e value of
the business, but will depend upon the amount of trouble which such a
business can cause by refusing to come into the Trust. If the
outstanding firm is in a strong position the Trust can only compel it
to sell, by a prolonged process of cutting prices, which involves
considerable loss. For such a business a high price will be paid. By
this means a strongly-established Trust or Syndicate will bring under
its control the whole of the larger and better-equipped businesses
which would otherwise by their competition weaken the Trust's control
of the market. A smaller business, or an important rival who
persistently stands out of the Trust, is assailed by the various
weapons in the hands of the Trust, and is crushed by the brute force
of its stronger rival. The most common method of crushing a smaller
business is by driving down prices below the margin of profit, and by
the use of the superior staying power which belongs to a larger
capital starving out a competitor. This mode of exterminating warfare
is used not merely against actually existing rivals, as where a
railway company is known to bring down rates for traffic below cost
price in order to take the traffic of a rival line, but is equally
effective against the potential competition of outside capital. After
two or three attempts to compete with Jay Gould's telegraph line from
New York to Philadelphia had been frustrated by a lowering of rates to
a merely nominal price, the notoriety of this terrible weapon sufficed
to check further attempts at competition. In this way each
strongly-formed Trust is able to fence off securely a certain field of
investment, thus narrowing the scope of use for any outside capital.
This employment of brute force is sometimes spoken of as "unfair"
competition, and treated as something distinct from ordinary trade
competition. But the difference drawn is a purely fallacious one. In
thus breaking down a competitor the Trust simply makes use of those
economies which we have found to attach to large-scale businesses as
compared with small. Its action, however oppressive it may seem from
the point of view of a weaker rival, is merely an application of those
same forces which are always operating in the evolution of modern
capital. In a competitive industrial society there is nothing to
distinguish this conduct of a Trust in the use of its size and staying
power from the conduct of any ordinary manufacturer or shopkeeper who
tries to d