Diplomingenieur Dr. Paul Tafel, The North
American Trusts and Their Impact on Technical
Progress, Stuttgart, 1913.
(Preface indicates that the author worked in the
U.S.A. for seven years.)
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According to Liefmann, Cartels and Trusts. |
⎫ ⎬ ⎭ |
p. 1—Beginning of trusts (about) 1880s. 1900—185 trusts. 1907—250 with 7,000 million dollars. |
date
of origin of trusts |
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p. 2—Number of shareholders (steel shares) >100,000!! |
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pp. 8-9—America passed directly to railways. “Even today there are still no main roads in the U.S.A. that can be used for travel in summer and winter” (71, note 9).... |
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Economic conditions and forms of trusts dealt with at length.
p. 48: “The chief rival of the Steel Trust, the Jones and Laughlin Co. of Pittsburgh, is said to have more modern equipment in its mills than the Trust.—Leather trust shareholders blamed the board for the business doing badly, because it had neglected the technical equipment of the factories. The harvester-machine trust was praised for sparing no expense to equip its factories with the most up-to-date machinery in order to reduce production costs and thereby raise competitive power. [Quoted from Kartellrundschau, 1910, pp. 53 and 902.]
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“The tobacco trust has gone the farthest, perhaps, in this direction. An official report says: ‘The trust’s superiority over competitors is due to the magnitude of its enterprises and their excellent technical equip- ment. Since its inception, the tobacco trust has devot- ed all its efforts to the universal substitution of mechanical for manual labour. With this end in view it has bought up all patents that have anything to do with the manufacture of tobacco and has spent enormous sums for this purpose. Many of these patents at first proved to be of no use, and had to be modified by the engineers employed by the trust. At the end of 1906, two subsidiary companies were formed solely to acquire patents. With the same object in view, the trust has built its own foundries, machine shops and repair shops. One of these establishments, that in Brooklyn, employs on the average 300 workers; here experiments are carried out on inventions concerning the manufacture of cigarettes, cheroots, snuff, tinfoil for packing, boxes, etc. Here, also, inventions are perfected.’”[1] (Report of the Commissioner of Corpo- rations on the Tobacco Industry, Washington, 1909, p. 266.) |
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“It is quite obvious that such a policy greatly stimulates technical progress. Other trusts also employ what are called development engineers whose business it is to devise new methods of production and to test technical improvements. The Steel Trust grants big bonuses to its workers and engineers for all inventions that raise technical efficiency, or reduce cost of production.”[2]
Besides competition, the bad financial circumstances of the majority of trusts (owing to over-capitalisation (N.B.)) are a stimulus to technical progress.
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The capital of the Steel Trust = about $1,000 million (“one-seventh of the total national prop- erty”). The shareholders received three new shares for each old one. (Cf. also Glier in Conrad’s Jahrbücher, 1908, p. 594.) Interest has to be “earned” on this triple capital!!! The capital of the railways = $13,800 million. Of this, about 8,000 million is fictitious capital!! (p. 52). |
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To continue. What if there is a complete monopoly? (At present the greater part consists of
| (α) outsiders | } |
| (β) the world market |
In the U.S.A., only the post office is run by the government. Everything else (including railways, telegraphs, etc.) belongs to private companies.
1880—177 telegraph and parcel-post companies with a capital of 66.5 million dollars;
| 1907—25 companies with a capital of 155 million dollars | |||
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of which 6 ↔ 97.7 per cent of the total receipts. Price is uniform and for telegrams “excessively high” compared with Europe (p. 60). |
N.B. | ||
Railways in disorder: Michelsen (a leading authority!) calls them “anarchic, uneconomic, cumbersome, unscientific, unworthy of the genius of the American people” (p. 63).
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—railway cars very often lacking, when- ever there is a boom (1902, 1906), in a number of localities, etc., etc. |
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N.B. |
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cf. Conrad’s Jahrbücher (Blum), 1908, p. 183 {||| N.B.
In the recent period the technical condition of the American railways has deteriorated; they lag behind Europe (p. 63).
The process of railway concentration was completed in 1899; by 1904 the price per ton-mile had risen from 0.724 cents to 0.780 cents ((!! p. 62)).
| The Role of Technology. Camphor | ||
| Million pounds |
Price per pound |
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| 1868 export= | 0.6 | 16.4 dollars (!!) |
| 1907 ” | 8.4 | 168.5 ” |
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⎛ ⎝ |
in 1905 it became possible to produce it artificially; ⭩ the price fell; but raw material (turpentine) was dear |
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The position of the trusts is shaky: “colossi with feet of clay” ... p. 67 (an American writer says)... the future is dark....
| N.B. On the trusts, The North American | ||||||
| Review is frequently quoted.... 1904; 1908; 1902, | ||||||
| p. 779; 1906; 1910, p. 486; | and others | |||||
E. A. Heber, Industrial Labour in Japan, Zurich, 1912.
N.B. A very detailed work.
J. Grunzel is quoted, The Error in Regard to Produc-
tive
Forces.
Zeitschrift für Volkswirtschaft, Sozialpolitik und Verwaltung,
Vol. 20, Nos. 3 and 4.
Quoted by Tafel
?? J. Grunzel, The Triumph of Industrialism, 1911.
[1] See present edition, Vol. 22, pp. 203-04.—Ed.
[2] Ibid., p. 204.—Ed.
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