THE Global Justice Movement Website

THE Global Justice Movement Website
This is the "Global Justice Movement" (dot org) we refer to in the title of this blog.

Thursday, April 30, 2015

The Lost Speech of Peter S. Grosscup, II: Ineffective Efforts

As has been known for some time, concentrating ownership of capital in the hands of a few people (capitalism) or the State (socialism) necessarily means that most people will not own a significant capital stake — or any at all, for that matter.  The modern ideal, as the solidarist economist Goetz Briefs (1889-1974) explained in The Proletariat (1911, German, 1937, English), is capital ownership concentrated in the hands of a private sector or government elite, with the great mass of people supported by State-subsidized wages, benefits, and welfare.

Propertyless Workers
This, as Briefs explained, is an unstable and inherently dangerous situation.  When workers (and, by extension, everyone else) do not own capital, they are utterly at the mercy of those who do, whether those who own are in the private sector or the government.  (Keep in mind that, as Louis Kelso put it, “ownership” means control in all codes of law.  You don’t have to have legal title if you can take the income and control the disposition of what someone else has title to — you, not the nominal title holder, are the real owner.)

This has had a horrifying effect on the modern family, which is fragmenting under the pressure.  As the State more and more takes over the role of the family in providing income, education, and even “moral” philosophy, the family as the family comes to mean less and less, and becomes a redundant institution instead of the fundamental unit of society.  That is why we are working on the “Five for the Family” campaign — to restore the family to its proper place in society by bringing word of the Just Third Way to world leaders with true vision.

That’s also why we need to understand that this is nothing new — as Judge Grosscup’s speech on the dangers of concentrated ownership makes clear:

Peter S. Grosscup
Judge U. S. Circuit Court, Chicago

Judge Grosscup (1894 photo)
“The corporations of this country have grown up as developments of our business life, without much reference to their relations to the people as institutions of, and for, the people. It is time that they be looked into as institutions of, and for, the people. The Sherman Act was passed before the regulation of interstate carriers was seriously attempted or foreseen. Now that ‘regulation’ has come it is time to inquire how far the old ‘prohibitions’ should remain. The whole matter — corporate reconstruction and a restudy of the anti-trust act — should be gone over carefully with a view to bringing some kind of order out of the disorder that now prevails!”

(New York National Civic Federation, Proceedings on the National Conference on Trusts and Combinations Under the Auspices of the National Civic Federation, October 22-25, 1907. New York: The McConnell Printing Company, 1908, p. 11.)

THE CHAIRMAN: It gives me pleasure now to present the Hon. Peter S. Grosscup, of Chicago, who will speak on “Anti-Trust Laws.”

Hon. Peter S. Grosscup.

Mr. Chairman — We are now well into the eighteenth year since the passage of the Sherman Anti-Trust Act, and well into the seventh year since Mr. Roosevelt’s administration began actively to enforce it.

Senator John Sherman
Thus, so far as enactments make law, there has been a prohibitory law against the so-called trusts or big corporations for nearly five times the length of time it took to fight out the civil war; and so far as a sincere and vigorous purpose to enforce law results in actual enforcement, the battle line against the so-called trusts or big corporations has been in action for nearly twice as long as it took to fight out the civil war.

In its means of enforcement, as well as in its purpose, the Sherman act was as comprehensive as language could make it. It withheld no power, civil or criminal, that the lawmakers thought would contribute to the complete eradication of the supposed evil. It had been preceded in Texas, Kansas, Michigan and Maine by State laws directed to the same end, and was quickly followed by like laws in one-half of the other States, including New York, Ohio, Indiana, Illinois, Wisconsin, Iowa and the West generally.

Our Ineffective Struggle Against Trusts

John D. Rockefeller, Founder of Standard Oil (1898 photo)
Have the so-called trusts or big corporations been exterminated? Have they been even diminished? Has the Sherman act brought about any decrease in the cost of living or any increase in wages? Has the process of combining ceased? Has any specific, practical purpose of the Sherman act, not present in the law as it has existed for centuries, been fulfilled? On the contrary, were I to call the roll of the so-called trusts or big corporations, organized since the Sherman law went into effect, I would be naming the largest ones in America today, an inspection made for me of a list of one hundred and twelve of the leading so-called trusts or big corporations showing that all but thirteen have been organized since the passage of that act. And if it be said that this is because the Sherman act, until the past six years, was treated as a dead statute, I ask. How many of the so-called trusts or big corporations have been exterminated, or even diminished — what increase has there been in wages or decrease in the cost of living — by what is admitted on all hands to have been a sincere and vigorous attempt to enforce the law during the administration of President Roosevelt? Injunctions have issued against the several packing houses that make up the meat industry, and here in Indiana against certain concerns in the drug business, and against certain other so-called trusts throughout the country; but in no case have these so-called trusts or big corporations been exterminated; in no case have wages or prices been affected; in no case, except in minor detail, has anything been done that could not have been done as effectually under the common law that was in existence before the Sherman act went into effect — that could not be done against individuals as well as against corporations; and though, in this respect, perhaps, the case of the Northern Securities Company is an exception, even in that case the several railroads that made up the Securities Company are managed now almost precisely as they were before the order of dissolution was entered.

President Roosevelt (1906 photo)
If, then, the enactment of the Sherman Anti-Trust act was intended to exterminate the so-called trusts or big corporations, or to affect wages or prices, manifestly the Sherman Act has failed. If the entrance of Mr. Roosevelt’s administration upon a vigorous enforcement of that law was intended, as some of his more radical followers constantly give out, to exterminate the so-called trusts and big corporations, manifestly that feature of Mr. Roosevelt’s administration has failed. The organization of industry into corporate form does not cease. Neither wages nor prices change. That much, at least, has been proven. And the reason that the organization of industry in corporate form is not ceasing, is because, as an effective, industrial agency to wield the energies of mankind, the corporate form, beyond any other form, is the most effective yet discovered. What government is to mankind politically organized, the corporation is to modern industry organized. It is on that account that the corporation is here at all; and it is on that account that it is here to stay. And not until men, in their general relations to each other, can safely dispense with government, will come a time when men, in their industrial relations, can safely dispense with industrial organization.

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On Monday we’ll post the next section of Judge Grosscup’s talk on how the legislative principles involved were going at the problem in the wrong way.  The Sherman Act tried to have the government control the concentrated ownership, rather than break up the concentration of ownership and broadly diffuse power.