the Federal Government. As the court said, speaking through Mr. Justice Lamar, in Kidd v. Pearson (126 U. S., 22):

"No distinction is more popular to the common mind or more clearly expressed in economic and political literature than that between manufacture and commerce. Manufacture is transformation-the fashioning of raw materials into a change of form for use. The functions of commerce are different. The buying and selling and transportation incident thereto constitute commerce." The same statement applies to mining, lumbering, and agriculture.

If under its commercial power the Congress could charter corporations to mine, manufacture, and produce, then we should have Federal mines and Federal factories, Federal wheat farms, Federal cotton plantations, Federal truck gardens, and Federal poultry yards. These corporations could enter the States without their consent and acquire and hold their soil against their public policy and even against their prohibitory laws. And this is the reductio ad absurdum of the whole matter, because if there is any question beyond dispute it is that a State has absolute dominion over her own soil, and no part of it can be held or owned without her consent, except by the Federal Government, or its instrumentalities for public purposes, under its sovereign power of eminent domain. It will not be for a moment contended that under the fifth amendment or under any other power in the Constitution, express or implied, private property can be taken for a private business use. Therefore the creation of corporations by Congress under the exclusive and unlimited power to regulate commerce, and the giving of such corporations faculties which they can not exercise except with the consent of the States, expressed or implied, is an absurdity, because the essence of the right to exercise an unlimited and exclusive power is that it shall be exclusive and shall not depend in any respect upon the consent or be liable to the prohibitions of any other authority whatever. The barrier which marks the boundary of an exclusive power lies at that point where other powers, strong enough to eviscerate the object of its action, begin to operate. A Federal private business corporation, with the power to manufacture and produce, existing outside of the District of Columbia, or a Territory, or an insular possession of the United States, is therefore as complete a legal absurdity as the fabled creature, woman above and fish below, is a physiological absurdity. Risum teneatis amici?

The Supreme Court of the United States has said that court is not the harbor in which the people can find a refuge from ill-advised, unequal, and oppressive State legislation; nor ought the people of the States, who are justly proud of their independence and justly jealous of their right of self-government, to look to the Congress as such a harbor as iong as the remedial power lies with them. That the remedy for the corporation debauch from which the people of the States are now awakening lies in their own hands I have demonstrated, and it is only necessary that such remedy be worked out by them in that spirit of amity, fraternity, and consciousness of common interests and a common destiny without which the Republic can not endure.

The ACTING CHAIRMAN. The committee will take a recess until Monday morning at 10.30 o'clock, at which time the chairman is expected to be here.

(Thereupon, at 5 o'clock and 35 minutes p. m., the committee took a recess until Monday morning, January 8, 1912, at 10.30 o'clock a. m.)

The commitee met, pursuant to recess, at 10.30 o'clock a. m., for the purpose of further considering the bill (S. 2941) entitled "A bill to create an interstate trade commission, to define its powers and duties, and for other purposes," introduced by Mr. Newlands July 5, 1911. Present: Senators Clapp (chairman), Brandegee, and Newlands.

The CHAIRMAN. Several members of the committee have other engagements this morning, and if it is convenient to you gentlemen we will take a recess until to-morrow morning. I dislike to ask you gentlemen to remain over, but I think it would be better under the circumstances.

(The committee thereupon took a recess until to-morrow, January 9, 1912, at 10.30 o'clock a. m.)

TUESDAY, JANUARY 9, 1912.

UNITED STATES SENATE,

COMMITTEE ON INTERSTATE COMMERCE,

Washington, D. C.

The committee met, pursuant to recess, at 10.30 o'clock a. m., for the purpose of further considering the bill (S. 2941) entitled "A bill to create an interstate trade commission, to define its powers and duties, and for other purposes," introduced by Mr. Newlands July 5, 1911.

Present: Senators Clapp (chairman), Nixon, Cummins, Brandegee, Oliver, Lippitt, Townsend, Newlands, Watson, and Pomerene.

STATEMENT OF ALBERT H. WALKER, ATTORNEY AT LAW, NEW YORK CITY.

The CHAIRMAN. Mr. Walker, under the resolution, gentlemen who come before the committee are allowed to proceed and make such statements of their views as they desire without interruption, and afterwards they are interrogated by the committee. You may proceed.

Mr. WALKER. I have examined the reports of the hearings which have been held by this committee, beginning with the 15th of November, with great interest and instruction. I have not been able to read every word, because I think there are about a million words; but I would like to read the whole collection, for I do not know of any more instructive hearings that have ever occurred.

The resolution, as I remember it, authorized and directed this committee to inquire what changes were necessary or desirable in respect to the creation or control of corporations engaged in interstate commerce, or in respect of individuals or partnerships engaged in interstate commerce.

I do not remember that much has been said relevant to the control of those who are engaged in transportation of commodities without change of ownership.. I do not think that much has been said in respect to the interstate-commerce law of 1887, or the amendments of that law of 1889 and 1893, or in respect to the Elkins law of 1903, or the Hepburn Act of 1906. The discussion has been directed almost entirely to the Sherman law, and, rather curiously, not much has been said about the Sherman law itself, but the discussion has been mostly directed to proposed changes in the Sherman law.

Now, when Congress is deliberating what changes to make in a particular statute, it is well for somebody to give a great deal of attention to the statute proposed to be changed.

I have been very much impressed, during several years of study of the Sherman law, with the general public ignorance of its terms. I never saw the Sherman law printed in but one daily paper. Several months ago I took pains to have copies made of the Sherman law from the statute book, and I sent a copy to each of the New York daily papers, and I wrote a letter to the editors, stating that I had never seen that statute printed in any daily paper, although it is so short that it would not occupy more than a column. And I suggested that perhaps the public would be interested in reading the language of this important statute; but only one of those papers used the copy that I sent. The Tribune printed it in full, and the others ignored it altogether.

I have talked with a good many different people and attorneys with respect to the Sherman law, and the fashionable thing to say is that it is vague and mysterious. "If we only knew what it means, we would, like good little boys, obey it, but we have no one to tell us what it means, and we can not find out ourselves."

It does not seem to occur to these people that jurisprudence is a science, and the practice of the law a profession, and that it happens a good many times in the course of human events that when a gentleman wants to know what the law is he consults a lawyer. But these business men who complain of the Sherman law as vague and uninstructive, and not a guide to them, do not take that risk, apparently; and I have shrewdly suspected that they fear that, if they do consult a lawyer, they will be told their conduct violates that law, and in order to avert that unpleasant information they avoid consulting counsel altogether.

Now I wish, in a few words, to give an account of the Sherman law as it exists to-day; and to base my statement upon its language and upon the constructions that have been placed upon it by the courts during the last twenty years, for I am acquainted with all the decisions that have ever been rendered.

The Sherman law itself is a model of draftsmanship. I have been reading and studying statutes a great many years, and it is the most scientific, artistic, and perfect statute I have ever read. The architect of that statute was George F. Edmunds, who built upon the foundation laid by John Sherman. I believe that never since the Civil War has there been, between the two oceans, any human being more competent to draw a statute than George F. Edmunds. I have had some correspondence with Mr. Edmunds during the past year in respect to that statute, and I know how he feels about it now, and I know the view he has taken of it from the first.

Now in that statute there never were but three words that required three minutes of consideration by competent attorneys in respect to their interpretation. When that statute was enacted and signed by President Harrison on July 2, 1890, there were but three words in it that required the slightest explanation. Those words were "restraint," "commerce," and "monopolize." The only question that could ever occur to any mind in respect to the significance of the word "commerce" is the question that was broached by Mr. Bland, of Missouri, in the House, as to whether the word "commerce" included the transportation of property without change of ownership and whether it included the railroad business, and in order to make sure on that point he introduced an amendment in the

House to the bill as it came from the Senate expressly providing that the bill should apply to common carriers. That amendment was adopted by the House, but afterwards in conference between the two Houses it was agreed that it was not necessary, and the amendment was omitted as the bill was finally enacted. And the bill was finally enacted in exactly the same words in which it was prepared by Senator Edmunds and reported by the Judiciary Committee of the Senate. And in the course of the explanations that were given on that bill at that time it was finally agreed on all sides that the word "commerce" includes transportation of merchandise without change of ownership, as well as the sale and purchase of commodities. So that whatever ambiguity resided in the word "commerce" was cleared away.

Now, in respect to the word "restraint." Senator Edmunds has written me lately that he did not intend to use any more definite expression than that. He did not then believe, and does not now believe, that it is practical in such a statute as that to define the conduct prohibited any more definitely than it is defined in the Sherman law. In a letter to me he stated that there is no more propriety in attempting to define the word "restraint" in the Sherman law than there would be to attempt to define the word "fraud" in the common law, or "duress," or any one of a large number of words that have been handed down to us from early times as indicative of conduct prohibited.

I believe it was Lord Holt who said he would never define the word "fraud," and that no court ought ever to attempt it, because he said the rascals are smarter than the courts, and they will go outside of any definition. And the word "fraud" has never been authoritatively defined, nor has the word "duress," and there are a large number of law words that have not been defined.

Now, the use of that word "restraint" in the first section of the Sherman law was adopted advisedly with a view of prohibiting conduct that is always wrong and leaving to the courts the decision of the judicial questions as to what conduct constitutes "restraint."

In respect to the word "monopolize," which occurs in the second section of the Sherman law, its significance was the subject of debate in the Senate at the time the Sherman law was finally passed by that body. Senator Kenna, of West Virginia, whose statue now stands in the old Hall of the House of Representatives, asked Senator Edmunds and Senator Hoar whether that word "monopolize" would cover the complete acquirement of a particular industry, or particu lar business, on account of superior merit, without any nonethical conduct on the part of the party who made the aquirement, and both of those Senators stated that in their judgment the word "monopolize" does not cover such complete acquirement.

Now it has occurred to me, as an illustration of what might be held to fall outside of this word "monopolize," to cite this case: Alvin Clark and his sons in Cambridge, Mass., have had for many years the sole business in this country of grinding lenses for large refracting telescopes. They have had no competition. They did not encroach upon any other man's rights; but this business came to them simply because they were the only people in this country who could grind those lenses perfectly, and nobody ever attempted to

compete with them. It was a complete acquirement of a particular business due to extraordinary skill.

Another illustration has occurred to me more recently, in Cleveland, Ohio, where the firm of Warner and Swayzey have, during the last quarter of a century, completely acquired the business of manufacturing mountings for great telescopes. Nobody could compete with them. Why? Because those gentlemen are adapted by nature and by acquirement to manufacturing those great telescopes such as the Lick and Yerkes telescopes, which are so perfect that no one else can compete with them at all.

Now it is very plain indeed that the word "monopolize" never was intended by Congress to cover that kind of complete acquirement of a particular industry. So, also, if anybody, otherwise than by the exercise of particular genius, acquires the entire control of a particular industry meritoriously and ethically, as Senator Hoar explained and Senator Edmunds explained, that complete acquirement does not come within the meaning of the word "monopolize" in the second section of the Sherman law. That is an active verb, and implies, in the law, the idea that only where a man does something nonethical to prevent other people from competing with him or throws some impediment in the way of those people who are trying to compete with him, he is a monopolizer.

Now those are the views that I hold with respect to the meaning of those three words, and since those three words are defined, every word in the Sherman law is as plain as noonday. Nothing can make it any plainer than reading it can.

I attended the arguments in the Sherman law cases last year at the Supreme Court, and heard every word that was said there. There were 11 speeches in the Standard Oil case and the American Tobacco case; and nobody there recommended the Supreme Court to qualify the word "restraint" by any such word as the word "unreasonable" or by any such word as the word "undue." None of the gentlemen present took any such ground as that the first section of the Sherman law should be read as if the word "undue" or the word "unreasonable" were implied before the word "restraint." In the opinions that were read by Chief Justice White in those cases he repeatedly inserted the word "undue" in that behalf, but he did not thus insert the word "unreasonable." In the dissenting opinion which he had delivered in the trans-Missouri case, 15 years before, he inserted the word "unreasonable" in his dissenting opinion, and insisted that the first section of the Sherman law should be construed as if Congress had inserted the word "unreasonable" before the word "restraint." That dissenting opinion was concurred in by four of the justices but overruled by five, so it has no force as a law.

When the Tobacco case was decided, Justice Harlan delivered his great dissenting opinion therein, and he commented upon the circumstance that 15 years before the Supreme Court expressly decided that the word "restraint" in the first section of the Sherman law is not subject to any such limitation, and that it was obiter dicta to insert that word in that place, and not only obiter dicta but contrary to what the court itself had decided 15 years before.

Now, my views on that subject are published in the American Law Review for September and October, and they are, in short, that all that is said in the Tobacco case and Standard Oil case relevant to