ossibilities of creating fair conditions of competition (which
never had fully prevailed) in which efficiency would be able to prove
its merits and monopoly would work its own undoing. It was the more
logical for the country to give this policy at least a trial before
adopting irrevocably the policy of general industrial monopoly.
In either case competition actual or potential is the fundamental
principle by which prices have to be regulated. Where competition is
enforced it is by applying some general rules that create a general
market price instead of discriminatory prices, but the fixing of the
price is left to the competitors. Where monopoly is accepted prices
must be fixed with reference to an estimated competitive standard,
that which under hypothetically free conditions would just suffice to
attract and retain private enterprise and capital.

Sec. 18. #Anti-trust legislation of 1914#. The anti-trust legislation
of 1914, passed by the Democratic party to carry out its program, is
embodied in two acts: the Clayton Act, laying down new rules; and
the Federal Trade Commission Act, mainly to provide an agency with
administrative and quasi-judicial functions to deal with unfair
practices. This displaced the Bureau of Corporations, established in
1903. The Clayton Act forbids discrimination where the effect may be
to lessen competition, or tend to create a monopoly. Due allowance may
be made for difference in the cost of selling or transportation, but
a difference is not required in such cases. It forbids contracts
to prevent dealers from handling other brands. It forbids corporate
ownership of stock in a competing corporation, forbids interlocking
directorates in large banks and in other competing corporations,
with capital, surplus and undivided profits aggregating more than
$1,000,000. The Trade Commission Act in addition to its administrative
provisions for investigation, reports, and readjustment of the
business of companies upon request of the courts, declares that
"unfair methods of competition in commerce" are unlawful, and both
empowers and directs the Commission to prevent their use (banks and
common carriers subject to other acts being excepted).

These acts are too new to have been given a fair test. They have,
however, given evidence of exercising at once an influence upon
the situation. They are imperfect in some details that will require
amendment; but they mark the beginning of a new policy toward
indu