Mergers and the Law
Mergers and the Law
Public policy in the regulation and control of business organization and methods is a continuing factor in the economic environment of modern life which must always be reckoned with. Such policy establishes certain standards of conduct for business in its relation to other business and to the public. Like any general standards, for some they mean restraint or compulsion, while for others they assure a measure of freedom and individual initiative. The attention of the business community and the public at any time is naturally most directed to the degree of compulsion or freedom which results from the prevailing public policy.
What is less noticed, however, is the process of constant change in public policy, on the one hand, and in business organization and conduct, on the other, through which the two gradually and insensibly accommodate and adjust themselves to one another. Business organization and conduct, especially in the past generation and in the United States, have been undergoing rapid and far-reaching changes. But public policy also is a living and flexible thing, never fully or accurately expressed in the mere letter of the law, but reflected in the many-sided and changing interpretations which the law receives at the hands of the courts and of governmental officials. Although in the degree of freedom or compulsion which it provides, public policy may lag behind the realities of business life from time to time, in a country with free and democratic institutions there is reason to believe that in the end such policy toward business enterprise expresses a public opinion based upon experience, which in turn reflects more or less directly the actual effects upon the public welfare of prevailing forms of business organization and conduct.
The failure to recognize this process of mutual adjustment between business life and its legal environment is a source of the recurrent discussion of the adequacy or propriety of prevailing public policies toward business. In recent years, particularly, the growth of industrial productive power, in-