New-York tribune., 1910-11-06
REJECT AMERICAN OFFER.
Germans Refuse Proposal OF
Potash Question.
COMMERCIAL WAR FEARED
Government Announces That
Proposition Cannot Be
Considered.

country, contracted Tor by American -
terests. This proposal sought to halVe
the difference under dispute caused oy
the enactment of the potash bin by Ger
many last May. The American contrac-
tors would thus have accepted loss OF
S14, 900. .000-that is, S2,000000 annually
for seven years, which constituted the
life OF their contracts. The new law
limits the production TO certain
amount at each OF the mines and levies
a tax Of 16 marks a hundredweight on
all production in excess Of the stated
amount.
Germany's refusal to accept the Amer
ican proposal is on the ground that 1T
does not accord with the principle Of the
new potash law, and it is announced
that the government cannot consider
any proposals not in harmony with that
! act. If the Americans have proposals
! TO make in consonance with that law il
will consider them. Various conditions
are mentioned IN the reply framed by
/ the German government, all Of which
are Of an uncompromising character
! Herr Won Sydow, Minister OF Com
/
/ American Ambassador. this evening and
handed to him the reply. which embodies
a letter to the minister from Herr
Kampner. chairman of the German Pot
| ash Syndicate. Herr Won Sydow empna-
| sized that he was not acting officially.
! but only as joint mediator with Am
bassador Hill in an endeavor TO adjust
! the dispute.
| The American Ambassador transmit
ted the reply TO NJ. H. Davis, the COM
mercial adviser OF the American Depart
ment OF State, who has been here for
| several weeks investigating the potash
| situation with representatives OF the
| American companies concerned in the
| dispute. Mr.. Davis and the others held
meeting late tonight and decided in
| view OF the wholly unsatisfactory reply
| 10 leave Berlin Immediately. Mr. Davis,
| after sending by cable his recommenda-
/ tons to the State Department, will go
| to Vienna on another mission.
History of the Negotiations.
Mr.. Davis points out that some of the
| contracts in question were made as far
back as 1907, while others were made
between June 30 and October I, 1909.
He says that the United States govern
ment made representations to the Ger
! man government FIVE months before the
/ recent law was enacted. protesting that
! such a law would destroy the value Of
! the contracts previously made with
American buyers OF potash salts, and
that it might operate TO embarrass the
negotiations which were then in progress
between the two governments for grant
| ing the minimum duty rates on the ex-
ports and imports of all articles of COM
/ merce between the United States and
/ Germany. When it was explained to the
! United States government in January
/ last that there would be no export duty
on potash, as had previously been sup
posed, there appeared to be no reason
/ for fearing action on the part of the
! German government that would impair
! the American potash contracts.
/ All other questions which related to
/ the commerce between the two countries
/ having been satisfactorily adjusted, the
| commercial agreement between Germany
}
! signed by the respective representatives
Of both countries, by which each country
! granted it's minimum customs rates to
! the other.
/ Soon after the agreement was signed
| the potash bill again came before the
/ Reichstag, changed in form and provid-
| ing for tax on production in such a
/ ma O0er that Tha r7j0ae bov,iro- oo,,+-. -.
/ with Americans, or owned largely by
/ American capitalists, would be unable 10
operate without having TO pay a tax on
/ their output greatly in excess OF the
value Of the potash. Such q measure of
law was regarded by the American gov
ernment as imposing burdens on a COM
modify largely purchased by American
/ citizens, which would not necessarily ap-
ply to exports to other countries. but
would apply substantially to all the ex-
ports of potash TO the United States
then under long time contracts
Protests were again made by the
American government against the pas
sage Of the bin the practical effect of
which would be to tax American com
merce and destroy the advantages gained
under contracts made between German
mines and American buyers before the
/ measure was formulated.
United States Forced 70 Act
| MIR. Davis points out that the tariff
law OF the United States contains pro-
| visions designed to maintain the priv
ileges and opportunities for commerce to
be enjoyed by American citizens as long
/ as another nation does not alter through
a change in its laws or through new en-
actments. the commercial relation as
| established at the time of making com
mercial agreements or treaties. When
| the conditions are changed, then a seri-
Gus development follows. for the Presi-
! dent is obliged to take cognizance of the
! change.
The American contracts are low in
price, but they We're made at a time
when the Kali Syndicate was dissolved
and when other mines would make as
| low prices if the syndicate did not again
come together and establish higher and
| more profitable prices These contracts
| however would enable the German
mines TO fill them at Il fair profit had
not the potash law been passed. restrict
ing their output and levying a tax on
! excess mining.
| The failure TO come 10 an agreement
| with the German government and the
| Kali Syndicate. by which the terms OF
he FttIl