The Sherman antitrust law was enacted, which forbids all combinations and contracts in restraint of trade and monopoly. Similar laws were enacted by the states. Notwithstanding these laws, combination and cooperation continued; and a long series of suits have been brought by the Attorney General of the United States to enforce the Sherman law and dissolve unlawful trusts. But still cooperation existed everywhere, not by definite contracts, but by mutual understanding, so that in any given community the price for each standard commodity was the same. However, the representatives of the people did not surrender their faith that the remedy was to restore the freedom of trade; and in 1915 the Clayton antitrust act was passed, which attempted to bolster up the Sherman act by introducing the new restrictive principle that any combination which resulted in substantial lessening of competition was unlawful.
Thus antecedent to the war, so far as the control of production and distribution of commodities were concerned, we were mainly dependent upon the law of supply and demand with competition and upon repressive laws which should prevent cooperation and allow a free flow of trade.
Regulation Before the War
Regulation, however, had begun. It had become recognized that the public utilities occupied an exceptional position.
The Public Utilities.—All business and industry are so dependent upon transportation, and the public convenience was so interested in having good service without discrimination that, for the railroads and other public utilities, regulation had been adopted as a national policy through the enactment of the Interstate Commerce law and the various state public utilities laws. It is difficult to recall the bitter opposition which the proposal to regulate the public utilities aroused when it was first made. The owners of the stocks and bonds said the railroads were private property, in the control of which the public should have no part. These ideas bring a smile now; but the older men among us remember the fierce contest running through years, before it was established that the public had such an interest in the utilities as to require their regulation.
The Pure Food and Drug Acts.—At another point, it appeared that the laws of supply and demand and competition were not adequate to control commerce. It was the theory of those who held these doctrines in an extreme form that supply and demand and competition would result in securing quality, because poor goods or spurious goods could not compete with good materials. But, after the period of concentration came on, it was found as a matter of fact that food and drugs were extensively sold of inferior quality and even dangerous character under false names. After a prolonged contest, the pure food and drug laws were enacted by Congress and by the several states. The manufacturers of food and drugs denounced these regulatory measures as an interference with private business. It seems odd to us now that any one should consider it a right to sell a food or a drug under a false name. It seems even more strange that the right to sell diseased meats should be regarded as sacred. But this is so recent that probably all here remember the severe struggle to establish the principle that meat should be inspected and found wholesome before being placed upon the market.
During the contest for public control, those who advocated the regulation of the public utilities and foods and drugs were often denounced as socialists and were held up for opprobrium as being in favor of the
