24 BULLETIN 102, VOL. 1, UITITED STATES NATIONAL MUSEUM. 



Coal can not be mined effectively under the present system. The 

 nature of the resource demands integration. Only by the grace of 

 lavish coal wealth has the United States this long borne the incubus 

 of competition in coal mining. So much is easily recognized, but 

 the means whereby integration may be attained are less apparent. 

 The most practicable path leads toward the enlargement of the 

 public utilities conception to embrace coal. 



We may define a public utility as a necessity which does not lend 

 itseK to competition. In such a category fall gas, water, and elec- 

 tricity, the telephone service and traction systems of municipalities. 

 In the case of these necessities, public regulation is substituted for 

 the restraining influence of a competition that has been found 

 inexpedient. Gk)al is a necessity which does not lend itself to com- 

 petitive mining. 



In anthracite is found an interesting spokesman of this principle. 

 The anthracite industry began with many competing units, but the 

 smaUness of the field made combination easy and led to the merging 

 of the rival interests in a unified organization. The purpose of the 

 combination, judged by the results, was twofold; to raise the price 

 of anthracite and to increase the efl&ciency of mining. The disad- 

 vantages of the first was commonly recognized, but not the advantages 

 of the second, which were equally significant. Through its monop- 

 olistic control of a recognized necessity, the combine years ago 

 became a matter of public concern and the Government faced two 

 alternatives in meeting the problem thereby raised — it could either 

 recognize a combination in restraint of trade, and order its disinte- 

 gration; or else accept the combination as a procedure essential to 

 the proper handhng of the resource, and impose suitable restrictions 

 on the basis that the activity had become automatically a public 

 utility. The first procedure was adopted and the combine was dis- 

 solved in so far as its legal existence was concerned; but at bottom 

 the combination persisted, because it was inherent in the nature of 

 anthracite development and could not be legislated out of existence.* 

 The alternative chosen by the Government was impossible of execu- 

 tion. It is open knowledge that the anthracite companies to-day 

 operate in concert and fix prices by circular announcements at rates 

 suitable for the effective operation of both high-cost and low-cost 

 mines. As a result, anthracite is mined efficiently in spite of laws 

 opposing the means to that end. 



The bituminous industry deals with a necessity that is lending 

 itself less and less to competitive production. Competition is incom- 



» Writes F. W. Taussig, in a different connection: "The large outstanding fact is the collapse of competi- 

 tive industry. Combination and monopoly are the inevitable result of the machine processes and large- 

 scale production. Legislation can not prevent monopoly. ... " Principles of Economics, New York, 

 1911, p. 442. 



