The Policy of Compulsory Competition If there is a contract obligation of the Holding Company, it is collateral to and independent of the proprietary interest of the holder of the stock. It is the proprietary interest and not the contract right that is exempt from taxa tion. If there is only the proprietary interest, there is nothing to guaranty, and the obligation of the railroad is inde pendent. Even if there is a non-taxable obligation of the Holding Company it is
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less in scope than the agreement of in demnity, and so that is not a guaranty, but an independent obligation to pay money. As such it is taxable in Massa chusetts. These considerations merely illustrate the uncertainties which are inevitable in the highly artificial forms which simple business operations are forced to assume under the existing system of taxation in Massachusetts.
The Policy of Compulsory Competition f I AHE past month has witnessed a A great amount of discussion of the Sherman Anti-trust Act, in terms for the most part distinctly unsympathetic with the Administration. Never before has the question been more widely dis cussed from the standpoint of the busi ness man rather than of the consumer or politician. The remarks of speakers before the Senate Committee on Inter state and Foreign Commerce, before the Academy of Political Science of New York, and before the New York Eco nomic Club, plainly show that public sentiment has already begun to move in a new direction. Mr. Roosevelt wrote an article in the Outlook of November 18, in which Presi dent Taft's name was not once men tioned, and in which he appeared to be mainly advocating the regulation of trusts by a commission, but the article was immediately construed throughout the country as an attack upon the TaftWickersham policy of administering the Sherman act. Mr. Roosevelt said : "The position now taken by the Gov ernment is absolutely destructive of legitimate business, because they out line no rule of conduct for business of
any magnitude. It is absurd to say that the courts can lay down such rules. The most the courts can do is to find as legal or illegal the particular trans actions brought before them. Hence, after years of tedious litigation, there would be no clear-cut rule for future action. This method of procedure is dealing with the device, not the result, and drives business to the elaboration of clever devices, each of which must be tested in the courts. . . . "The effort to restore competition as it was sixty years ago, and to trust for justice solely to this proposed restora tion of competition, is just as foolish as if we should go back to the flintlocks of Washington's Continentals, as a sub stitute for modern weapons of pre cision. The effort to prohibit all com binations, good or bad, is bound to fail, and ought to fail; when made, it merely means that some of the worst combina tions are not checked and that honest business is checked. Our purpose should be, not to strangle business as an inci dent of strangling combinations, but to regulate big corporations in thor oughgoing and effective fashion, so as to help legitimate business as an inci
