Sec. 20. #Private and public interests to be harmonized.# If an extremely abstract view is taken there is danger of losing sight of the real problem, which is that of harmonizing these two interests in thought and in public policy.  Yet the extreme advocates of the private control of railroads for a long time resented indignantly any public interference with railroad rates and with railroad management as an infringement of individual liberty.  Before the passage of the Interstate Commerce Act, in 1887, this position was inconsistently taken by those in whose interests free competition had been violently set aside at the very outset of railroad construction, and for whom governmental interference had made possible great fortunes.  It has become generally recognized that the railroads ought not to be allowed to change from a public to a private character just as it suits their convenience.  True, they are private enterprises as regards the character of the investment, but they are public enterprises as to their privileges, functions, and obligations.

Finally, it might be said that if there were none of these special reasons for the public control of railways, there is an all-sufficient general reason in the fact that a railroad is always, in some respects and to some degree, a monopoly.  Therefore, the railroad problem may be viewed as but one aspect of the general problem of monopoly.  To other aspects of this problem we are now to turn our attention.

[Footnote 1:  Returns for 1915.  The following figures are from the census taken in 1909.]

[Footnote 2:  See A.T.  Hadley, “Railroad Transportation,” pp. 10, 32.]

[Footnote 3:  See Vol.  I, pp. 437, 438, 443.]

CHAPTER 28

THE PROBLEM OF INDUSTRIAL MONOPOLY

Sec. 1.  Kinds of monopoly.  Sec. 2.  Political sources of monopoly.  Sec. 3.  Natural agents as sources of monopoly.  Sec. 4.  Capitalistic monopoly; aspects of the problem.  Sec. 5.  Industrial monopoly and fostering conditions.  Sec. 6.  Growth of large industry in the nineteenth century.  Sec. 7.  Methods of forming combinations.  Sec. 8.  Growth of combinations after 1880.  Sec. 9.  The great period of trust formation.  Sec. 10.  Height of the movement toward combinations.  Sec. 11.  Motive to avoid competition.  Sec. 12.  Motive to effect economies.  Sec. 13.  Profits from monopoly and gains of promoters.  Sec. 14.  Monopoly’s power to raise prices.

Sec. 1. #Kinds of monopoly.# Monopolies may, for special purposes, be classified as selling or buying, producing or trading, lasting or temporary, general or local, monopolies.  The terms selling or buying monopoly explain themselves, tho the latter conflicts with the etymology.[1] Under conditions of barter the selling and the buying monopoly would be the same thing in two aspects.  A selling monopoly is by far the more common, but a buying monopoly may be connected