Theodore Roosevelt’s 1904 Election as U.S. President

The presidential and vice presidential candidates for the Republican Party in 1904 were President Theodore Roosevelt and Charles W. Fairbanks and for the Democratic Party, Alton B. Parker and Henry Davis.

Roosevet&FairbanksParker & Davis







Republican Party’s Nomination of Roosevelt (and Fairbanks)

At the Republicans’ June convention in Chicago, Roosevelt was unanimously nominated on the first ballot, and the leaders of the conservative wing of the Party selected Fairbanks, a conservative Senator from Indiana with close ties to the railroad industry, for the running mate. Roosevelt was not pleased with Fairbanks, but did not think it was worth fighting about.

Sagamore Hill
Sagamore Hill

On July 27th, 54 solemn Republicans went to Roosevelt’s home, Sagamore Hill, in Oyster Bay, New York  on the north shore of Long Island,[1] to enact their party’s “most hallowed ritual: a formal notification of nomination to its presidential candidate.” [2]

Roosevelt in a 12-minute speech that day accepted the nomination. He, of course, praised the Republican Party and slammed the Democrats. He had two comments regarding business issues. He stated, “In dealing with the great organizations known as trusts, we [need] . . . to point out that [the laws] . . . actually have been enforced, and that legislation has been enacted to increase the effectiveness of their enforcement.” Roosevelt added, “The problems with which we have to deal in our modern industrial and social life are manifold; but the spirit in which it is necessary to approach their solution is simply the spirit of honesty, of courage, and of common-sense.”

His more formal letter of acceptance of September 12th reiterated these points and praised the previously mentioned “successful suit against the Northern Securities Company merger,” the enforcement of “the anti-trust and interstate commerce laws, and the action of the last Congress in enlarging the scope of the interstate commerce law [in the Elkins Act], and in creating the Department of Commerce and Labor, with a Bureau of Corporations, [that] have for the first time opened a chance for the National Government to deal intelligently and adequately with the questions affecting society, whether for good or for evil, because of the accumulation of capital in great corporations.”

The Campaign

Roosevelt’s Secretary of State, John Hay, in a letter to American historian and author, Henry Adams, called this campaign “the most absurd political campaign of our time.” Roosevelt did not actively campaign. Instead he issued statements form his front porch at Sagamore Hill, and the Republican Party received large campaign contributions from wealthy capitalists, including J.P. Morgan, the financial leader of Wall Street and a director of the New York Central Railroad; Edward H. Harriman, the president of the Union Pacific Railroad and also a director of the New York Central; and Henry C. Frick, the steel baron.

1904 TR poster

Roosevelt’s campaign slogan The Square Deal reiterated his comment on the settlement of the 1902 coal miners’ strike. He promised to “see it that every man has a square deal, no less and no more.” This pledge summed up Roosevelt’s belief in balancing the interests of business, consumers, and labor. The Square Deal called for limiting the power of trusts  (a person having control of a large corporation so that no others can succeed in the economy), promoting public health and safety, and improving working conditions.

The Election Results

The results of the November 8th election were not close. Roosevelt and Fairbanks had 7,626,000 votes (56.4%); Parker and Davis, 5,084,000 (37.6%). The Electoral College margin for Roosevelt and Fairbanks was even wider: 336 (70.6%) vs. 140 (29.4%); the following map shows the geographical distribution of the electoral votes (Republican in red; Democrat in blue):



[1] Sagamore Hill is now a National Historic Site, currently closed for renovation.

[2] Edmund Morris, Theodore Rex at 343-64 (Random House; New York, 2001).

Federal Regulation of Railroads During U.S. President Theodore Roosevelt’s First Term (1901-1905): The Elkins Act

Theodore Roosevelt
Theodore Roosevelt

As discussed in a prior post, a major issue for President Theodore Roosevelt in his first term was whether and how to enhance federal regulation of railroads and other companies engaged in interstate commerce.

Two accomplishments on that issue stand out: conducting a successful federal antitrust case against the Northern Securities Company, as covered in another earlier post, and pressing for the enactment of a new statute (the Elkins Act) to increase the power of the Interstate Commerce Commission (ICC) over railroad freight rates.

Now we examine the circumstances relating to the enactment of that statute.

Legal Background

In 1887 the Interstate Commerce Act was enacted in response to rising public concern over the growing power and wealth of corporations, particularly railroads. Railroads had become the principal form of transportation for both people and goods, and the prices they charged and the practices they adopted greatly influenced individuals and businesses. In some cases, the railroads were perceived to have abused their power as a result of too little competition. Railroads also had banded together to form pools and trusts that fixed rates at higher levels than they could otherwise command.

ICC seal

This statute created the Interstate Commerce Commission (ICC) and required that railroad rates be “reasonable and just,” but did not empower the ICC to fix specific rates. It also required that railroads publicize shipping rates and prohibited short-haul or long-haul fare discrimination, a form of price discrimination against smaller markets, particularly farmers.

By 1901, however, it was apparent that large shippers were able to obtain discounts or rebates and that the ICC was not effective, and the ICC had notified the administration about abuses within the railroad industry. In addition, a large segment of the population supported efforts to regulate the railroads because so many people and businesses were dependent on them.

Roosevelt vs. The Railroads
Roosevelt vs.                   The Railroads

President Roosevelt then began advocating for new statutes to remedy these weaknesses:

  • State of the Union (Annual) Message (December 3, 1901). In his first Annual Message, Roosevelt recommended that the ICC’s 1887 statute be amended to ensure that railroad “rates should be just to, and open to, all shippers alike” and that the ICC had “a speedy, inexpensive, and effective remedy to that end.” Even though the “cardinal provisions of [the 1877 statute] were that railway rates should be just and reasonable and that all shippers, localities, and commodities should be accorded equal treatment,” there are allegations “that established rates are not maintained; that rebates and similar devices are habitually resorted to; that these preferences are usually in favor of the large shipper; that they drive out of business the smaller competitor; that while many rates are too low, many others are excessive; and that gross preferences are made, affecting both localities and commodities.” On the other hand, “the railways assert that the law by its very terms tends to produce many of these illegal practices by depriving carriers of [the] . . . right of concerted action which they claim is necessary to establish and maintain non-discriminating rates.”
  • Speech in Providence, Rhode Island (August 23, 1902). On August 23, 1902, before a crowd of over 20,000, Roosevelt in a speech said, “The great corporations . . . [or trusts] are the creatures of the State, and the State not only has the right to control them, but it is in duty bound to control them wherever need of such control is shown. . . . The immediate necessity in dealing with trusts is to place them under the real, not nominal, control of some sovereign to which, as its creatures, the trusts shall owe allegiance, and in whose courts the sovereign’s orders may be enforced. In my opinion, this sovereign must be the National Government.”
  • State of the Union (Annual) Message (December 2, 1902. In his second Annual Message to the Congress, Roosevelt said that “the experience of the past year has emphasized . . . the desirability of the steps” regarding regulation of [interstate] trusts that he discussed in his first state of the union message. In short, “Corporations, and especially combinations of corporations, should be managed under public regulation [by the federal government].”

The Elkins Act [1]

Senator Stephen Elkins
Senator               Stephen B. Elkins

In early 1903 the U.S. Department of Justice prepared a bill to remedy the perceived deficiencies in the ICC and submitted it to the Congress. By February of that year Senator Stephen B. Elkins, Republican of West Virginia and a member of the Senate Committee on Interstate Commerce, predicted that Congress would adopt a railroad anti-rebate bill that would satisfy the Administration as well as fair-minded railroad executives. Elkins and his wife, by the way, owned coal mines and a coal railroad, the latter of which in 1902 had been sold, and were friends of railroad interests.

That month (February 1903) what became known as the Elkins Act unanimously was passed by the Senate and approved by the House by a vote of 250 to 6. On February 19th Roosevelt signed the Elkins Act (An Act to further regulate commerce with foreign nations and among the States, 32 Stat. 847, ch. 708 (1903).) Although it was called the Elkins Act, it really was drafted by the President of the Pennsylvania Railroad, which resented being pressured by shippers to grant rebates. Other railroads supported the measure for the same reason with an estimated 10% of all railroad revenues being paid out in rebates.

The Elkins Act made it a misdemeanor for a railroad and its directors, officers and agents willfully to fail to file with the ICC and publish its freight rates or failure “strictly to observe” those rates. It also was a misdemeanor “to offer, grant, or give or to solicit, accept, or receive any rebate, concession, or discrimination” in such rates. All such misdemeanors were punishable by a fine between $1,000 and $20,000. The ICC alone was not empowered to make these determinations; instead the ICC had to petition a federal circuit court to do so and to enjoin any such violations.

Immediate Reaction to the Elkins Act

President Roosevelt in his Annual State of the Union Message on December 7, 1903, applauded the progress over the last year in the “exercise of supervision over the great [interstate] corporations and combinations of corporations.” This included congressional approval of the Elkins Act that has “secured equal treatment to all producers in the transportation of their goods, thus taking a long stride forward in making effective the work of the [ICC].”

The ICC itself in its Annual Report of December 15, 1903, emphasized that the Act was targeted “to prevent or more effectually reach those infractions of law, like the payment of rebates and kindred practices.” The Act also simplified the method of proving discrimination or rebates by making the violation the charging of a rate less than the published rate. In short, the Act is a “wise and salutary” statute correcting “serious defects in the original [Interstate Commerce Act of 1890] and greatly aided the attainment of some of [its] purposes.” However, the ICC noted that it had “no power to determine what rate is reasonable, and such orders as it can make [about rates] have no binding effect.”

Others criticized the Elkins Act’s failure to grant the ICC power to determine reasonable freight rates and the Act’s elimination of imprisonment for violations whereas the supporters of the measure thought that elimination would encourage firms to testify against each other and thereby encourage compliance with the law. Many merchants started agitating for new legislation granting the ICC power to suspend freight rates on complaint.

I have not found any commentary about the Elkins Act by W. C. Brown, my maternal great-great-uncle and then a Vice President of the New York Central Railway.

However, in an April 18, 1907, speech at the Buffalo, New York Chamber of Commerce, he said, “I am firmly and unalterably in favor of regulation of railroads by the Nation and States.”[2] This comment came after he had stated that “the railroads were being operated intelligently, skillfully, vigorously to the last limit of capacity. Yet almost any other business has offered higher and more certain returns than railroads, and it will be impossible for railroads to raise needed capital unless such investment will be reasonably attractive and secure resulting from assurance of reasonable cooperation and protection. This will be difficult in light of extreme hostility and indiscriminate agitation that has resulted in unjust and harmful legislation in many states.”

Brown returned to this theme in February 1908, when he said, “The principle of the control and regulation of railroads by the nation and the several States has been accepted in good faith by the railroads, and they have entered upon the task of adjusting their operations to the changed conditions resultant upon laws recently enacted.” His only caveat was railroads’ needing “a fair and impartial hearing and the . . . right to appeal to the courts to prevent injury or to secure redress of injustice.” [3]

In the New York Central’s annual report for 2009, Brown said, “Governmental regulation of railroads, within proper limitations, is of benefit to the public, to the railroads, and to those who hold their securities.” [4]

Therefore, it was not surprising for Brown to say in a September 26, 1910, letter to “My dear Col. Roosevelt,” after Roosevelt was out of office, “During your term as President, as you know, I steadfastly supported your ideas in regard to Corporations.”[5]



[1] This discussion is based upon the Elkins Act; Edmund Morris, Theodore Rex at 206, 429 (Random House; New York; 2001); Kolko, Railroads and Regulation, 1877-1916, at 90-92, 94-102 (Princeton Univ. Press; Princeton; 1965); ICC, Seventeenth Annual Report (Dec. 15, 1903); Theodore Roosevelt Center, The Elkins Act.

[2] William C. Brown, Remarks at Chamber of Commerce, Buffalo, New York, April 18, 1907.

[3] Praises Rebate Law, N. Y. Times (Feb. 2, 1908).

[4] Regulations Help Railroads Along, N. Y. Times (Mar. 13, 1910).

[5] This letter (Image (# 93-0659) was provided courtesy of the Library of Congress Prints and Photographs Divisions and Theodore Roosevelt Center at Dickinson State University, letter’s salutation of “Col. Roosevelt” was a reference to his having served as a Colonel in the U.S. Army’s Rough Rider Regiment in the Spanish-American War, where he was hailed as a hero for leading a charge  up San Juan and Kettle Hills in Cuba, and to Roosevelt’s preference to be called “Colonel” by those close to him. Why did he prefer to be called “Colonel” instead of “Mr. President”? I suspect it was his desire to emphasize his personal physical bravery in armed combat.

Federal Regulation of Railroads During U.S. President Theodore Roosevelt’s First Term (1901-1905): The Northern Securities Case

As mentioned in an earlier post, one of President Theodore Roosevelt’s major efforts to enhance federal regulation of railroads in his first term was his Administration’s commencement of an antitrust lawsuit under the Sherman Act against the Northern Securities Company, which combined the stocks of two competing railroads from the Great Lakes and the Mississippi River to Puget Sound on the Pacific Coast.

These two roads were the Great Northern Railway running from St. Paul, Minnesota to Seattle, Washington while the Northern Pacific Railway ran from St. Paul (and separately from Ashland, Wisconsin and Duluth, Minnesota) to Seattle and Tacoma, Washington and Portland, Oregon. In addition, the two of them jointly owned the Chicago, Burlington & Quincy Railroad, which connected St. Paul with Chicago. [1]

Great Northern Railway
Great Northern Railway
Northern Pacific Railway
Northern Pacific Railway

The Legal Background

The late 19th century was an era of “trusts” and of “combinations” of businesses and of capital organized and directed to control of the market by suppression of competition in the marketing of goods and services, the monopolistic tendency of which had become a matter of public concern.

To meet this problem, the U.S. in 1890 enacted “An act to protect trade and commerce against unlawful restraints and monopolies,” 26 Stat. 209, ch. 647 (1890). The statute is commonly referred to as the Sherman Act in recognition of its principal author or sponsor, Senator John Sherman, Republican of Ohio. The statute provided, in part, as follows:

  • “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several states . . . is hereby declared to be illegal. Every person who shall make any such contract, or engage in any such combination or conspiracy, shall be deemed guilty of a misdemeanor . . . .” (Section 1)
  • “Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several states . . . shall be deemed guilty of a misdemeanor . . . . ” (Section 2)

The prescribed penalty for such misdemeanors was a fine up to $5,000 or imprisonment not exceeding one year or both. In addition, the circuit courts (n/k/a district courts) were “invested with jurisdiction to prevent and restrain violations” of the statute (Section 4), and persons injured in their business or property by any violations could sue the perpetrators for treble damages and attorneys’ fees (Section 7).

The goal of the Sherman Act was to prevent restraints of free competition in business and commercial transactions that tended to restrict production, raise prices, or otherwise control the market to the detriment of purchasers or consumers of goods and services.

The Formation of Northern Securities

On November 13, 1901 (only two months after Roosevelt became President), J. P. Morgan, who controlled 21 railroads, including the Northern Pacific, and James J. Hill of the Great Northern [2] announced the formation of the Northern Securities Company to be a holding company for the common stock of the two competing railroads, This new combination was the second largest company in the world with annual revenues of $100 million and covering commerce from Chicago to Seattle and extending to China over Mr. Hill’s shipping lines.

A New York newspaper saw the new company as another step toward universal monopoly.

The Commencement of the Lawsuit

On February 19, 1902 (only three months after the formation of the Northern Securities Company), the Roosevelt Administration announced plans to commence the antitrust case alleging that the formation and operation of Northern Securities constituted a restraint of interstate commerce in violation of the Sherman Antitrust Act. In addition to the two railroads, the U.S. planned to sue James J. Hill of the Great Northern and seven directors of the Northern Pacific, including J. P. Morgan and George F. Baker. [3]

James J. Hill
James J. Hill
J. P. Morgan
J. P. Morgan
George F. Baker
George F. Baker








The U.S. stock market immediately registered significant declines with similar reactions in London, Paris and Berlin markets. In response, J. P. Morgan starting buying stocks in great quantities and helped to stop a panic.

The next evening Morgan and 12 other wealthy men met with Roosevelt at the White House without discussing the lawsuit, i.e., the elephant in the room. The next morning, however, the subject was broached when Morgan returned alone to the White House for a meeting with Roosevelt and the Attorney General, Philander Chase Knox. Morgan asked why the Government had not just called and asked him to correct any irregularities with the charter of Northern Securities, but Knox merely said the Government wanted to stop the company, not to fix it up. Afterwards Roosevelt said, “Mr. Morgan could not help regarding me as a big rival operator who either intended to ruin all his interests or could be induced to come to an agreement to ruin none.”

Theodore Roosevelt
Theodore Roosevelt
Philander Chased Knox
Philander Chase Knox

The Case in the Circuit Court

The bill in equity (or “complaint” in today’s terminology) thereafter was filed with the U.S. Circuit Court for the District of Minnesota.[4] The complaint charged that the Northern Securities was an illegal “combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several states” (Sherman Act § 1).

The next April 9th (1903), the Circuit Court’s four Circuit Judges unanimously upheld the validity of the Government’s complaint (United States v. Northern Securities Co., 120 Fed. 721 (Cir. Ct., Dist. Minn. 1903)) . The court in an opinion by Judge Thayer first entered the following findings of fact as established by the pleadings and evidence:

  • The Great Northern and Northern Pacific owned railroad lines from Minnesota to Puget Sound that are parallel and competing lines.
  • These two railroads in 1901 jointly acquired 98% of the capital stock of the Chicago, Burlington & Quincy Railway.
  • Thereafter in 1901 James J. Hill, J. P. Morgan and six other men, all of whom were defendants in the case and collectively had practical control of the two principal railroads, arranged to place a large majority of the stock of the two railroads in a holding company, Northern Securities, and that was done.
  • As a result, the control of these two railroads was put into a single person and thereby “destroyed every motive for competition” between them.
  • Those “who conceived and executed this plan . . . intended . . . to accomplish these objects.”

The court then concluded that the Congress “deliberately employed words of such general import [in section 1 of the Sherman Act] as, in its opinion, would comprehend every scheme that might be devised to accomplish that end.” In addition, the U.S. Supreme Court had held that the Act “applies to interstate carriers of freight and passengers . . .; that [the Act does] not mean in unreasonable or partial restraint of trade or commerce, but any direct restraint thereof; that an agreement between competing railroads . . . [to fix their rates is] a contract in direct restraint of commerce . . .; and [that the Act is constitutional].”

Therefore, the court entered a decree that the defendants had violated section 1 of The Sherman Act and that Northern Securities was enjoined from acquiring additional stock of the two railroads, from voting its holdings of those shares and from exercising or attempting to exercise any control or direction over the two railroads. Northern Securities, however, was permitted to rescind its acquisitions of the stock of the two railroads.

The Case in the Supreme Court

The case then went directly to the U.S. Supreme Court, [4] which on December 14, 1903, heard arguments. Attorney General Knox appeared for the Government and made what many thought was a brilliant argument without any questions from the Justices.

In March 1904, the U.S. Supreme Court, 5 to 4, affirmed the Eighth Circuit and ordered the company dismantled. (Northern Securities Co. v. United States, 193 U.S. 197 (1904).) The Court’s plurality opinion by Mr. Justice John Marshall Harlan and supported by only three of the other Justices concluded that “the evidence . . . shows a violation of the . . . [Sherman Act, which] declares illegal every combination or conspiracy in restraint of commerce among the several states . . . and forbids attempts to monopolize such commerce or any part of it.”

In so concluding, the Harlan opinion emphasized that the Court’s prior decisions had established that “every contract, combination, or conspiracy in whatever form, of whatever nature, and whoever may be parties to it, [that] directly or necessarily operates in restraint of [interstate] . . . commerce” is illegal. Those prior decisions, said the Harlan opinion, also determined that the statute is not limited to unreasonable restraints of trade; that railroads operating in interstate trade are covered by the statute; and that every contract, combination or conspiracy that would extinguish such competition is illegal. (Emphasis added.)

Mr. Justice David Josiah Brewer concurred in the judgment affirming the lower court’s conclusion of antitrust violations, but disagreed with the rationale of the Harlan opinion because of fear that it “might tend to unsettle legitimate business enterprises, stifle or retard wholesome business activities, encourage improper disregard of reasonable contracts, and invite unnecessary litigation.” Instead, said Justice Brewer, the statute only covered “contracts which were in direct restraint of trade, unreasonable, and against public policy.” (Emphasis added.)

A dissenting opinion was filed by Mr. Justice Edward Douglas White and joined by Chief Justice Melville Fuller and Justices Rufus Wheeler Peckham and Oliver Wendell Holmes. This opinion concluded that the constitutional power of the federal government over interstate commerce did not extend to cover Northern Securities Company’s acquisition of the common stock of the two railroads.

Holmes also filed a separate dissenting opinion that was joined by the other three dissenters. Holmes asserted that the antitrust statute only outlawed combinations in restraint of trade, not of competition and that he saw no evidence of an attempt to monopolize some portion of U.S. trade or commerce. He also expressed relief that “only a minority of my brethren [the four Justices who subscribed to the opinion of Mr. Justice Harlan] adopt an interpretation of the [statute] . . . which . . . would make eternal the bellum omnium contra omnes [the war of all against all], and disintegrate society so far as it could into individual atoms . . . . [Such an interpretation] would be an attempt to reorganize society . . . . I believe Congress was not entrusted by the Constitution with the power to make . . . [such a law], and I am deeply persuaded that it has not tried.”

The high court’s action was a major victory for the administration and put the business community on notice that although this was a Republican administration, it would not give business free rein to operate without regard for the public welfare.

W. C. Brown’s Reaction to the Supreme Court’s Decision 

W. C. Brown
W. C. Brown

Soon thereafter (May 24, 1904), W.C. Brown, my maternal great-great-uncle, in a speech to the Illinois Manufacturers Association that was covered by the New York Times commented on the Supreme Court’s decision. He said, “Propositions looking to the betterment of [railroad] service, having no other object, and impossible of any other result, have been misunderstood and have been fought inch by inch with a perseverance and zeal worthy a better cause.” As a result, Brown continued, it was “not impossible that the language of the majority of the Supreme Court [in the Northern Securities case] may . . . seem to reflect the clamor of the public, rather than the calm, judicial review of a great question.” [5]

Brown added that by “amendment or by judicial interpretation the question of reasonable restraint of commerce, as against any restraint whatever, must become part of the Sherman . . . [Act], and must be considered in its enforcement, or obstacles to commercial and industrial progress are likely to be interposed the gravity of which no one can foresee.” (Emphasis added.)

This commentary was preceded by Brown’s proclaiming that “[e]xcept for the birth of Christ, no event has meant so much to humanity as the U.S. Declaration of Independence;” that the recent U.S. war with Spain was “as holy, as high and unselfish in purpose as ever inspired a people;” and that the U.S. had the “satisfaction of having borne its share of the burden of carrying Christianity, civilization and education to those who sit in the darkness of ignorance and superstition.”

Brown also issued a stern warning that apparently emerged from his growing up in thinly populated Iowa and Illinois and that ignored his presumably elegant life in New York City (and earlier in Chicago). Brown said, “The most serious menace that clouds our national horizon today, ominous now and increasing in size and anger and portent, is the rapid growth of our cities . . . . No man can regard the growth of the great centers of population, with their sinister, dangerous, preponderantly influence in the politics of the State and Nation, without alarm.” He added, “The remedy for this evil and the safety of the Nation was building up, encouraging, and increasing our agricultural population.”

It should also be noted that at the time of this speech, Brown was a Vice President of the New York Central Railway, two of whose directors were defendants in the case: J. P. Morgan, a principal architect and beneficiary of the formation of the Northern Securities Company, and George F. Baker.

Subsequent Supreme Court’s Interpretations of the Sherman Act

Seven years later, in 1911, the approach to interpreting the Sherman act advocated by Justice Brewer and W. C. Brown was in fact adopted by the U.S. Supreme Court. In Standard Oil Co. v. United States, 221 U.S. 1 (1911), the Court, 8 to 1, stated that only combinations and contracts unreasonably restraining interstate or foreign commerce were illegal under the Sherman Act. Justice John Marshall Harlan, the lone dissenter in this case and the author of the Court’s opinion in Northern Securities, said the Rule of Reason was a departure from previous Sherman Act case law, which purportedly had interpreted the language of the Sherman Act to hold that all contracts restraining trade were prohibited, regardless of whether the restraint actually produced ill effects.

Thereafter the Court unanimously reaffirmed the Rule of Reason in two cases: United States v. American Tobacco Co., 221 U.S. 106 (1911) (section 2 of the Sherman Act did not ban the mere possession of a monopoly but only the unreasonable acquisition and/or maintenance of monopoly); Chicago Board of Trade v. United States, 246 U.S. 231 (1918) (agreement between rivals limiting rivalry on price after an exchange was closed was reasonable and thus legal).

Subsequent Supreme Court cases established the concept of per se violations of Section 1 of the Sherman Act. These are “agreements, conspiracies or trusts in restraint of trade” that have been found to have a “pernicious effect on competition” or “lack any redeeming virtue” and include competitors’ agreements to fix their prices or divide markets between them and concerted refusals to deal.

For other alleged violations of section 1 of the Sherman Act, the courts engage in a “rule of reason” analysis to evaluate the intent and purpose of the conduct, the facts peculiar to the business and industry, the history of the conduct and its effect on competition. If the result of this judicial analysis is the conduct unreasonably restrains trade, it is a violation of section 1.


[1] This post is based upon Edmund Morris, Theodore Rex at 59-65, 87-95, 219, 304-05, 313-16 (Random House; New York; 2001); MIller Center, Theodore Roosevelt: Domestic Affairs; and the other sources cited below.

[2]  The James J. Hill House is a St. Paul mansion now open to the public and operated by the Minnesota Historical Society.

[3] J.P. Morgan and George F. Baker were also directors of the New York Central Railway, and I was a beneficiary of Baker’s wealth as a George F. Baker Scholar at Grinnell College, 1957-1961. Morgan’s Manhattan Library is now the Morgan Library & Museum that is open to the public.

[4] As of 1903 nine U.S. circuit courts had jurisdiction over trials of all civil suits initiated by the U. S. Government in different parts of the country, and the circuit court that covered the State of Minnesota (the Eighth Circuit) had four Circuit Judges (Henry C. Caldwell, Walter H. Sanborn, Amos M. Thayer and Willis Van Devanter). As of January 1, 1912, these courts were abolished, and the previously established U. S. district courts assumed jurisdiction over all civil and criminal cases in the federal courts.

[5] W.C. Brown, Address before the Meeting of the Illinois Manufacturers Association, Chicago, Illinois (May 23, 1904); Supreme Court Influenced, N.Y. Times (May 24, 1904).