REPLIES TO CARD AND SCHEDULE INQUIRIES. 405

Our work brings us chiefly in contact with manufacturers of specialized
lines sold under brands and trade-marks. Hence we have little or no knowledge
 of the European cartel system, which we understand to be employed
chiefly in basic industries, making manufactures for further use in manufaecturing.

It would appear, however, that the European legal attitude toward competition
 is radically different from the American. Europe appears to hold that
reasonable price agreements, especially when competition in quality and service
continue, prevent, rather than foster, monopolies. That cut-throat competition,
unrestrained, results in the extinction of all but the strongest and thus leads
to monopoly
Furthermore, price agreements In themselves, or pooling of profits, even,
are not looked upon in themselves as either illegal or contrary to public
interest.
Another respondent adds: .

The knowledge on the part of foreign competition and also on the part of
foreign carriers, handlers, merchandisers, and buyers of the competitive situarion
 necessarily existing in the United States under the law, is sufficient for
them to take advantage of the opportunity of securing, by combination, prices
and creating conditions that could not be so easily and successfully accomplished
 if oppesed by conditions naturally ensuing through combination should
restriction be removed.
An importer of linens states:

It is well known that cartels or combinations have existed in Germany and
in Belgium, where the Government has given very able and direct assistance
In advice through the machinery of the Government, and frequently, has had
members of its Government attend all of the meetings and aid and abet plans of
syndicates or combinations in every way that the Government machinery can be
of assistance. This has been of tremendous importance. The Governments are
not inclined to hamper these cartels with red tape or with circumlocution but
have been of active, businesslike assistance. .
Foreign Governments assist private banking corporations to establish themselves
 in foreign countries. This assists in financial settlements; also gives a
method of obtaining necessary reports regarding financial standing of buyers.
in the writer’s experience. The German Government sent chemists to Belfast
to discover what dyes were needed and give exhibition of dyes and their uses.
After learning what was needed and reporting to manufacturing chemists in
Germany. these Government agents were followed by selling representatives of
German manufacturers, who came equipped with exactly the right materials
to meet the demand, and large sales resulted.
The Japanese Government is also stated to give similar aid. A
manufacturer of cotton goods who exports half his product says:

The Japanese combination, fostered by that Government, has seriously interfered
 with our business in China and has practically supplanted us in that
market.
The importance and character of Government aid to these combinations
 is described in the following excerpts from replies received,
the first being from a mannfacturer of corn products:
A foreign Government will permit a price to be fixed on a manufactured
article which will yield the capital employed in the business a fair return.
That income being assured, the manufacturers may offer their goods in foreign
markets at cost or below, until they have driven competition out. Then they
may advance their prices to cover what they have lost and interest thereon
and as much more as the buyer can stand. Most manufacturers reason that
under ordinary conditions, the greater the output, the lower the cost of production
 should be and the better the quality, because great businesses are in position
 to engage the services of better men at a less cost per unit. There being
a more severe struggle for existence in the older countries, their manufacturers
and merchants are forced to be skillful and careful, and they are backed up by
their Government as a rule.