East Oregonian : E.O. (Pendleton, OR) 1888-current, 1910-11-10
MAY HAVE TARIFF
WAR WITH GERMANY
GERMAN TAX ON POTASH
EXPORTS STARTS TROUBLE
State Department Receives Urgent
Appeals from Farmers 10 Intervene
for Protection of American Con-
sinners

Washington.-A tariff war is
threatened between this country and
Germany as a result of a tax impos-
ed by the German government upon
exports of potash which works to in
validate contracts involving about
$2Too0.000 entered into between
American firms and German miners.
The state department has received
urgent appeals from agricultural So
cietieS; every breed of politician: the
fertilizer manufacturers and interest
ed mercantile firms. to intervene for
the protection of American consum-
ers. When it IS considered that about
100000 farmers in this country are
interested directly as consumers of
potash and that the United States is
practically dependent upon Germany
for its supply, buying over one-half
of the empires total production, It is
realized that the commodity which
makes it impossible for American
firms to handle it under the present
contract price, has cut directly into
the welfare of the American farmer.
The farmer has taken quick notice
u WIS STATE VI dllClIS NllIl Ille result
that every diplomatic pressure is be-
ing brought to bear by the state de-
partment to effect an amicable set
tlement of the difficulty. Ambassa-
dor Hill, aided by a representative of
the bureau of trade relations. II. H.
Davis, is directly in touch with the
German foreign office. If Germany
fails to accede to the demand of the
American diplomats, it is highly prob
able that the maximum tariff will be
imposed upon every German importa-
ton into this country in retaliation
for the action.
The export tax upon potash which
was passed by the German Reichstag
on May 10 last increases the price of
potash in this country about seventy
per cent. This tax was imposed after
American buyers, taking advantage of
a peculiar situation in the German
market had entered into contracts
for vast quantities of potash at a very
favorable price,
For several years the production
and sale OF potash in Germany was
controlled by a syndicate which prac-
tically dictated the output and conse-
quently. the price of potash. This
syndicate expired in June, 1909.
Friction between the heads of the va
rlous subsidiary firms of the syndicate
made it impossible for them to agree
upon terms for a re-establishment of
the syndicate. This open competi-
ton between the companies natural
1,,f 81 IL,
figure. Foreseeing that future
agreement might again place them
at the mercy Of the German syndicate
American buyers made large con-
tracts with the several companies.
Most of those contracts were for two
years with the privilege of renewal
for five years at the expiration Of
that time.
Just exactly what the American
buyers anticipated did happen. The
German producers smothered their
differences and the old syndicate was
re-establshed. American manufac-
turers found themselves on top with
longtime contracts to protect them.
The syndicate interests then turn
ed their attention to sqirming out of
the American contracts. The law fall
ed and they turned to the Reichstag,
| Several bills to force up the price and
limit the production OF potash were
introduced each one aiming at the
American contracts.
Finally, in June, 1909, bill was
passed imposing the heavy export
tax. The American manufacturers
had already made contracts for the
sale of their products at prices based
upon the figures of their German con-
tracts.