THE HIGH COST OF MONOPOLY
Nikoloric, L. A.
The High Cosi of Monopoly By L. A. Nikoloric AMONG the many exports flowing from the United States to the Marshall Plan countries of Europe are many American experts on the enforcement of...
...62.7 Aircraft & parts...
...68.7 Biscuits, crackers, & pretzels 67.7 Agricultural machinery...
...Nobody needs to be told how difficult it is to crash this clique...
...This action of the steel companies accomplished more than the elimination of one independent from business...
...As the best theater in town it played only first-run pictures...
...anti-trust policy in the non-nationalized sector of industry...
...Paramount withdrew its pictures and gave them to another and inferior Balaban and Katz theater...
...RKO, Warner Brothers, Universal, Columbia, and United Artists...
...The antitrust division has the resources to investigate—much less prosecute— only about 10% of the complaints received...
...64.0 Seven more industries were dom inated by six companies or fewer: % of control by 6 companies or fewer Glass 6 glassware...
...The most important supply item was steel furnished by such companies as Bethlehem...
...The High Cosi of Monopoly By L. A. Nikoloric AMONG the many exports flowing from the United States to the Marshall Plan countries of Europe are many American experts on the enforcement of anti-trust laws...
...Balaban and Katz then threatened to build a new and competing theater near the Paramount...
...Prior to the Supreme Court decision it was operated by Balaban and Katz, 99% owned by Paramount...
...During the past 10 years, which have been years of business prosperity, 17 out of every 100 business organizations have disappeared altogether...
...experts on antitrust legislation," reported the Times, "have found opinion in many Left quarters increasingly receptive to the notion that the public interest would be better served by enforcement of something like the U.S...
...92.1 Copper smelting & refining .. 88.5 Cigarets...
...the stakes involve the very concepts of freedom and individualism on which this country was built...
...At just about the time of this report from Geneva a significant document became available in Washington...
...When last heard from, Balaban and Katz were opening negotiations to buy Schwyn's lease...
...But talk and press releases are cheap...
...Suppose we look behind the acres of statistics compiled by Congressional investigators to examine close up a few cases of monopoly in action...
...Schwyn made no management changes and the theater remained unchanged...
...Steel The Koch Erecting Co., Bronx, N. Y., was squeezed out of business by an industry in which seven companies control about 80% of the ingot capacity of the country...
...For example, a witness for the Garment Workers Union quoted the TNEC Reports of 1941 (the last definitive study of concentration) as stating that the garment industry "in each of its stages, is actively competitive...
...The Koch Company had been important in its particular field since 1924...
...Today three companies manufacture about 80% of the cars on the road...
...The largest part of its business was erecting Government buildings in Washington—contracts it won through competitive bidding...
...Every witness before the Committee agreed that the problem of concentration and monopoly is growing worse...
...When the Government changed its bidding policies to permit the steel companies to bid not only for supplying steel but also for erecting it, the companies took the business away from Koch simply by refusing to supply that firm with steel...
...The people can do two things to preserve our economic and political freedom...
...We are paying a staggering price for concentration of power...
...The price of the Ford is back approximately to the 1906 level...
...Since 1940, 1,800 companies have been swallowed up by merger...
...But after an independent started operating the theater, it became "unsuitable" for first-run pictures...
...There were hundreds of companies scrambling for the market...
...The price of a Ford, for example, in 1906 was $2,000...
...70.3 Office & store machines...
...Less than one per cent of the corporations employ more than 50% of all industrial workers...
...1,500 other soapers control about 10...
...66.6 Meat products...
...Motion Pictures This industry is dominated by eight corporations...
...The price of the Ford had tripled...
...Secondly, we can stop electing politicians who decry monopoly in November and forget us in May...
...None of the other "majors" sold first-run pictures to Schwyn...
...The Government cannot possibly do this job alone...
...Two years ago, the Supreme Court condemned this monopoly in the strongest language, and yet this is what happened to an independent theater operator after that decision: The Paramount Theater is by far the largest and best from a revenue-producing standpoint in Toledo...
...It was doubtful whether the automobile was a substantial improvement over the Model T except as a fancy gloss...
...Twenty-five years ago the automobile industry was one of the most highly competitive in the world...
...Even with their many weaknesses, the anti-trust laws which provide for a triple-damage remedy are powerful weapons...
...63.4 Industrial chemicals...
...It was Volume One of the Hearings before the Subcommittee on Study of Monopoly Power of the House Judiciary Committee— less awkwardly known as the Cel-ler Committee...
...The situation exposed by the Cel-ler investigation thus far can be summarized simply: • One-half of all the corporate assets in the nation are owned or controlled by 28 corporations...
...72.4 Plumbing equipment & supplies...
...trolled capital assets valued at over $16,000,000,000—one-half of all corporate assets...
...The pattern of concentration began to take shape...
...Eight years later this witness reports that four firms do 75% of the business in 16 products...
...First, they can fight back when concentrated power pushes them around...
...71.3 Rubber tires 8 tubes...
...It was common knowledge that Kaiser-Frazer found it necessary to provide its own steel...
...69.5 Motor vehicles...
...60.4 (Soap products should be included in this breakdown, but the figures are only approximate...
...We need Senators and Representatives who are not only willing to make such studies as that now under way by the Celler Committee but to translate the results into vigorous and streamlined enforcement of anti-monopoly policies...
...Four companies or fewer do 75% or more of the business in 121 products with sales of $10,000,000,000...
...By 1923 you could buy a better car for approximately one-seventh as much, $295...
...69.9 Carpets S rugs...
...Instead, U.S...
...another independent motion picture exhibitor was being squeezed out...
...They are too little understood and seldom used...
...77.6 Distilled liquors...
...Fox also withdrew its first-run product in favor of Balaban and Katz...
...Paramount, Fox, Loew's (MGM...
...Besides guarding carefully the technology and the skilled personnel of the industry, the monopoly is able to count on the steel boys (again) for cooperation...
...This was the Model T. Some of them are still on the roads...
...95.3 Linoleum...
...This newest in a long series of inquiries proves with frightening impact that during the 50 years since passage of the antitrust laws, the trend toward the concentration of power and the growth of monopoly has increased enormously...
...It socked the taxpayer too...
...II The Celler Committee is conducting an exhaustive inquiry into the problem with the view of revamping the anti-trust laws and providing private litigants with less cumbersome procedures...
...66.3 Primary steel...
...Of the remaining industries, about 60% of each industry is controlled by 15 companies or fewer...
...Steel refuses to sell an independent...
...Automobiles Although Studebaker is running a close fourth, this field is largely dominated by Ford, Chrysler, and General Motors, who do over 80% of the business...
...by 1935 there were only 15 manufacturers turning out 26 makes...
...Once competition was eliminated, the steel boys charged what they pleased to put up the buildings...
...Their mission is to show the nations of Europe how they can crack cartels and monopolies by following in American footsteps...
...A recent New York Times dispatch from Geneva reported widespread disenchantment among Left-of-Center economists and intellectuals with nationalization of industry...
...They fought with better designs at cheaper prices...
...In a study of 26 industries considered basic to our economy, 13 were almost completely dominated by three companies or fewer: % of control by 3 companies or fewer Aluminum ..............................100.0 Tin cans & other tinware...
...66.3 Dairy products...
...Translated into human terms, these figures tell the grim story of thousands of small business men driven out of competition and millions of consumers squeezed daily by monopoly power...
...When Balaban and Katz disagreed with the landlord over rental terms, Schwyn, an independent, was able to lease the theater...
...The TNEC report of 1941 revealed the shocking gravity of the problem, but little or nothing was done...
...Stated more conservatively, 113 corporations list directly conL. A. NIKOLORIC has had first-hand experience in the struggle against monopoly as a member of the Washington law firm of Arnold, Fortas, and Porter...
...The big four control about 90...
Vol. 14 • February 1950 • No. 2
