546 HARVARD LAW REVIEW Usually it is potential, and the costs of the potentially competing concern are not unlikely to be greater than those of the estabhshed one; but if rates are fixed seriously above the point at which the potential competitor could supply the demand, he will presently supply it. If the utility is free from competition, actual or poten- tial, it can easily fix rates at the point of greatest net return, how- ever far that may be above cost; if the law leaves it alone. But it seems clear that the law should, as it does, undertake to prevent that. It would be hard to find a presentable reason of poUcy for allowing the beneficiaries of a monopoly, natural or legal, more than a reasonable return on the value of their whole property, or more than a reasonable profit on any particular service. It is said that the utiHty should share in the prosperity of its cus- tomers; but it is not made clear why it should, and moreover it inevitably does,^^ through disposing of more of its product when its customers are prosperous. Should an industry pay a rate that yields more than a fair return, simply because it can pay such a rate and still do business? The proposition that it should leads logically to the old idea that a utiHty may properly charge "what the traffic will bear"; which means that it may absorb the entire profit of its customers, except just enough to keep them nmning. There may be good reason why the results of the enterprise or luck of the men in a particular business should go to others than them- selves, to the state, for example; but why they should go to the monopolies which serve them it is hard to imagine. Again, suppose companies elsewhere generally charge a rate which would give the particular company an inordinate profit. The most which one company can at all plausibly argue from the case of another is that it is entitled to parallel treatment. As the rates of the other companies are presumably based on their costs, and accordingly allow them only a reasonable profit, the par- ticular company gets essentially parallel treatment if it also is allowed a reasonable profit. The fact that n is the rate which will yield a reasonable return to A company is no more reason for keeping the rates of B company, whose costs are lower, up to n, than for keeping the rates of C, whose costs are higher, down to n. Companies are concerned with rates only so far as they bear on ^ The Interstate Commerce Commission points this out in Central Yellow Pine Assn. V. Illinois Central R. R., lo I. C. C. 505, 536 (1905).
