The Washington herald., 1907-08-12

The Standard OH Company. a corpora
tion operating under the laws OF New
Jersey. with various subsidiary COM
panies throughout the United States. has
sacrificed the interests OF the American
consumer for the purpose Of securing
foreign business, according TO Herbert
Knox Smith. Commissioner of Corpora
tons, in a report just submitted to Presi-
dent Roosevelt Tho report deals with
determinations in prices"
Another charge made by Commissioner
Smith against the Standard is 10 tho ef-
feet that It has maintained high mo-
nopoly prices in noneompetitive commu-
mites, thus making up losses incurred in
communities where 1t had TO meet or cut
the prices quoted by independent con-
Germs.
Further, the Standard has practically
forced the American railroads 10 pay
exorbitant prices for lubricating oils.
favoring some roads to the prejudice Of
others. The pet railroad of the Standard,
the Commissioner of Corporations de-
clares. is the Pennsylvania.
In vigorous English the Commissioner
OF Corporations charges the Standard OIL
Company with deceit and faIsehood in
its dealings with the government. and
with unfair, unjust and unlawful meth
DDS in developing and extending its bust
ness
Vigorous Terms Applied,
Bogus. "bribmg." 'falsity," Illegal, g"
and "extortionate" are some Of the terms
employed in the report.
Commissioner Smith reherates an as
sertion he made in a previous report thar
combination in industry may. as a rule
reduce costs and consequently prices, and
therefore benefit the consuming public.
But he denies that this is true in the
case Of the Standard. In his letter trans
mitting the report to the President, the
Commissioner says.
The obnoxious character Of the
Standards price policy is made clear. The
Standard has repeatedly asserted that
eorAbinatiOn, as illustrated by its own his
tory. is a great benefit to the public
II may readily be that in some industries
combination has had beneficial results.
TT is probable that the Standard. by
reason OF its undoubtedly great efficiency.
could, had II been content with reason
able profits, have made prices TO consum-
ers lower than would have been possible
for smaller concerns, and thus have main
tsined its great proportion Of the business
by wholly fair and legitimate means.
Unfair Methods Employed.
The Standard is, however. a most con-
spicuous example of precisely the oppo-
site-of combination which maintains
q substantial monopoly, not by superiority
OF service and by charging reasonable
prices. but by unfair methods OF de-
strOying competition; a combination
which then uses the power thus unfairly
gained to oppress the public through
wholly extOrtionate prices.
1t has raised prices instead OF lowering
them: Il has pocketed ali the advantages
of its economies instead of sharing them
with the public. and has added still fur
ther monopoly profits by charging more
than smaller and less economical concerns
could sell for If the Standard allowed
them the chance.
by your direction continues the Com
missioner Of Corporations, "in view of the
proceedings of the Attorney General
against the Standard Oil Company. some
of the more detailed evidence regarding
price discrimination Is at present withheld
from publication"
Disparity in Prices.
Discussing the disparity in prices Of oil
In the United States and foreign markets.
Commissioner Smith says that the Amer
ican price steadily advanced from 1887 to
1903 The New York export price AL
vanced much less up to 1903. declining IN
1904 and the Hamburg (German) price
shows practically the same movement as
the New York export price, while the
London price shows a steady decline from
1901 10 1904 and a very important drop
during 1905.
The course OF American and foreign
prices In the last five years covered by
this report Commissioner Smith saws.
has shown a greatly increased diver
gence. in general the American prices
going up and the foreign prices showing
a marked decline"
Commissioner Smith shows that the ex-
cess Of the price in the United States over
that received abroad varies from 10 cents
10 p cents.
Really Significant Figures.
''The really significant figures" he SAYS.
'are the margins of the respective prices
above costs. The deduction of the prin-
cipal clements Of cost throws into proper
prominence these great differences in
prices. From the prices may, therefore.
be deducted, first. the price Of crude oil.
and, second. the operating expenses Of
piping, refining. and marketing the oil.
which amount to about cents per gal
Ion"
With these deductions, for certain desig-
mated periods. the Commissioner shows
that the average German margin was Leg
cents, as compared with 463 in the United
States; the United Kingdom margin was
L64 cents, as against i.54 in the United
States; and other coUntries-Belgium.
Holland. Denmark. and the Orient-show
similar enormohs disparities. Comnnis-
sioner Smith continues:
These remarkable determinations in
favor Of foreign markets at the expense
Continued on Page s, cOIumn 2.