Show SMITH TELLS lEftS HOW llON TEN TN MEN CONTROL NATIONS NATION'S TOBACCO TRADE IRAD WASHINGTON I Feb Herbert Herbert Knox Smith commissioner of or corporations corpora corpora- today made mado public ImbUe subdivisions 2 and 3 of or part rt 1 of or his hb report on the tobacco tobacco tobacco to to- bacco Industry They deal with th the present pres pru- ent eat organization of or tho the tobacco combination tion called so-called d its ita degree of ot control In that Industry and tho the development of ot that thit control Th These 80 divisions of or th the th report resulting I from a thorough h ln investigation estimation nto nto the business operations of ot tho tobacco com corn contain a i t elaborate discussion of ot the tho methods b bj- bj which the tho manufacture turu ture of ot tobacco except cl cigars ars has lias como come under tho control of or a comparatively few rew capitalists Commissioner m Rh says as Jn In tho the tobacco combination are the American Tobacco company compan and its three great rent subsidiary combinations the AmerIcan Amerlean Amer Amer- ican lean Snuff company the tho American Cigar company and the American British compan com com- I pan pany besides two eighty other subsidiary concerns concern doing business In th the United States Porto Forto Rico and Cuba Cubi Tho The com corn combination represents a total net not capitalization capitalization capitali capitali- of or over o J- J A Aery t ery r small group of ot ten 4 a. j stockholders controls 60 per cent r l of or the outstanding voting stock of ot r J JC C r i tho the American Tobacco company J. J 4 i. through which company tho the entire J. J combination 1 lit Ix controlled f en Seven of ot these are ro directors Tho They arc TC J J. J B n Duke president of or the company company com corn pany A. A A A. N N. Brady nul y 0 O II Pano P. P A A. A B. B Widener Thomas Thomis F. F nan B. B N N. Duke Duk C. C G G. B B. the tho banking and brokerage firm of or Moore Schley chiefly chief chief- ly I- n ns as agents for tor clients and the tho estates of or W W. C. C Whitney and W. W L L. Elkins Bogus Independents A list of or the subsidiary companies con con- troll trolled d. d Including over O twenty hitherto secretly sec U controlled called so-called bogus Independent lode Inde n pendent ent concerns is given I en In tho the re report re- re port It 11 Is ls shown ho also alao that the combination tion Lion Is practically the tho only Important ex exporter eJr- eJr porter of ot tobacco manufactures from this count country Astonishing figures figure are given In respect to lo tho development of ot the tho combination In 1831 1891 It controlled S 83 8 per cent of or the business of or cigarette manufacture and I this proportion practically Is 18 maintained toda today In cl cigars rs its output Increased a ell from fromI A I per cent of or the tho business In 1897 1837 I to H 4 1410 10 cr cent tent per In 1900 while In iii mart man tobacco chewing tobacco fine fino cut and snuff th the combinations combination's output Increased ed from rein 7 per par cent of or the tho total In 1891 1831 to 77 p per r cent in 1 1305 0 Finally in 1906 tho the combination con con- troll trotted trolled d of or these separate products re respectively re- re plu plug 8 82 per cent smoking 71 11 per c cent nt fine cut 8 81 per cent and snuff 06 6 per cent In tho the year oar 1906 1306 the th combination used In tho manufacture of ot its various arlous products prod prod- nearly pounds of ot leaf leat to to- to bacco I How It Has Grown An An Idea of tho the absorption of or competing plants Commissioner Smith and ana andor of or the chan changes g through combination within the th last f decade may be he had from the th fact that in 1897 tho tIm combination had ten plants each pach producing o over er pounds of or manufactured tobacco or snuff a year while there thero w were ro 43 Independent ont ent plants of ot tho tire same Game class elms In 1906 on nn the tho other hand tho the combination had ort forty plants O of ot this class dass and Ina- Ina pendent manufacturers HO Especially conspicuous has hur been tho tite absorption of ot the tho largo large plants plant In 1897 tho the combination had els eight It plants each ach producing over o pounds of or these thes products R R. year while Its competitors had rort six forty plants In 1906 1901 the combination combi nation had thirty four plants plant of or this size and Independent concerns only seventeen sc Is Compelled to Buy D Despite the combinations combination's enormous expenditures for tor advertising nd and md In schemes and despite frequent nt price cuttin cut cut- tin ting tim by means of ot its called so-called n lighting brands thero there has ben In so eral branches s of ot tho the industry a constant tendency tendency ten ten- dency for competitors to gain business moro rapidly r tItan than the combination and thus to r reduce duce Its proportion of ot tho tIm out out- put This tendency has s been overcome o ani only by hy continued buying up of ot Q M concerns lany weaker concerns have been virtually driven dri out of or busi busi- ness or forced to sell out to th the Lion tion tion either by reason of or tho direct competition corn com petition of or tho ho latter Iatter or as an Indirect result of lit tho time vigorous competition ho- ho tween tho the combination and larger lode lode- pent concerns In the thc case caso of or the larger and moro more powerful concerns which it acquired however the combination ha has usually re- re cured ed cu control only by paying a n hl high h price pm Ho Tiro Immense profits of or the tho com corn I policy o ha enabled it to keep up this I |