This basic shift in the British attitude toward "trusts"—paralleled by a similar change in many other countries—had its roots in the economic conditions growing out of the World War. Readjustment of industry and trade to peace-time conditions was rendered difficult by deflation of prices, excessive plant capacity, heavy taxation and mounting re strictions on international trade. The position of British industries was especially difficult because her economy relied so heavily upon foreign trade and markets, both of which were greatly affected by the post-war policies aimed at the achievement of national self-sufficiency.
A committee of the Government—the Committee on Industry and Trade—made an intensive study of the British economic position from 1925 to 1929 and submitted a final report in the latter year. Statements of this committee indicate clearly the basis for the development of senti ment for co-ordination and combination in business. The committee was of the opinion "that the first step towards putting British industries in a position to compete successfully in overseas markets is to subject their organization and equipment to a thorough process of recondition ing." In a supplementary statement to the final report, a number of the members of the committee stated that the last quarter of a century had witnessed "a mighty transformation from individualistic to co-operative methods of action" and that "it is in proportion as the principle of co operative action and control is accepted that we find economic success achieved, both at home and abroad." Pursuant to this type of thought, the Government has encouraged informal combination arrangements established by industry groups and, by such acts as the Cotton Industry Reorganization Act, the Sugar In dustry Reorganization Act, the Livestock Industry Act, and others of similar character, has provided for definite forms of combination.