856 THE AMERICAN JOURNAL OF SOCIOLOGY
class itself. " Give us an advance in wages, and charge it to the public," is often the demand, tacitly or openly expressed, of union men in the employ of the trusts. It is often to the advantage of a monopoly to share its spoils with its employees.
Would trade-unionists, then, consent to the plan of sweeping away the whole system of private industry, and putting everybody into the employment of the state, which would have to treat them all alike? Favored trades would lose by such a democratic leveling. The government could pay high wages for short hours in a few trades, since, if they were run at a loss, it could collect the deficit by imposing new taxes, or by raising prices ; but only by making industries phenomenally productive could the state give large pay to everybody ; and with the " go-easy " plan of labor which a government would be forced to adopt, he would be a sanguine man indeed who would expect such an increase of pro- ductivity. Such an ultra-democratic program as socialism proposes may not be expected to appeal strongly to those whom monopoly gains have raised above the common level of immigrant and unskilled, or at least unorganized laborers.
Thus the ultimate triumph of socialism is less to be apprehended, in view of this analysis of the situation, than are certain immediate evils involved in the rule of monopoly, which a wise treatment may be expected to remove. JOHN BATES CLARK, in Political Science Quarterly, December, 1903.
E. B. W.
The American Trust. Although agriculture is still the leading branch of industry in America, both in point of capital invested and the number of persons engaged, yet the enormous growth of large businesses engaged in manufacture and transportation has marked that country as pre-eminently the home of capital- ism proper. The chief significance of this fact lies in the direction which capital- istic enterprise has taken ; it is the common goods and services required by all that are controlled by powerful trusts and combinations.
The prime economic facts and forces which account for the growth of the trust are the control of natural sources of supply, the tariff, franchises and patent laws, and, finally, the power exercised by gigantic established businesses to repress incipient competition of outside capital.
The railroad system is the first of two distinctive features which mark America as the stronghold of unrestrained capitalism. It is the railroads, more than the tariff, which, in point of fact, have been " the mother of trusts." With their intimate connection with extractive and manufacturing processes, in which their influence is often all-powerful, and their rapid concentration into a few large units, they form the true center of gravity in the economic system of America.
The second distinctive characteristic is the domination of the financier over industry. Whether a banker who has entered industry, or an industrial magnate who has moved into the wider world of finance, it is he who forms and reforms corporations, holds, speculates in, and manipulates stocks and shares, and wields the greatest financial influence in the history of the world.
Although the number of capitalists, or investors, is increasing, the control, and probably the ownership, of the bulk of capital is passing into fewer hands ; for the great financiers are becoming to a larger extent than before permanent owners of large portions of the more profitable businesses which they finance.
The attitude of the American people toward the trust is a characteristic one ; if some sort of semblance of competition, of fair wages and fair treatment, and of moderate prices prevails, the general temper seems to favor a policy of laissez faire. It is only by some acute situation, such as the recent coal strike, that America is brought up suddenly against the essential inefficiency of her federal constitution; for the radical difficulty consists in the fact that the great majority of the trusts are not directly amenable to federal legislation or administrative control. The theory on which the present administration is working seems to be that the stretching of the constitutional power " to regulate commerce .... among the several states " so as to include compulsory disclosure of accounts, prevention of railroad discrimination, and of predatory competition, will be suffi- cient to obviate the dangers to which the country is exposed by the existence of
