceedings to forfeit the char

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ter of the San Antonio Gas Company, alleging that its consolidation with another company was in violation of the anti-trust law. A verdict was rendered for the state, the Appellate Court affirming the decision. The defendants then agreed to a judgment for the state against all four companies, and further proceedings were stopped. Receivers were then appointed for each of the four properties.

In accordance with an order of court, issued on March 5, 1900, in the receivership, April 4 was set as the day of the sale under the foreclosure proceedings. The sale took place on the courthouse steps. The highest bidder offered an aggregate of $200,000 for the four properties, and they were sold to him under the order of the court at that price. Immediately after the sale he announced that he had made the purchase in the interests of the former owners, and that the properties would be operated by two new companies:

1. San Antonio Traction Company.

2. San Antonio Gas & Electric Light Company. Both concerns have been chartered under the state laws with a capital stock of $200,000 each. They have secured the consolidation desired, by order of court, in its attempt to enforce a law expressly prohibiting consolidation.

An interesting phase of this procedure is found in the fact that the people of San Antonio took the affair seriously. The general feeling in that place, and

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throughout the state, is one of satisfaction at the preservation of vested interests, though considerable indignation is expressed over the petty persecution of the owners in their effort to retain possession of their property, and the reputation acquired by the state as being opposed to further introduction of outside capital. The Express, the leading paper of San Antonio, states the fact that the "need of Texas is outside capital to develop its resources," and cites several cases where, owing to quo warranto proceedings, proposed large enterprises have been dropped, under the impression that the policy of the state is antagonistic to corporate capital. In this case it says: "While a few lawyers and court officials have made fees, the state has been to great expense, and the owners have been compelled to pay out many thousands of dollars that should have gone into the betterment of the property, that would have redounded to the benefit of the people and the credit of the city. The suits, while successful under the law, were a travesty on common business sense, and an outrage on the defendants and the public."

It might have added, the lesson is worth its cost, as it shows a simple way in which consolidations can be legally effected under an anti-trust law, enacted expressly to prohibit consolidations.

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ECONOMIC LAW.

NO HUMAN LAW IS SO STRONG AS AN

ECONOMIC LAW.

We ask special attention to an editorial in the Chicago Evening Post, under the title of "Trusts and Legal Confusion," and to an article to which it refers in the Times-Herald, by Arthur J. Eddy, under the title of "Monopolies, Trusts and Combinations." Mr. Eddy addresses himself to lawyers, students of economics and thoughtful citizens generally rather than to politicians. We are quite sure, however, that no article on the trust question is more worthy of careful study by politicians than the one Mr. Eddy has written without regard to them. If anyone is in doubt about this we ask him to turn at once and carefully read that portion of the article under the subtitle of "Inconsistencies of the Law."

In commending Mr. Eddy's article we wish to dissent from one statement, "Each state has the power to prescribe the terms and conditions upon which it will permit the corporations of other states and countries to do business within its borders, or it may, if it sees fit, arbitrarily exclude them." While reserving the discussion of this statement for another occasion, we will say now that the power to regulate does not include the power to exclude.

With Mr. Eddy's article as a whole we are in most hearty accord. It is one of the soundest studies of the subject we have ever seen. His conclusion is that

"Combinations of capital and combinations or labor have come to stay; they are part of the superb organization which characterizes modern industry and commercial progress; they are the inevitable and legitimate successors of more primitive conditions of trade rivalry and destruction; they are part of the great scheme of co-operation, which is the principal factor in social advancement; they bring persons, localities, states and countries together; they are the foes of war and the allies of peace, and at their best they tend to make the dream of the brotherhood of man a reality."

This summing up is a wonderfully luminous exposure of the ignorance, hypocrisy and cunning with which William J. Bryan has presumed to discuss the question of "trusts" before the American people. His doctrine of annihilation for corporations and hatred for employers by employes is the antithesis of the gospel of "peace on earth and good-will for all men," taught by the Christ in whom he professes to believe. His inordinate ambition has perverted his understanding until he is incapable of distinguishing truth from error. His remedies are the poisons for which he represents them to be true antidotes.