140

THE GREEN BAG

ization of power, and therefore to be con banking, and yet the publicity given to this demned. This is political sentiment and business, its supervision by the Comptroller not fundamental principle. If the power of the Currency and the necessity of filing did not exist, then the policy would be ob elaborate reports, have not been to its jectionable, but assuming the power to prejudice, but have rather increased the exist, it should be exercised, not only to confidence of the public in the management the extent indicated by the Littlefield Bill, of banks. It is not conceivable that any Federal but to its full extent, and that is by the enacting of a law by Congress that will regulation would encroach upon property permit the incorporation of companies doing rights, such as trade secrets, and advantages an interstate commerce business. Such a due to individual skill or endeavor. No law should contain the most conservative danger may be expected from Congress, to restrictions respecting capitalization, so as which, multiplied to the fith power, corpora to prevent stock watering, but in other tions are not now exposed by the states. The criticism (from the standpoint of the respects should facilitate the easy conduct of business. Modern business conditions corporation) to which the present policy is require Some such law in order to remove subject, is not that it attempts to regulate, business conducted in corporate form from but that it does not go far enough. Congress the annoying, petty, retaliatory and un should create corporations as well as reg necessary restrictions now existing. Cor ulate those now in existence. If this should porations doing business in the various be done, it would be welcomed by the busi states should enter those states as a matter of ness and corporate world. The advantages right, not as a matter of comity. Commerce that would result are many, chief among should be encouraged, not restricted. This which are relief from local state regulation, is a public necessity. The business and burdensome taxation and franchise fees, and franchises of these corporations should not the security afforded by the administration be a prey to the legislative greed of every of the law in the Federal courts. The state and subjected to burdensome and cer latter advantage is now secured in many cases by the fact that there is usually a tainly unequal taxation. This brings us to the consideration of diversity of citizenship in litigation. It is the subject from the standpoint of the so important an advantage, that often times companies are purposely organized in corporation. The best modern corporate practice favors a state foreign to their principal place of publicity. This is illustrated by the volun business in order to secure this protection tary and elaborate reports published by from local courts and influences as well as many of our largest corporations. The incompetent judges and worse juries. To late Mr. Coster, of the firm of J. P. Morgan say that this would impose additional & Company, insisted upon the utmost burdens upon the Federal courts is merely publicity (consistent with prudent manage to state what the business and territorial ment) of the business of the many large extension of our country is already making corporations under his direct charge; and clear, that the number of courts and judges to him is in large measure due the credit of must be increased in order to meet the establishing in this country this high stand inevitable and natural growth of the business of the country. At present, this necessity ard of corporate management, which prop erly recognizes the public interest in the exists in a few circuits only. The increased affairs of large industrial, railroad and labor that may be required of the Federal courts by the legislation proposed would financial corporations. No business is more sensitive than that of not be appreciable. But even if it were,