Analysis of Congressional Intent
Sherman views on the policy to be served by antitrust legislation are clear. They appear on the face of the bill he drafted and reported from the committee on finance, S1. Section 1 of that bill declared illegal two classes of “arrangements, contracts, agreements, trusts, or combination”: 1 those “made with a view, or which tend, to prevent full and free competition,” and 2 those “designed, or which tend, to advance the cost to consumer” of articles of commerce. Sherman employed these two criteria of illegality in every measure he presented to the senate. Read the rest of this entry »
January 26th, 2010 in
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There is no doubt that hostility toward big business – at that time an unfamiliar from of enterprise – motivated the passage of the Sherman act. From this point of departure, critics of the antitrust laws sometimes assert that the antitrust laws have served to protect small business from the competition of rivals. Despite a few statements in debate that indicate concern for the fate of the individual competitor, the consensus in that the protection of small forms was not among the original goals of the Sherman act. 
It is sometimes said of these combination the monopolistic trusts that they reduce prices to the consumer by better methods of production, but all experience shows that this saving of cost goes to the pockets of the producer. The price to the consumer depends upon the supply, which can be reduced at pleasure by the combination.
Income transfer is a tangible and obvious effect of monopolistic pricing. Resource allocation is an intangible and subtle effect. It is clear from the congressional debates that senators knew that monopolistic pricing transferred income from consumers to producers. Speaking in support oh his bill, Senator Sherman said;
