ShmoopTube

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Finance a la shmoop what are the Clayton Antitrust Act and the Sherman Antitrust

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Act? well they're all about controlling monopolies which a century ago were

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called Trust's ironic in that well they essentially stole the trust from the

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people, the common Jo, Ma and Pa Kettle well in late 19th century even more so [Ma and Pa Kettle standing together]

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than today white men generally ruled the Western

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world and were you know very clubby, Bob here in church pew seven likes to do

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business with Mike here in pew eight Bob ran a tugboat shipping line hauling [Bob sailing a tugboat]

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grain down the Mississippi, Mike here had a bunch of farms and liked to do

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business with Bob and well there's Jim here in pew six who runs the entire

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region's worth of banks then he liked loaning money to farms because well back [Jim with stack of cash]

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then they were always money good to pay their debts yeah there was a time farms

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were considered you know safe bet and the three of them formed essentially a

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vertical monopoly controlling grain distribution in the center of the [Ship travels through center of the US]

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country from creation to distribution to sales to you know all the financing and

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banking and stuff underneath it if they wanted to raise prices on the grain for

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bread well who was to stop them you know there were no competitors why were there

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no competitors, because the three had teamed up to elbow out anyone else [competitor appears and Mike elbows him away]

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who might come along and well you know cut them out of the precious resource

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flows of whatever was needed and soon the three had enough scale so that if

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they were buying resources for a million acres of farmland well, their volume

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discount pricing discount discount discount were so massive that they could

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undercut anyone who came along wanting to compete fair and square [Prices of grain appear]

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well the Sherman Antitrust Act of 1890 was the first set of anti monopoly laws

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to come down the pike like it says right there in the name the act was anti

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trusts it was passed to bust up any unfairly organized legal arrangements or [Sherman Antitrust Act strikes company]

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would-be monopolies which would prevent from taking advantage of unknowing

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consumers and provide for a competitive marketplace because then who wins and a

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consumer that's who the government's protecting right so what did this mean [Jim Bob and Mike in a farm]

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for poor old Mike Bob and Jim well now they couldn't just raise grain prices

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Willy or nilly suddenly there were strictures in place

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and our gruesome threesome had to abide by this new rule of law which meant [Jim Bob and Mike in court and judge holds up Sherman Antitrust Act]

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pricing their product fairly and reasonably whatever that meant so that

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no one was having to sell the family farm to afford to buy a loaf of

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sourdough you know for their kids and then clever lawyers defending bazillionaires

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poked so many holes in the Sherman Act it looked like one of the real [Lawyer poking holes through document]

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housewives after her latest Botox treatment so along came the Clayton

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Antitrust Act in 1914 to fill in those holes and puff up the cheeks of law as

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it were well any little loopholes discovered by the clever lawyers were [Plasters appear on Sherman Antitrust Act]

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closed and more specifics were added to the language so it was even harder for

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folks like Mike Bob and Jim to pull one over on Ma and Pa Kettle, so yeah you

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know it's a Billy Joel famously saying 'It's just a matter of trust'.... [Man in club singing]

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ask your parents

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