Sample

Agustin Tamayo-Peña

Professor Cruz

Business 210

Extra Credit Assignment: Antitrust Laws

Capitalism is fueled by the people's self-interests, which breed an extremely competitive environment. In essence, the playing ground starts off level, but over time certain vantage points are reached wherein one can gain the upper hand and deter all competition. Clearly this is in direct violation of the American dream, which expresses rewards through dedication and strife, thus the United States government established rules that enforced this crucial factor - antitrust laws. The term derivates from the 19th century when the word "trust" meant big business. It was in 1887 that the initial federal law of "big business" was established to regulate the railroad industry which at the time had engaged in monopolistic practices such as price discrimination, as well as established the Interstate Commerce Commission to enforce the new rules and monitor the railroads. Three years later in 1890, the rudimentary Sherman Antitrust Act was passed.

The Sherman Antitrust Act of 1890, which was created by its namesake Ohio Senator John Sherman, was enacted to prevent the formation of trusts, or cartels, but more specifically for the protection of the consumer. Logically, the consumer is at the mercy of a company when the company has no competitors, forcing the consumer satisfy his/her demands at whatever price the company beckons. The first two sections of the law state:

Section 1:

"Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal."

Section 2:

"Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony."

Hence, the Sherman Antitrust Act laid the...