MEAT TRUST

Nelson Evening Mail, Volume LII, Issue 299, 14 December 1918, Page 5

MEAT TRUST

MUST BE KEPT OUT OF NEW ; ZEALAND A STRONG IXDICTiIEXT. THE "BIG FIVE" AT WORK. THE "SQUEEZE" IX OPERATION. (Concluded from yesterday) The following axe additional extracts from the United States Trade Commission on the (Meat -Packing Industry: "Tn order that th e working of this system shaU. be clearly understood, it well-to sfert- with the simplest situation —-that a stockyard in which only- two of the big packers are represented and where the division is commonly 'fifty-fifty.' In such a market the independent packers, local butchers anj speculators will purchase nob to exceed 6 per cent oi the live stock, far too few to influence the market strongly, much less fix the price. The other 96 per cent of the live stock, is is agreed, is to be divided evenly between the two big packers. This is the .ait} "Wiortth and Denver. - Even if there should be no further collusion or communication beween the two big packers, it must be obvious that there will be no truly oompetitive purchases. Each buyer may come into the market with a different* idea of, what the different grades of cattle are worth, but only • a few sales .will be made before each will know what the other is offering, and they- will some to a common price. In" a : freely competitive market the common- price would tend to reflect the true market value, because the lower bidder would be required to afaeet tiiis price or be left without- a t supply to keep 'his packing house running. But in a market where there is an agreed division, the natural law of the market is topsy-turvey, and the common price inevitably becomes that offered by the low bidder. Thus/ even without any collusion beyond the agreement to divide purchases, the market price which the producer receives for his live stock is bound in the long Tun to be the lowest price which, will keep the - producers cattle, hogs, and sheep and Sending them to the stockyard." That this combination and conspiracy to limit" the supplies of meat to the United- States and onr Allies has continued- to the present time, and vfith pernicious Tesults, is shown by a state- " writ made ill 1317- by the president of a- committee "appointed by the Argentine, Chamber of Deputies to investigate' the cost of necessities ''They (the combination of packing companies) suppress real competition, maintaining it only in appearance, and they determine by common agreement the prices which are to be paid to proaugers; reserving to themselves tjie right to seir -at .the highest price possible in order to obtain enormous profit*, . which' do not? remain in the country. Thus it is that these freezing companies have been able to show in their 'latest balance-sheets mode than. 100 per cent of. -profits, that is to say, that in a single year they have .made iriore than- their capital. . H?ere the freezing companies' contract- with the "foreign. 1 who is to-day j - owing to circumstances of the war, a single party, since the Allied Governments have concentrated their purchases in a central office; and haying mad?"'their - agreements at prices which they "raise as -high as possible, they purchase" the live stock from the producers, -imposing upon them' the law of the strongest." ■ POLITICAL FUNDS. The "Big Five's" joint funds were used.:— . employ lobbyists and: pay their "unaudited, expenses." - To~"Thfluence legislative bodies. Tot elect candidates who would wink at violations of law and defeat" those pledged to fair enforce- . meat To control tax officials and thereby. evade just taxation To secure of governmental rules and; regulations by de- * vious and improper methods. To bias public opinion by- -the control ; oi editorial policy through advertising, loans, and subsidies, ■ and by the publication and distribution at large expense of false and misleading advertisements. Through these and other manoeuvres they -were able to block the movement for"an investigation until the President of the United States, in February, 1917j directed the commission make the investigation.

FRAUDULENT TRADING. "These big packers who aim at world antmopoiy persisfcenly stoop to the commonest' of commercial . frauds—the live stock producers in the sale of grain and hay at the stockyards; they i ehortweight the retailers .on iheir I shipments of meat; they short-weight j the Government; and, to make a com- j plete job of it, they short-weight one another. Hera is an amusing example of tne last-named practice in the form of an extract from a letter written July 6, 1917, by Armour's Neenah Cheese and Storage Company to its {Mineral Point (Wis) branch, giving instructions "with reference to Cudahy's demand for a weighm asters certificate on his border: —-'Now, if you have not got an official weighmaster, feet some fellow that looks like one and furnish him with blanks if necessary yourself. It is hardly necessary to have him maSe a tesb on each lot. You _ can arrange t<i> have a few cheese sitting around for him to "weigh that are not going "to show up too much shortage. 'Whatever yon do, however, give them good weights on the car." "Another indefensible practice, which particularly affects the producers of live stock, and has done much to ..dishearten them, is technically knoien as 'wiring on.' When a cattle r man, dissatisfied with the prices offered at the stockyards to which he has; shipped, "decides to try another, a telegram _is sent forward over the packer's private wire notifying the buyers at the destination thatr the cattle are:, being shipped, and giving the: price offered at the first market. As . a result the cattleman finds that at the second market he is offered the same or a lower price, and stands to • lose at least the freight arid the .shrinkage as punishment for trying to beat the system." "Their conspiracies. and unfair practices have disheartened producers of stock -by'-destroying their confidence in the fairness of the market-ing-system to such an extent that large numbers -have abandoned; or curtailed their operations. Thousands> of ithe more intelligent producers to-day regard the stockyard markets as gambling places in which . the packer owners -not only takean exorbitant 'percentage,' but rig and control the game itself."