The Detroit times., 1909-02-25
l[h men CONTROL
OUTPUT OF SNUFF
AND TOBACCO
THOMAS r. RYAN Is/ NAMED IN
ltsT-TwENTY BOGUS INDIE
PENDENT" CONCERNS ARE CON-
TRotLEp BY COMBINATION.

WASHINGTON, Feb. 25-Herbert
Knox Smith. commissioner OF corpora
lions. today submitted 10 the president
his report on the present organization
OF the tobacco combination. its degree
of control in that industry and the
growth OF that control" Subsequent
reports. he says, will deal with prices
and profits and with eumpeuuFe
methods.
Todays report says;
"fn the Tobacco Combination are
The American Tobacco company anu
its threat great subsidiary comDlna'
tions. the American Snuff company the
American Cigar company, ana me
Brftish-American company besides 81
other subsidiary concerns dOinS busi'
ness in the United States, Porto RICO
and Cuba. The combination repre-
SCENTS a total net capitalization tex
cluding intercorporate holdings) or
over SAFE 0OO. 900. A very small group
y. OF 10 stockholders control 90 per cent
OF the outstanding voting STOCK OF the
American Tobacco company, through
which company the entire eomolhA-
ton Ii controlled. M,
.The ten stockholders controlling
the output of tobacco, with the eA'
ception of cigars. are; j. u. Duke
tpresident % the American Tooacco
company: A. n. Brady, c. IL. Payne
p A b. Widener. Thomas r. Ryan
B. n. Duke. G. b. Schley. OF the DroA,
erace firm OF Moore & Schiey, ana
the estates of VIM. c. whitney anu
w. l.. Elkins.
X ssThe list OF subsidiary companies
controlled, includes over twenty
hitherto secretly controlled, so-called
bogus independent concerns. Inc
combination is practically the only I'M
portant exporter OF tobacco manulac-
lures from this country.
.To overcome the effects OF the an
ti.trust sentiment and the union lapei
-sentiment. and even TO take adNan-
tare of them, the tobacco compiha,
ton. particularly during 1908 anu
1894 secretly acquired a conuoiiihs
interest In numerous concerns which
had been catering TO customers VIM
held those sentiments. Such concerns
continued TO operate under their lot
mer MANAGEMENT and kept up pre-
tense OF independence and or hostll-
ifv ~ the combination. Those when
employed union labor continued 10 90
40 and advertised the union laoei'
These secretly controlled concerns
were. until the facts were disclosed
nv the government, a powerful engine
Of warfare against the genuine lnde-
pendents and were looked upon py
the latter as their worst enemy.
From the time OF its origin. in 1890.
10 tho end OF 1906, the growth OF the
combinations proportionate control III
the plug. smoking, and snuff branches
OF fhe Industry has as whole Deeh
steady and great In cigarette manu-
facGare Il already controlled SO per
cent of the business in 1891. and this
pfoUs3r dion has since been practically
maintained (S2.3 per cent in 1906. In
cigars it's output increased from
ner cent OF the business in 1897 ID
AT per cent In 1906. In manufactured
tobacco fchewing. smoking, fine cut.
and snuff) the combination's outpu.
Increased from per cent OF the total
in 1891 to az per cent in 1906. It's pro
duction in 1891 was 19,l99,924 pouncs
out OF a total OF 270,529.326 pounds,
and In 1906, 306 .039.641 pounds out OF
q total OF 394,276.429 pounds. Finally.
in 1906, the combination controlled OF
these separate products. respectively,
plug per cent, smoking II per cent.
line cut 81 per cent, and SNUFF SO per
cent. The. extent OF the operations OF
the combination as whole Is shown
by, the fact that in 1906 IL used In the
manufacture of its various products
nearly 400,O00,000 pounds of leaf to-
bacco.
AN idea OF the absorption Of COM
peting plants and OF the changes
through combination within the last
decade may be had from the fact thac
In 1897 the combination had 10 plants.
each producing over $4,000 pounds OF
manufactured tobacco or snuff per
rear. while there were 243 independent
plants of the same class. In 1906, on
the other hand, the combination had
IS plants OF this class and independent
manufacturers lao. Especially con
Bpicuous has been the absorption OF
the large plants. In 1897 the combina-
lion had eight plants. each producing
over 100000 pounds of these pro
ducts per year, while its competitors
had 46 such plants. In 1906 the com.
binatlon had "a plants OF this size. and
Independent concerns only II. Tho
average annual output in 1906 OF the
rombination's plants was nearly
Z, 1000 900 pounds each, as compared TO
100000 pounds for independent
plants"