THE CONTROL OF "TRUSTS." By Harry Earl Montgomery. THE discussion of the "trust" problem has passed through the hysterical, dema gogical and denunciatory period, and has now entered upon that stage where calm, sane and deliberate judgment prevails. The thoughtful minds of the country have come to agree on certain phases of this question, among which may be cited the following :— First : That the giant corporation, mis called a " trust," is a step in the natural, logical and evolutionary development of the co-operative idea in the economic world. Second : That there are many good fea tures as well as many bad features connected with " trusts," in the way they are organized and conducted. Third : That " trusts " are becoming more numerous, year by year, and that they now are, and will continue to be, live, controlling factors in the commercial life of our nation. Fourth : That to take away the charters of the corporations commonly known as "trusts" would be unfair and unjust to their stockholders, and would be productive of great loss and injury to the whole people. Fifth : That it is imperative that some means be found at once to regulate and con trol the "trusts" so as to preserve their good features, and at the same time to de stroy their power to harm. Sixth : That it is the duty of the State Legislatures to take hold of this problem, and to pass laws tending to its solution, un til such time as power shall be vested in Congress to enact a general corporation law applying to all corporations throughout our land. A " trust," in the common acceptation of the term as applied to industrial combina tions, is a corporation having a large aggre
gation of capital. A corporation is a privi lege granted by a government to a few citizens permitting them to co-operate and carry on a joint enterprise without partner ship restrictions and liabilities. A corporate charter is sought because it enables its own ers to exercise certain functions impossible to individuals and to partnerships. Being a privilege highly prized, it ought not to be given without adequate compensation. This principle is the basis of the theory upon which our government was reared. A corporate privilege is worth to its own ers just what it will earn, and no more and no less. If a corporation does business at a loss, or comes out even, the privilege of be ing incorporated is worth practically nothing. If this privilege is the means whereby money is made, then the privilege is worth some thing. If the earning power of this privilege is greater than is the earning power of in dividual dealers, or of partnerships, then it is unfair and unjust to the many to permit the few, through the gift of the State, to outstrip them in the race for wealth. And if the possession of this corporate privilege gives to the few owners the opportunity to make money at the expense of the many, as so many corporations are doing to-day, the State should step in, and, so far as possible, equalize the rights of all. This the State can do in but one way, — by means of its power of taxation. That the State has a right to levy a tax as a payment for the giving of a corporate charter, the courts have repeatedly held. But how to lay this tax? Shall it be on corporate assets, on capital stock, on divi dends, on the volume of business, or on profits? Experience has shown that the
