Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1907-08-13
CRAVE CHARGES
Against Standard by Cor
pOration Commissioner.
Says Company Makes AmerI.
cans Pay for Foreign Prestige


~
Washington, Aug. Fin the bust
ness of selling petroleum products in
foreign countries. the price policy of
the Standard Oil Co. had apparently
been to sacrifice the interests of the
American consumers for the purpose OF
securing the Standards foreign bust
. ness"
This direct charge is made in an OFF,
Cial report to President Roosevelt by
Herbert Knox Smith, commissioner OF
corporations, inssubmittlng to him fur
Their results Of the investigation Of the
operations Of the Standard Oil Co. by
the bureau of corporations.
Part three of the report, dealing with
discrimination in prices. was made
public today by Commissioner Smith. 1t
consists of detailed summary Of the
work Of the investigators and letter
of transmittal of the report to the
President.
Commissioner Smith asserts that the
Standard, enjoying practically an abso-
lutte monopoly of the Oil trade in this
country, has charged 'such prices as
II could thereby extort" and the Amer
lean consumer has had to pay these
prices. Meeting competition abroad, 1T
has given the foreign consumer enOr-
mo,lsly lower prices and 1T has used the
profits made at home to maintain it's
position abroad that the American
consumer has been severely discrimi-
mated against for the purpose of MAIN
tanning. not the dominance of the
American export trade, bu the domi-
nance of a particular combination
which has used its power frequently
and conspicuously to the disadvantage
of the American public"
Extraordinary statements are con-
tanned in the report respecting the
VARYING prices of oil in this country
1t is pointed out that as the Standard
does business directly with the retail
dealers, 1t is in position to make dlt-
ferent prices on the same grade Of OIL
in different localities and actually taxes
advantage of that position. In locall-
ties where the Standard has no COM
petition, it eNaCts immensely higher
prices for it's products than it charges
in localities where it is obliged to meet
competition.
It ia shown in the report that seven
mills per gallon on Illuminating oil az
fords n profit of about ten per cent. on
the investment in refining and market
ing the oil.
but the actual differences in the
Standards prices among competitive
and non compctitivc towns and areas,
saws Commissioner Smith, "often
amounts to several cents per gallon A
combination which can command the
profits that these figures imply. over
large areas, has therefore obviously a
tremendous weapon when 1t enters on
! aggressive price cutting against indie
pendent concerns"
The report adverts to a striking IN
= stance Of this divergence in the prices
= Of the same grade of oil in California
, where the Standard carries oil from ITS
refinery near San Francisco. several
hundred miles, by water and rail to
Southern California and there sells IL
for several cents gallon less than IL
charges for it in San Francisco. Com
missioner Smith declares that evidence
sis absolutely conclusive" that the
Standard takes full advantage of all
non-competitivc conditions to impose
the highest prices possible and uses
similar means to drive from the COM
petjtiye field all would-be rivals Tor
business.
Some astonishing statements, too, are
made regarding the methods OF the
Standard towards various railroads OF
the country in supplying to them their
necessary lubricating oils. Some lines
which have shown disposition and
have the power to compound their own
lubricants obtain favorable rates from
the Standard, but from all wothcr
other roads the highest prices are eX-
acted. An intimatiOn of the reason why
the railroads are willing to jay the high
prices demanded by the Standard when
they might obtain their supply at con-
siderably lower rates from Independent
concerns is contained in Commissioner
Smiths statement that the reasons
are entirely apart from the matter of
lubrication.'
Commissioner Smith expresses his
belief that he has shown that the
Standard has maintained its monopoly
mot by superiority of service and by
charging reasonable prices, but by I'M
fair methods of destroying COMPETE
ton; combination which then uses
the power thus unfairly gained to OPP
press the public through wholly extor-
Tomato prices"
|, BY direction of the President, Com
missioner Smith says he has with
held from publication at this time some
important evidence of price discrimi-
nation on account of the proceeding:
l. which have been instituted by the gov.
4 eminent to dissolve the Standard OF
Co. AZ ..