the investment necessary for controlling the industry almost to the
vanishing point.

[Footnote 1: Laws of New Jersey of 1913, chaps. 13-19.]

It is needless to enlarge on the possible abuses of the holding-company
device. They are coming to light more and more. The remedy, however, is
not so simple as it seems at first blush. A summary abolition of the
holding-company device would result in great injury and hardship to
industry. In the present condition of the corporation laws of certain of
the states, the right of large corporations to operate through local
subsidiary corporations is a practical necessity. Otherwise they would
be subjected to well-nigh intolerable exactions and interference. It has
been the policy in some states in dealing with foreign corporations to
attempt to impose, under the guise of fees for the privilege of doing
business in the state, a tax on all their property and business wherever
situated. Some of the attempts have been nullified by the Supreme Court
as violative of the prohibition of the Fourteenth Amendment against
taking property without due process of law, but these decisions have
not wholly remedied the evil or checked the ingenuity of state
legislators. In some jurisdictions great corporations seem to be
regarded as fair game for which there is no closed season.

Right here the scheme of federal incorporation brought forward during
President Taft's administration has many attractions to offer. It would
do away with the principal excuse for the holding-company device, and
pave the way for its abolition. It should satisfy the general public
because it would clothe the Government with enormously increased powers
of regulation and control; it should be attractive to the corporations
because it would afford relief from many of the intolerable