deal was restricted where the nature and character of the dealing was such as to engender the presumption of intent to bring about at least one of the injuries which result from monopoly, that is, an undue enhancement of price.1

Later, in discussing the facts of the case, the Chief Justice decided that the change which had taken place through the acquisition of the stocks of the other corporations by the New Jersey corporation,

when analyzed in the light of the proof, we think, establishes that the result of enlarging the capital stock of the New Jersey company and giving it the vast power to which we have referred produced its normal consequence, that is, it gave to the corporation, despite enormous dividends and despite the dropping out of certain corporations enumerated in the decree of the court below, an enlarged and more perfect sway and control over the trade and commerce in petroleum and its products 2

This sentence indicates that not only was the object of raising prices considered to be sought by combinations, but also the acquisition of power. The power thus gained was later explained as being used to destroy" the potentiality of competition" which otherwise would have existed. This reason for the formation of the corporation is further shown in the summary of its acts, "solely as an aid for discovering intent and purpose." By acts which" necessarily involved the intent to drive others from the field and to exclude them from their right to trade and thus accomplish the mastery which was the end in view," the reason was revealed. The desire to gain control of the industry, and thereby affect prices, was then held to be one of the reasons for forming a combination.

1 221 U. S. 54.

2221 U. S. 71.

The government policy, we must conclude, has been steadfast in its imputation of anti-social motives for the formation of combinations. The acquisition of power, the driving of competitors from the field, and the raising of prices, have been the sole motives recognized by it. No where does its attitude show any acknowledgment of such benefits as the increase of efficiency, the lowering of costs, and the escape from a ruinous competition. If these have ever been reasons in the formation of combinations, their legitimacy has never been considered.1

The policy in regard to the condemnation of certain acts or of monopolies as such 2

It is well-nigh impossible to determine whether Congress

1 President Taft, in a special message to Congress on January 7, 1910 [H. R. Doc., 408, 61st Cong., 1st sess.], gave his opinion of the causes for combinations. These were, first, the possibilities of great economies; second, the reduction of excessive competition by a union of competitors, and third, the possibility of securing a monopoly and completely controlling prices. This, opinion, however, is interesting only as coming from the President; it cannot be said to have dictated the policy of the government.

One other possible cause, which has received considerable attention in Congress, is the connection of trusts and the tariff. This has never played a part in determining the policy of the government, but has rather been a point of dispute in party politics; since the Republicans have steadfastly denied all connection between them, and have been practically continuously in power since 1890, it is clear that the government policy has followed this view.

2 The exact nature of this inquiry seems to require rather more explanation. The same act may have different results as it is performed under different conditions. For instance, price-cutting under conditions of competition between two fairly-balanced competitors, is of social benefit; but price-cutting by a powerful combination, which ruins all competitors and establishes-a monopoly, is a social evil. This inquiry is directed to the ascertainment of the fact whether the policy of the government has been to regard certain acts as in themselves evil, or whether it has condemned monopolies regardless of their acts or of their social consequences.

had in mind the effect of particular acts, or whether they wished to put a stop to monopoly as such; if the questions had been put in concrete form at that time, there are few data to enable the student to decide how Congress would have answered them. On the whole, however, the purpose of Congress seems to have been to prevent monopoly as such. Certain acts were of course associated with monopoly, and the effort was made to prohibit it more specifically by enumerating these acts. But the keynote of the law was the cessation of monopoly.

1

This intention may be traced back to Senator Sherman's first bill; it was clearly aimed at anything which might obstruct competition, without reference to particular acts. The hope of the author was for liberal interpretation by the courts, to carry out the spirit of the bill in preventing monopoly. The main objections to this proposal were based on its probable unconstitutionality; and the acceptance of the Reagan substitute seems to show that certain acts were the objects of attack; but a more careful analysis shows that this enumeration was supposed to include all the evils of which combinations were capable, and that this more definite form carried out the original idea.

In its final form the bill was couched in terms which seemed to insure the return of competition; by its all-inclusive wording, no aspect of monopoly whatsoever appeared to escape the ban. The words "or otherwise" made possible the inclusion of any kind of combination which might appear to the court to be harmful; complete freedom of interpretation was permitted.

But the Court was not prepared to accept this view at once. It was more simple and logical, to consider monopoly due to certain acts, than to construe the results of those

acts. In the Knight case, this view was distinctly held. The entire effect of the combination, which was a monopolization of the manufacture of sugar, was held secondary to the particular acts of the corporation in the acquisition of that monopoly. These acts were considered legal, and consequently the whole combination was considered legal.

Shortly after, however, the combination began to be considered more as a whole. This was first shown in the Joint Traffic Association case. The Court at this time did not consider the specific acts of the Association, although it admitted that these were reasonable. But it condemned the very existence of so vast and powerful a combination.

It is the combination of these large and powerful corporations, covering vast sections of territory and influencing trade throughout the whole extent thereof, and acting as one body in all the matters over which the combination extends, that constitutes the alleged evil, and in regard to which, so far as the combination operates upon and restrains interstate commerce, Congress has power to legislate and prohibit.1

And again in the Addyston case, the Court dismissed as unimportant the question whether the prices charged were reasonable or not, concluding that "its tendency was certainly to give defendants the power to charge unreasonable prices, had they chosen to do so." 2

However, in the Connolly case, the Court again turned to the specific acts, to the exclusion of general tendencies. Here it examined merely the contract of sale for certain sewer pipes. This contract, considered by itself, it held to be legal, even though the contract of combination were illegal. The single act of sale was of importance; the validity of the combination was another question. In the language of the Court:

1171 U. S. 571.

' 175 U. S. 238.

It is sufficient to say that the action which it [the Sherman law] authorizes must be a direct one, and the damages claimed cannot be set-off in these actions based upon special contracts for the sale of pipe that have no direct connection with the alleged arrangement or combination between companies. Such damages cannot be said, as matter of law, to have directly grown out of that arrangement or combination, and are besides, unliquidated.1

Hereafter, however, the doctrine of the unity of all the separate parts was clearly enunciated in every case. Again and again, the Court refused to regard single acts by themselves, and insisted on viewing the combination as a whole.

In the case of Montague v. Lowry, the Court refused to consider the sale of unset tiles in California as a transaction wholly within the state (which, viewed narrowly, it was), but insisted that this was but a part of the entire scheme. The plan, and not the sales in California, were the determining features.2

The point was further developed in the Northern Securi

1 184 U. S. 552.

193 U. S. 45, 46. “It is urged that the sale of unset tiles, provided for in the seventh section of the by-laws, is a transaction wholly within the state of California and is not in any event a violation of the act of Congress which applies only to commerce between the states. The provision as to this sale is but a part of the agreement, and it is so united with the rest as to be incapable of separation without at the same time altering the general purpose of the agreement. The whole agreement is to be construed as one piece, in which the manufacturers are parties as well as the San Francisco dealers, and the refusal to sell on the part of the manufacturers is connected with and a part of the scheme which includes the enhancement of the price of unset tiles by the San Francisco dealers. The whole thing is so bound together that when looked at as a whole the sale of unset tiles ceases to be a mere transaction in the state of California, and becomes part of a purpose which, when carried out, amounts to and is a contract or combination in restraint of interstate trade or commerce."