Reformers are often inclined to urge that the payments for railways, telegraphs, etc., should only be sufficient to duplicate the existing plant, and this generally means much less than the selling value of the plant. They make a serious mistake in taking this position. As a matter of policy, this course is not to be recommended, because it needlessly antagonizes such a large proportion of the population of the country. Those who are asked to part with their property at a price less than the market value will feel themselves aggrieved, and will oppose the reform in every way in their power. The plan proposed is also objectionable on the score of justice. The value which property of this kind has in excess of the cost of duplication of the plant is largely due to a public policy which has been approved by a majority, and a vast majority, of the people of the United States. A large capitalization, so far as it exceeds the actual value of the plant, very frequently represents only the waste due to attempted competition, and this attempted competition has been encouraged in every way, directly and indirectly, by the general public. Even when such is not. the case, the possibility of an excessively large income, which has brought about the large capitalization, has been due to a considerable extent to failures of the legislature to make proper laws, and of the other public authorities adequately to enforce existing laws. Now, if the property is appraised simply at the cost of duplication of the plant, it would make a portion of the community bear the entire burden of a false public policy, whereas, as the whole of the public is to blame, the burden should be diffused among the people as a whole. it is necessary to raise large sums to pay off the debt necessitated by the acquisition of enterprises of this

If

kind, it could be done through a wisely devised system of inheritance taxes.

When we consider the difficulties in the way of the socialization of natural monopolies, we must always remember what the alternative is. These difficulties are real, but the difficulties of the present system are even greater. Mention has already been made of many of these difficulties. We cannot expect to have private property well managed, if the managers are obliged to manage it, not as they like, but as somebody else dictates. To interfere at every turn with private management renders illusory the benefits of private ownership of the instruments of production. Moreover, in this attempted minute control, society is likely to be worsted. The special skill is necessarily on the side of those who are to be controlled, because this special skill is acquired by experience in the management of these private industries. The result is that the public authorities wage an unequal contest against private persons, who, in addition, are thereby rendered hostile to the state a most unfortunate condition of affairs.

CHAPTER IV.

THE SOCIALIZATION OF OTHER NATURAL MONOPOLIES, AND THE TREATMENT OF ARTIFICIAL MONOPOLIES.

NATURAL monoplies of the second class are those which become monopolies because the supply of raw materials, consisting of natural treasures, is so limited that it can all be acquired by a single combination of men. Anthracite coal has been cited as an illustration; other similar cases could be instanced. It is said that it has been possible to purchase practically the entire supply of some raw materials found among barbarous or semi-barbarous peoples; not so much, perhaps, on account of the limitation of the supply, as on account of the fact that it is easy to cheat them, and to buy a great supply at far less than its actual value. Wherever the supply of an article is so limited that it can all be secured by a single combination of men, making monopoly prices possible by limitation of the supply upon the market, the only adequate remedy would seem to be collective ownershipownership by the nation, commonwealth, or some local political unit.

A distinction must be made between the ownership of agricultural land upon which wealth is produced, and natural treasures which are found ready made, so to speak, mostly beneath the surface of the earth, so that all man has to do is to appropriate them. Private ownership is important with respect to agricultural land,

because it encourages production; but the natural treasures of which we speak are found already created, and no social institution can add to their supply. All that

can be required is that a sufficient reward should be given to those who appropriate them. This fair return, of course, is all that is needed, even in agriculture; but the distinction is not so easily drawn in that pursuit as it is in the exploitation of the natural treasures of the earth. Even should we grant private ownership in the land, it is an exaggeration of that institution, forming no essential part of the principle of private property, to allow the land-owner to own indefinitely all that is above him, and all that is below him to the centre of the earth. The legal systems of many countries have always regarded the natural treasures below the surface of the earth as public property, and they should be thus regarded everywhere.

So far as barbarous or semi-civilized peoples are concerned, it is difficult to see what they can do until they become more civilized, and form organized governments, unless, indeed, they should receive protection by the civilized nations of the earth.

It does not appear evident at once that the collective management of the property collectively owned is essential. If the anthracite coal mines were owned by the State or by the nation, satisfactory results might, perhaps, be secured by leasing the land, or by allowing individuals or companies to mine coal freely on the payment of a royalty which would absorb any economic surplus above the normal returns to labor and capital.

Artificial monopolies, apart from those which become such on account of their close connection with natural monopolies, whereby they are made to partake of the

qualities of the latter, are those businesses which are made so by legislative enactment, or by some act of pub lic authority. These are the monopolies with which our forefathers had to deal; for kings and queens formerly granted exclusive privileges to favored persons, permitting no one else to engage in certain undertakings. These artificial monopolies early became odious, and sovereigns were forced to forego the privilege of granting them. The odium which attached to them is shown by the "bills of rights," like that which forms part of the Maryland constitution, forbidding the creation of any monopolies. Reference was not had, and in the nature of the case could not be had, to the natural monopolies which are now the most important class of monopolies.

The existing artificial monopolies so far as they are created by government are chiefly such as are created by copyrights and patents, and their purpose is the public welfare. The design is to encourage literary production and invention by exclusive privileges strictly limited in point of time. These exclusive privileges appear, on the whole, to promote the public welfare. Where they do otherwise, all that can be desired with respect to them is, perhaps, a clear recognition of the actual principles involved, and certain modifications in the present laws designed to prevent abuses which have grown up, particularly with respect to patents.

Copyrights interfere least of all with industrial freedom, because no two persons can possibly produce the same book, or musical composition, or any other work which is copyrighted. The fact that one person has written a book cannot keep any other person from writing another book on the same subject. There is reason,