Antitrust Policy Essay

When Woodrow Wilson was inaugurated in 1913, he stated in his address that, “We shall deal with our economic system as it is and as it may be modified, not as it might be if we had a clean sheet of paper to write upon” (First Inaugural Address, online). He did just that when he passed the Clayton Antitrust Act in October 1914. The Sherman Antitrust Act was passed in 1890, but it was very vague in the way it described monopolies (Clayton Antitrust Act, online). Big business took advantage of the loopholes, which diminished competition (Clayton Antitrust Act, online). Although Roosevelt and Taft successfully busted about 150 trusts, big businesses continued to grow and our entire economic system remained in the hands of a few men (Taft Biography, online; T. Roosevelt – Section 8, online; Clayton Antitrust, online). Wilson requested Congress to modify the Sherman Antitrust Act, and the Clayton Antitrust Act was born (Clayton Antitrust, online). It is “An Act To supplement existing laws against unlawful restraints and monopolies, and for other purposes” (HR 15657, online). The Sherman Act simply declared monopolies illegal, while the Clayton Act declared activities linked with monopolies to be illegal (Clayton Antitrust Act, online). Such activities include mergers and acquisitions that are intended “substantially to lessen competition, or to tend to create a monopoly” (HR 15657, online). The Federal Trade Commission Act, passed about a month before the Clayton Act, banned

There was an increase in technology, factory production, production of steel and oil. This industry produced a lot of wealth for businessmen like Andrew Carnegie, John D. Rockefeller, Cornelius Vanderbilt, and Henry Clay Frick. These trusts were huge economics forces and had the power to manipulate prices. In response to these trusts, Congress passed the Sherman Antitrust Act in 1890. The Sherman Antitrust Act prohibited trusts and was based on the power of Congress to regulate interstate commerce. However the Sherman Antitrust act did little to stop the growth of trusts, but instead was used against labor unions. The act restricted labor unions by cease and desist orders against strikers and their unions. Cease and desist prohibited a person from doing a certain activity, and in this case it meant that laborers could not strike. By not allowing a worker to strike is not letting them achieve their full citizenship rights. The Sherman Antitrust act did more to restrict human rights than ban

Antitrust laws are federal and state government laws that regulate the conduct and organization or businesses. This helps promote fair competition for consumers. There are four main areas involving the

The Sherman Anti-trust Act in1890 aimed to stop monopolies from their unfair practices: The standard oil company being one of the government’s first attempts to stop. The government’s actions demonstrated their attitude towards monopolies. “ In 1887, congress passed the Interstate Commerce Act, which outlawed railroad rebates and kickbacks and also established the Interstate Commerce Commission to ensure that railroad companies obeyed the new laws” (“Sherman”). Both the Sherman Anti-trust and Interstate Commerce Acts were established to minimize the control monopolies had over the economy.

Big businesses, such as the Standard Oil company, had trust and monopolies which meant they could set high prices since they controlled the industry. Reform was again demanded and the Pendleton Act was put into effect. The Pendleton Act insured that only qualified individuals would be able to hold a political service job - this was made possible by instituting a qualification test (if an individual wanted to work in politics they had to pass a test to prove they were qualified to hold the position). The Sherman Antitrust Act was also put into effect. This act protected consumers from the efforts of trust and monopolies, its aim was to sustain economic competition and impose penalties on those companies whom violated the

The Sherman Act of 1890 created the legislation to declare the existing monopolies illegal and made violation of the Act a felony, essentially deeming the existing monopolies in violation of the law. These two regulations made common practices such as price fixing and market divisions illegal. The Sherman Act would open the doors for individuals and government agencies such as the U.S

In 1890, the United States Congress passed the first Anti-Trust Law, called the Sherman Act, in an attempt to combat anti trusts and as a “comprehensive charter of economic liberty aimed at preserving free and unfettered competition as the rule of trade.” (The Antitrust Laws). Twenty four years later in 1914, Congress passed two more Anti-Trust Laws: the Federal Trade Commission Act, which created the Federal Trade Commission whose aim is to protect American consumers, and the Clayton act, which fills in any loopholes in the Sherman Act. Ultimately, these three Anti Trust Acts regulate three core problems within the market: restricting the creation of cartels, restricting the “mergers and acquisitions of organizations which could substantially lessen competition”, and prohibit the creation of monopolies in the market (“The Antitrust Laws”).

The Sherman Anti-Trust Act of 1890 was passed to prohibit trusts, this was the first law passed by U.S. Congress to enforce this. This act was named after Senator John Sherman. Before this act was put into place, many other states had enforced laws very similar to the Sherman Anti-Trust Act. These laws were not perfect though, the large corporations had the majority of the economic power. Congress was not pleased with this, thus making the Sherman Anti-Trust Act. This act allowed Congress to regulate interstate commerce, outlawing monopolistic practices. If a person were to violate this act, he or she could be imprisoned for a year and fined five-thousand dollars. This law was successfully used to help Theodore Roosevelt during his campaign, “trust-busting”. Also, President Taft used the law to back himself up against the Standard Oil Trust and American Tobacco Company. The Standard Oil trust was when a board of nine trustees was set up to make all of the company decisions , allowing the company to run as a monopoly. The Sherman Anti-Trust Act allowed both presidents to dissolve the trusts that were creating problems. On the other hand, the Sherman Anti-Trust Act had many holes, it did not have exact wording, therefore allowing companies to still control the majority of the producing and still get away with it. The Sherman Anti-Trust Act had substantial success, but was put to rest and replaced with the Clayton Anti-Trust

Despite its good intentions, the Act didn't hit all its targets. The Act emerged as a somewhat tenuous plan to break up the "big business" monopolies. The weaknesses of the Act are described by Chief Justice Stone: "The prohibitions of the Sherman Act were not stated in terms of precision or of crystal clarity and the Act itself does not define them. In consequence of the vagueness of its language, perhaps not uncalculated, the courts have been left to give content to the statute, and in the performance of that function it is inappropriate that courts should interpret its words in the light of its legislative history and of the particular evils at which the legislation was aimed." Ultimately, "there [was] no question that nearly everyone wanted to

Section 1 of the Sherman Antitrust Act, in part, states that “every contract, combination… or conspiracy, in the restraint of trade or commerce… is declared to be illegal.” (Sherman Act, 2006). This law provides “a comprehensive charter of economic liberty aimed at preserving free and unfettered competition as the rule of trade (Northern Pacific Railway Company vs. United States, 1958; Reiter vs. Sonotone Corporation, 1979). It relies on a fundamental belief in supply and demand (Baum Research & Development Company vs. Hillerich & Bradsby, 1998).

In the United States, several laws were established to keep businesses operating fairly and competitively in every market. With businesses willing to do just about anything to gain the competitive edge, antitrust laws were set into place to prevent to keep a companies from being dishonest while trying to obtain new clientele. Being a small business is tough trying to compete with larger companies, such laws protect them from market allocation, bid rigging, and price fixing.

What is a monopoly? According to Webster's dictionary, a monopoly is "the exclusive control of a commodity or service in a given market.” Such power in the hands of a few is harmful to the public and individuals because it minimizes, if not eliminates normal competition in a given market and creates undesirable price controls. This, in turn, undermines individual enterprise and causes markets to crumble. In this paper, we will present several aspects of monopolies, including unfair competition, price control, and horizontal, vertical, and conglomerate mergers.

Fourth, our approach includes the politics into the discussion on monopoly so that the approach can narrate the monopolistic actions and antitrust policies as the social phenomena, which embedded in social and political conditions, unlike the standard one that perceives monopoly as a technical problem. As the public policies inevitably relate to the policies and power relations in the society, another advantage of our approach is that it can explain why and how some societies succeeded in creating and implementing antitrust policies and the other ones failed to minimise monopolistic

What are the arguments in favour of anti-monopoly legislation and under what conditions might monopolies be allowed to exist? 1. What are the arguments in favour of anti-monopoly legislation and under what conditions might monopolies be allowed to exist? Before discussing the arguments in favour of anti-monopoly legislation and the conditions that a monopoly would be allowed to exist it is important to define monopoly and its market structure.

There are many different types of economic markets nowadays. For example; the oligopoly and the perfect competition markets. Each market has its own factors and characteristics. In this research paper however; we will discuss and cover the monopoly market from the economic perspective. According to Parkin; “a monopoly market is a market which is characterized by producing a good or a service for which no close substitute exists and in which there is one supplier that is protected from competition by a barrier preventing the entry of new firms”. In addition; there are two types of strategies in which monopoly firms set for their selling for maintaining such monopoly state, these types are single-price monopoly strategy and price discrimination strategy. All of these strategies with the addition of factors of monopoly; are what shapes the monopoly market as it is.