The dealer and manufacturer is caught between the upper and nether millstones-he is obliged to pay prices fixed by farmers' organizations and wages fixed by labor unions, but cannot-under the laws of most of the states-organize with others for his own benefit.

This is a condition so manifestly unfair and illogical it cannot exist for long, and while it does exist it engenders mischief and class hatred.

The problem presented is by no means peculiar to this country, for the nations of Europe are struggling with it, but the condition is more acute here because we have fortyeight states and a federal government passing laws on the subject, and for nearly a generation passing laws—“antitrust laws"-drawn in most drastic terms to suppress cooperation and promote competition.

XI

The Sherman Act was passed 1890.

Since its enactment many suits have been begun to dissolve "trusts"-combinations of dealers and manufacturers.

Not a single suit has been begun to dissolve any one of the large combinations of labor or of farmers, though the existence of such combinations arbitrarily controlling inter-state commerce is a matter of common knowledge!

What is the net result of the enforcement of that law? A few "trusts" and a number of lesser combinations have dissolved, but where one has been suppressed five hundred have taken its place. No such era of combination and coöperative organization has ever been known in the history of the world as the period of twenty-odd years since the passage of the Sherman act.

This movement has not been organized in "defiance" of 1See Chapter XIX.

the law, but in response to irresistible forces-the same forces that brought the partnership, the corporation, the labor union, into existence; the forces that compel men to work together in harmony to accomplish the things mod-) ern society demands of them.

Just as the stage-coach, owned and driven by one man, has given way to the railroad, owned and operated by a hundred thousand men, so the individual laborer, farmer, merchant, small manufacturer, merges his identity in that of his union, his coöperative society, his large corporation, his "trust," to secure larger results, to do things on a larger scale, a scale commensurate with the marvelous development of the world of to-day.

XII

The country has reached the parting of the ways. It must make its choice, and make it intelligently—either the competitive or the coöperative basis. If the competitive, then no class should be permitted to organize a coöperative movement to get more for what it has to sell; if the cooperative basis, then no class should be prevented from organizing either one policy or the other, the two cannot exist together.

The man who argues for competition must be consistent; he must argue against farmers' coöperative societies and labor unions just as vehemently as he argues against combinations of dealers and manufacturers.

XIII

We are in course of making this choice; Congress is debating constructive legislation to supplement or take the

place of the Sherman law, which is purely destructive in its intent.

But, judging from the debates in Congress and its committees, this new legislation is not being considered in the spirit it should be. Many of the bills offered are directed! against coöperation. There is still a belated cry for a more drastic "anti-trust" remedy, for a law that will purge the country of all combinations-all combinations except combinations of farmers and combinations of labor-no statesman proposes to frame a law that will interfere with them.

But while many of our law-makers refuse to see conditions as they are, that is by no means true of all, and certain it is that as time goes by the conviction gains ground in Washington that the country is passing slowly but surely from the old competitive basis to the coöperative, and what is needed are not futile laws directed against coöperation, but more legislation in aid of the new spirit that is abroad in the land, legislation that will help men to come together and work together, securing for the public the maximum of good from coöperation, and, at the same time, protecting the people and all classes from abuse of power by combinations.

Many additional illustrations of unfair, oppressive, and disastrous competition are given in the following chapters, but no reader need go beyond his own experience and observation for facts.

The farmer knows that competition means lower prices for his produce, and so all over this country farmers are organizing coöperative societies,1 to enable them to sell what

1

1In addition to the many farmers' coöperative associations enumerated in Chapter XIX, the following just at hand is in point: "Kentucky farmers are preparing to organize a farmers' union covering the entire state, and to establish a central store in every county seat. To date this union has been organized in only a few counties. Wherever the coöperated stores have been established they have given satisfaction

they have to sell for more money, to get larger and surer returns.

The laborer knows that competition means lower wages, therefore he joins a union to suppress competition and advance wages.

The merchant and manufacturer know that competition means "cut-throat" prices for what they have to sell, hence they, too, try to form coöperative organizations to lessen competition; but the law is not so indulgent to them, it tries to prevent their doing what farmers and laborers do.

The only class in the community that profits from unrestricted competition is the class that has nothing to sell, people who live on fixed incomes; their interest is in low prices. If they can buy what they want below cost they are happy, even though their advantage means ruination to the farmer, the laborer, the dealer, the manufacturer. But this class is small in numbers and importance as compared with the rest of the community, and not a few would have difficulty in justifying their right to be non-producers in any fair theory of social organization.

"Solicitors for members are constantly at work, and by the time the tobacco, wheat, and corn crops are ready for harvest, many more counties, it is expected, will take up the plan.

"A meeting held in Lexington was attended by leading farmers of different parts of the state. Many of these were members of the old American Society of Equity, established several years ago to force higher prices for tobacco and other farm products from trusts, which then controlled these products.

"From the agitation started by the American Society of Equity came the Burley Tobacco Society, which now controls the production of more than 200,000,000 pounds of tobacco annually in Kentucky, Ohio, Indiana, and West Virginia."

Another instance from Illinois:

"Farmers of Cumberland and Cole counties signed an agreement to-day pledging themselves not to raise broom-corn for five years unless the dealers will guarantee them a price to exceed $120 a ton in advance of planting. For twenty years the two counties have been the broomcorn center of the country."

President Taft recently advised consumers to form coöperative societies, after the English type, to eliminate the profits of exchange by buying direct from producers. And Colonel Roosevelt, speaking to Minnesota farmers, has advised them to form coöperative societies to eliminate the intermediate dealers and sell direct to the consumers.

CHAPTER IV

GROWTH OF COÖPERATION

I

Every railroad, every telegraph, every telephone, means coöperation, and coöperation means combination in one form or another.

Before the railroad merchants in towns fifty miles apart did not compete with one another; each could charge practically what he pleased; prices could vary fifty or a hundred per cent. without affecting trade appreciably.

A low man might draw trade from territory within, say, twenty or even fifteen miles of the other town, depending upon condition of the roads, season of the year, etc., but the high man in the second town would have customers the other could not reach, customers who could not afford to go the extra distance to make the saving in price.

A railroad between the towns changes their economic relations; now a very slight difference in prices draws trade one way or the other.

Theoretically, and, in large measure, practically, the measure of the opportunity of the merchant in one town to charge more than a merchant in another for like goods, is measured by the fare to and fro between the towns, plus the element of loss of time.

When an electric line is built, running cars every half hour and carrying passengers at nominal rates, the two