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COMMITTEE ON THE JUDICIARY.
HOUSE OF REPRESENTATIVES.
ANDREW J. VOLSTEAD, Minnesota, Chairman. DICK T. MORGAN, Oklahoma.
EDWIN Y. WEBB, North Carolina. GEORGE S. GRAHAM, Pennsylvania.
ROBERT Y. THOMAS, JR., Kentucky. LEONIDAS C. DYER, Missouri.
WILLIAM L. IGOE, Missouri. JOSEPH WALSH, Massachusetts.
WARREN GARD, Ohio. C. FRANK REAVIS, Nebraska.
RICHARD S. WHALEY, South Carolina. JAMES W. HUSTED, New York.
THADDEUS H. CARAWAY, Arkansas.
M. M. NEELY, West Virginia.
W. C. PREUS, Clerk.
HIGH COST OF LIVING AS AFFECTED BY TRUSTS AND
COMMITTEE ON THE JUDICIARY,
Monday, September 8, 1919. The committee this day met, Hon. Andrew J. Volstead (chairman) presiding
Other members present were: Mr. Dyer, Mr. Boies, Mr. Yates, Mr. Goodykoontz, Mr. Igoe, Mr. Gard, Mr. Whaley, and Mr. Steele.
The CHAIRMAN. The committee will come to order. Mr. Commissioner Murdock, the committee would be pleased to hear you. STATEMENT OF HON. VICTOR MURDOCK, COMMISSIONER
FEDERAL TRADE COMMISSION. Mr. MURDOCK. Mr. Chairman and gentlemen of the committee, I take it that this hearing has its inspiration in the address of the President to the Congress, dealing with the high cost of living. The Government departments are at this moment directing their attention to that problem, and if I may, I would like in the beginning, to give somewhat of a personal view of the way the problem appears to me. First of all, there is disorder in the world due to the war, which disorder has many expressions, among them extravagance, waste, and lack of production.
The CHAIRMAN. And too much money?
Mr. MURDOCK. I will come to that. Growing out of the war a second general cause has arisen, inflation of the currencies of the world, varying in degree in different countries, and expansion of credit. More particularly in the United States a third cause has arisen, not a sole cause, and its relations to the other causes are not as yet exactly determined. This third element is heavy exportation. A fourth cause is heavy taxation. A fifth cause is speculation. A sixth is
found in restraints of trade. Of these we have a very intimate view in the Federal Trade Commission. There are other causes, and among them are some undetermined factors, factors that no man completely comprehends. There are evolutions evident through the world which is impossible precisely to define or to offer concrete remedies for at this time.
Take, for example, the social change in labor in the world. There has been in the last 100 years a tremendous increase in the rate of production and volume of production through tool power and process. Machine-made goods are put out in a volume which was beyond the imagination of man 100 years ago. I think that labor, the world around, with more emphasis in Europe probably than in the United States, believes that there is not an equitable distribution of the production arising from tool power and process, and I think labor is going to demand more and more that it have a more equitable distribution of the joint product of the community.
Now, we touch in the Federal Trade Commission more particularly one element in these causes which I have recited, restraints of trade, and in approaching that subject I would like to say for the record and to the gentlemen of this committee that I am convinced that not only is there working in the world a profound change incident to production, but there is working also throughout the world an epochal change in commercial methods. The international politics of the future, the international trade and industry of the future, and the factor of overseas transportation are all going to be marked in the future, by the presence and activities of exceedingly great units. Much business is now done by big units. It will continue more and more to be done by big units. The chief activities will center in basic commodities. I think that it is going to take all the forebearance, all the patience, all the devices of solemn compacts between nations in the next 20 years to keep society at peace because of this. Take the matter of petroleum alone. Within 10 or 15 years the bulk of the overseas traffic of the shipping nations will have as power fuel oil. There are two great companies in the world at the present time, two great units, not perhaps units legally, but units in action. One is our own great company, the Standard Oil Co., and the other is the Dutch-Shell Combination of Great Britain. Those two companies are the greatest companies in petroleum in the world. Not only the navies of all countries but the merchant marine of the world as well, in the next 10 years are to become more and more dependent upon petroleum. Both these ambitious companies are out in the world's markets for business. Both are placing throughout the seven seas great reservoirs for the fueling of shirs. They are strongly competitive. They are also strongly nationalistic.
I want to say to you gentlemen with as much solemnity as I can summon that we may see Great Britain and the United States embroiled over this rivalry in the next 20 years, unless, as I said previously, the peoples of both countries exercise forbearance and patience, and unless there is an increasing supervision over commerce by these two Governments-Great Britain and the United States.
We have in the United States, in the way of supervision over large units, first the Sherman antitrust law of 1890. That was later supplemented by the creation of the Federal Trade Commission, which was given power to keep alive the principle of competition in commerce. In addition, Congress gave the commission power over four sections