Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1909-04-09
JOHN D.'SPROFITS ARESMALL?
Attorney Milburn Ridicules Idea
Standard Makes Big Money.
LOSES PATIENCE WITH KELLOGG
OIL Lawyer Says Corporation Could
Have Made More by LOaninE
Money at Compound
interest.

ST. LOUIS, Mo-. April s.-Attorney Mil
burn, heading the Standards array Of
lawyers here in defense of the govern
ment's now celebrated suit tc have the
great corporation with its many millions
Of capital, declared Illegal as violator of
the Sherman act, this morning resumed his
argument commenced late Tuesday even
ing. The four dignified judges of the
United States circuit court, sitting banc,
are following the noted lawyers address
with marked attention, but do not hesitate
to PROFOUND perplexing questions to him.
when his meaning is not quite clear to
them. His answer, however is always
ready and apt.
This morning Mr. Milburn devoted sew
eral hours to replying TO special Attorney
General Frank b. Kellogg's charges that
the Standard had earned the enormous profit
of over S500OO0.OOO upon a capitalization of
$97, $4,000 This $7000OO0O0, Mr.. Kellogg
charges was both enormous and unreason-
able That the defendants had made either
enormous or unreasonable profits. Mr.. Mil
burn denied at the commencement of to-
days argumea- In no uncertain terms.
That the profits exceeded the sums paid
out as dividends. the attorney said was
true, but that such surplus had been used
In the extension. of and construction, OF
other properties.
Attacks keIlOsg's Theory of Profits
Another statement was that, the value of
the properties owned by the Standard of
New Jersey, which the government seeks
TO dissolve, capitalized at $97, $4,000, really
possesses interests worth not less than
500, 10000
And" declared Mr.. Mlbum, with
marked emphasis THE government S
theory for estimating profits, as set forth
in the petition is unsound in law and does
not accord with business principles or the
facts of human experience. 1t is even diff
ficult to discuss such a proposition with
patience"
The attorney pointed out that the funda-
mental fallacy in the governments posi-
tion was that 1t failed in any way to recog-
nize the enormous cumulative effect of
compound interest
Taking as a basic proposition that the
properties OF the Standard in 1882 were
worth S7O,OOO00O. as testified to by Mr..
Archbold, the attorney quoted from a table
to show that compounded at per cent from
1852 to 1896 the original $7o.OOO.OOO would
reach the very comfortable amount of S355 =
| 0GS ,6S6.74. Assuming that this per cent
had been added to the capital, irrespective
Of dividends, Mr.. Milburn suggested it
might in a way explain the rapid and APP
parently phenomenal growth OF the Stand
| ards assets.
IT'S but a matter of a pencil, bit of
paper and school boy to figure it out
no lawyer is required" added Mr.. Milburn.
Lawyers Figures Interest.
Even taking the value OF the properties
| Of the defendant in 1ss2-S55, 71o,O0O as
claimed by the government-the attorney
said compounded at per cent from 1882
TO 1906 It grew to 1856, ,27l 900, which was but
S6,12S5SS less than the actual assets OF the
1 latter year as shown by the accounts of
| the corporation.
why" said he "if we had never pur-
chased a gallon OF oil, but loaned our cap
ital eXpeditiously and carefully, we could
| have made as much, and recalling the high
/