y
they hold in trust needs to be supervised with far more strictness
than has ever been attempted under American law. When invested capital
shall be quite out of the range of buccaneers' actions, it will
produce more, increase more rapidly, and the better do its part toward
maintaining the wages of labor.

_Perversions of the Economic System by the Action of Promoters._--The
state will be carrying out its established policy if it shall
effectively control the action of promoters in their relation to
prospective investors. The man who is invited to become a stockholder
has a right to know the facts on which the value of the property
offered to him depends. How many plants does the consolidated
corporation own? How much did they cost? What is their present state
of efficiency? What have been their earnings during recent years?
Concerning these things and others which go to make up a correct
estimate of the value of what the promoter is selling, the purchaser
needs full and trustworthy information, and an obvious function of the
law is to see that he gets it. That such action would guard investors'
personal rights is, of course, a reason for taking it; but the reason
that here appeals to us is the fact that it would remove a second
perversion of the economic system, accelerate the increase of capital,
and help in securing a distribution of wealth which would be more
nearly in accordance with natural law.

_Perversions of the System caused by the Action of Corporations in
their Entirety._--More directly within the domain of pure economics is
the relation between the typical great corporation and the majority of
the public which is wholly outside of it. In the common mind this
relation also often appears as that of plunderers and plundered, and
what it often has actually been, is a relation between corporations
which have exacted a certain tribute and a body of consumers which has
had to pay the tribute. Bound up with this general relation between
the manufacturing corporation and the consuming public is one between
it and producers of raw material which it buys and with laborers whom
it hires. In this last relation what is endangered is the normal rate
of pay, present and future. The type of measure which protects
consumers protects the other parties who are affected by the great
corporation's policy. Workers are safe and producers of raw materials
are measurably so if the power of competition in the making and
selling o