Rock Island daily Argus. (Rock Island, Ill.) 1886-1893, 1891-12-28
A BIG STARCH TRUST.
HOW THE JOB WAS MANEuvEREo
THROUGH CONGRESS.

1
Early in February, 1890, the leading
starch manufacturers of the United
States met in Buffalo for the purpose of
| considering the ACCESSIBILITY and the
ways and means of consolidating their
Interests. The outcome of this meeting
was the formation of the National Starch
company, popularity known as the Starch
trust. By the end of March the organi-
cation was completed, and the trust be-
gan operations with a capital of SIC, OOO,-
900. LIS offices are at Covington, KY.
Hiram -Duryea, of the Glen Cove
| Starch company, was elected president
and Frank Schiller. of the Erkenbrecker
Starch company. of Cincinnati, secre-
tary.
Eigh cen of the largest concerns in the
| country came under the absolute con-
troll of the trust. Some of these were
| sold outright for cash, but the greater
part were bought by the trust by pay
! ment o. 25 per cent. in cash and rs per
cent. il debenture bonds.
Two defunct concerns, the American
Starch company. of Columbus, Ind, and
| the Ottawa Starch company. of Ottawa,
| Ills, threatened to resume production
in competition with the trust, but were
| appeased, the former by long lease to
/ the trust and the latter by the guarantee
| of a sufficient income to keep out of
| business
| The trust thus organ Ied proceeded at
once to business by advancing prices.
| Previous to ITS formation lump starch
NJ
raised The price to $50, and short time
after to $50, TO so, and on Aug. = to $50
per ton, or an increase of 60 per cent.
above the price prevailing earlier in the
| year.
| In order to make its control of the
market absolutely secure, President Dur
yea, of the trust, had frequent consulta-
| lions with MIR. Thurber and other men,
| bers of the Wholesale Grocers National
association, the outcome of which was
an agreement on the part of the trust to
| sell at wholesale only. and on the part
of the wholesale grocers and Jobbers TO
maintain trust prices The trust also
agreed to grant the jobbers a rebate of
II per cent and freight to be paid, on
condition only that the trust prices be
uldlIIdl leu.
Having thus secured absolute control
over the production and sale of starch,
the trust proceeded to formulate its
tariff Job" The duty on starch under
the tariff of 1888 was practically prohibi-
tive, but dextrine and sago flour, which
are kindred products, the former manu-
featured by roasting starch and the lat
ter an East India product made from
the pith of the palm We're still imported
in considerable quantities. The imports
for 1890 were:
Pounds Value.
Dextrine. .................. elS3.566 sos G}g
sago hour.................. 6J9,l9l l25,7S3
The trust aimed TO have the duty on
starch retained as il was, and the duties
on dextrne and sage flour so increased
as to prevent their importation
In accomplishing its purpose the trust
did not appear at the public hearings of
the ways and means committee, but Sc
cured Il private hearing and induced Nc
kinley to adopt its schedule of duties.
In the tariff of 1898 starch and its kim
dred products We're made dutiable as
follows:
Sage, sage crude and sage -four, free:
potato OF corn starch, . cents per pound;
rice and other starch, 2l5 cents per
pound; dextrine, burned starch, gum
substitute, or British gum. / cent per
pound"
The schedules as recommended by the
starch trust and carried through by Nc
Kinley are as follows:
Sage, crude, and sago flour, free;
starch, including all preparations from
whatever substance produced. fit for use
as starch, 9 cents per pound; dextrine.
burned starch, gum substitute, or British
gum, - cents per pound"
Apparently the only important change
made was that increasing the duty on
dextrine 80 per cent. The cotton cloth
and wall paper manufacturers. who are
the largest consumers of dextrine and
sage flour, opposed this increase. but mt
the same time they thought that so long
as sago hour was on the free list the
starch trust could not force them to pay
exorbitant prices for its dextrine. They
were mistaken, however, for when the
price of dextrine went up and they i'm
ported sage Hour instead, the treasury
department decided that sage -four was
ouDJSSt " al uuly vi TWO CeulS per pOunu
as preparation fit for use as starch"
The job c0ncocted by the "starch trust
and carried through by Mckinley was
thus exposed. but too late.
The effect of this job in raising the
prices of dextrine and sage flour was as
follows:
Aug. 1890. Nov. 1921.
Cts. per ID. Cts. per 10.
DeXtrine. ........... 43AG4La 6d6lh
Sage -four. ........... 3@3A 46494
This increase in the prices of dextrine
and sage flour bears heavily upon the
cotton clo5h manufacturers, since it in
creases the cost of the goods which they
are exporting to China and other Asiatic
countries in competition with England
and France
No wonder Mckinley wants his tariff
left alone. He would have had no cause
for fear had all his work been open ana
above board