Twilight of TNEC

Quietly last week there passed out of existence the most remarkable Government investigating committee in U.S. history. The Temporary National Economic (Monopoly) Committee, its work done after two years, nine months and two days, closed its book-lined Washington offices. Its executive secretary, learned, slangy ex-Stanford Professor Dewey Anderson, went back to California to think about running for Governor.

There never was before, and may never be again, quite such an economic study as the committee closed its books on. The committee spent $1,062,000, once had a staff of 182 experts, looked into 95 different industries, heard 552 witnesses. It made headlines month after month with sensational charges of patent monopoly in the glass-container industry, of international patent combines which put Germany's finger in the U.S. magnesium and optical-glass industries, etc. As its permanent record it left 37 volumes of printed testimony, 43 exhaustive monographs on various phases of its study.

Before closing shop last week, TNEC published its recommendations. With all the ammunition the committee had stored up, a terrific broadside might have been expected. Instead, the committee rolled a rusty BB gun into place, pinged at the nation's economic problems thus:

>Monopoly control of industry should be attacked through 1) additional funds for the Justice Department's Antitrust Division and the Federal Trade Commission; 2) higher fines for corporations and officials guilty of violating antitrust laws; 3) new legislation to limit corporate mergers; 4) laws making patents available to anyone willing to pay for them; 5) Federal registration of trade associations (to stop any price-fixing activities).

>Interstate corporations should be chartered by the Federal Government, thus put in the way of stricter regulation.

>Freer competition should be guaranteed by 1) elimination of interstate trade barriers; 2) repeal of the Miller-Tydings Act (which gives Federal blessing to State minimum-price laws); 3) elimination of basing-point price systems. The price system for soft coal set up by the Guffey Act was found to contain the "germs" of Fascism. (Congress renewed it for two years last week.)

>New business should be encouraged by incentive taxation. (But the committee made no specific proposals.)

>State regulation of insurance companies should be tightened up through larger and better staffs, stricter laws (with Federal control perhaps necessary if the States fail to do the job).

Such recommendations had a familiar sound; many of them were contained in the letter which Franklin Roosevelt sent to Congress three years ago asking that the committee be set up. Both friends & foes joined in criticism. Editorialized the conservative New York Times: "TNEC . . . proposes to stimulate private enterprise by adopting . . . more . . . Federal controls that have already done so much to burden . . . new enterprise." Said New Dealers Leon Henderson and Isador Lubin, who served on the committee but were too busy with defense work to bother with the final recommendations: "Surely it should be possible, with all this great wealth of evidence ... to offer a concrete program geared to the needs of our time."

But not only on the basis of its recommendations, good or bad, will TNEC finally be judged. It assembled more economic data than has ever been available to business management and business theorists before. No private agency, without power of subpena, could hope to get such an authoritative picture of U.S. business. Because of the expense, no Government agency is likely to tackle the job soon again. For years to come, unless World War II makes pre-war economics obsolete, the TNEC study will provide a factual basis on which U.S. business problems will be approached.

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