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 of many of the most successful and most skilfully managed combinations.

1. The form of combination which has ordinarily been first adopted has been some kind of agreement with reference to maintaining prices, or to paying wages, or to dividing the territory for the distribution of the product or similar questions. Experience has shown that, generally speaking, such agreements are not likely to be kept in good faith for a long period.

2. In order to make the combination more permanent in its nature, the form of the trust, technically so called, was adopted. Under this form of combination, the stockholders of the various constituent companies of the trust place their stock in the hands of a small board of trustees, giving to these trustees an irrevocable power of attorney to vote the stock as they see fit, or in accordance with specific instructions given at the beginning. The title to the stock itself remains in the original holder, with the right to sell or pledge or dispose of it as he sees fit, but without the power of recalling his right to vote. In return for this stock thus deposited with the trustees, the trustees have ordinarily issued trust certificates, which are in themselves negotiable and take the place of the stock. Inasmuch as the holding of the voting power of the majority of the stock of each of the different constituent companies gave to the trustees absolute power of election of directors, and consequently the power of guiding harmoniously the affairs of all of the plant entering into the combination regardless of the will of the stockholders, the United States courts held that the corporations entering into such an agreement had gone beyond their powers, and that such a trust was illegal. Owing chiefly to these hostile decisions of the courts, this form of trust was abandoned, and new forms, which still, however, leave the power of unified direction in the hands of a few men, were adopted.

3. After the trusts were declared illegal, it was usual, when a combination was formed, to organize a new corporation which bought all of the properties of the constituent members of the trust. These constituent companies then dissolved, and the one great corporation owning all of the properties remained.

4. The form that now seems to be much in favour approaches in its general nature more closely to that of the original trust. Under this form a corporation is organized for the special purpose of buying and owning all, or a controlling share, of the stocks of each one of the constituent companies. The separate companies are then managed technically independently, the dividends of the separate corporations are all paid to the parent corporation as the stockholder owning all of the stocks, and these dividends are the source of profits of the new corporation. The officers in this parent corporation, of course, vote the stocks of the separate companies, and thus absolutely control.

From the savings which it is possible for the combinations to make, it would seem possible for them to pay higher rates of wages to those remaining in their employment and Wages. than it was possible for the constituent companies to do. In certain instances, especially when the combination has first been made, wages have been increased.

On the whole, however, it is probable that as yet the wage-earners have succeeded in getting an increase of wages in circumstances substantially similar to those under which their wages would be increased by single corporations. An increase of wages comes only through pressure on their part. Under a prosperous condition of industry it is possible, without materially lowering profits, to increase the wages.

Certain classes of employes, especially superintendents and commercial travellers, are less needed by the combinations, and consequently the total sum of wages paid to these classes by the combination is less than that formerly paid by the constituent companies. On the other hand, the number of employes of these classes being less than before, the average wage has, in certain cases at least, been increased. Owing to the fact that competitive selling is in certain cases largely done away with, it has in some, perhaps in many, cases been possible for fewer travelling salesmen, of less skill and with lower wages, to do the work than before the combination, so that not merely has the total expense been lessened, but also the average salary paid to those retained in the business.

In case of disputes arising between the combination and the operatives, the position of the combination is stronger than that of an individual corporation. It is possible to close one or two works where troubles have arisen, and to transfer orders to the other works without any material injury to the business, provided the closing of the one or two establishments is not for too long a period. Such instances have occurred. On the other hand, labour organizations are also rapidly increasing in strength, and their leaders are of the opinion that within a comparatively short time they will be so thoroughly organized in all of the chief industries that a strike can be instituted and supported not merely in one or two establishments, but throughout the entire industry. Whenever this condition of affairs shall have been reached, the employes will be substantially on an equality with their employers in such cases of conflict, so that the advantage now resting with the combination will be largely removed. In certain industries this condition seems already to have been reached.

From the sources of savings that were enumerated before, it is evident that it would be possible for a combination either to increase the prices paid for raw materials, or to lower the prices of its finished products. Experience, however, seems to show beyond question that whenever the combinations are powerful enough to secure a monopolistic control it has usually been the policy to increase the prices above those which obtained during the period of competition preceding the formation of the combination. Inasmuch, however, as an attempt to increase prices to any great extent, so as to secure very high profits, would certainly result in tempting new capital into the field, it has been the general experience that prices have either been increased only comparatively little after the combination was formed, or else that competition entering the field has comparatively soon forced a lowering of prices to substantially the former competitive rates. It should be noted, however, that inasmuch as combinations have very frequently been formed only after a period of competition so fierce that practically all the competitors were running at a loss, it is hardly just to speak of a combination placing its prices above “competitive rates” unless one defines what is meant exactly by that expression. Whenever they have put their prices above the competitive rates existing just before the combination, it may mean that they have put their prices back to rates that will allow medium profits instead of losses, and not above rates that would be normal in the case of small competitors.

It will have been noted from what has been said that the excellences of the combination consist largely in the savings that have already been enumerated. The evils are: (1) The losses to investors through the acts of the promoters and financiers at the time of the organization of the combinations, and through the speculation in the

stocks which is at times carried on by the directors of the combinations themselves. (2) The losses to the wage-earners from the power that sometimes exists of forcing wages rather lower than it would be possible for a single corporation or manufacturer to do, and also from the discharge of certain classes of employés whose services are no longer needed, such as commercial travellers. It should be remarked of the latter case, however, that the injury is a personal one to those men that are discharged, but that it results in a saving to the community, and, therefore, presumably to the wage-earning class as a whole in the long run. (3) A further injury at times to the consumer arises, as has been suggested, from the increase in price. Other evils come through the power that is sometimes exercised by combinations in the corruption of legislatures; in the control over industries of such a nature that it tends to destroy the spirit of individual activity and independence on the part of many persons who would otherwise enter business independently; and evils also come through the increased force of any improper or dishonourable business practices, since this added force for evil