Januabt 11, 1918] 



SCIENCE 



35 



meet Germany in world trade through the 

 individualistic method under the law of 

 supply and demand can not have the high- 

 est success. If we do not meet Germany's 

 competition by national organization as 

 efficient as her own, we may as well at 

 once concede that Germany will gain a 

 predominant position for those industries 

 for which she has adequate resources. 



Already this has been appreciated by 

 Congress; and there is now in conference 

 the Webb bill which, if enacted, will per- 

 mit cooperation in foreign trade. This bill 

 proposes to remove the handicap in selling 

 goods abroad; and thus is in the right 

 direction. It does not, however, permit 

 cooperation in production within the United 

 States; whereas such cooperation through 

 cartels is legal in Germany. This power- 

 ful advantage Germany will retain. But 

 if to meet this situation it be decided to 

 permit cooperation within the United 

 States, regulation is inevitable. If indus- 

 try and commerce are freed from the re- 

 straints and penalties of the antitrust laws, 

 there must be governmental agencies that 

 shall see that advantage is not taken of the 

 public in consequence of this fact. 



Continuance of Regulation required to meet 

 Needs of Allies 

 There is still another aspect of the ques- 

 tion of continuing regulation which re- 

 quires consideration. For a considerable 

 period after the war, the demand for food 

 and other essentials will be excessive. The 

 cereal production of Great Britain, France 

 and Italy has declined alarmingly during 

 the war, because of lack of fertilizers and 

 insufBcient labor. Their herds are greatly 

 depleted. These tendencies will continue 

 throughout the war, so that their agricul- 

 tural production will become even smaller. 

 It is probable that for a long time, possibly 

 for several j'ears, we may have an insuffi- 



cient surplus to even meet the legitimate 

 needs of our associates in war ; indeed it is 

 little short of certain that this will be true 

 for a number of commodities. 



Shall we revert to the law of supply and 

 demand under competition, and allow 

 goods to be exported in unlimited quanti- 

 ties and without preference 1 



I do not know the answer others will 

 make, but, for mj-self, it seems clear that 

 the necessities of the allies must be met not 

 only during the war, but for a sufBcient 

 period after the war so that their agricul- 

 ture and industries may be rehabilitated; 

 especially as such rehabilitation in Belgium, 

 northern France and Serbia, is largely 

 necessary because of ruthless and uneces- 

 sary destruction of property on a vast 

 scale by the Central Powers and because of 

 heavj' drafts upon their financial resources 

 wholly unwarranted by international law. 



If the country accepts the answer sug- 

 gested, it will require at the least that ex- 

 ports be controlled. Also if I am correct 

 in believing that the demands for essential 

 commodities after the close of the war will 

 exceed the supply, the control of prices 

 must continue, otherwise there will be 

 another period of runaway prices; and 

 with the present base from which it would 

 start, this is not to be considered. 



Continuance of Regulation will avoid Gov- 

 ernment Ownership 

 No thoughtful man can doubt, whether 

 or not he believes in the extension of regu- 

 lation, that great economic changes are 

 inevitable following the war. The growth 

 of the socialist group, heretofore mainly 

 confined to other countries, will expand in 

 the United States. Experiments on a gi- 

 gantic scale of public control and even pub- 

 lic operation of manufacture and commerce 

 have been made in European countries en- 

 gaged in the war and of less magnitude in 



