Trusts, pools and corporations

Front matter

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I

SELECTIONS AND DOCUMENTS IN ECONOMICS

Preface

This volume is intended to be more than a mere collection of economic reprints. Such compilations have often been made; as for example in Dunbar’s “ Laws relating to Currency, Finance and Banking”; Rand’s “Economic History”; and in the Reports of the United States Industrial Commission. This collection is planned for use specifically as a text-book ; not merely as a handy volume for reference, or as a collection of original documents. It is not intended, however, to supplant, but rather to supplement, the standard treatises on the trust problem; and may readily be used in connection with Jenks’s “Trust Problem,” Ely’s “Monopolies and Trusts,” or Meade’s “Trust Finance.” It denotes a deliberate attempt at the application to the teaching of economics of the case system, so long successful in our law schools. With this end in view, each chapter is intended to illustrate a single, definite, typical phase of the general subject. The primary motive is to further the interests of sound economic teaching, with especial refer¬ ence to the study of concrete problems of great public and private interest. A difficulty in the substitution of present-day social and economic studies for the good, old-fashioned, lin¬ guistic ones, or for the modern sciences,- — a difficulty especially peculiar to descriptive economics as differentiated from eco¬ nomic theory, — has always been to secure data sufficiently concrete, definite and convenient to form a basis for analysis, discussion and criticism. The lecture system has its advan¬ tages in stimulating interest and — it is to be hoped arousing enthusiasm among students. But lectures alone entirely fail

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IV

PREFACE to do justice to the possibilities inherent in economic science for rigorously training the mind in habits of close and consecu¬ tive thought. The law has always enjoyed a peculiar and wellmerited prominence among other studies for this reason.

The first requisite, therefore, for the successful conduct of economic instruction in the descriptive field is to provide raw material ; which in discussion, supplementary to the general lectures, may be worked over in detail in the class room. Such material, by reason of the great increase in economic periodical literature since 1890, is now rapidly augmenting. Yet with classes, as at Harvard University, often aggregating in such economic courses from one to two hundred men, resort by each student to the files of such periodical literature is out of the question. Public documents are also impossible for reference reading with a class of considerable size. And finally, in my judgment, a generally neglected and amazingly rich find lies embedded in the mass of factual evidence accumulated in the course of legal proceedings in our courts. The mere decisions, as long currently used, are of course well known. But it is not the legal pronouncement in the case, infrequently interlarded with brief statements of fact ; but the actual testimony adduced — “The Record” of evidence submitted — which has rarely been utilized. Such matter must be painstakingly uncovered, abridged, even digested, and made more conveniently accessi¬ ble to serve its due end for the teacher. To direct attention to this material by a few concrete illustrations from such sources, reprinted in this volume, is not an unimportant motive in its production.

A second, and by no means inconsiderable, motive in the preparation of this volume has been the hope that it might contribute toward a crystallization of public opinion favoring a reasonable policy of public control over monopolistic and cor¬ porate enterprises. The general reader and the legislator, in the mass of loose generalizations upon this topic, can scarcely be expected to follow publications in the technical economic

PREFACE v journals. Such articles, unswayed as they should be by selfish interest and personal prejudice, nevertheless, are the main ones which may safely be relied upon in the formation of a final judgment. By gathering together in convenient form this series of papers and documents, it is confidently hoped that progress toward the solution of one of our most troublesome public questions may be in some slight degree facilitated.

Most cordial acknowledgment is due to the Editorial Boards of the Political Science Quarterly , the Economic Journal ’, the Yale Review and the Quarterly Journal of Economics, and in even greater measure to the authors of the several papers herein reprinted, for permission to make use of their material in this enterprise. In every instance a most hearty acquies¬ cence in the project has been expressed, for the which I cannot be too grateful. Without such assent the meagre original con¬ tributions of the editor would have made but a sorry show. Nor can I refrain in this instance from an expression of my peculiar obligation to Professor J. W. Jenks of Cornell Uni¬ versity, my former colleague in the work of the United States Industrial Commission, who has been long and deservedly recognized as a pioneer in this field of economic study. To my former teacher, Professor Goodnow of Columbia ; to my colleague, Professor Bullock ; and to Dr. E. S. Meade of the University of Pennsylvania, I am also more than ordinarily indebted. Hon. E. B. Whitney, former Assistant Attorney- General of the United States, now of the New York bar, has also been of great service in awakening my interest in the legal sources of economic information, to which reference has been made. This volume, as it appears, is largely the work of my professional colleagues and friends. It is earnestly to be desired that my editorial endeavors may serve to direct attention anew to the value and interest of their contributions.

WILLIAM Z. RIPLEY.

Contents

Introduction . * .

CHAPTER

I. The Michigan Salt Association. (Early pooling.) By J. W. Jenks .........