one of the constituent members of the Tobacco Trust, it was decided on demurrer, among other points, that a corporation may be liable criminally for conspiracy, and that an indictment under the anti-trust law may charge all who aid in the commission of the offenses as principals, and a corporation and its officers who personally participated in committing the offenses may be joined as defendants, although their acts may be separate and not done at the same time, and that to bring any given case or scheme within the law, the restraint of trade need not amount to a total suppression, nor the attempt at monopoly to a complete monopoly, but it is sufficient if the necessary operation tends to restrain interstate commerce and to deprive the public of the advantages flowing from free competition. (Decided December, 1906; 149 Fed. Rep., 823.) The case is now pending in the Supreme Court, having been taken there on a writ of error by the defendants, who were convicted in the trial court.

In the proceedings preliminary to the Paper Trust suit and the Tobacco Trust prosecution, the United States won a very important victory by compelling certain witnesses to testify under personal immunity, without protecting other persons or corporations, with the result that in the Paper Trust case the final decree provided for its dissolution, and the Tobacco Trust prosecutions are proceeding, along with a suit in equity to dissolve that combination, with the aid of the testimony and information of which the Government compelled the production. (Paper Trust Cases, 201 U. S., 92, 117; decided March 12, 1906; Tobacco Trust cases, id., 43, 90, decided same day.)

In the suit in equity to dissolve the Tobacco Trust the testimony has all been taken, and the argument before the Circuit Court has just been completed, May, 1908.

The suit against the Anthracite Coal Trust is now ready to be pressed vigorously, and active proceedings will be undertaken forthwith and maintained in the Federal Court for the Eastern District of Pennsylvania, where the bill to dissolve the combination was filed.

In the case of the United States v. The New York, New Haven and Hartford Railroad Company et al., recently instituted in the United States District Court for the District of Massachusetts, the Government seeks to enjoin that company from exercising further control through stock ownership over the Boston and Maine Railroad Company and to prevent the New Haven road from controlling the various trolley lines paralleling said road in the States of New York, Connecticut, Rhode Island and Massachusetts. The bill charges the New Haven road with combining and attempting to combine under one common control the various railroad systems and electric railway systems in New England.

It will thus be seen that, in obedience to the demand of the people and the legal and economic policy reflected in the Sherman law, the Republican administration, legislative and executive, has been steadily proceeding during the last four years to maintain its record of uncompromising prosecution against the great combinations which are violating the law. It is clear that the Government policy and efforts have been to reach the strong and vast aggregations of power and capital, rather than to avoid enforcement of the law against them and proceed against minor and less culpable defendants, and the foregoing review shows also that the results achieved have been commensurate with the importance of the subject and with the efforts of the Government.

THE CAST-IRON PIPE CASE.

Judge Taft's Decision and its Important Relation to the Trust Question.

No list of judicial decisions declaring the power of Congress over combinations in restraint of trade is complete without naming the Addyston Pipe & Steel Co. case. It was one of the early and most important successes of the Federal Government in attempting to enforce the Sherman Anti-trust Act,

and was a signal judicial victory for Judge William H. Taft, for the Supreme Court 'in deciding the case affirmed the Circuit Court of Appeals and adopted the reasoning and quoted a considerable portion of Judge Taft's opinion in deciding the case in the lower court. The Circuit Court had decided the case against the Government in a long and exhaustive opinion, so that the decision of the Appelate Court, delivered by Judge Taft, which the Supreme Court held was the law was a pathbreaking one and blazed the way for later decisions which have settled beyond all dispute the wide-reaching power of Congress under the Interstate Commerce clause of the Constitution. When the case was first tried, over eleven years ago, the power of Congress was not clearly understood, even in the minds of lawyers and court.

The history of the case, briefly stated, is as follows: The Attorney-General of the United States filed a bill in equity against six corporations engaged in the manufacture of castiron pipe, charging them with a combination and conspiracy in unlawful restraint of interstate commerce in such pipe in violation of the "Anti-trust Law." The companies manufactured iron pipe in four different States and they divided their sales territory into six districts, and agreed not to bid against each other, though fictitious bids were put in at prices higher than was bid by the member of the combination in whose territory the particular contract to be bid on was located. The Circuit Court dismissed the bill, basing its decision mainly on the case of United States vs. E. C. Knight Company, wherein the United States Supreme Court dismissed a bill filed under the anti-trust law, which sought to enjoin the defendants from continuing a union of substantially all the sugar refineries of the country for the refining of raw sugars. The Supreme Court held the monopoly thus effected was not within the law, because the contract or trust agreement related only to the manufacture of sugar and not to its sale, and it was not within the power of Congress to regulate manufacture within a State. The trial court held the cast-iron pipe case was governed by the reasoning in the sugar trust case, and decided against the Government. The case was appealed to the Circuit Court of Appeals, and was heard by Mr. Justice Harlan, of the Supreme Court, and Circuit Judges Taft and Lurton. This court held the combination was unlawful, both at common law and under the Sherman act of 1890 against trusts and monopolies.

Judge Taft's opinion, delivered February 8, 1898, was hailed by the Government as a great victory in its fight against monopolies, and on December 4, 1899, the Supreme Court affirmed Judge Taft's decision and adopted his reasoning and the very language in his opinion.

The closing paragraph of Judge Taft's opinion is worth quoting entire: "Much has been said in argument as to the enlargement of the Federal Government functions in respect of all trade and industry in the States if the view we have expressed of the application of the anti-trust law in this case is to prevail, and as to the interference which is likely to follow with the control which the States have hitherto been understood to have over contracts of the character of that before us. We do not announce any new doctrine in holding either that contracts and negotiations for the sale of merchandise to be delivered across State lines are interstate commerce, or that burdens or restraints upon such commerce Congress may pass appropriate legislation to prevent, and courts of the United States may in proper proceedings enjoin. If this extends federal jurisdiction into fields not before occupied by the general government, it is not because such jurisdiction is not within the limits allowed by the Constitution of the United States."

Not one of the least of Judge Taft's services to his country was his illuminating and record-making decision in the Addyston Pipe and Steel Company case.

no

One vital, dominating fact confronts the Democratic party which no oratory, which no eloquence, which rhetoric can obscure: BRYAN'S NOMINATION MEANS TAFT'S ELECTION.-New York World.

THE DEMOCRATIC PLAN OF TRUST REGULATION IS THE PLAN PROPOSED BY STANDARD OIL MAGNATES.

The plan which the Democratic national platform of 1908 proposes for the control and regulation of trusts and corporations engaged in interstate commerce is precisely that proposed and publicly recommended by the Standard Oil President and Vice-President. Moreover, it is certified to by Mr. Bryan's paper, the "Commoner," as the genuine Standard Oil plan.

The "Commoner," in its issue of October 31, 1902, says:

The plan of vesting in the Federal Government exclusive control of trusts was not originated by the present leaders of the Republican party. John D: Rockefeller in his testimony before the industrial commission, when asked what legislation would be advisable, said: "First, federal legislation under which corporations may be created and regulated, if that were possible." Vice-President Archbold, of the Standard Oil Company, said: "The next great and, to my mind, inevitable step of progress in the direction of our commercial development lies in the direction of national or federal corporations." Henry H. Rogers, a Standard Oil magnate, indorsed Mr. Archbold's suggestion.

The Plan Proposed by Standard Oil Magnates in 1899.

The recommendations of the Standard Oil magnates referred to by Mr. Bryan's "Commoner" and apparently followed in the Democratic platform of 1908, will be found in detail in Vol. 1 of the Report of the Industrial Commission. On page 797 Mr. Rockefeller is asked: "What legislation, if any, would you suggest regarding industrial combinations?" His answer is: "First, Federal legislation under which corporations may be created and regulated, if that be possible; second, in lieu thereof, State legislation as nearly uniform as possible encouraging combinations of persons and capital for the purpose of carrying on industries, but permitting State supervision, not of a character to hamper industries, but sufficient to prevent frauds upon the public.'

(Signed) JOHN D. ROCKEFELLER.

On page 565 of the same volume, Mr. Archbold, Vice-President of the Standard Oil Company, says: "If you should ask me, gentlemen, what legislation ean be imposed to improve the present conditions, I answer that the next great, and to my mind, inevitable step of progress in the direction of our commercial development lies in the direction of National or Federal corporations. * Lack of uniformity in the laws of

*

various States, as affecting corporations, is one of the most vexatious features attending the business life of any great corporation today, and I suggest for your most careful consideration, the thought of a Federal Corporation law.”

The Plan Proposed by the Democratic Platform in 1908. The portion of the Democratic national platform of 1908 which offers the plan of the Democratic party with reference to trust regulation is as follows:

"We favor the vigorous enforcement of the criminal law against guilty trust magnates and officials, and demand the enactment of such additional legislation as may be necessary to make it impossible for a private monopoly to exist in the United States. Among the additional remedies we specify three: First, a law preventing a duplication of directors among competing corporations; second, a license system which will, without abridging the right of each State to create corporations, or its right to regulate as it will foreign corporations doing business within its limits, make it necessary for a manufac turing or trading corporation engaged in interstate commerce to take out a Federal license before it shall be permitted to control as much as twenty-five per cent of the product in which it deals, the license to protect the public from watered stock and to prohibit the control by such corporation of more than fifty per cent of the total amount of any product consumed in the United States; and, third, a law compelling such licensed corporations to sell to all purchasers in all parts of the country on the same terms, after making due allowance for cost of transportation."

The Republican platform, instead of proposing to give speciul favors to certain corporations in the form of Federal licenses as proposed by the Standard Oil magnates and the Democratic party, proposes uniform and equal enforcement against all corporations, great or small, of existing law and such further laws as may be necessary. The plank of the Republican platform of 1908 is as follows:

"The Republican Party passed the Sherman Anti-trust law over Democratic opposition and enforced it after Democratic dereliction. It has been a wholesome instrument for good in. the hands of a wise and fearless administration. But experience has shown that its effectiveness can be strengthened and its real objects better attained by such amendments as will give to the Federal Government greater supervision and control over and secure greater publicity in the management of that class of corporations engaged in interstate commerce having power and opportunity to effect monopolies."

It must be, at least, a pleasing surprise to the Standard Oil Company, after its recent experience with Republican officials in enforcement of existing laws, to find the Democratic platform declaring for the very legislation publicly recommended by its President and Vice-President in 1899 and certified to by Mr. Bryan's "Commoner" in 1902, as the genuine Standard Oil plan in behalf of corporations.

The biggest corporation, like the humblest private citiezn, must be held to strict compliance with the will of the people expressed in the fundamental law.-President Roosevelt at Cincinnati, Ohio, September 20, 1902.

The tariff affects trusts only as it affects all other interests. It makes all these interests, large or small, profitable; and its benefits can be taken from the large only under penalty of taking them from the small also.-President Roosevelt at Minneapolis, April 4, 1903.

Under present-day conditions it is as necessary to have corporations in the business world as it is to have organizations-unions-among wage-workers. We have a right to ask in each case only this; that good, and not harm, shall follow.-President Roosevelt at Providence, R. I., August 23,

1902.

Mr. Bryan's whole system of remedies for the evils that both Mr. Roosevelt and he and many others recognize, is based on his distrust of the honesty, courage and impartiality of the individual as an agent on behalf of the people to carry on any part of government and rests on the proposition that our present system of representative government is a failure. He would have government ownership of railways because he does not believe it is possible to secure an interstate commerce commission that the "money power" cannot and will not ultimately own. He would have the initiative and referendum because he distrusts representative government and has no confidence in the ability of the people to find men who will conscientiously, and free from the influence of the "money power," represent them in preparing and voting legislation. He would take away from courts, because he distrusts the ability of judges to resist the malign influence of the "money power," the power to enforce their own orders until a jury is called to tell the court whether the order has been disobeyed, and thus, in practice, though not in theory, the jury would come to pass on the correctness and justice of the court's order. -Hon. Wm. H. Taft, at Columbus, Ohio.

The Democrats are a party having no solidarity, uniting elements that are as unmixable as oil and water, and when they come to make a government, should they ever be elected to power, the administration would become as nerveless as a man stricken with paralysis, because the radical difference between the elements necessary to make up the party would be so great as to produce perfect stagnation in legislative provision for the emergencies which might arise. The Democratic party today, as organized, is nothing but organized incapacity. Neither element of the party would have a sense of responsibility strong enough to overcome its antagonism to the principles upheld by the other faction, were it to come into power.-Hon. Wm. H. Taft, at Montpelier, Vermont.

One vital, dominating fact confronts the Democves party which no oratory, which no eloquence, whiq of rhetoric can obscure: BRYAN'S NOMINATION MEANS TA ELECTION.-New York World.

THE MONEY PANIC OF 1907.

The panic of 1907 was financial, not industrial or commercial. The country was at the high tide of industrial and commercial activity. The great manufacturing industries and those related thereto were making their highest records. The value of manufactures shown by the census of 1905 (including its estimate for customs work and repairing) aggregated nearly 17 billion dollars, against 13 billions in 1900, 9 1-3 billions in 1890, and 5 1-3 billions in 1880. The imports of manufacturers' materials in the fiscal years 1906 and 1907 so much exceeded those of 1905 as to make it perfectly apparent that the manufacturing activities of those years were still in excess of those recorded by the census of 1905. Not only were imports of manufacturers' materials higher in 1907 than ever before, but exports of manufactures were also in excess of any former year, thus again indicating unusual activity in manufacturing; while the fact that the quantity of pig iron produced, the quantity of coal mined, the quantity of freights carried on the Great Lakes and on railroads, the quantity of grain, flour, cotton, live stock, meats and other commercial staples arriving at the great interior centers and departing therefrom was also greater than ever before, gives further evidence that the commercial as well as industrial conditions of the early and midsummer months of 1907 were at high-water mark. The railroads, with all their greatly increased facilities in trackage, in cars and equipment. were unable to respond to the business activity, and James J. Hill, a distinguished Democrat, who had declared in November, 1906, that the traffic congestion exceeded imagination, and that there was neither money enough nor rails enough in the world to build track enough to carry the traffic offered, declared again in 1907 that the railroads would need 1,100 million dollars yearly for five years for construction work.

The demands for money for conducting and enlarging these great industrial, commercial, and transportation enterprises grew apace. In January, 1907, the Chicago and Alton sold $6,000,000 of notes, the Western Indiana $5,000,000, the Southern $15,000,000, New York Central $50,000,000, and the Chicago and Northwestern voted to issue $25,000,000 of stock. In February the Rock Island sold $6,500,000 of notes, the Lackawanna Steel Company $5,000,000, the Interborough Rapid Transit Company of New York $10,000,000, the Pennsylvania $60,000,000, the Tidewater Railroad $10,000,000. New York city sold $30,000,000 of bonds and the New Haven road $28,000,000 of bonds. In the succeeding months the issues of securities of this character continued until by the middle of the year the total thus issued in sums sufficiently large to be easily noted aggregated more than a thousand million dollars of securities thus placed upon the market, and this continued into August and September, despite the fact that the scarcity of money resulted in the actual issue of but one billion dollars' worth of railway notes, stocks and bonds out of a total of more than 11⁄2 billions authorized. But the world's losses of capital by wars, coupled with the speculative investment, rendered loans more and more difficult

The amount of money in circulation in the United States was nearly three billion dollars, and including the money in the Treasury exceeded three billions, and the amount of per capita circulation was larger than ever before, being over $32, as against a little over $21 in 1896. Nine-tenths of the business was as usual in times of financial peace, being transacted by the use of checks, script, notes and other financial paper. Millions of holders of surplus money had deposited the surplus in banks, which in turn had loaned the legitimate proportion of their deposits, and these had been in turn deposited by those to whom the loans were made or by others, so that the aggregate record of deposits in all banks and loan and trust companies of the country was in 1907 over 13 billions of dollars, while the actual amount of money in

54