close relations with it, it also examines titles, places insurance, and performs other duties of fiduciary or legal character.

Turning now to a consideration of what will probably be the effects, good and bad, of this movement, we shall have to limit ourselves to a very general examination. The movement is as yet too young to permit of any accurate forecasting of the ultimate results as regards the details of our industrial system. It is scarcely necessary, however, to comment upon its possible overwhelming significance. There are definite limits to the progress of concentration, and these seem to have been reached in a number of cases. There are practically none to that of integration. It has already given us a billion dollar corporation, although its influence as a definite force has only recently begun to be distinctly felt.

In the future progress of this movement there is one industry in which it would seem that the conditions are peculiarly favorable for its operation. This is the great industry of railway transportation. The peculiarity of this industry is that it is at once dependent upon all the other industries for its successful exploitation, and all the other industries are in a like manner dependent upon it. We have given above one or two instances where this interdependence has led to integration. These cases, however, are insignificant in comparison with what might take place. The railroads, to an extent equalled by almost no other undertaking, are enormous purchasers of certain articles, such as rails, cars, structural material, and other supplies. These articles, moreover, are ones for which a steady and certain demand exists year after year. The time may very easily come when the roads will abandon the policy of depending upon outside concerns for the supply of the materials and equipment of which they have need, and undertake, as is now done in isolated cases, their direct manufacture. With their lines reaching all the mines or other sources of supplies of which they have need, and with the possession of certain markets for what is produced in their own needs or the ability effectually to distribute any surplus, the roads are in a peculiarly favorable situation for the manufacture of a large number of products. If their charters will not permit this to be done directly, the same result can be

accomplished through closely affiliated companies, as is now done by the Pennsylvania company through the Conemaugh Steel company.

The question may legitimately be asked why, in view of these circumstances, if integration is such a strong force, the roads have not already entered these fields; why, as regards their most immediate needs, such as cars, direct manufacture has not been more resorted to. The explanation lies in the fact that the evolution of the railway systems in this country has not yet advanced far enough to make this desirable. During the past as well as at the present time the great problem confronting the railroads is the building up of systems through which effective control can be obtained of particular territories or lines of traffic. So overwhelming in importance is this consideration that all other considerations have for the time to be left in abeyance. In the contest for supremacy the greatest arm is the possession of capital with which other railroad property needed for the rounding out of the systems can be acquired. It is thus the height of folly for any considerable sum of capital to be devoted to other purposes, unless an absolute necessity for such expenditure exists.

The time is now rapidly approaching, however, when these systems will be comparatively perfected, and the greater part of the country be divided up among a few great systems of railroads. When this is accomplished, a radical change may be looked for in the policy governing railroad administration. Energies will then be turned exclusively to the efficient equipment and operation of the properties. The different lines of the systems must be reconstructed, so that they may be welded into one harmonious whole. The matter of securing supplies and equipments at the best possible rate will receive the most careful attention, and the time will then have been reached when the desirability of the roads themselves manufacturing the articles of which they have need will be considered purely as a problem in the cost of production and control over a necessary element in the operation of their properties.

To what extent the railroads will ever become manufacturers on a large scale it is now impossible to predict. That they will do much more than they are now doing would, how

ever, seem extremely probable. Should, moreover, the time ever come when there will be an integration of industries, as well as an integration of related branches of an industry, the railroads of the country would furnish the connecting links binding the different departments together.

It would be a hardy prophet who would seek to follow out all the consequences of the continued operation of this tendency. Especially would it be futile to attempt to weigh the social effects that would result from the concentration of such enormous power in the hands of a few individuals. Of one result, however, we may speak with comparative certainty. Each step in the direction of integration implies a lessening of possible friction and a substitution of a direct for a more indirect method, and both of these mean greater economy and increased efficiency of production. With this will also come an enormous strengthening of control over the factors of industrial operations. That the greater control resulting from the concentration of industry would have as one of its most important consequences the steadying of production and the resulting lessening of industrial depressions, so it is believed that the far greater control that will follow from integration cannot but work in the same direction. Here, however, we are treading upon more uncertain ground. The causes of industrial depressions are too complicated and too little understood to permit of confident statement.

In conclusion, it is of not a little interest to note how perfectly this tendency towards integration fits in with the theory of evolution as applied to industrial progress. Evolution as a method of progress, stated in the simplest terms, may be said to be the differentiation of functions and the concomitant integration of parts. With the rise of the modern industrial system began that differentiation of function which is known as division of labor. Particular duties or operations were assigned to particular units. In the beginning this was the most important feature of the changes that were taking place. With this diffusion of duties largely accomplished, there now rises, as the factor of prime importance, the second element of evolution, that of integration, by which the various interdependent parts are being knitted together into a more harmonious whole.

THE GREAT CONSOLIDATIONS CALLED

"TRUSTS."

BY PETER S. GROSSCUP.

[Peter S. Grosscup, judge United States Circuit court of appeals; born Ashland, O., Feb. 15, 1852; graduated Wittenberg college, 1872, and Boston Law school, 1874; city solicitor Ashland, O., 1876-82; practiced law in Chicago, 1882, until appointed United States judge for the Northern district of Illinois, in 1892; appointed to the Circuit court of appeals, 1899; president of the John Crerar library of Chicago.]

It is the fashion, nowadays, to point to our place as a people, industrially and politically, among the nations of the earth; to take a just pride in the leadership acquired; and to exploit the belief that it is not only secure now, but will remain secure for a long time to come. We are told that our manufactures go to every land; that our harvesters are to be seen in the grain fields of Asia Minor; our locomotives drawing trains in Russia; our machinery bringing out gold from the mines of South Africa; our bridges spanning the rivers at Khartoum; and the sultan of Turkey preparing to defend his sovereignty by battleships built in American shipyards. All this, it is said, is still on the rising tide, so that when the flood is reached, the United States will have become the richest and most powerful people on the face of the earth. Her political power and influence, we are told, have kept equal pace. She is present, physically and politically, not only throughout North America, but at the outposts of the western hemisphere in the Caribbean sea and at the outposts of the far east in the islands of the Pacific. Her views are consulted by the cabinets of Europe and her armies aid in keeping the peace of the world.

Gratifying as this outward spectacle is, it should by that very token lead us to inquire, how goes the life within? During these same years, one third or more of the industries of the United States have passed from the ownership of individuals or local corporations into the great bodies of property known as the trusts. Should the process go on until all our industries

are thus consolidated, as many well informed men now think probable, the so-called trusts will have absorbed nearly one sixth of all the wealth, of all kinds, in the United States. Nothing in history, outside the rise of the feudal system, has left so striking a change in what may be called the personnel of ownership. As a mere right to hold and control, ownership remains, of course, unchanged, but if the process of the last few years goes on unchanged the universality of ownership that characterized our past-an ownership of our industries widely spread among the people-will be all but lost.

Accurate statistics show that the former owners of the industries now consolidated have put their money, or the bulk of it, in the banks; the workman declines to invest his surplus wages; and with them, also standing aloof, is the ordinary man, possessing ordinary means. It is certain that, as never before in our history, there are several millions of men and women brought up in the industrial trades who are now without proprietary interest in the trades they follow. No less a man than Webster said that the freest of governments will not long be acceptable if the tendency of the laws be to create a rapid accumulation of property in a few hands, rendering the majority of the population dependent. If this be truth, it has come about that the same years that brought us riches and greatness as a nation have brought with them an internal disorder, which, if allowed to go on, will endanger the stability of the government itself.

The men and women who, two generations ago, came over the Alleghanies into the Ohio and Mississippi valleys; the children of these, who, abiding with their fathers until wild nature had been tamed, faced wild nature again on the trans-Missouri plains; our earliest forefathers, who threw themselves on the ocean to be cast up in the wilderness; the men and women, who every year have braved something, to gain something they might call their own; these, and these alone, are the true types on which our institutions thus far have found secure foundation. It was not civil and religious liberty alone these fathers sought. The spirit of adventure does not, alone, account for the courage of their children. They sought, one and all, opportunity as well; the independ