Section 10.-This section provides that the President may requisition foods, feeds, fuels, and other supplies necessary for the support of the Army and Navy and for the public service.

Section 11.-This section authorizes the President to purchase, store, and provide storage facilities for and to sell at reasonable prices wheat, flour, meal, beans, and potatoes. In other words, the Government is authorized to become a dealer in the particular necessaries mentioned.

Section 12.-This section provides, so far as it is necessary to secure an adequate supply of necessaries for the Army and Navy, or for other public use, that the Government may take over and operate any factory, packing house, pipe line, mine, or other plant, in which the necessaries are manufactured or mined. When such establishments are no longer necessary for the purposes named, the same may be restored to the person entitled to the possession thereof.

Section 13. This section authorizes the President, when he finds it necessary to prevent enhancement, depression, or fluctuation of prices, or to prevent injurious speculation, manipulation, or quotation, all of which are called evil practices, to prescribe regulations for the exchanges, boards of trade, and similar organizations dealing in necessaries to prevent such evil practices.

Section 14.-This section provides that when the President finds an emergency exists requiring stimulation of the production of wheat, he may guarantee for a period not to exceed 18 months a price which will insure producers a reasonable profit. No. 1 northern spring wheat at the principal interior markets is to be made the basis upon which the guaranty for the various crops is to be calculated. The section further provides an absolute guaranty of $2 a bushel at the primary interior markets for No. 1 northern spring for the crop of 1918. The section further provides that the President may increase the importation tariff on necessaries if he finds this advisable to prevent undue importation from other countries.

Section 15.-This section provides that after 30 days from the approval of the act, no foods, fruits, food materials, or feeds shall be used for the production of distilled spirits for beverage purposes, but they may be used for other than beverage purposes. No distilled spirits shall be imported into the United States. The President is also authorized, when it is necessary to limit the use of food and food materials and feeds for the production of malt and vinous liquors, to make such limitations as he regards as essential in order to assure an adequate and continuous supply of food.

Section 16.-This section authorizes and directs the President to commandeer all distilled spirits in bond or in stock at the date of the approval of the act. He may redistill such spirits so far as necessary to meet the requirements of the Government in the manu

facture of munitions, military, and hospital supplies, or to dispense with the necessity of utilizing food products in the manufacture of distilled spirits.

Section 18.-This section appropriates $2,500,000 for expenses in connection with the act.

Section 19.-This section appropriates $150,000,000 as a working capital to be used in carrying out the business operations authorized by the act.

Section 22. This section provides that if any part of the law is found to be invalid by the Supreme Court of the United States, this does not invalidate any other part of the law.

Section 23.--This section provides that the word "person" as used in the act includes individuals, partnerships, associations, and corporations.

Section 24.-This section provides that the provisions of the act shall cease when the existing war between the United States and Germany terminates.

Section 25.-This section gives most comprehensive powers to the President in regard to the production and dealing in coal and coke. The President is authorized, whenever it is necessary for the efficient prosecution of the war, to fix the price of coal and coke, wherever and whenever sold. If any producer or dealer fails to conform to the prices or regulations imposed by the President, the President is authorized to requisition and take over the plant, business, and appurtenances of the offending producer or dealer. The President is authorized, if he thinks it necessary for the efficient prosecution of the war, to require the producers of coal and coke to sell exclusively to the United States; and the Government is authorized to act as an agent for the resale of coal and coke under such methods and regulations as the President may indicate. In case the President decides that it is necessary to become the exclusive dealer in coal and coke, all producers of these articles must cease to sell elsewhere after 15 days' notice. To make the provisions of the act effective, the Federal Trade Commission may make a full inquiry in regard to the management and costs of coal and coke, in order that the President may fix the maximum price for the coal and coke at any locality. The powers given the President may at his discretion be exercised through the Federal Trade Commission.

Section 27.-This section authorizes the President to procure nitrate of soda to increase the agricultural production during the calendar years 1917 and 1918, and to sell the same for cash, $10,000,000 being appropriated for this purpose.

Pertaining to several sections.-Wherever in the act provision is made for the President to requisition or take any commodity or plant, he is to pay just and reasonable compensation; and where a

commodity is purchased such compensation shall include proper maintenance and depreciation charges and reasonable profits. If the compensation proposed by the President or his agent is not acceptable, he is to pay 75 per cent of the amount determined by him as reasonable, and the aggrieved party may bring suit for the remainder in the United States courts.

Wherever the President is authorized to enter into business relations the money received for the sales of the commodities may be retained by him as a rotating fund to be used in the continuance of the business.

In each of the mandatory provisions penalties are provided in the form of heavy fines and imprisonment.

COMMENTS UPON FOOD-ADMINISTRATION BILL.

The regulatory authority of the food-administration bill is granted under the war power of Congress, as stated in the first section of the act. In section 3 of the original bill, as introduced by Representative Lever into the House and Senator Chamberlain into the Senate, and as originally passed by the House, it was stated that the production and dealing in all necessaries "are hereby declared to be effected with a public interest." There is no doubt that this is a true principle, and it is in accordance with the arguments given in another place. This important statement was omitted from the bill as reported by the Senate committee and as passed by that House. The reasons for this omission have not been disclosed, but it is plausible to suppose that since the bill is strictly limited to the war period and the courts have declared that the war powers of Congress can be enlarged to almost any extent necessary successfully to prosecute the war, the validity of the law is less likely to be successfully attacked under the theory of the war power than it would be under the theory that the necessaries affected are a public interest.

The general powers of regulation of the bill are limited to foods, feeds, fuel, fuel oil, natural gas, fertilizers and all articles necessary for the production of any of these commodities. The logic of the limitation is that the most fundamental commodities are included. Foods and fuels are more essential than any other commodities. However, it is clear that steel and cotton are scarcely less important in industry and commerce than are foods and fuels. Indeed, at one time the proposal to include these commodities was before the Senate, but they were not included in the bill as passed by that body. However, the extension of regulation to one of these commodities is to come before the Senate. Under S. 2756, which bill is now in the Committee on Interstate Commerce, it is proposed to give governmental control for iron, iron ore, steel, and their products, similar to that provided for coal and coke in the food-control bill. (See p. 54.)

Section 5 is so important that its essential parts are fully summarized on page 52. The section authorizes the President to require a license for all dealers in the necessaries named by the bill. It gives the President great regulatory power. By the licenses no unjust or unreasonable charge may be made; no discriminatory or unfair practice may be engaged in; and no wasteful methods may be used. If prices are unjust or unreasonable, leading to exorbitant profits, the President is authorized to indicate what are just and reasonable prices. If the orders of the President or his agents in these respects are not obeyed, the license may be revoked. There is heavy penalty for handling or dealing in necessaries without a license.

The exceptions to this section are agricultural products at their source and retailers whose business is less than $100,000 per annum. At one stroke the executive branch of the Government is given full power to create agents or agencies analogous to the State and interstate commerce commissions and the State utilities commissions, which may exercise all the powers in the control of the necessaries named in the bill that have been exercised in regard to the public utilities by commissions; also in certain respects this general provision gives authority far beyond any proposal for regulation which has heretofore been made.

Section 6 prevents enhancement of prices through hoarding by any person beyond the reasonable requirements of the business; and section 13 gives the President comprehensive power of regulation for exchanges and boards of trade, so as to prevent such evil practices as artificial enhancement or depression of prices, injurious speculation, or manipulation.

If the general measures are not found adequate for certain commodities, the President has even larger authority. Under section 11 he may actually become a dealer in wheat, flour, meal, beans, and potatoes. It is the purpose of this section to give the Government power by buying and selling on a vast scale to maintain reasonable and stable prices.

The very exceptional importance of wheat is recognized in section 14 by the President being authorized to guarantee a minimum price to the producer, and further by giving an absolute guarantee of $2 a bushel for No. 1 northern spring and prices in proportion for other grades at the primary interior markets for the crop of 1918.

However, it is in section 25 in regard to coal and coke that the most comprehensive powers appear. If the owners are to continue to operate the mines the President may fix the price of coal and coke wherever sold. Or, if it seems best, he may require that all coal and coke produced shall be exclusively sold to the United States, to be resold by the Government agencies. Or, if it seems better, he may take over the entire production and distribution of coal and thus act

in the position of producer and commercial agent for the entire coal business of the country.

It would be difficult to form a more comprehensive and sweeping set of powers in regard to the necessaries than those provided for coal.

If the President designates the Federal Trade Commission to exercise the powers and duties provided by this section for coal and coke, as he has authority to do, the commission will have for this fundamental commodity much broader powers than were advocated for the commission by those who believed in governmental regulation, at the time the trade commission law was formulated. (See p. 54.)

By sections 10 and 12 the President is authorized to commandeer necessaries for the Army and Navy and for public use, and also to take over all manufacturing establishments to produce such commodities in the discretion of the President.

Another general provision to prevent abuses is that making it unlawful to destroy necessaries for the purpose of enhancing prices or restricting supplies, or knowingly to commit waste, or willfully to permit their deterioration. Every year in the past there has existed willful destruction or waste of perishable commodities at many business centers, when the placing of such articles upon the market was likely greatly to depress prices. (See p. 13.) This important section will prevent such practices in the future.

As indicating the close connection of the economic philosophy of the war movement for regulation with the conservation movement before the war attention may be called to the fact that in 1911 the Legislature of Wisconsin passed an act making it "unlawful for any person, firm, or corporation, unreasonably to waste or maliciously to injure, destroy, or impair any natural resource within this State."

In conclusion it may be said that the effect of the bill is to give the Government practically monopolistic power for foods, feeds, fuels, fuel oil, natural gas, fertilizers, and the manufactured commodities needed from their production; not monopolistic power in every case by complete control, but sufficient power for all so that the market may be controlled. The power under the licensing section which applies to all these necessaries is sufficient to do this. The conditions of the license require fair and reasonable prices. If the licensing section is extended to all commodities covered by the bill, then the market is controlled for them.

The power of control futher extends in the case of the commodities which can be bought and sold; these are wheat, flour, meal, beans, and potatoes. For coal and coke the control may be complete. Prices may be fixed by the Government, or the Government may become the exclusive selling agent, or the Government may take the mines, operate them and sell the output.