are given to "promote the useful arts," but the
inventor whom they are supposed to encourage reaps but a small share of
the profits of his inventions. Valuable improvements soon fall into the
hands of large companies, who are able to defend them in the courts, and
reap all possible profits by their use.
Again, patents sometimes aid in the formation of trusts and
combinations. Two or three firms may control all the valuable patents in
connection with some important industry. If they agree to combine their
interests and work in harmony, they are far stronger than an ordinary
trust, because the patents they hold prevent outside competition. It was
pointed out in the opening chapter how the control of patents was
sometimes a feature helping to induce the formation of trusts. The
Standard Oil Trust had its origin in the superiority which one firm
gained over its competitors through the control of an important patent.
The envelope trust, which, at this date, has raised the price of
envelopes about twenty per cent., owes its chief strength to its control
of patents on the machines for making the envelopes. Instances
innumerable could be given where a few manufacturers, who by their
ownership of patents controlled the whole field, have ended a fierce
competition by consolidating or agreeing to work together harmoniously
in the matter of selling-prices. Very many of these are monopolies in
trade or monopolies in manufacturing, and as such have already been
considered in the preceding chapters; but it is proper here to point out
the part which our patent system has taken in their formation, and the
fact that it is due to their control of patents that many of the
existing combinations owe their security against outside competition.
Probably the public was never so forcibly reminded of the defects of our
patent system by any other means as it has been by the operation of the
Bell Telephone monopoly. The purpose in granting patents is to aid in
the establishment of new lines of industrial activity, secure to the
inventor the right to reap a reward for his work, and encourage other
inventors to persevere in their search for new improvements. All these
things are effected by the monopoly which is held by the Bell Telephone
Company; but they are effected at a cost to the users of the telephone
under which they have grown very restive. Passing by the statement that
the patents which the Bell company holds were illegally procured in t
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