From Simons' 1934 A Positive Program for Laissez Faire (emphasis in original):
As a main feature of the program, there must be a complete "new deal" with respect to the private corporation. As many writers hve pointed out, the corporation is simply running away with our economic (and political) system -- by virtue merely of an absurd carelessness and extravagance on the part of the state in granting powers to these legal creatures. The following proposals, while tentative in detail and obviously inadequate in scope, will suggest the kind of reform which seems imperative.
- Transfer to the federal government of the exclusive power to charter ordinary, private corporations, and subsequent annulment of all charters granted by the states
- Enactment of federal incorporation laws, including among other the following provisions:
- That no corporation which engages in the manufacture or merchandising of commodities or services shall own any securities of any other such corporation
- Limitation upon the total amount of property which any single corporation may own
- A general limitation for all corporations, and
- A limitation designed to preclude the existence in any industry of a single company loarge enough to dominate that industry -- the principles being stated in legislation, the actual maxima for different industries to be fixed by the Federal Trade Commission
- That corporations may issue securities only in a small number of simple forms prescribed by law and that no single corporation may employe more than two (or three) of the different forms
- Incorporation of investment corporations under separate laws, designed to preclude their becoming companies or agencies of monopoly control -- with limitations on their total property, on precentage holdings of sercurities of any single operating company, and on total investement in any single industry (again under the immediate control of the Federal Trade Commission)
- That investmente corporations shall hold stock in operating companies without voting rights, and shall be prohibited from exercising influence over such companies with respect to management
- That no person shall serve as an officer in any two corporations in the same line of business and that no officer of an investment corporation shall serve as an officer of any operating company
- That corporate earnings shall be taxed to shareholders in such manner as to prevent evasion of persional income tax with respect to undistributed earnings
The corporation is a socially useful device for organizing the ownership and control in operating companies of size sufficient to obtain the real economics of large-scale production under unified management. It should not be made available, however, for financial consolidation of operating enterprises which are (or which, without serious loss of efficiency, might be) essentially independent as to production management. Horizontal combinations should be prohibited, and vertical combinations (integration) should be permitted only so far as clearly compatible with maintenance of real competition. Few of our gigantic corporations can defended on the ground that their present size is necessary to reasonably full exploitation of production economies: their existence is to explained in terms of opportunities for promoter profits, personal ambitions of industrial and financial "Napoleons," and advantages of monopoly power. We should look toward a situation in which the size of ownership units in every industry is limited by the minimum size of operating plant requisite to efficient, but highly specialized, production-- and even more narrowly limited, if necessary to the maintenance of freedom of enterprise.