Anti-Trust Reform

No Federal law weighs more heavily or constantly on the mind of corporate business than the Act of July 2, 1890 which bluntly begins: Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal. This law is known as the Sherman Anti-Trust Act because its chief sponsor was John Sherman, Ohio's Republican Senator (1861-77, 1881-97), younger brother of General William Tecumseh ("War is Hell") Sherman.

Each week brings its grist of Federal action under this statute. Fortnight ago it was the nut, bolt & rivet men whose trade association was dissolved by a U. S. court (TIME, March 30). Last week it was the sugar and steel industries upon which Attorney General Mitchell opened fire. The steelmakers, he charged, had for ten years conspired to fix the price of steel rails at $43 per ton. But far more spectacular was his suit in the U. S. District Court, New York City, to dissolve the Sugar Institute, whose 50 member-corporations refine more than 85% of the nation's granulated sugar. The petition charged that the Institute had induced beet sugar refiners to restrict competitive activities, had maintained the price of cane sugar 20-c- per hundredweight higher than refined beet sugar.

Industry's desire to ease the vague but potent restraints of the Sherman Act was responsible for two significant Manhattan meetings last week. President John Emmett Edgerton of the National Association Manufacturers called into conference 28 of his colleagues to organize a drive on Congress for the law's modification. Industry's major complaint is that under the Sherman Act it never knows until too late whether its mergers and trade activities are legal or not. Therefore what Mr. Edgerton, along with most of the business men, wanted was a Government agency which could pass authoritatively on the legality of consolidations and trade agreements in advance of their execution.

Next day the American Bar Association's Committee on Commerce met to sponsor much the same program. They felt that Congress should put a more liberal interpretation upon "restraint of trade." Even here and there was heard a cry for repeal.

What these manufacturers and lawyers wanted most was embodied in a proposal to the Democratic party by its chairman. John Jacob Raskob, at last month's Washington meeting (TIME, March 16): "To free business from unnecessary handicaps. I recommend that the Federal Trade Commission be empowered to hold public hearings whenever leaders in industry desire to present reasons why certain combinations are desirable and necessary. If facts developed indicate that a given combination is not inimical to public interest and does not violate the spirit of the Sherman law, then the Federal Trade Commission should be empowered to issue a certificate which will grant immunity from criminal prosecution of those individuals forming the merger."

P: In Atlantic City last week Henry Ward Beer, president of the Federal Bar Association of New York, New Jersey & Connecticut flayed the outcry over the Sherman Act. Said he: "Our antimonopoly machinery has broken down hopelessly. The name of the Federal Trade Commission should be changed to the Friendly Federal Fraud Commission. It is mothering over 100 combines formerly declared criminal. . . . The yelp to amend the monopoly laws comes from the throats of big corporation lawyers where tears are shed for pay."

This file is automatically generated by a robot program, so reader's discretion is required.