detailed legislation, but rather for some administrative machinery that would take the principles laid down by the lawmaker and apply them with impartiality, yet with elasticity, to the quickly changing conditions of industrial life. Congress, with its predominantly political aims and ambitions is not a suitable body for this purpose. We need rather some group of men, scientifically trained, with expert knowledge of their field, who can secure evidence, hear it, and form their conclusions accordingly, regardless of partisan bias or political effect. One of the great difficulties in our present interpretation of the law has been the uncertainty which many business managers feel as to whether their actions, contracts and agreements, and even the very existence of their corporations, are legal or not. The American Tobacco and Standard Oil cases were hastened to the utmost, yet it took five and a half years to reach an ultimate decision. There are other combinations in violation of the Sherman Act which have been in litigation in the courts exclusively on the point of their legality under the Sherman law for ten years. It has been calculated that over 1,200 combinations with ten billions of capital have to-day either an illegal existence, or one of doubtful legality. We may accordingly form some notion of the advantage to these concerns of having an authoritative, official statement of their legal status and some means of bringing their organization into definite compliance with the law upon a profitable basis. This suggests another advantage of the plan,-that it is preventive rather than remedial. The visiting of fines and imprisonments upon offenders has never been as successful in securing obedience to the law as has the plan of changing or removing the causes of offence. It is safe to say that the overwhelming preponderance of business men in all industries, would undoubtedly conform to the law as a matter of course, if its provisions were clearly drawn and reasonable, and were made to conform with the easily understood principles of commercial honesty. These advantages are undoubtedly possessed by the commission plan.

The Need for Expert Service. Corporation attorneys have often pointed out that our courts, both Federal and State, experience serious difficulty in examining into all the intricate and multiform detail of business practices in a large corporation and in tracing the effects of these practices upon the business world. Such a task is entirely foreign to the natural jurisdiction of a court, and the judges, in order to perform it properly, would have to devote sufficient time and study to this one particular class of legal and economic subjects to become specialists therein. As they are not able to do this it may be said that the courts are unfitted for the work of supervising industrial combines. Yet the immense extent of government regulation of such corporations has created a new body of law, of legal and regulative principles, which does require the careful training and study of the specialist. What is still more important, the supervision must be a constant and continuing one,

it cannot be the mere registering of a court decree which shall determine, once for all, the questions involved.

Let us examine the most favorable court procedure possible under the Sherman Act,-that illustrated by the dissolution of the Western Union-Bell Telephone combine. Here the Attorney General inspired by the desire to settle cases out of court, in order to avoid litigation whenever possible, was able to persuade the Bell system and the Western Union to separate voluntarily without legal prosecution. The Bell companý agreed further not to purchase competitive telephone lines in the future, also to allow existing independent companies to connect with its lines upon payment of a moderate fee. But even when a court decree providing for these conditions is registered on the records of the Federal Courts, such a settlement covers only one aspect of the regulative problem. The Bell and Western Union companies and their independent competitors must still be subject to the supervision of the interstate commerce commission, both as to the reasonableness of their rates and the nature of the services to be offered. The meat packers combine to fix prices and practice other illegal acts forbidden by the Sherman law. They are enjoined by the Federal courts and prohibited from further continuance of these violations, as we have seen in considering Swift v. U. S., 196 U. S. 307; 1905, yet five years later these same packers are prosecuted in a criminal suit in which the government alleges that they are still combining to manipulate meat prices. In their defence much weight is placed upon the vagueness and uncertainty of the anti-trust law, and they are acquitted, at the end of a long and expensive trial, after which the prices of meat products immediately rise. Why should the regulation of such an important industry be attempted by a few general terms in the Sherman Act? Can the immense interstate and foreign trade in meat products be adequately regulated in the public interest by means of a court decree or a criminal suit? It is not otherwise with other large interstate commercial enterprises. They might be willing to agree to a court order bringing them into general compliance with the main principles of the Sherman Act, but the ordinary routine of their business and their relations to their competitors should not be and cannot be successfully regulated by criminal prosecution or injunctions or any other court decrees. This routine and these business practices are matters of daily happening, changing frequently over night, and requiring for their proper regulation, the supervision of an administrative body with flexible inexpensive forms of procedure and possessing a staff of skilled experts or specialists who can ascertain and report on the business facts involved. A commission has such a staff of investigators, a court has not. A commission sits continuously and accumulates the precedents, maxims, and principles covering a given class of corporations more completely and in greater detail than is possible in a court. A commission in brief, would specialize

in the public regulative law of interstate commerce and would apply the principles of that law to the rapidly changing business conditions with a success that few judicial bodies could hope to attain.

The Federal Trade Commission; Its Powers.-The strong considerations already explained led to such a preponderance of opinion that President Wilson in 1914 endorsed the plan of a Trade Commission, which is the fourth step in our trust policy. The Democratic party for many decades had opposed material extensions of the Federal power and was at most only mildly favorable to the whole Federal system of regulation, but such was the change in all strata of public sentiment that the President's plan finally won and on September 26th, 1914, the new Federal Trade Commission law was approved. It provides a body of five members appointed by the President and Senate for seven years, each with a salary of $10,000. The other central feature of the law is the provision in Section 5 "That unfair methods of competition in commerce are hereby declared unlawful." The Commission is directed to prevent persons, partnerships, or corporations from using unfair methods of competition in commerce, excepting banks and common carriers. Somewhat like the Commerce body the Trade Commission is authorized to ascertain any unfair methods of competition, and to serve notice upon parties complained of that there is reason to believe that such unfair practices have been used. Thereupon the parties accused may appear and a formal hearing is held, at the end of which an order is issued by the Commission upon those concerned. This sweeping power is subject to review in the Federal Courts upon the appeal of any party to whom the order is directed. The Commission itself may also appeal to such courts to secure the enforcement of its orders. In order to expedite procedure the appeals in both cases are taken direct to a Circuit Court of Appeals, thereby skipping the lower or district courts and eliminating much delay. The Circuit Courts of Appeals are required to give precedence to such cases. A review of the court's decrees may be made by the Federal Supreme Court. Facts found by the Commission, if supported by testimony, are conclusive, that is, they are binding upon the court. If new evidence is produced at the court proceedings the court suspends action and refers the evidence to the Commission.

The Circuit Court of Appeals, after its hearing, issues a decree to enforce, set aside, or modify the orders of the Commission. Section 5 declares that no order of the Commission or judgment of the court enforcing the order, relieves or absolves any person or corporation from its liability under the Anti-Trust Act. That is, the rules and orders of the Commission do not supersede the Sherman Act. The new law does however provide that where the government is commencing a suit in equity against a corporation under 1 Commerce is defined in the sense of territorial, interstate and foreign trade.

the Anti-Trust Act,—that is, where the Attorney General is seeking an injunction to dissolve an illegal combination under the Sherman law, the court before which the suit is held may ask the Trade Commission to work out a solution of the whole problem and may embody the Commission's recommendations in the court decree. Further Powers of the Trade Commission.-The Commission also has power to gather, compile and publish information on the organization, business management, practices, etc., of any corporation engaged in national trade (excepting banks and common carriers), and its relation to other corporations or individuals. It may require corporations so engaged to file annual and special reports or answers to questions under oath.

It may on its own initiative, or on the application of the Attorney General, investigate and report upon the manner in which a final court decree under the Anti-Trust Act, has been carried out and obeyed. In its decision it may publish this report.

When directed by the President or by either House of Congress, it investigates and reports on the facts relating to alleged violations of the Anti-Trust Acts.

Upon application of the Attorney General it may investigate and make recommendations for the re-adjustment of the business of any corporation alleged to be violating the Anti-Trust Acts in order that such corporation may thereafter manage its business in accordance with law. This significant power has been given to the Commission because of the large number of companies that were operating in violation of the Sherman Act who were anxious to bring their practices into conformity with the law. In many of these cases the Attorney General properly held that a reasonable adjustment or re-organization rather than a government prosecution would be the fairest and most equitable manner of enforcing the Act. The new provision just noted enables the Trade Commission to bend toward this object the expert service and experience which it may accumulate. In the records and personnel of the former Bureau of Corporations it possesses a valuable asset of this kind.

The Commission is authorized to classify corporations and make rules and regulations for the purpose of carrying out the new Act. It may also investigate trade conditions with foreign countries and ascertain the effect which foreign associations and combinations and trade practices have upon our foreign business, reporting to Congress its conclusions and recommendations. The law visits with heavy penalty any disclosure of information obtained by the Commission, except such which the Commission itself shall deem wise to publish. The purpose of this provision is to safeguard the business records and accounts of corporations from improper use by their competitors.

It will be noticed that the law gives to the new Commission some of the same general powers over commercial companies that the Interstate Commerce Act has given to the Commerce Commission

over railroads. The Trade Commission is not a merely investigating body with power to report, as was the Bureau of Corporations. The latter body is superseded by the Commission, and its powers and staff of employés have been taken over by the new authority. The Commission has full power not only to inquire and investigate but to issue orders which have all the force of law, and to provide rules and regulations both special and general, which shall carry out the great central principle on which the law is based, namely that unfair methods of commerce are prohibited. One of the serious difficulties which the new authority must face is the immense volume of work awaiting it. Undoubtedly a Commission of five members may find it difficult to hear, investigate and decide upon the great mass of problems affecting fairness of competition which are constantly arising. This, however, is not a defect in the principle upon which the law proceeds, but is rather a proof of the need for more extensive machinery to carry on the amount of work to be done. One feature of the law is especially notable and praiseworthy, viz., Congress has not attempted to regulate any detail of the minute questions of commercial competition but has contented itself with fixing one fundamental principle, and has authorized the Commission to translate this principle into rules, regulations, orders and decisions in the particular cases that may come before it. It is precisely this elasticity and adaptability that we have seen were most needed in our past regulations of the trust problem.

The Clayton Act.-The latest step in our regulative policy was taken in the passage of the Clayton Act, October 15th, 1914. This important measure has three objects.-First: To put the injured party or plaintiff who is seeking redress under the anti-trust laws in a stronger legal position, and make it easier for him to prosecute his suit. Second: To define more clearly certain abuses, discriminations, and restraints of trade, which had become common in trade relations, and to forbid these, or to empower the Trade Commission to suppress them. Third: The original bill covering these two purposes was supplemented by the efforts of organized labor so as to include a revision of the methods of granting injunctions in labor cases, and especially to legalize the boycott in labor disputes. These three separate objects were originally embodied in three distinct bills but in order to hasten congressional action the leaders in Congress decided to combine them in a single measure.

First: The Legal Position of the Injured Competitor Under the Anti-trust Acts.-Under the Sherman Act as interpreted by the courts a business concern which had been injured by an illegal combination must sue for damages in that Federal district in which the combination was incorporated, or "was found." This involved heavy expense of prosecution at a distance, the transportation of witnesses, the interruption of their business and private affairs, and accordingly a material weakening of the plaintiff's case. It explains in part why so few private suitors were successful under the Sher