The Sherman Anti-Trust Act

Beginning with the tariff, Wilson personally addressed Congress concerning the tariff and the Underwood Tariff Act was established and passed by 1913, which lowered the tariff and graduated an income tax. Following with the bank, Woodrow implemented the Federal Reserve Act, which established a new Federal Reserve and created twelve central banks in twelve banking districts and also, gave them the power to produce currency or “federal reserve notes.” The Federal Trade Commission Act went after the trusts and created a board to investigate trusts and stop unfair trade practices such as, unlawful competition, bribery, false advertising, mislabeling, and adulteration. Finally, in 1914, there was the Clayton Antitrust Act, which made monopolies unlawful and exempted labor unions from being labelled as trusts and legalized striking and peaceful picketing (Document

It required that all prices must be reasonable and just, rates must be publically posted, outlawed all secret rebates and deals, and price discrimination against smaller companies was now made illegal. While the act promised many changes to reduce the domination of the railroad monopolies, it was not enforced as pro-railroad commissioners were appointed by most of the later presidents. The next act passed by congress in 1890 called Sherman Antitrust Act. The objective of the act was to ban trusts and other contracts that restrained free trade. Much like the Interstate Commerce it was not enforced at all. In fact it was used to help the railroad monopolies even more by regulating labor unions. The very pro-business Supreme Court would rule that strikes violated the prohibition against “a conspiracy in restraint of trade.” In the act. This was the opposite intent of the act, and would not be properly enforced until the early

From 1865 to 1900 the federal government ignored a lot of economic affairs (also known as Laissez-faire) simply because they could and it made running the government much easier. This became a big issue when: railroad land grants, control of interstate commerce, and antitrust activities began to become very competitive in the market place. You may wonder what laissez-faire is; the dictionary definition is the theory or system of government that upholds the autonomous character of the economic order, believing that government should intervene as little as possible in the direction of economic affairs. This is the reason why larger companies could buy out smaller companies and raise the price of the product because they owned everything so to a large extent the government play a large part in the violation of laissez-faire.

During the building of the Transcontinental Railroad, the railroads themselves created a large market for the steel and iron industries.4 The steel and oil industries were booming and corruption was rampant. Andrew Carnegie had cornered the market in the steel industry and John D. Rockefeller had cornered the oil market. Rockefeller bought up his competition after essentially putting them out of business by flooding the market with refined oil bringing down prices and profits. He was determined to pay no one a profit because he wanted it all for himself. He created a plan called vertical integration which consolidated his businesses into one by creating The Standard Oil Trust.5 These two men became known as barons and got rich beyond belief. In 1890, the Government enacted the Sherman Anti-Trust Act to prevent large firms from controlling one single industry and finally put a stop to these monopolies and trusts, 6 but it was not rigorously enforced until the 1900’s. This act was designed to restore competition and

President Theodore Roosevelt, a leader of progressivism was highly in favor for a reform at a national level. He believed it was the governments duty to regulated businesses and improve the life's of the people. While the second industrial revolution brought major industrial achievement it also gave corporate bosses excessive amount of power, which they used to bend political parties to their favor and progressives such as president Wilson hoped to rectify this(Document 2). During this progressive movement many Americans focused on reform the country in ways that would creating a limitation on major business, such as Rockefeller Standard Oil, that used a unfair monopoly system to build their empire, which was damaging the economy. Roosevelt being the first to take signification action on trust-busting, such as passing the Hepburn Act which was enacted in 1906 set a precedent for the power of the federal government. The Hepburn Act set a maximum price for the freight rates on the railroads and it extended the reach of the Interstate Commerce Commission to regulation of pipelines, freight companies, sleeping-car companies, bridges and ferries. During this period the federal government passed an incredible amount of legislation that mainly regulated the problems in the society to provide a greater sense of regulation and protection for the people. Problems such as overbearing freight prices, vile food preparation and inconsistent economic status were issues that needed to be amended. Roosevelt also focused of the conservation of natural resources to help further developed the nation land and it's usefulness(Document 6). Anti-trust acts, Federal Reserve Acts were also established to break trusts to help improve market rates and improve the quality of life for the working class through more regulations on businesses by the federal government. Roosevelt trust-busting helped

11. Significance of the Clayton Antitrust Act- The Clayton Act of 1914 reformed and emphasized certain concepts of the Sherman Act of 1890 that are still active today. These reforms were necessary in order to better the United States and move the country forward.

The Clayton Anti-Trust Act targeted business monopolies that could easily control the whole economy. Wilson being the arrogant president that he was, created a few minor laws that would not greatly improve the economy. It would be the next successor of the president that would be left with all these problems.

With the Sherman Antitrust Act in 1890, the government set out to limit the power of large corporations who were monopolizing good and controlling the economy. Small businesses struggled to stay afloat in the midst of these economic superpowers. The aim of the Sherman Antitrust Act was to make monopolization illegal. This was significant because it made the American economy rich with competition and increased monetary circulation. This in turn made the economy more favorable for smaller businesses.

After using the Sherman Act, Roosevelt started using new legislature to conquer the Trusts and make labor conditions more tolerable. The first department that he made to conquer Trusts was the Federal Department of Commerce and Labor. The Commerce Department could not break down the Trusts, but they could make working conditions better for all workers, and also set rates so the corporations could not over charge. The Commerce department set a maximum rate for the railroad companies in which they could charge companies. This way, the companies tnies could not survive and compete. Also, the

Workplaces became under power of men like Henry Frick, an associate of Andrew Carnegie, who expedited the process of manufacturing to benefit the profit of the company. The Homestead Strike soon came underway as Frick cut wages twenty-two percent and eliminated union positions, despite Carnegie’s public support of labor unions. Frick later hired the Pinkerton Detective Agency to put an end to the increasing union forces, which led to the strike. Industrial workers responded with strikes and labor unions because of the need to regulate workplaces and safety requirements. The spike in strikes and chaos throughout the country led to the creation of the Sherman Anti-Trust Act, which prohibited any action that restricted trade or commerce among states or international affairs. (1890). The Sherman Anti-Trust Act was intended for use against corporate monopolies, but was used instead to break apart labor unions, which were seen as worker monopolies. The Act was not fully instituted for its proper use until the later election of President

The government also enacted the Hepburn Act, which made shipping internationally difficult on the railroad. Despite the fact that government grants led to incompetent railroads, the Interstate Commerce Commission and Hepburn Act were put into place, which made it so Hill “could not offer rate discounts on exports traveling on the Great Northern en route to the Orient” which was helping improve the economy with increased trade. Hill and other market entrepreneurs were not corrupt or unfair when choosing to not have subsides, but rather the political entrepreneurs were corrupt and insolvent. Also, Folsom argues that John D. Rockefeller was negatively impacted by government intervention. The Sherman Act was intended “to prevent monopolies and those companies ‘in restraint of trade’. Yet Standard Oil had no monopoly and certainly was not restraining trade” . Rockefeller’s goal was not to create a monopoly but in order to keep his business succeeding he needed directors in each state. By enacting the Sherman Act, Rockefeller’s company struggled, due to competition rising. These laws essentially stopped the growth of successful businesses, such as Hill and Rockefeller, who became so successful due to no government intervention.

The government during the late 19th century was laissez-faire, which meant that it did not interfere in business. That meant that big business could get away with using immoral and unscrupulous methods in order to gain wealth including forming trusts. Since the government was laissez-faire, they did not help the farmers because the government, like many other Americans during this time period, believed that people should pull themselves up from the bootstraps. In J. Laurence Laughlin’s “Cause of Agricultural Unrest”(Doc E), he speaks about issues with supply and demand in agriculture and how the government is to blame for the issues that arose from the supply and demand problems. “The sudden enlargement of the supply without any corresponding increase of demand produced that alarming fall in the price of wheat which has made the farmer’s excuse for thinking that silver is the mage panacea for all his ills...” This quote shows how the farmers were not to blame for the supply and demand issues, which caused a fall in wheat prices and for thinking that the addition of silver into the currency system would benefit them. It is actually the governments fault for not regulating the supply and demand within agriculture, which caused problems for the farmers including the fall of wheat prices. The Presidents during this time period did not make any progression in solving political issues in the United States especially in the currency reform, which dealt with Greenbacks and inflation. In 1896, William McKinley was elected President of the United States and he was against the Populist Party and the bimetallic system. The McKinley tariff was passed to increase the tariff on foreign goods to protect industry in the United States. This tariff only helped industry in the United States and not agriculture, which shows how McKinley favored business over the farmers,

The Sherman Antitrust Act was enacted on July 2nd, 1890 which prohibits activities that restrict interstate commerce and competition in the marketplace.

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