rosa: regulation of natural monopolies 221 



much better to have strong state commissions, well equipped with 

 technical assistants, than to have separate commissions for each 

 city. And with the co-operation of other states and the federal 

 government, any state commission can establish its work with 

 only a fraction of the effort and expense required by those states 

 that have pioneered the movement.^ 



Turning now to the great industrial and financial corporations 

 popularly called trusts, the question suggests itself whether it is 

 possible for the government to regulate them in a manner similar 

 to the regulation of the natural monopolies we have been discuss- 

 ing, so that full publicity may be secured, the rights of the public 

 may be conserved, and at the same time the rank and file of the 

 stockholders will be protected from the vultures that often hover 

 over the executive offices of such concerns. One cannot say that 

 it will be done as easily, but it is coming to be believed that the 

 general method adopted in the regulation of public utilities is the 

 right one, namely, less dependence on law and the courts, and more 

 dependence on engineers, statisticians and business experts; that 

 the government should prescribe affirmative duties for the giant 

 corporations, and not merely negative ones; that a constructive 

 policy that would benefit both the business concerns and the pub- 

 lic they serve should be sought, rather than a retrograde policy 

 that is no benefit to the business and does no good to the public. 

 If such regulation could be realized, and consolidations and 

 promotions in business could be limited to such as would benefit 

 both the public and the stockholders, and not merely big finan- 

 ciers and promoters, it would be a notable achievement in our 

 political as well as economic history. It would assist mightily 

 in the peaceful settlement of industrial disputes and in the bring- 

 ing of a better understanding between capital and labor. 



It is just as reasonable to expect the government to perform 

 this function of regulation of monopolies as to expect it to adjust 

 international disputes by arbitration rather than by war. It 

 is not socialistic, but rather the reverse, for it is the alternative of 

 state ownership. In Germany the cities are great Imsiness 



3 Writing in 1908, Professor Ely said: "States having commissions empowered to 

 enforce uniform accounting will constitute great economic laboratories in this 

 connection during the next quarter of a century." 



