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Show ' Packers Threaten Domination of I All Important Foods in U. S. I Is Trade Commission Report I PACKERS CONTROL MARKETS ! Big Five Threaten Free-i Free-i dom of Country's I - Food Products. I REPORT TO WILSON Illegal Commissions, Rebates Re-bates and Undisclosed II Control. i WASHINGTON, July 11. -An ;ip . I proaching packer domination of all important im-portant food? in the United Stati s, md an international control of meat prod I uf ts "vsith foreign companies seerus a certaintly unless fundamental action is taken to prevent it the federal trade commission declared today in part 1 of its report to President Wilson on the "extent and growth of power of Unlive Un-live packers in meat and other indus-K indus-K tries." "A fair consideration of the course the five packers have followed and the position they have already reached." said the report, "must lead I to the conclusion that they threaten the freedom of the market of the coun-L coun-L try's food industries and of the byproduct by-product of the industries linked t here-j. here-j. with The meat packer control of oth I er foods will not require long in de-i de-i veloping." Declaring "the history of the packers pack-ers growth is interwoven with illegal commissions, rebates and with undisclosed undis-closed control of corporations" the report re-port urged the importance of full public pub-lic ity of corporate ownership for all industries. in-dustries. Devices for Securing Control. v"As to devices for securing control. Ilierc does not exist adequate law." the report said. "In its absence un- fair comnetition may run its our.e I to the coal of nionopolj and accom ! p iplish the ruin of competitors without ! ! jlhe secret ownership being suspected! 1 and consequently without complaint to I j the commission or investigation of j ifacts. The competitor is in jeopardy so long as he has not the know ledge of true ownership and the public is en-' en-' titled to such knowledge" Alleging that the "big five" packers Swift & Co.. Armour t Co , Wilson fc j 'Co., Morris 6z Co.. and the Cudahy company jointly or separately wield controlling interest in 574 companies, minority interest in Uo others and un determined interest in 93 a total of m 7tJ2 companies and that they produce or deal in some 775 commodities, largely fod products the report gives this picture of growing packer Inva-I Inva-I sion into related and unrelated indus-I indus-I I tries. In addition to meat foods, they pro duce or deal In such divers conimodl-I conimodl-I K ties as fresh tomatoes and banjo strings, leather and cotton seed oil, breakfast foods, vln fir., curled hair, pepsin and washing powders Their branch houses are not onlj Btatione for the distribution of meat and poul trj . but take on the character f wholesale whole-sale grocery stores, deal i In various kinds of produce and jobbers to special lines of trade. Dominating Interests. "They have interests large enough to be dominating influence in most of the services connected with (he production pro-duction and distribution of animal foods ;iud their by-product;, and are reaching out for control, not only of I I substitutes of animal tood. but of BUD stitutes for other lines into which the I I integration ot their business in led them. They are factors in cattle loan companies, making the necessary loan -to growers and feeders of livestock; I are interested in railways and private car lines transporting livestock and r manufactured animal products; In most of ihe important stock yards com-L; com-L; panics the public market for the bulk of food animals, and in livestock trade papcys on which growers and feeders I" rrly for market news. Control in Banks. ' "They are interested in banks from which their competitor packing houses borrow money; m companies supply- Ing machinery, ice, salt, materials, boxes, etc, to themselves and their I competitors; they are principal dealers deal-ers on the provision exchanges where .future prices in standard cured animal 'products are determined; they or their subsidiary companies deal in hides, I oleo, fertilizer material and other 'crude animal byproduct-: purchase from other packers these crude byproducts by-products and themselves earn the , manufacture thereof to a further stage than most Of their competitors "They are important factors in the leather industry, in oleomargarine and lard substitute-., m cotton Beed oil, in fertilizer, in soap, in glue, etc. Vast Distributing System "Their vast distributing system, with the advantage arising from the control con-trol ot private cars, cold storage and a network of branch houses, has enabled en-abled them to extend their activities on a large scalp into poultry, eccs, cheese butier, rice, soda fountain supplies sup-plies and other fines "Relatives ot the Armour family are i owners of grain and elevator com i panies and J. Ogden Armour is a prominent factor in the American International In-ternational corporation, with its ship-j ship-j ping and shipbuilding Interests, its ; import and export companies in various var-ious lines, its interest in a company organized to develop cattle raising, meal packing, quebracho extract and allied buslm sses in Paraguay, Its control con-trol of a large tea importing company and a sugar machinery corporation and Ita minority stock in the United (Fruit company. "Some of Swift and company's subsidiaries sub-sidiaries are growing tropical fruits in Hawaii, a subsidiary ot ilson and company, Inc., has reached inio the salmon fisheries of Alaska, and a Morris concern cans shrimp taken in I the waters of the Gulf of Mexico. 1 In England, France. Italy. Holland and other European countries large nipat distrihnt iiil' comnanies have been organized by the packers to sell the meat: from their plants In the United States, Argentina, I'ruguay, Paraguay, Brazil and Australia " Public Utility Corporations The big five, the report said, have control or interest in public utility corporations in Sioux City, Kansas City, South St. Paul, Portland, Ore ; South San Francisco South St. Joseph, Mo ; Hill City, Minn.; Fort Worth, Tex.; and Chicago. 4 As to financial power, the report said in part: Ownership in Banks "The packer has drawn to a marked degree upon the banks of the country for liquid funds. To assure himself loans ample to his purpose, the big I packer has secured affiliat ion through Btock ownership, representation on directorates di-rectorates and in other ways, with numerous banks and trust, companies. Mr. Armour. Mr Swift, Mr. Morris 'and Mr. Wilson are directors in banks affiliated closely with those who are strong at the sources of credit in the i aited States Being thus allied with the powerful interests at the source? ; of credit, the packers' power is great, not only for financing their own na tLonal and International operations, but for affecting for good or for ill the ' credit of cattle producers and of com- 1 petitors or customers In any line " After reviewing the interest of the packers in the leather, fertilizer, cottonseed cot-tonseed oil. grain and breakfast, food industries, the report said "The reason why the packers are seeking control of the substitutes for 'meat Cue foods that compete with meats are obvious. If Uie prices of substitutes for meats are once brought under packer ontrol, the consumer will have- ."jtUe to gain in turning to "Jvern for relief from excessive meat prices. "Judged conservatively by trade estimates, es-timates, the 'big live' handle at least :half of the poultry, eggs and cheese in the man) channels of interstate commerce. com-merce. Dealing in Staple Groceries I "Recently the big packers began dealing in various staple groceries and vegetables such as rice, beans, potatoes pota-toes and coffee and increased their gales at such a rate that in certain lines they 1m e become factors ol great moment." Referring to the packers' activities in South America, the reports said that from establishment of a single plant in Arge'nlina in 1907 by Swiff and Company, the American packers, Swift, Armour, Morris and Wilson, had developed de-veloped by 1917 until for thai year the exported 57.4 per cent of all exports of trozen and chilled beef quarters from Argentina and Uruguay. Swift Denies Charges CHICAGO, July 11 Charges against the big meat packers contained in the report issued by the federal trade commission today were denied by Louis Lou-is F. Swift, president of Swift and company, t-peaking for his own company com-pany and for the other big Chicago packers, Armour and company. Morris Mor-ris and company. Wilson and company and Cudahy and company. Mr. Switt said the report was "merely "mere-ly an attack upon large and successful success-ful business organizations and should be resented by all Americans who arc-proud arc-proud of the industrial progress oi the nation " "It Is to be regretted that in these I days " said Mr Swift, "when the pub-llc pub-llc feels keenly the pressure of high prices, a government body does not give out facts respecting prices and profits. This has never been done fairly by the lederal trade commission as regards the packing industn although al-though the commission has constantly had the most complete information in its possession. "The report just issued by the trade commission and its discussion of the number of subsidiary companies and its calculation of percentages of the classes of business handled by the packers, are not only erroneous but are entirely immaterial. "The real question in which the public pub-lic is interested, namely why are pri ces high0 "I do not believe that the findings of such a prejudiced and unfair report should be used to influence public opinion or ns a basis for the radical legislation that has been introduced at Was hingtoa." V |
