He stated that the unit of the scheme would be the association representing each industry. This shall be composed of all the producers or manufacturers of an industry forming themselves into an association. Representatives from the various associations shall compose a General Council of Commerce and Industry. Combined action of manufacturers through an association for the purpose of securing a footing in overseas markets was proposed and the backing of the Commonwealth to secure necessary credits from banks was mentioned as a means of pushing the Australian products in the overseas markets.

Japan Excels in Marshalling Industrial Interests.

In Japan organization of business has made rapid strides during the war. The solidarity of her business interests, the cooperation of her exporters, the systematic aid furnished manufacturers by the government through subsidies, tariff legislation, etc., is unequaled anywhere among the other commercial nations of the world. Japan's shipping has virtually monopolized the Pacific maritime trade during the war. Three shipping firms of Kobe recently pooled their interests. The new concern stands fourth in the list of Japanese shipping companies. Well-organized cartels have been formed in the textile, tea, chemical, camphor and other industries. In Canada there was incorporated a company styled "The Associated Industries of Japan," with head office at Vancouver. This company comprises some one hundred and sixty Japanese manufacturers. An enterprise on a larger scale was formed by six of the largest mercantile firms of Japan, the Mitsui, the Mitsubishi, the Okura, the Furukawa, the Kubara and the Kogyo Kaisha, for the purpose of placing joint loans in China. The new combination has already succeeded in acquiring certain valuable mining privileges.

Canada Joins in the March Toward Trade Consolidation.

In Canada the trend towards combination evidences itself in the recent organization of two huge concerns eclipsing all previous efforts in the realm of industrial consolidation. Nine Canadian steel, coal and transportation companies were recently merged

into the British Steel Corporation, with a capital of $500,000,000. British and Canadian interests combined in the formation of this enterprise, which is said to represent the largest merger of its kind in the British Empire. In another branch of Canadian industry, pulp and paper, a merger has been effected which embraces the large Riordon, Edwards, Gilmour and Hughson interests. The parties involved are said to control 12,000 square miles of forest areas.

France and Belgium Show Similar Trend.

Co-operative purchasing bureaus have been established in Belgium under the auspices of the Belgian Ministry of Reconstruction. In all fifteen such central purchasing bureaus have been formed.

In France purchases for the restoration of the French liberated districts are made through the Central Purchasing Bureau of the Liberated District. A presidential decree of August 25, 1919, increased the capital of the Bureau from 7,000,000 to 100,000,000 francs.1

TRADE ASSOCIATIONS.

Side by side with the world-wide tendency to form cartels, syndicates and trusts, a rapid growth has been taking place during the war in the number and size of trade associations. Industries in which all efforts to bring about an organization failed in previous years have been successfully organized under the stress of war times, not only along sectional lines, but as units covering the entire national industry. In the United States the coal and the dye-stuff industries have for the first time been organized into national associations. Numerous new associations of manufacturers, of wholesalers and of retailers have grown up throughout the country, partly as a result of governmental pressure, and many of the older existing associations have taken.

1Journal officiel, August 27, 1919.

occasion to establish a greater degree of solidarity and more efficient co-operation among their members.

A similar movement can be distinguished in Great Britain. The largest organization of this kind established in that country is the Federation of British Industries, which comprises more than sixteen thousand manufacturing companies with a total capital of twenty billion pounds. The prime object of the federation is to promote British trade prestige in overseas markets.

In Australia, in Canada, in the Scandinavian countries and in Japan concerted action on the part of trade associations is noticeable and numerous associations and federations for defensive and aggressive purposes have been formed in those countries during the past decade.

Objectionable activities on the part of trade associations in different countries have given rise to criticism on the part of the public as well as of government authorities and closer supervision of their activities has been advocated. Regarding conditions in the United States, the Federal Trade Commission in its "Report on the Book-Paper Industry" (Washington, 1917, page 18)

says:

The commission also desires to call attention of the Congress to the necessity for the enactment of legislation regulating the activities of trade associations. The print paper and other investigations of the commission show that trade associations, although they are presumed to be organized for legitimate purposes, and are often engaged in activities which serve a useful purpose, nevertheless, in some instances, engage in practices which tend to destroy competition and defeat the objects of the Sherman Law.

Price-Fixing Through Associations.

A practice of suppressing competition through price-fixing associations receiving daily reports of sales of principal members dealing in certain commodities, has grown up in the United States, and has assumed large proportions. Owing to the fact that only past or "closed" transactions are called for and considered, the belief has become quite general that the anti-trust

laws do not apply to this system of eliminating competition and standardizing prices. The effect has been to intimidate dealers who wish to reduce prices; and a virtual restraint of trade has resulted in numerous industries.

In order to correct these abuses and overcome this attempt to circumvent the Sherman Law, the Federal Department of Justice has conducted an investigation and an anti-trust suit has been brought. The Federal court' (March 16, 1920) has sustained the Government (U. S. v. American Column & Lumber Co., et al., 263 Fed. 147, and no doubt other actions will be instituted to terminate such price-fixing.

1In the District Court of U. S., Western District of Tennessee, Western Division.

CHAPTER X.

Organization of Export Trade in the United States Prior to the Enactment of the Webb-Pomerene Law.

Understandings Among American Export Interests.

Combinations of manufacturers or others for exporting goods to foreign countries from the United States have been in operation openly only since the passage of the Webb-Pomerene Act in April, 1918. Apparently agreements or understandings among American business men as to prices, sales terms, etc., for export trade have existed in a number of instances prior to the enactment of that law, but fear of prosecution under the Sherman Anti-trust Act obviously prompted all parties so engaged to observe the utmost secrecy. Moreover, so long as our exports consisted chiefly of raw materials and foodstuffs, there was little difficulty in finding foreign markets and virtually no competition was to be encountered. The rank and file of American manufacturers shipped their exports through brokers and export commission houses. With few exceptions only the largest shippers have been able to develop a direct export organization, with salesmen and branch houses in foreign countries, to undertake expensive foreign campaigns.

Corporations Became Pioneers in Our Overseas Trade.

A large share of the success of the United States in exporting manufactures has been due to the efforts of large corporations. The Standard Oil, United States Steel, International Harvester and other large industrial concerns have established export organizations of their own which encompass the world's markets. The International Harvester Corporation, prior to the war, carried on its business in Europe, Western Africa and Asia from four centers, viz., London, Paris, Hamburg and Moscow.