Show THE rills 4 il CAUSES OF THE PRESENT FINAN k I 1 CIAL conditions IS 18 MADE THE CHIEF TOPIC t y SUGGESTS REMEDIES FOR ILLS CONTROL OF corporations AND 1 9 RAILROADS TO PREVENT overcapitalization IT A bel eel eves this would solve the lem lern together with provision for more elastic currency becom i mends postal banks and asks for legislation along many lines washington dec dee 2 3 president roosevelt s annual message to congress la Is a voluminous document of 0 nearly so 30 words by tar far the longest mes sage he has ever submitted to congress the opening subject of the message is the financial cond tion of the country and tor for which the president lays much of the blame upon unscrupulous stock speculators and says in any large body of men however there are certain to be some who are dishonest and it if the cond eions are such that these men prosper or corn com mit their misdeeds with impunity their example is a very evil thing for the where these men are bus bust ness riess men of great sagacity and of 0 tern pe both unscrupulous and reck less and where the cond eions are such that they act without supervision or control and at first without effective check from public opinion they delu delude de many innocent people into making in vestments est ments or embarking in kinds of business that are really anso unsound u nd when the misdeeds of these success successful ful ay dishonest men are discovered suf fering comes not only upon them but upon the innocent men whom they have misled it is a painful awakening whenever it occurs and naturally W when hen it does occur those who suffer are apt to forget that the longer it was deferred the more painful it would be in the effort to punish the guilty it is loth both wise and proper to endeavor so far as possible to minimize the dis tress of those who have been misled by the guilty yet it Is not possible to refrain because of such distress from striving tr iving to put an end to the m that are the ultimate causes of the sut suf fering and ae as a means to this end where possible to punish those re tor for them there may ba be hon hen st differences of opinion as to many governmental policies but surely there can be no such differences as to the need of unflinching perseverance in the war against successful dishonesty he quotes at length from his mes age sage of last year in which he aavo bated federal control of corporations loang doing interstate business and believes that in such control would be found the remedy tor for overcapitalization and took stock speculation which he believes have brought about the present finan cial conditions he ile says our steady aim should be by legis legi s lation cautiously and carefully under taken but resolutely persevered in I 1 to assert the sovereignty of the national government by affirmative action this Is only in form an innovation jn in substance it Is merely a restoration for from the earliest time such regula tion of industrial activities has been recognized in the action of 0 the law making bodies and all that I 1 propose Is to meet the changed conditions in euch such manner as will prevent the corn com mon wealth abdicating the power it has always possessed not only in this coun try but also in england before and ince since this country became a separate nation federal control of railroads is favored revered no small part of the trouble that we have comes from carrying to an ex the national virtue of self re liance of independence in initiative and action it is wise to conserve this virtue and to provide tor for its fullest ex compatible with seeing that lib erty does not become a liberty to wrong others unfortunately this is the kind of liberty that the lack of all effective tive regulation inevitably breeds the founders of the constitution pro vided that the national government hould should have complete and sole control of interstate commerce there was tl en practically no interstate business eave save such as was conducted by wa water ter and this Ws the national government at once preceded proceeded to regulate in thorough going and effective fashion condi condl eions have now so wholly changed that the interstate commerce by water is in significant compared with the amount that goes by land and almost all big business concerns are now engaged in interstate commerce As a result it can be but partially and imperfectly controlled or regulated by the action of any one of the several states such ac tion inevitably tending to be either too drastic or else too lax and in either cage case ineffective for purposes of justice only the national government can in thoroughgoing fashion exercise the needed control this does not mean that there should be any extent extension ion of federal authority tor for such authority already exists under the constitution in amplest and most tar far reaching form but it does mean that there should be an extension of federal activity alis tl Is Is not advocating centralization it is merely looking facts in the face and realizing that centralization in business has already come and can not be avoid ed or undone and that the public at large can only protect itself from tain evil effects of this business cen by providing better methods for the exercise of control through the authority already centralized in the national government by the cons titu tion itself there must be no halt in the healthy constructive course of ac tion which this nation has elected to pursue and has steadily pursued dur ing the last six years as shown both in the legislation of the congress and the administration of the law by the de apartment part ment of justice the most vital need is in connection with the railroads As to these in my judgment t there here should now be either a national ancor po horation por atlon ration act or a law licensing railway companies to engage in interstate corn com merce upon certain conditions the law should be so framed as to give to the into inte tate late commerce commission power to p ss as upon the future issue of ties while ample means should be pro vided to enable the commission when ever in its judgment it Is necessary to make a physical valuation of any rail road As I 1 stated in my message to the congress a year ago railroads should be given power to enter into agree dents subject to these agreements be ing madu made public in min ite detail and to e 9 1 6 e the consent of the interstate commerce commission be being I 1 ng first obtained until the national government a assumes s proper control arol of interstate commerce in the exercise of the authority it al ready possesses it will be impossible either to give to or to get from the full justice the railroads and all oti oil er great corporations w 11 do well to recognize that this control must come the only question is as to what go ern mental body can most wisely exercise it the courts will de termine the limits within which the federal authority can exercise it and there will still remain ample work within each otate for the railway corn com mission of that state and the nat onal interstate commerce commission will work in harmo ly with the several state commissions each within its own brov ince to achieve the desired end control of interstate Inte rotate business Ilu lne concerns Con cerna urged moreover in my judgment there should be additional legislation looking to the proper control of the great business con cerns engaged in interstate business this control to be exercised for their own benefit and prosperity no less than tor for the protection of investors and of the general public As I 1 have repeatedly aid in messages to congress and else where exper ence I 1 as definitely shown not merely the but the futility of endeavoring to put a stop to all bus bust ness combinations modern industrial conditions are bucl that combination Is not only necessary but inevitable it is so in the world of bus ness just as it Is so in the world of labor and it is as idle to des re to put an end to all corpora eions to all big combinations of capital as to desire to put an end to coni bombina bina eions of labor corporation and labor union alike have cone ne to stay each if properly managed la Is a source of good and cot not evil whenever neNer in either there Is evil it sl be promptly held to ac count but it sl ol receive hearty en courage coura gement meat so long as it is properly managed it is profoundly immoral to put or keep on the statute books a law nominally in the interest of public moral ity that really puts a premium upon public immorality by undertaking to forbid honest men fro tron n doing what must be done under modern bus ness condl eions so that the law itself provides that its own infraction n be the condition precedent upon business success to aim at the accomplishment of too much ally means the accomplishment of too lit tie ile and often the doing of positive dam age the antitrust law should not be re pealed but it should be made both more efficient and more in harmony with act ual conditions it should be so amended as to forbid only the kind of comb nation which does harm to the general public such amendment to be accompanied by or to be an incident of a grant of su sory power to the government gov eminent over these big corporations engaged in inter state business th s should be accod by provision for the compulsory icat on of accounts and the tion of books and papers to the inspect tion of the government officials A be ginning has already been made for such supervision by the establishment of the bureau of corporations the antitrust law should not prohibit combinations that do no injustice to the public still less those the existence ot of chich Is on the whole of benefit to the public but even it if this feature of the law were abolished there would remain as an equally objectionable feature the difficulty and delay now incident to its enforcement the government must now submit to irksome and repeated delays before obtaining a final decision of the courts upon proceedings instituted and even a favorable decree may mean an empty victory moreover to attempt to control these corporations by lawsuits means to impose upon both the depart ment of justice and the courts an im poss ble burden it is not feasible to carry on more than a limited number ot of such suits such a law to be really effective must of course be administered by an ex executive body and not merely by means of lawsuits the design sho should be to prevent the abuses incident t to the crea tion of unhealthy and improper bombina eions instead of waiting until they are in existence and then attempting to de stroy them by civil or criminal proceed ings investing public should be amply safeguarded the congress has the power to charter corporations to engage in interstate and foreign commerce and a general law can be enacted under the provis ons of which existing corporations could take out fed eral charters and new federal corpora eions could be created an essential pro vision of such a law should be a method of predetermining by some federal board or commiss on whether the applicant for a federal charter was an association or combination within the restrictions of the federal law provision should also ba b mide made tor for complete publicity in all matters affecting the public and complete krotec tion to the investing public and the share holders in the matter of issuing corporate securities if an incorporation law Is not deemed advisable a license act for big interstate corporations might be enacted or a combination of the two might be tried the supervision established might be analogous to that now exercised over national banks at least the antitrust act should be supplemented by I 1 specific prohibitions of the methods which ex peri ence has shown have been of most service in enable ng monopolistic bombina eions to crush out competition the real owners of a corporation should be corn cona belled to do bus ness in the r own name the right to hold stock in other corpora eions should heare after be denied to inter state corporations rations unless on approval li bv the proper government officials and a prerequisite to such approval should be the listing with aith th the government of all owners and stockholders both by the corpora corporation t ion owning such stock and by the corporations in which such stock Is owned to confer upon the national govern ment in connection with the amendment I 1 advocate in the antitrust law power of s per pervasion vision over big business concerns engaged in interstate commerce would benefit them as it has benefited benefit the na lional banks in the recent bus ness crisis it is noteworthy that the eions which failed were institutions which were not under the su pervis on and control of the national government those which were under national con arol stood the test national control of the kind above ad vacated would be to the benefit of every well managed railway from the stand point of the public there is need for ad dit lonal ional tracks additional adit lonal ional terminals and improvement improvements in the actual h hand and ng of the railroads and all this as rapidly as possible ample sate safe and speedy trans por tation facilities are even more feces sary than cheap transportation there tore fore there Is need tor for the investment of money which will provide tor for all these things while at the same time securing as tas fas as Is possible better wages and shorter hours tor for their employed emp loyes there tore fore while there in st be just and rea regulation of rates we should be the first to protest against any arb arary and unthinking movement to cut them down without the fullest and most care ful consideration of all interests con berned and of the actual needs of the situation only a special body of men acting for the national government un der authority conferred upon it by the r congress Is competent to pass judgment on such a matter greater elasticity in currency in I 1 urged the president quotes extensively from his last message in dealing with the dl 4 i fads ia t 1 subject of currency leg slat 0 O and says bagain I 1 again urge on the congress th the need of dimmed ate attention to tl s matter we need a greater elasticity in 0 r cur rency provided of course that we lecog nize the e en greater need of a safe and secure cur currency there must alvais al vai s be tl e most rig d examination by the na lional authorities pron Is on shou d be made tor for an e ner gency currency the emergency issue should of course be made with an effect v e guaranty and up on conditions ca detully prescribed proscribed by br tl tle e government S ch emergency issue must be based on adequate securities approved bv the government and must be issued under a heavy tax il 1 is would permit c arency be ng issued wien w I 1 en the demand for it was urgent while securing its re ti rement as the demand tell fell off it Is worth investigating to ne whether officers and directors of national banks sho id ever be allowed to loan to them selves trust con banies should be sub eject to the same supervision as banks legislation to this effect should be en acted tor for the district of columbia and the terr tortes yet we must also remember that even the wisest legislation on the subject can only ac compi sh a certain amount no legislation can by any possibility guar antee the business community coni against the results of specula the e tolly folly any more than it can guarantee an india dual against the results of his extravagance extra acance athen hen an in mortgages his house to buy an auton obile he incites in ites disaster and when A hen wealthy men or n en who pose as such or are unscrupulously or foolishly eager to become such indulge in reckless spec ul lt on especially if it is accompanied by dishonest they jeopardize not only the r own future but the future of all their thelt in fellow citizens for they |