The Barre daily times. (Barre, Vt.) 1897-1959, 1909-02-25
OF Tobacco and Snuff Bus.
mess Of This Continent.
EXCEPTING CIGAR MAKING
They Have Gained 1t by "Unscrupulou'
Use Of Vast Sums Of Money, by
Deoeivng the Public,' Etc.
Says Report on Trust.


business Of this continent, with the cx-
esption of the manufacture OF cigars
and the colossal trust which they man.
ege has within the last few years throt-
tied almost every yestige Of real compe
tition. They have gained their hold on
the trade by tho INSCRIPTIONS use Of
vast sums Of money, by deceiving the
public, BY resorting to all manner Of
schemes, and by tho flercest price.cut-
ting that the commercial world has
ever known.
These are, In brief, the conclusions
reached by Herbert Knox Smith, chief
Of the bureau of corporations, the trust
probing end Of the department of COM
merce and labor. Mr.. Smiths second
installment of his report on the tobacco
industry was made public today, and in
II he deals With the organization Of the
combination, its degree Of control its
growth, and it's present overtowering
position In The trade. In future chap
tsns Of his story, he writes the president
he will handle the subjects Of price,
profits, and competitive methods.
The American Tobacco company and
les three great subsidiary companies
the American Snuff company, the Ameri-
can Cigar company, and the British
American ompany--comprise some SO
subsidiary concerns in the United States
Cuba and Porto Rico, according to the
Smith report. Ten stockholders are al
legged to control sixty per cent of the
stock Of the mammoth concern, and
these are; J. B. Drake, (president Of the
cempany); A. N. Brady, O. H. Payne, p
A. Widener, Thomas r. Ryan, B. N.
Duke, G. B. Schley, the brokerage firm
Of Moore & Schley. and the estate of
w. 9. Whitney and w. L. Elkins. Twen-
ty eight directors own nearly ~ per
cent Of The stock, but for all practical
purposes, says ehp report, the ten names
mentioned dictate the policy of the COM
bination, which represents total net
capitalization Of ssf6,o00,O00. Accord
ing to the REPORT, the concern controls
81 per cent Of the cigarette business of
&hsx country, N per cent Of the manu-
fact1red tobacco (ehewing, smoking,
fine-cut and snuff). and IA per cent Of
the cigars. In 1906 the American To-
bacco used in its manufacturing plants
400 100000 pounds of leaf tobacco.
An ideh of the absorption OF eompet
ing plants and Of the changes through
combination within the last decade may
BE had says Mr.. Smith, "from the fact
that in 1897 the combination had ten
plants each producing over $4,000 pound
Of tobacco or snuff per year, while there
were 243 independent plants of the
same type. In 1906, on the other hand
the combination had As plants Of this
class and independent manufacturers
140. Especially conspicuous has been
The absorption Of large plants. In 1907
the combination had s plants each pro-
ducing over 100000 pounds Of these
products per year, while its competitors
had 46 such plants. In 1906 the comb
nation had "a plants of this size and
The independent concerns only 17'
One of the favorite plans Of the trust,
MIR. Smith says, was to buy up an in
dependent plant that had made its rep
utation on its antitrust record, its fair
dealing with union labor, or its time
honored squareness to its customers. and
to operate 1t still as an independent"
or aanti-tr concern. Dozens Of the
plants IL purchased outright or CON
trolled were operated in this manner, 1t
ii charged The only branch of the to-
banco trade that it has not been able
to dominate. says the report. il the
cigar business and it failed in that
ambition only because the great bulk Of
cigars are made by hand, and therefore
the small factory is practically upon IN
equality SO far as manufacturing advan-
tages are concverned, with the plant op
eating thousands Of hands whose year
ly output Is high In the millions The
trust Ii now spending large sums Of
money experimenting with cigar.mak-
ing machines, and If they are successful
IN developing them to the required
state of efficiency and control The pa
tents. they may be able TO comnlsni
fhc cigar business in the same manner
that they dominate every other branch
OF the tobacco trade, Mr.. Smith says.
"The combination" continues the re-
port, "has superior advantage over com
petitors, from the great size OF its
plants and from the control of more eff
cient machinery but nevertheless
great many independent concerns have
been able to keep their heads above
water and continue active competition.
However, he adds, "many weaker con
Germs have been virtually driven out of
business or forced to sell out to the
either by reason OF the di
rect competition of the latter or as an
Indirect result of the vigorous competi
ti0n between the combination and larger
Independent ooneernss
Among the concerns alleged to be
owned OF controlled By the trust are the
following: S. Anargyres and Monopol,
cigarette firms; r. J.. Reynolds. r. J.
Reynolds Tobacco Co.; D. II. Spencer &
Sons Co.; Nashville Tobacco Works,
plug tobacco makers; P. LorilIard Co.
BlackwelFs Durham and r. A. Patterson
Tobacco Co., smoking tobacco makers;
Crescent Cigar { Tobacco Co.; United
Cigar Stores CO.: International Cigar
90; Manhattan Brier Pipe CO.; Ameri
cnH stosie Co.; Havana American Co;
Uninn American Cigar Co; Porto Rean
arssFisan Tobacco Co.. Henry Clay and
besk c..