the word "Trust," as expressed in the title, are included especially those organizations of capital which have been called "capitalistic monopolies." Neither railroads nor telegraphs nor other public service corporations are especially considered; but, in general, Trusts are taken to mean manufacturing corporations with so great capital and power that they are at least thought by the public to have become a menace to their welfare, and to have, temporarily at least, considerable monopolistic power.

An effort has been made to explain these Trusts, and not to rest content with calling them the product of evolution, and assuming that, therefore, they are both inevitable and in the long run helpful rather than harmful. In a letter written but a few days before his death, Gen. Francis A. Walker, commenting upon this fatalistic attitude of some of his friends who were satisfied to call Trusts the product of evolution, remarked that he supposed the modern train robber was merely a normal development of the old-fashioned, commonplace highwayman, and continued: "Some evolution is worthy of only condemnation; some evolutionists ought to be hanged." With that view of economic evolution, as something requiring further explanation before being either approved or condemned, the book has been written. But it is also believed that sufficient data have now been accumulated and experience has been long enough so that in this edition positive conclusions can be reached regarding the economic principles that apply and regarding legislation that is probably wise. The authors have, therefore, written with more conviction on many phases of the problem than in earlier editions.

The first two or three chapters, which discuss the modern business conditions leading to the formation of combinations, necessarily show their favorable side and the evils of the competitive system most strongly; later chapters, depicting their methods of work and their effects, show most clearly the evil in them.

It is hoped that the prejudices which are common to all have not prevented a reasonable degree of fairness in seeing and depicting both sides of this question, the good as well as the evil. While it is probable that the book has been written chiefly from the viewpoint of the economist, it has been the intention not to ignore that of the publicist and of the citizen, who think of the practical as well as the desirable in legislation, and who keep in mind the social and moral as well as the business welfare of the people.

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CHAPTER I

THE EVOLUTION OF BUSINESS

HIS is a factory-made age. Its leading tendency is toward concentration and the power-driven machinery of the factory best accounts for this

tendency.

That concentration is characteristic of modern life is in evidence:

1. In the widening of national sovereignties. Since 1750 three great world empires have been built and the land area of the whole world has been gravitating toward control by a few nations. The present war seems likely to strengthen this movement while changing its method.

2. In the growth of national wealth. By official estimate the wealth of the United States, exclusive of Alaska and the island possessions, grew from seven billion dollars in 1850 to one hundred and eighty-seven billion dollars in 1912.

3. In the growth of national populations. The new world populations have grown almost magically. The population of the United States multiplied by twenty-three between 1790 and 1910, and that of Canada has increased twenty-nine times since 1800. Even among the nations of Europe population increase has been notable since the factory came. The populations of England and of Russia have multiplied by four in the past hundred years. The population of the coun

try included in the German Empire at the beginning of the war had increased nearly five-fold in less than a century.

4. In the growth of cities. Some of the western nations have become practically urban and all of them tend that way. The United States, young among the nations and of large area, had only about three per cent. of its population urban in 1800, whereas the census for 1909 records more than forty-six per cent. of the population as urban and five of the states as being more than seventy-five per cent. urban.

5. Among wage earners. In 1800 they were competing individuals. To-day, though still competing, they are massed in effectively organized armies, millions under each of several banners.

6. In the world of capital control. In the middle of the eighteenth century capital was scattered in hand tools and in village shops. To-day mechanized industries have combined and integrated until the concentrated capital of single business enterprises surpasses the whole wealth of most kingdoms prior to 1750.

All these phases of the modern world's concentration have come from the great industrial inventions of the eighteenth century.

Inventors and discoverers have always played leading rôles in the drama of human evolution. Eric and his hardy crew futilely attempted to establish colonies on this Western continent some six centuries before any permanent colony was established. Those six centuries gave Europeans movable type, the compass, and gunpowder. Many seventeenth century colonists were induced to undertake their journey and were sustained during pioneering hardships by the prospect

of worshipping according to their interpretation of the Book. Their voyage was lined by the compass and by means of it supplies and recruiting bands could reach them. Once landed, their deadlier weapons prevailed over the hostile natives. Thus permanent colonization of the new world, impossible in the days of bold Eric the Red, was actually accomplished after three great inventions had equipped man with needful means of communication, of better sea travel and of conquest over even valiant savages.

Just as these three inventions were fundamentally important in evolving modern from medieval life, so the series of eighteenth century inventions which gave us power-driven machinery made their fundamental contributions. The factories they made possible largely increased production and therefore rapidly increased the wealth of nations. These factories compelled many workers to live near them and industrial cities grew. These industrial cities produced factory-made goods in high surplus above their own needs for such goods. To provide raw materials for these factories and food for the workers, and to dispose of the surplus factory products, nations developed transportation by land and by sea, searched for foreign markets and established new colonies. The widening of national sovereignties resulted. Both the rapid increase of national wealth and the establishment of new colonies stimulated the increase of population. The wage earners in the growing industrial cities were called to their work and were freed from it at common times. Associating in large numbers all day at their work, coming and going in groups, they talked of the growing