Senator NEWLANDS. But, as I understand it, the Supreme Court in the Tobacco case and in the Standard Oil case was simply rendering the judgment that would be rendered in an English court of common law under similar circumstances, was it not?

Mr. VINSON. I understand that.

Senator NEWLANDS. Therefore its action in this case is entirely consistent with its declaration, is it not, that the Sherman law is simply declaratory of the common law?

Mr. VINSON. I do not think so. I think that the application of the court's decree, its injunction, goes to the point of not only preserving, but protecting and requiring absolute and enforced competition. I understand that is the effect of the decree.

Senator NEWLANDS. The purpose of my inquiry-I shall not carry it any further-is to draw your mind to the question as to whether the States themselves can not cover a great deal of this ground; whether the wisest course to pursue is not to have the States legislate regarding State commerce and have the Nation legislate regarding interstate commerce, and then to bring the regulating tribunals of each sovereignty into cooperation through mutual conference, instead of absolutely merging all the powers of the State, police powers and other powers, in the powers of the United States through the exercise of the interstate-commerce power, and thus practically permitting the National Government to absorb all the functions of the State with reference to these vast businesses and occupations which cover almost every field of effort.

I do not care to pursue the matter any further.

The CHAIRMAN. Do you desire to answer that?

Mr. VINSON. Well, I can only say, Senator, that that particular phase of this whole question is comparatively new to me, and I am sorry that I did not get the benefit of your suggestions or statements before along that line. I can say, generally speaking, that I have come to this conclusion-I may be wrong about it; I do not mean to say that I am-but it seems to me that modern industry and commerce of this country must, to a certain extent, and I may say very largely, really obliterate State lines.

Senator CUMMINS. I would like to keep history a little straight, if possible, because we are really discussing the whole matter now. Senator Newlands has asked the witness if the Supreme Court has not declared that the antitrust law was simply declaratory of the common law. I understand the Supreme Court has said that the antitrust law, construed as it now construes it, is declaratory of the common law. That is to say, if I may put this in the form of a question, at the common law a contract or agreement in unreasonable restraint of trade was invalid; it was not, however, criminal. Mr. VINSON. That is right, Senator.

Senator CUMMINS. Nor could the Government at common law take any steps toward absolving or setting aside such an agreement. Mr. VINSON. The parties could not specifically enforce it.

Senator CUMMINS. What the Supreme Court means, therefore, when it says it is declaratory of the common law, is that a contract at the common law in unreasonable restraint of trade could not be enforced by either of the parties to it in any court; but that does not mean that at the same operation at the common law or under the

common law that it is under the antitrust law, which makes what was then invalid a crime. You perceive that difference, of course. I think that is the whole distinction-that the antitrust law gives to the Government the power to bring its suit to enjoin these agreements that are in unreasonable restraint of trade. No such power existed at common law. Therefore it does not help us very much simply to have the Supreme Court to say that the present antitrust law was found in the common law. I want to have the record show that difference that I perceive between the antitrust law and the common law on this subject.

Mr. VINSON. As you state, Senator, I understand it to be that way. That is my opinion, my own judgment, my understanding of the common law.

The CHAIRMAN. Has any other Senator any questions to ask? If not, Mr. Vinson will be excused.

(The bill and brief submitted by Mr. Vinson are as follows:)

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled:

SECTION 1. That the provisions of this act shall apply to all persons, firms, and corporations engaged in the business of mining coal and selling the same for shipment into States and Territories and foreign countries other than such States and Territories wherein said coal is mined.

SEC. 2. That a commission is hereby created and established, to be known as United States Mining Commission, which shall be composed of five commissioners skilled in the business of mining and selling coal, to be appointed by the President, with the advice and consent of the Senate.

The commissioners first appointed under this act shall continue in office for the term of four, five, six, seven, and eight years, respectively, from the first day of June, nineteen hundred and twelve, the term of each to be designated by the President, but their successors shall be appointed for terms of eight years, except that any person chosen to fill a vacancy shall be appointed only for the unexpired term of the commissioner whom he shall succeed. Any commissioner may be removed by the President for inefficiency, neglect of duty, or malfeasance in office. Not more than three of the commissioners shall be appointed from the same political party. Said commissioners shall not engage in any other business, vocation, or employment. No vacation in the commission shall impair the right of the remaining commissioners to exercise all the powers of the commission.

The commission is hereby authorized and required to execute and enforce the provisions of this act. And upon the request of the commission it shall be the duty of any district attorney of the United States to whom the commission may apply to institute in the proper court and to prosecute under the direction of the Attorney General of the United States all necessary proceedings for the enforcement of the provisions of this act; and the costs and expenses of such prosecution shall be paid out of the funds hereinafter provided for. And for the purposes of this act the commission shall have power to require by subpœna the attendance and testimony of witnesses and the production of all books, papers, contracts, agreements, and documents relating to any matter which said commission may have under investigation. Such attendance of witnesses and the production of such documentary evidence may be required from any place in the United States at any designated place of hearing. And in case of disobedience to a subpoena the commission or any party to a proceeding before the commission may invoke the aid of any court of the United States in requiring the attendance and testimony of witnesses and the production of books, papers, and documents under the provisions hereof.

And any district court of the United States within the jurisdiction of which such inquiry is carried on may, in case of contumacy or refusal to obey a subpœna issued under the provisions of this act, issue an order requiring such person or company to appear before said commission and produce books and papers, if so ordered, and give evidence touching the matter in question; and any failure to obey such order of the court may be punished by such court as a contempt thereof. The claim that any such testimony or evidence may tend

to criminate the person giving such evidence shall not excuse such witness from testifying; but such evidence or testimony shall not be used against such person on the trial of any criminal proceeding. The commission may take any testimony in open session, or order testimony to be taken by deposition, in any proceeding or investigation pending before it. Such depositions may be taken under such rules and regulations as the commission may prescribe. Reasonable notice, however, must be given to parties interested of the time and place of taking said evidence or said testimony. Any person may be compelled to appear and depose and produce documentary evidence in the same manner as witnesses may be compelled to appear and testify and produce documentary evidence before the commission.

Every person deposing as herein provided shall be sworn (or affirm if he so requires) to testify the whole truth. His testimony shall be reduced to writing by the officer taking the deposition, or under his direction, and shall, after it has been reduced to writing, be subscribed by the deponent, unless the deponent's signature be waived.

Witnesses whose depositions are taken pursuant to this act and the official taking of the same shall severally be entitled to the same fees as are paid for like services in the courts of the United States.

SEC. 3. That the commission shall prescribe such rules and regulations for the enforcement of this act, and all the provisions thereof, as in its judgment are expedient. A majority of the commission shall constitute a quorum for the transaction of business, but no commissioner shall participate in any hearing or matter in which he has any pecuniary interest. Said commission may from time to time make or amend such general rules or orders as may be requisite for the regulation of the matters coming before it.

Every vote and official act of the commission shall be entered of record. Said commission shall have an official seal, which shall be judicially noticed. Either of the members of the commission may administer oaths and affirmations and sign subpœnaes.

SEC. 4. That each commissioner shall receive an annual salary of ten thousand dollars, payable monthly.

The commission shall appoint a secretary and treasurer and such other attorneys, agents, representatives, and employees as may be necessary for the proper enforcement of this act; and the said commission shall fix a compensation for each and all of said employees, which shall be paid monthly.

Until otherwise provided by law the commission may hire suitable offices for its use and shall have authority to procure all necessary office supplies. Witnesses summoned before the commission shall be paid the same fees and mileage that are paid witnesses in the courts of the United States.

The general offices of the commission shall be located in the city of Washington; but the commission may provide offices and establish stations at other places whenever the same shall expedite the business of said commission.

All salaries and expenses of the commission, its attorneys, agents, and employees shall be paid by the treasurer upon orders from the commission.

SEC. 5. That the commission shall, on or before the first day of December in each year, make a report, which shall be transmitted to Congress, and copies of which shall be distributed as are other reports transmitted to Congress. This report shall contain such information and data collec'ed by the commission as may be considered of value in the distribution of questions arising under the provisions of this act, together with such recommendations as to additional legislation relating thereto and as the commission may deem necessary, and the names and compensation of the persons employed by said commission, as well as a statement showing the sums of money paid to the commission and the dibursement thereof, and the sums of money paid into the miners' relief fund and the disbursement thereof.

TRADE AGREEMENTS.

SEC. 6. The commission is hereby authorized and directed to sanction trade agreements between competitors engaged in interstate trade or commerce providing for a joint selling or purchasing agency, or to supply each other with any of the means or methods of carrying on their business, or for the purchase or sale of their plants, or parts thereof, or property used in conducting their business, whenever in the judgment of such commission such trade agree ments will not unreasonable restrict or limit competition, nor raise prices beyond what may be justified by the supply and demand, nor authorize competitors

making such trade agreements to engage in unfair methods of competition against other competitors not parties thereto. A joint application shall be presented to the commission filing therewith a copy of the proposed agreement signed by all the parties thereto. The form and requirements of such application shall be prescribed by the commission. Upon such application the commission shall make such investigation and hear such evidence as they may deem pertinent and shall approve said agreement unless it shall appear to them from the facts submitted that said agreement will result in an unreasonable restraint of interstate trade and commerce, or otherwise violate the provisions of this act. When the commission approves any such agreement the same shall be deemed a lawful contract or agreement in any court of the United States.

SEC. 7. The commission is hereby authorized and directed to prescribe and enforce rules and regulations to secure the safety and health of the employees engaged in and about coal mines, and also rules and regulations to prevent waste and conserve unmined coal and all the provisions of law now existing for the investigation of mine explosions created by act of Congress on the day of, nineteen hundred and and shall be under the jurisdiction of

and enforced by the commission.

SEC. 8. The commission shall require each owner or operator of a mine subject to the provisions of this act to file a report with the commission on or before the fifteenth day of each month showing the quantity of coal mined the preceding month, as well as requiring a report of all accidents of every character to be made immediately after such accident has occurred. Such reports shall be made in the manner and upon blanks or forms to be prescribed and furnished by the commission and to be verified by the person directed to make such report.

RELIEF FUND.

SEC. 9. Every owner and operator of a mine shall pay to the treasurer of the commission one cent per ton on all the coal so mined, and one per centum to be deducted from the pay roll of all its employees. The sum so collected shall be a miners' relief fund, and at all times under the direction and control of the commission.

Whenever any person while employed by any such owner or operator in and about his mines shall be injured from any cause, the commission shall cause an investigation to be made of the extent and permanency of said injury, and shall pay to the person so injured, out of the miners' relief fund, such sum as will be a reasonable compensation for such injury. If the injury results in death, then the commission shall pay such sum out of the miners' relief fund as will be a reasonable compensation therefor, to the widow if there be one, and if no widow survives, then to the personal representative of such deceased person. The payments herein provided shall in no case exceed five thousand dollars. The payments to be made under the provisions of this section shall be in such sums and at such times as the commission may determine in each

case.

No person injured, nor the widow, heirs, or personal representatives of a person killed, while employed in and around a mining operation, shall bring or maintain any action or suit for damages, by reason of such injury or death, against any owner or operator of such mine.

The provisions of this section shall be carried out and enforced by appropriate rules and regulations to be prescribed by the commission.

SEC. 10. The commission is authorized to issue any lawful orders that may be necessary to enable them to properly perform their duty under the provisions of this act, and may enforce obedience to such orders by mandamus injunction, or other appropriate writ, by a proceeding instituted in the name of the commission in any court of the United States having jurisdiction of the parties.

CONDITION OF BITUMINOUS-COAL TRADE.

The bituminous-coal trade is in such a deplorable condition as a whole that unless immediate relief is given disaster and great loss are sure to follow. Competition has driven this commodity into the markets at ruinous prices, resulting in a total net loss for the year 1910 of more than $17,000,000. West Virginia sold her coal last year for 95 cents per ton, composed of the very highest grade of coal that goes to market. The average sale price through the whole

country for 1910 was $1.11 per ton. The actual cost of producing this coal was $1.07 per ton, excluding interest and depreciation for the coal mined and exhausted. The item of depreciation will amount to 4 cents per ton, while the interest on the investment of $585,000,000 is $35,100,000, at 6 per cent. The selling price of coal has remained stationary for the last six years, being $1.10 in 1904 and $1.11 in 1910, with an extreme fluctuation of only 8 cents, while the cost of producing the coal has increased 9 cents a ton during that period.

The mines are only operated about 200 working days in a year, owing to their capacity being fully 50 per cent more than the consumption. This excess capacity has been largely brought about in recent years by the construction of very large individual plants equipped with the latest and best appliances for producing the greatest quantity with the least cost. For many reasons these newer mines can mine and sell their coal much cheaper than the older ones, and it is the mines that have been in operation for some time that are the greatest sufferers. It may be asked why is it that the mines losing money do not stop and cease their operations like any other business when it is running at a loss, and then start up again when conditions are such that they could reasonably expect to make some profit? There are several answers to this question: (1) In all leases the operator is required to pay a minimum royalty of $5 to $8 per acre, whether he mines coal or not; (2) no property will decay and disintegrate so rapidly as an unused coal plant; (3) the fixed charges of taxes and interest must be paid at all events; and (4) in many cases the accumula tions of water in the mine must be kept constantly pumped out. Disbanding a working organization when once established is a serious detriment and requires many months to build it up again. Considering these inevitable losses when the mine stops entirely, the operator is confronted with the problem of whether he will lose less money by running than by closing down. This situation has existed for such a length of time that the operator has about reached the limit of his loses, no matter whether he closes his plant or tries to keep it alive. The consumers of bituminous coal in the United States pay less for their fuel than in any other country in the world. The other branches of industry in this country have been profiting at the expense of the bituminous-coal business, an the only possible way that this industry can protect itself from ruin is by combination, and they dare not combine as long as the antitrust law hangs over them with its threats to prosecute them criminally and dissolve their organization if they do combine.

You will probably find that the bituminous-coal trade is the best concrete example of one of the country's great industries being completely demoralized by the operation of the antitrust law. It will require but little investigation at your hands to convince you beyond a doubt that a very large majority of the companies engaged in coal mining have not only worked without profits for the last three or four years, but have actually operated their mines at a net loss. The competition between all the coal-producing concerns has been so acute that the larger concerns are surely driving their smaller adversaries into bankruptcy by reason of greater economies both in producing and selling their output. A company mining two or three million tons per annum has a tremendous advantage over its competitor producing only 100,000 tons. The large concern possesses the financial ability to

(1) Purchase and install the most modern machinery and labor-saving devices;

(2) It generates its own power at the lowest possible cost per ton, and

(3) Its auditing department and clerical force is not as expensive per ton of coal mined;

(4) It often owns its own cars, and

(5) Has its own selling agency, and

(6) Owns boats, barges, docks, elevators, depots, and storage grounds; (7) It eliminates the middleman, his expenses and profits;

(8) It can readily secure contracts from large consumers at better prices by reason of its ability to fill such contracts whenever required; and

(9) It has the ability to store its slack coal and hold it for a favorable market.

The large company will purchase and own in fee thirty or forty thousand acres of coal lands, and open its mines only after the plans of the most scientific engineering have been matured. Having the timber on its own property, it can construct and maintain its houses, tipples, and mine cars at the minimum of cost. Having to pay no royalties on leases, there is no fixed charge that it is compelled to meet. On the other hand, the small operator takes a