Part 23 (1/2)

”The parallel between the two cases [the Knight case and the Northern Securities case] is complete The one corporation acquired the stock of other and coe for its own It was conceded for the purposes of the case, that in doing so ar, that the sugar to be produced was likely to become the subject of interstate commerce, and indeed that part of it would certainly becoress was decided not to extend to the subject, because the ownershi+p of the stock in the corporations was not itself commerce”

Mr Justice White was entirely correct in this statement The cases were parallel It was necessary to reverse the Knight case in the interests of the people against e just as it had been necessary to reverse the Dred Scott case in the interest of the people against slavery and privilege; just as later it became necessary to reverse the New York Bakeshop case in the interest of the people against that forhts below property rights where orkers were concerned

By a vote of five to four the Supreht case, and in the Northern Securities case sustained the Government The power to deal with industrial ulate coht case had deprived the Federal Government, was thus restored to it by the Northern Securities case After this later decision was rendered, suits were brought by ainst the American Tobacco Coed criht case was finally overthrown

The vicious doctrine it eer remains as an obstacle to obstruct the pathway of justice when it assails monopoly Messrs

Knox, Moody, and Bonaparte, who successively occupied the position of Attorney-General under me, were profound lawyers and fearless and able men; and they completely established the newer and more wholesome doctrine under which the Federal Government may now deal with monopolistic combinations and conspiracies

The decisions rendered in these various cases brought under my direction constitute the entire authority upon which any action h the exercise of national power to curb anized and directed the Northern Securities Co forces in the Steel Corporation, which has since been prosecuted under the act The proceedings against the Sugar Trust for corruption in connection with the New York Custo to be considered separately

Fro co corporations engaged in inter-State business, it would be impossible to over-estimate the importance of the Northern Securities decision and of the decisions afterwards rendered in line with it in connection with the other trusts whose dissolution was ordered The success of the Northern Securities case definitely established the power of the Governreat corporations Without this success the National Government must have remained in the iht decision as regards the most important of its internal functions But our success in establishi+ng the power of the National Governht ained the power We had not devised the proper h in rather cumbrous fashi+on, be broken up by law suits Great business combinations, however, cannot possibly be encies merely by law suits, and especially by law suits supposed to be carried on for their destruction and not for their control and regulation I at once began to urge upon Congress the need of laws supple business, good and bad, alike, and as the event proved was very inefficient in checking bad big business, and yet was a constant threat against decent business hgoing and drastic Govern business coed in inter-State industry

Here I was able to accomplish only a small part of what I desired to accomplish I was opposed both by the foolish radicals who desired to break up all big business, with the i to mid-nineteenth century industrial conditions; and also by the great privileged interests themselves, who used these ordinarily--but soressives” to further their own cause The worst representatives of big business encouraged the outcry for the total abolition of big business, because they knew that they could not be hurt in this way, and that such an outcry distracted the attention of the public fro them, in just but masterly fashi+on, which was advocated by the sane representatives of refor by securing the passage of a law creating the Department of Commerce and Labor, and with it the erection of the Bureau of Corporations The first head of the Department of Commerce and Labor was Mr Cortelyou, later Secretary of the Treasury He was succeeded by Mr Oscar Straus The first head of the Bureau of Corporations was Mr Garfield, as succeeded by Mr

Herbert Knox Smith No four better public servants from the standpoint of the people as a whole could have been found

The Standard Oil Coislation

This was natural, for it had been the worst offender in the a of enormous fortunes by improper methods of all kinds, at the expense of business rivals and of the public, including the corruption of public servants If any uage officially used by the Supreainst the Standard Oil Coraressanization, they did their best to kill the bill providing for the Bureau of Corporations I got hold of one or two of these telegrams and letters, however, and proenerally happens in such a case, theas they could work in secret and behind closed doors became powerless as soon as they were forced into the open The bill went through without further difficulty

The true way of dealing with rows so powerful that even when courts conde it The Supreme Court in the Tobacco and Standard Oil cases, for instance, used very vigorous language in conde these trusts; but the net result of the decision was of positive advantage to the wrongdoers, and this has tended to bring the whole body of our law into disrepute in quarters where it is of the very highest importance that the law be held in respect and even in reverence My effort was to secure the creation of a Federal Commission which should neither excuse nor tolerate monopoly, but prevent it when possible and uproot it when discovered; and which should in addition effectively control and regulate all big coive honest business certainty as to what the laas and security as long as the laas obeyed Such a Commission would furnish a steady expert control, a control adapted to the probleulation, but is purely negative; and negative remedies are of little permanent avail

Such a Co corporation engaged or proposing to engage in business between the States It would have the power to discri well and those that are doing ill; and the distinction between those who do well and those who do ill would be defined in terms so clear and unmistakable that no one couldits profits through serving the co prices, or ihts of others (including its rivals, its eeneral public), and strictly obeying the law, then no reat the volued to still more abundant production, or better service, by the fullest protection that the Government could afford it On the other hand, if a corporation were found seeking profit through injury or oppression of the coh trick or device, by plot or conspiracy against coe-workers, and then extorting high prices for the commodity it had anizing if its nefarious purpose could be discovered in time, or pursued and suppressed by all the power of Government whenever found in actual operation Such a commission, with the power I advocate, would put a stop to abuses of big corporations and small corporations alike; it would draw the line on conduct and not on size; it would destroy est business man in the country conform squarely to the principles laid down by the A fair play to the littleand as right both to big h under the decision of the courts the National Government had power over the railways, I found, when I became President, that this poas either not exercised at all or exercised with utter inefficiency The law against rebates was a dead letter All the unscrupulous railway men had been allowed to violate it with impunity; and because of this, as was inevitable, the scrupulous and decent railway men had been forced to violate it the beaten by their less scrupulous rivals It was not the fault of these decent railway men It was the fault of the Government

Thanks to a first-class railway man, Paul Morton of the Santa Fe, son of Mr Cleveland's Secretary of Agriculture, I was able completely to stop the practice Mr Morton volunteered to aid the Govern rebates He frankly stated that he, like every one else, had been guilty in the matter; but he insisted that he uttered the sentiments of the decent railway men of the country when he said that he hoped the practice would be stopped, and that if I would really stop it, and not ive the testimony which would put into the hands of the Government the power to put a coly he testified, and on the inforave us ere able to take such action through the Inter-State Commerce Commission and the Departislation, that the evil was absolutely eradicated He thus rendered, of his own accord, at his own personal risk, and from purely disinterested motives, an invaluable service to the people, a service which no otherto render As an immediate sequel, the world-old alliance between Blifil and Black George was i rebates he had done only what every honest railway ed to do because of the failure of the Governards dishonest railway e and sense of obligation to the public which made him come forward and without evasion or concealht successfully put an end to the practice; and put an end to the practice we did, and we did it because of the courage and patriotism he had shown The unscrupulous railway men, whose dishonest practices were thereby put a stop to, and the unscrupulous deues ere either under the influence of these norant people no ainst Mr Morton They actually wished h such prosecution would have been a piece of unpardonable ingratitude and treachery on the part of the public toward hi as the steward of the public in this matter I need hardly say that I stood by him; and later he served under me as Secretary of the Navy, and a capital Secretary heof rebates, but in the Hepburn Rate Bill ere able to put through a ave the Inter-State Commerce Commission for the first time real control over the railways

There were two or three a features in the contest over this bill

All of the great business interests which objected to Governht it, and they were helped by the honest e, whether good or bad We finally forced it through the House In the Senate it was referred to a committee in which the Republican majority was under the control of Senator Aldrich, who took the lead in opposing the bill There was one Republican on the committee, however, whom Senator Aldrich could not control--Senator Dolliver, of Iowa The leading Democrat on the committee was Senator Tillood tered to cancel an invitation to hi ue froainst him on account of his conduct in connection with certain land matters Senator Tillman favored the bill The Republican majority in the committee under Senator Aldrich, when they acted adversely on the bill, turned it over to Senator Till him its sponsor The object was to create what it was hoped would be an impossible situation in view of the relations between Senator Tillarded the action as simply childish It was a curious instance of how able and astute men sometimes commit blunders because of sheer inability to understand intensity of disinterested etting credit for the bill, or having charge of it I was delighted to go with hi inincident in connection with the passage of the bill All the wise friends of the effort to secure Governmental control of corporations know that this Governh administrative and not judicial officers if it is to be effective Everything possible should be done tofrom the decisions of the administrative officer to the courts But it is not possible Constitutionally, and probably would not be desirable anyhow, completely to abolish the appeal Unwise zealots wished to make the effort totally to abolish the appeal in connection with the Hepburn Bill Representatives of the special interests wished to extend the appeal to include what it ought not to include Between stood a nue of, or the failure to pass, the bill, and ere not inclined towards either side Three or four substantially identical amendments were proposed, and we then suddenly found ourselves face to face with an absurd situation The good ivings about the ultra-radicals would not accept a good amendment if one of the latter proposed it; and the radicals would not accept their own amendment if one of the conservatives proposed it

Each side got so wrought up as to be utterly unable to get matters into proper perspective; each prepared to stand on unimportant trifles; each announced with hysterical emphasis--the reformers just as hysterically as the reactionaries--that the decision as regards each unimportant trifle determined the worth or worthlessness of the measure Gradually we secured a measurable return to sane appreciation of the essentials

Finally both sides reluctantly agreed to accept the so-called Allison ae in the bill at all The amendment was drawn by Attorney-General Moody after consultation with the Inter-State Commerce Commission, and was forwarded by me to Senator Dolliver; it was accepted, and the bill became law

Thanks to this law and to the way in which the Inter-State Commerce Commission was backed by the Administration, the Commission, under men like Prouty, Lane, and Clark, becaood that we had accomplished was undone after the close ofa Commerce Court; but the major part of the immense advance we had made remained There was one point on which I insisted, and upon which it is necessary always to insist The Coood unless it does justice to the corporations precisely as it exacts justice from them The public, the shi+ppers, the stock and bondholders, and the ehts, and none should be allowed unfair privileges at the expense of the others Stock watering and swindling of any kind should of course not only be stopped but punished When, however, a road is ed fairly and honestly, and when it renders a real and needed service, then the Government must see that it is not so burdened as to make it iislation necessary for the safety of the public, or--like work of the employee, which nevertheless imposes such a burden on the road that the burden eneral public and the corporation, or there will be no dividends In such a case it hest duty of the commission to raise rates; and the commission, when satisfied that the necessity exists, in order to do justice to the owners of the road, should no more hesitate to raise rates, than under other circu stick” in dealing with the corporations when they rong Now for a sample of the square deal

In the fall of 1907 there were severe business disturbances and financial stringency, cul in a panic which arose in New York and spread over the country The dae threatened was incalculable Thanks largely to the action of the Govern htful and Nation-wide calaht with untold misery and woe to all our people For several days the Nation trembled on the brink of such a cala these days both the Secretary of the Treasury and I personally were in hourly coe in the situation, and trying to anticipate every development It was the obvious duty of the Ad disaster by checking the spread of the panic before it grew so that nothing could check it And events moved with such speed that it was necessary to decide and to act on the instant, as each successive crisis arose, if the decision and action were to acco The Secretary of the Treasury took various actions, some on his own initiative, so I was informed that two representatives of the Steel Corporation wished to seena, while at breakfast, I was infor at the office I at once went over, and, as the Attorney-General, Mr Bonaparte, had not yet arrived froht, I sent athe Secretary of State, Mr Root, as also a lawyer, to join us, which he did Before the close of the interview and in the presence of the three gentle forth exactly what Messrs Frick and Gary had proposed, and exactly what I had answered--so that there

This note was published in a Senate Document while I was still President It runs as follows:

THE WHITE HOUSE, Washi+ngton, Novee E H Gary and Mr H C Frick, on behalf of the Steel Corporation, have just called upon me They state that there is a certain business firm (the name of which I have not been told, but which is of real importance in New York business circles), which will undoubtedly fail this week if help is not given A its assets are a majority of the securities of the Tennessee Coal Coently made to the Steel Corporation to purchase this stock as the only e Gary and Mr Frick informed me that as a mere business transaction they do not care to purchase the stock; that under ordinary circu the stock, because but little benefit will come to the Steel Corporation from the purchase; that they are aware that the purchase will be used as a handle for attack upon the to secure a monopoly of the business and prevent competition--not that this would represent what could honestly be said, but what ht recklessly and untruthfully be said

They further informed me that, as a matter of fact, the policy of the company has been to decline to acquire more than sixty per cent of the steel properties, and that this purpose has been persevered in for several years past, with the object of preventing these accusations, and, as a htly decreased, so that it is below this sixty per cent, and the acquisition of the property in question will not raise it above sixty per cent But they feel that it is immensely to their interest, as to the interest of every responsible business eneral industrial so into this transaction, which they would not otherwise go into, because it seement in New York that it will be an iht be ruinous; and that this has been urged upon them by the combination of the ed in endeavoring to save the situation But they asserted that they did not wish to do this if I stated that it ought not to be done I answered that, while of course I could not advise them to take the action proposed, I felt it no public duty of ned) THEODORE ROOSEVELT