which finds its principal disinterested support among those who object to business institutions of great size and with far- reaching tentacles. But chain-store taxation is chiefly a matter of carrying economic competition to the legislature, where the decision is likely to be influenced not by any principle or any consideration of the public interest but by the more effective lobby. It is probably true that our business institutions are "too big"; but no criterion of excessive size is available except the test of efficiency in a market that is free, though policed to prevent monopoly.
The tax system is not a discriminating means of dealing with the monopoly problem. A more effective and courageous use of the police power would be preferable. However, pending such development, the use of the taxing power in the form of a special levy on intercorporate dividends, in spite of its admitted crudeness, is probably better than no control. And tax concessions, not involving subsidy, might well be granted small new business. The regulation of intercorporate financial practices should be squarely lodged with the federal government and should be exercised to prevent abuses and any interference with legitimate business operation and expansion. Beyond this, we need to know much more about the impact of monopoly on the economy, and we certainly need a more clearly defined policy in this field. A sounder view among business men on the suicidal effects of destroying competition and restricting output would be helpful. Where reasonably effective competition cannot be maintained, government regulation, government ownership, or competition of cooperatives are the appropriate remedies. This is an issue that needs more illumination and courageous action. When such illumination and such action are achieved, it probably will be apparent that the usefulness of taxation in the control of monopoly is extremely limited.