Robert H. Jackson Center

Anti-Trust Legislation Seen Necessary

New Jersey Law Journal
February 3, 1938
61 N.J.L.J. 37 (1938)
c. 1938 ALM Properties, Inc.
Reprinted with permission

Anti-Trust Legislation Seen Necessary

By Robert H. Jackson
Assistant Attorney General of the United States

Monopoly as a social and economic problem is a hardy perennial in American political life. It is difficult of treatment because the very business we may wish to foster and encourage today may become the monopoly of tomorrow. It is a more real problem today than ever before. Hand in hand with the growth of business on a nation-wide scale to an extent undreamed of half a century ago, the concentration of economic power and control over industry had been intensified to a degree unknown to past generations. The competitive system, dear to American hearts, has in many fields practically vanished. For competition to exist, there must be rivalry between numerous concerns, of approximately equal strength, seeking to win the trade of customers by offering better goods and services at lower prices.

But bankruptcy and merger have reduced the number of firms doing business, and among those that remain the rigors of competition have been relaxed by practices such as common financial control, basing points, sharing the market, price leadership and other mechanism of artificial price control.

Most industries today are in the grip of one or a few large corporations which dominate the market. With the growth of the nation the extent of the monopolies which engross its business had expanded.

But although the social and economic phases of the problem of monopoly have increased in magnitude, the legal problem remains much that same as it has always been. The same landmarks of the law stalk the stage. In anti-trust litigation today lawyers cite the same cases, interpreting the same language of the same statues, as did jurists of an earlier day. The weapons now available for curbing the giant corporations which dominate the nation’s economic life are, for the most part, no stronger or keener that those of 1890.

In fact, the basic anti-trust laws are weaker instruments than they were originally, because of enfeebling interpretations which they had received at the hands of the courts.

Moreover, the policy expressed in anti-trust legislation has been in many respects undermined by the effect of legislative action dealing with other matters.

The Sherman act was a product of the progressive movement originating among the discontented western farmers which six years later led to the nomination of Bryan and the subsequent election of Theodore Roosevelt. The latter’s efforts to enforce the Sherman act were nullified by the “rule of reason” decision of the Supreme Court in the Standard Oil case.

In addition to decisions unwarrantedly limiting the scope of the anti-trust laws, the courts have created confusion and uncertainty in the application of those laws by handing down conflicting and ambiguous adjudications interpreting them. As a result, it is practically impossible for a lawyer to determine what business conduct will be pronounced lawful or unlawful by the courts. This state of affairs is equally embarrassing to businessmen endeavoring to obey the law and to Government officials attempting to enforce it. The confusion which prevails in the field of resale price maintenance and with respect to the legality of various types of loose combinations or trade associations is typical and illustrative.

So the Government today finds itself faced with the same perennial problem of curbing monopoly. The social and economic phases of the problem have waxed in importance. The legal problem has become has become more difficult because the legal weapons have been weakened, while the strength of the adversary against which they are to be directed had been magnified.

The anti-trust laws ought to keep pace with changing business conditions. Hence, the enactment of new legislation, definite and specific in its terms, in keeping with the needs of present day conditions is to be desired.