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corporation presses its demands upon the public authorities with persistence and usually with success. Its defeats are but temporary checks. Its victories are permanent conquests. Every public grant to it at once becomes a vested contract whose obligation may not be impaired even to correct a public wrong
Thus it appears that the private corporation, a creature of positive law, the sole justification of whose being is the public need, has been permitted to invade and largely to possess the field of personal enterprise; that we have all but lost sight of the reason for its being and allowed its multiplication without restraint for any and every purpose with no thought of the public welfare but only of the desire of its promoters; and that we have raised it above the law where it may dispute even public authority, thereby giving it a tremendous advantage over individual competitors.
It seems all but incredible that State governments which are merely representative of individuals possessing the franchise almost all of whom are engaged in industry and trade, should have permitted the private corporation-a mere creature of law,-not only to enter into every field of personal enterprise there to compete on unequal terms with the individual citizens, but to wage against them a war of extermination. It šeems even more incredible that a government which is itself but the agent of free men should surrender to these impersonal creatures of law some portion of its own merely delegated authority, thus arming them with some of the powers of the State itself. The situation calls for a reexamination of the action through which these results have been reached. The time has come to consider whether constitutional guaranties intended for the protection of the individual have not been perverted to the service of the private corporation. We may well inquire whether the State and its creatures exist for the service of the citizens or to minister to the monopoly corporations, whether the welfare of all the people shall give way to
EDWIN BURRITT SMITH.
the personal interest of a privileged few. We may rest assured that the case is not closed in favor of vested rights whose vesting rests merely upon old interpretations of general constitutional provisions. We have, perhaps, come to regard the term “vested rights” as too inclusive and made it also to cover what Washington Gladden bas well characterized “vested wrongs." The question seems to be fairly presented whether Mr. Lincoln's vision of a government of the people, by the people, for the people, shall give place to a government of the monopoly corporation, by the monopoly corporation, for the monopoly corporation's stockholders.
It is not intended by what has thus far been said to prejudge the final issue between the public and the monopoly corporation. It is, however, assumed that the public welfare, whatever it shall prove to be, is paramount; and that all other interests, however worthy or important, are but secondary. We have thus far but stated in general outline the relative positions of the contending forces. This is neither the time
. nor place to discuss the economic questions involved between them, even if the writer had any peculiar qualification for such a discussion. It is proposed here to consider what may be a done about the monopoly corporation, leaving it for the economist to say what ought to be done within the limits of what may be done. For the reason that the arbitrary methods of despotism cannot become the practice of democracy, we can not assume that what ought to be done may be done under a constitutional government.
The monopoly corporation is a development. Some believe it to be a natural growth; while others regard it as an abnormal product of our commercial and legal conditions. Mr. Aldace F. Walker, in his recent article on “Anti-Trust Legislation," announces his conclusion that it is the direct consequence of such legislation. He states the situation as he sees it thus:
"Men have been driven by some power higher than the law to find a legal method of accomplishing a given result
which legislators have endeavored to prevent; the method devised is one which they would have preferred not to employ; its adoption has been compelled, because all other methods were made illegal.
"What, then, is the commercial force that has driven business men to this position? The answer is easy, when the subject is broadly viewed. Laws can not subdue the natural
. effort to overcome the violence of excessive competition."The Forum, May, 1899, p. 262.
Thus in the view of one of our ablest and most experienced observers, who believes that we have placed too much reliance on competition and that it is not now the life but the death of trade, excessive competition has finally led to excessive combination.
It is true that the competition which it has so long been the policy of the law to preserve as the very life of trade, has under modern conditions become a veritable war of extermination between unequal forces. Far different were the conditions from which sprang the common law with its anathema of illegality against agreements for the creation of monopolies and in re. straint of trade. The early cases dealt with merely local competition, the competitors acting usually in the same locality, under like conditions and upon relatively equal terms. Then followed the great abuse known as patents for monopolies. This abuse culminated in the reign of Elizabeth in numerous grants of patents for monopolies by the queen to her servants and courtiers, who usually assigned them to others and thus enabled them to raise prices and place almost incredible restraints upon industry and commerce. Of these grants Hume says:
"It is astonishing to consider the number and importance of those commodities which were thus assigned over to patentees. Currants, salt, iron, powder, cards, calf-skins, fells, pouldavies, ox shin-bones, train oil, lists of cloth, pot es, anise seeds, vinegar, seacoals, steel, aqua-vitae, brushes, pots, bottles, saltpetre, lead, accidences, oil, calamine stone, oil of blubber, glasses, paper, starch, tin, sulphur, new
EDWIN BURRITT SMITH.
drapery, dried pilchards, transportation of iron ordnance, of beer, of horn, of leather, importation of Spanish wool, of Irish yarn; these are but a part of the commodities which had been appropriated to monopolists. When this list was read in the House, a member cried, 'Is not bread in the number?' ‘Bread!' said every one with astonishment. 'Yes, I assure you,' he replied; 'if affairs go on at this rate, we shall have bread reduced to a monopoly before next parliament.' These monopolists were so exorbitant in their demands that in some places they raised the price of salt from sixteen pence a bushel to fourteen or fifteen shillings. Such high profits naturally begat intruders upon their commerce; and in order to secure themselves against encroachments, the patentees were armed with high and arbitrary powers from the Council, by which they were enabled to oppress the people at pleasure, and to exact money from such as they thought proper to accuse of interfering with their patent. The patentees of saltpetre, having the power of entering into every house, and of committing what havoc they pleased in stables, cellars, or wherever they suspected saltpetre might be gathered, commonly extorted money from those who desired to free themselves from this damage or trouble. And while all domestic intercourse was thus restrained, lest any scope should remain for industry, almost every species of foreign commerce was confined to exclusive companies, who bought and sold at any price that they themselves thought proper to offer or exact.”
(4 History of England, Harper's ed., 335-336).
It will be noted that Queen Elizabeth's monopolies were, due allowance being made for difference of conditions, no mean rivals of our monopoly corporations. Hers held patents from the Crown; ours hold charter contracts with the State. The former shared the royal prerogative; the latter share the delegated powers of a democracy.
The legality of the patents for monopolies did not long remain unquestioned. In 1682, in the great case of Darcy v. Allen, 11 Coke 84, the court pronounced them void. The plaintiff, who was groom of the privy chamber to Queen Elizabeth, brought suit for infringement of a patent giving him "the whole trade, traffic and merchandise
“, of all playing cards” and the manufacture thereof “within this realm.” It was declared in support of the grant that the queen, "intending that her subjects being able
to exercise husbandry, should applying themselves thereunto, and that they should not employ themselves in making playing cards, which had not been any ancient natural occupation within this realm, and that by making such a multitude of cards, card playing was become more frequent, and especially among servants and apprentices, and poor artificers; and to the end that her subjects might employ themselves to more lawful and necessary trades, by her letters of patent under the great seal” granted to the plaintiff "full power, license and authority, by himself, his servants, factors and deputies, to provide and buy in any parts beyond the seas, all such playing cards as he thought good, and to import them into this realm;" and also to have the exclusive right of manufacture and trade as above stated.
The court, however, waived the opportunity to strike a blow at excessive card playing and declared the grant void for these reasons:
(1.) All trades, as well mechanical as others, which prevent idleness (the bane of the Commonwealth), and exercise men and youth in labor, for the maintenance of themselves and their families, and for the increase of their substance, to serve the queen when occasion shall require, are profitable for the Commonwealth; and therefore the grant to the plaintiff to have the sole making of them is against the common law, and the benefit and liberty of the subject.
"(2.) The sole trade of any mechanical artifice, or any other monopoly, is not only a damage and prejudice to those who exercise the same trade, but also to all other subjects; for the end of all these monopolies is for the private gain of the patentees.
"(3.) The queen was deceived in her grant; for the queen, as by the preamble appears, intended it to be for the weal public, and it will be employed for the private gain of the patentee, and for the prejudice of the weal public.