On April 14 a report of the Special Committee of the Chamber on Trust Legislation was submitted to a referendum vote which, under the by-laws, will close on May 29. This first report of the Committee was entirely devoted to a discussion of the usefulness of an interstate trade commission and its functions.

On May 12 and 13 the Committee met in New York City and considered other subjects included in the program which the President outlined in his address of January 20, 1914. All members of the Committee except Mr. Rhett and Dr. Van Hise were in attendance. At the end of the sessions the Committee formulated a second report upon subjects which were not considered in its earlier report. On May 19, the Board of Directors received the report and ordered that it be submitted to a referendum vote. The full text of the report and the text of bills to which the report makes considerable reference are printed in this pamphlet.

The resolution under which the Special Committee on Trust Legislation acts was adopted at the Second Annual Meeting of the Chamber in February, 1914, and reads as follows:

"WHEREAS, Congress is now calling upon the business interests of the Country for an expression of their views on legislation recently proposed relative to the Sherman Act, the Board has authorized and directed the President of the Chamber to at once appoint a Special Committee of not less than seven to study and analyze all bills, tentative or actual, which may be obtainable, and to prepare a referendum to the membership of this body on the principles of the subject matter involved;

"Now be it Resolved that this Convention heartily approves such action and that such referendum be taken and further that this Convention wishes to express to Congress its desire to cooperate to the fullest extent in securing from the business interests of this Country a full expression of constructive opinion on the principles of the subject matter in question;

Be it Further Resolved that the result of such referendum be promptly reported to the proper Committees of Congress, and

"Be it Further Resolved that said Committees be furnished with copies of this resolution.”

The Committee appointed under this resolution consists of two economists, two lawyers, and two business managers, with a member of the Board of Directors of the Chamber as Chairman. The members are

R. G. RHETT, Charleston, S. C., Chairman,
CHARLES R. VAN HISE, Madison, Wis.,
W. L. SAUNDERS, New York, N. Y.,
HENRY R. SEAGER, New York, N. Y.,
Guy E. TRIPP, New York, N. Y.,

GEORGE RUBLEE, Washington, D. C. Legislation concerning monopolies and restraints on trade was the main subject of discussion at the Second Annual Meeting of the Chamber, February, 11-13, 1914. The speeches made in the course of the discussion were printed in The Nation's Business of February 16 and subsequently sent in pamphlet form to each organization member.




WASHINGTON, D. C., May 13, 1914.

To the Board of Directors of the Chamber of Commerce

of the United States :

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The proposal to create an interstate trade commission with functions which are largely characteristic of an interstate corporation commission was the subject of a report of this committee submitted under date of March 31, 1914, and at present before the organization members of the Chamber for a referendum vote. At the end of the earlier report the committee explained that it withheld expression of opinion about proposals other than those for an interstate trade commission until it became more evident what concrete suggestions for legislation would actually go before Congress for consideration.

As a bill referring to other matters than a trade commission has now been deported from committee in the House and is upon the calendar and ready for immediate consideration, and as a bill of somewhat similar scope has reached the final stages of discussion in a committee of the Senate, your committee presents this report upon its conclusions regarding the principles involved in these specific proposals for legislation, making reference to the text of the bills in so far as is necessary for purposes of illustration and clarity. The bilis may be amended. For that reason the committee has not attempted to make critical analyses.

In the House bill, H. R. 15657, the subjects involved take a wide range. The bill is not, however, an “omnibus” bill in its proposals for legislation regarding “trusts”; a separate bill deals with the proposal for an interstate trade commission. First taking up the subject of unfair business practices the House bill makes definitions and fixes penalties in connection with discriminations in prices; regarding discrimination among applicants to purchase commodities in the one instance of mine products; and concerning sales or leases of goods and merchandise accompanied by contracts which control the freedom of the purchaser or lessee. The House bill also regulates corporations engaged in competitive businesses, having provisions with reference to interlocking of officers and directors and corporate ownership of stock. Other provisions concern the use of decrees obtained by the Government in suits under the antitrust laws, the existence of labor unions under the antitrust laws, the issue of injunctions in Federal courts, and the procedure to be used in trials for contempt in Federal courts. The text of the House bill is printed at page 18.

The Senate bill, S. 4160, is in fact an "omnibus” bill, touching all “trust” questions upon which the Senate Committee on Interstate Commerce thinks there should now be legislation. After providing for an interstate trade commission, the bill proceeds to regulate corporations, except banks, that engage in or affect commerce which Congress has power to regulate. The provisions seek to prevent for the future issues of watered stock by any such business corporations and as to corporations engaged in competition relate to interlocking of directors or officers and corporate ownership of stock. There is also a separate provision relating to railroads and other businesses with which they deal. The text of the bill is

Senate bill

Subject of the President's


General attitude of com


printed in this pamphlet at page 24, and under each part of this report the provisions of the House and Senate bills are set out.

The bills have been drafted, it is under: tood, for the purpose of following suggestions offered by the President in the address which he made on January 20, 1914, before the two Houses of Congress and in which he said that he spoke upon the subject of trusts and monopolies. In the course of the address the President expressed a purpose to ask legislation which would not interfere with business as enlightened men prefer to do it. Perhaps because of the difficulties inherent in the choice of language with the preciseness necessary for legislation the bills in question appear to exceed the purposes of the President and to affect the whole structure of American industry and business.

Your committee cannot commend all of the pending proposals In so far as the provisions of the bills relate to monopolies they will cause doubts about the applicability of the Sherman Act in situations to which the relation of the Sherman Act has now been made definite by a long series of decisions. It is not to the public interest that business and industry whether of large or of small degree should have for years to await new judicial determinations of tests of legality. New doubts of legality in business conduct which of itself is morally indifferent would inevitably follow enactment of pending proposals expressed in terms of specific definition. Any policy of legislation by definition once entered upon will involve an endless succession of new legislative definitions and a puzzling complexity of statutes.

Your committee believes that any legislation on the subject of business practices should, so far as possible, be erpressed in terms of principles only.

Having given the general attitude of the committee, we now discuss the several proposals for legislation and make our separate recommendations.

Point of view of committee


President's statement

Apparently having in mind unfair business practices which come under the prohibitions of the Sherman Act, the President said, in his address of January 20,

“The business of the country awaits also, has long awaited and has suffered because it could not obtain, further and more explicit legislative definition of the policy and meaning of the existing antitrust law. Nothing hampers business like uncertainty. Nothing daunts or discourages it like the necessity to take chances, to run the risk of falling under the condemnation of the law before it can make sure just what the law is. Surely we are sufficiently familiar with the actual processes and methods of monopoly and of the many hurtful restraints of trade to make definition possible, at any rate up to the limits of what experience has disclosed. These practices, being now abundantly disclosed, can be explicitly and item hy item forbidden by statute in such terms as will practically eliminate uncertainty, the law itself and the penalty being made equally plain."

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House bill

The practice which is first forbidden by the House bill is discrimination in prices for any reason other than considerations of quality, quantity, and cost of transportation and for the purpose of "destroying or wrongfully injuring” the business of a competitor. The penalties are those of the Sherman Act.

The Senate bill does not propose new legislation on this subject.

See page 18

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