The Conversion

To master planners in the U.S. and most of the world beyond, David Eli Lilienthal still stands as a prime symbol of Government administration of vast public business projects. During his 17 years as a star of the New Deal, Lilienthal headed and largely shaped two of the world's greatest Government enterprises: TVA and the Atomic Energy Commission. In his books and innumerable lectures he sang the praises of what he called "people's businesses." A year and a half ago, however. David Lilienthal went into private enterprise as a consultant to Lazard Freres & Co., New York investment bankers. (His chief current interest: management of Philadelphia's Attapulgus Minerals & Chemical Corp.) This week he had a new book on the market with a title that, at first sight, might jolt his old New Deal disciples. The title: Big Business: A New Era (Harper; $2.75).

The Asset of Size. "The convictions about Big Business presented in this book grew out of more than 20 years of experience, observation and reflection." Lilienthal begins. "Many times during those years I had to revise my opinions and pre-judgments because they simply did not square with the facts as I found them to be." The central fact about the U.S. economy, as Lilienthal now sees it: "Our productive and distributive superiority, our economic fruitfulness, rest upon Bigness. Size is our greatest single functional asset."

The fear of Big Business reflected in U.S. antitrust laws, Lilienthal says, is based "largely upon prejudice created by abuses long since corrected ..." and against the danger of future abuses of power by Big Business "we either already have adequate public safeguards or know how to fashion new ones as required." In fact, the nation should abandon limitations upon Big Business for a governmental policy which will promote "those principles and practices of Bigness that can bring us, in increasing measure, vast social and individual benefits."

Negative to Positive. Some classical economists, in full agreement with this enthusiasm for revising some obsolete cliches about Bigness, would suggest that the way for the Government to encourage Big Business is to let it alone. Lilienthal takes a different tack. He proposes that Congress pass a Basic Economic Act pro claiming its prime concern with "productivity and the ethical and economic distribution of this productivity." Lilienthal's law would automatically repeal "the Sherman and Clayton acts, and all other existing laws, administrative policies and judicial interpretations of the antitrust laws" insofar as they were inconsistent with the Basic Economic Act. Under its terms, "the legal test Bigness would have to face would thenceforth be whether the particular aspect of size challenged by the Government does in fact further the public interest." Such a law, says Lilienthal, would mark a transition from a negative to a positive approach to Big Business. But he is apparently unworried that it would also mark a transition from limited Government regulatory power over business to virtually unlimited Government power to "guide" the business community along whatever lanes an incumbent Congress and executive might believe to represent "the public interest."

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