The San Francisco call., 1898-01-13

management intended to defeat the wise and benefcent purpose which in spired the establishment of the Jute mill. It would be impossible for them to garner surplus revenue from the product, without taking it out of the pockets of the farmers. Not only IS this true but every increase of price fixed by them above actual cost, besides being of the nature of eXtortion, is an inflated standard of value for sacks to which the price for the Calcutta inn portations are adjusted. It is a fic- titious margin within which the inn porters may juggle their rates.
 The hardship thus imposed on the farmers is a double one. Under the spacious pretext of making money for the prison fund, those farmers who use State sacks are forced to pay more money for their supplies than they should be required to pay, and all the other farmers suffer losses consequent upon an imitation of price which the price of Calcutta sacks is made to ap proximate in the market.
 In this manner the competitive value of the San Quentin plant is nullified if not destroyed.
 A careful review of the subjoined fig uISS VIII eIilpIdSlZe llle DOlll. He OTlS- inal revolving fund of s40000 was in creased to enlarge the scope of opera tions for the directors in 1894 to s100 00O The revolving fund, be it understood was devised as a sort of rotary capi- taliZation of the raw jute needed for manufacture. From this fund money is drawn to pay for jute purchases and In turn the fund receives the proceeds from the sales of the manufactured goods.
 A strict and legal administration of affairs would keep the fund within the legal limitation; that is to say, at no time should the cash on hand and investments in raw jute and manufac- tured goods exceed $100O00. In other words, when the fund, as thus repre- sented by the three items of value, ex- ceeds S100 900. it should be the duty of the board to reduce the price of the goods below cost, until the equilibrium of the fund was re-established.
 On the other hand. when the assets and cash show a depletion of the fund they are enabled, under the legal privi- 1ege of adjusting prices within one cent a sack in excess of the cost of produc- tion to reimburse the revolving capital to it's limit It fellows that at no time SAiOOAo Nl4C Opeild ill'AildSt lile SdItS dIlu fix prices so as to create designedly a dividend on the s1OO,OOO, since such divi- dend can be derived only from class of citizens with whom the State is not dealing on principles of barter.
 Beginning with the fiscal year. 1893-94, an examination of the records will disclose the surprising fact that the capitalization of the San Quentin stock and nrOdnnf sive and enormously so. The fund was then represented by raw jute, S14,5S4 GA; manufactured goods, $32,- GAO 51; cash, s100O0O; total, s147 7,225 15 In the succeeding year 1t was swollen by $2S,916 fl, as follows: Raw tute, $53OSS 02; manufactured goods, s122,- 957 p; cash, S96 32; total, $176,141 56 At the opening of the 1S96-97 term year it stood: Raw jute s53,214 53; manufactured goods, S141, S25 54; cash s5S32 3S; total $2O0,S72 45.
 But this was not enough, so in 1897 when the farmers were promised a prosperous year, the board developed its masterful stroke of mismanagement by forcing another dividend of $50 000 On January l, 1897, it is found that the score stands: Raw jute. $19150 S2; manufactured goods. $131.157 57; cash, $l00000 or total represented by the revolving fund of $250,3 sos 39.
 So that in three and half years the directors have juggled over s150,000 out of the farmers, not to mention the immeasurable losses they caused the farming industry by reason of the CO., operation they have so glaringly ex- tended, by the maintenance of excess sive prices for sacks, to the combina- tion of Calcutta importers and the middIemen. Business expediency can- not justify such a willful perversion of the law.
 In following the systematic manipu- lations of the board to a logical and inevitable end, in a few decades they would have squeezed the farmers out of enough money to run life and fire insurance auxiliary to the other State institutions. On the basis of the profits of the three years past they would have shaved from the farmers crops the handsome sum of half million, and in a single generation their ex- tortiOns would be represented by fig ures little less than S3,000,0
 Who shall dare to say that the San Quentin jutemill was founded and it's revolving fund created for such a purpose?
 Taking up the operations of the board for 1897, it may be affirmed at the outset that they could not have failed to perceive the hardships they were inflicting the farming indus try by the extraordinary course they pursued. Section of the Ostrom law distinctly says: Demands for iute goods by consumers shall be promptly filed If this means anything it is that immediately upon receipt of the application or order, accompanied by the required 10 per cent deposit, the goods shall be shipped. As further specified in the same section, the re- maining 90 per cent of the purchas SC money shall be paid on receipt of the consignment by the farmer or actual consumer.
 As section 2 says orders shall be promptly filled, it cannot mean that sfh shall he accented e.