The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1911-02-01
GERMANY'S REPLY
IN POTASH MATTER
Declares Penalty Tax Ncccs.
sary to Conserve
Deposits.
NEGOTIATIONS NOT TO LAG
Secretary Knox Himself IS
Handling Important
Question.
NEGOTIATIONS NOT TO LAG

Washington. January 31.-The action
Of the German government in Imposing
q penalty tax on the production Of
potash, after having been for many
months Il subject of examination anu
exchange of briefs and notes between
Inc American contractors and repre-
sentativeS OF the German potash syn
dictate, may be said to have passed into
the realm OF diplomacy to-day. when
kount Rernstorff, the German ambas-
sador, presented to Secretary Knox the
answer Of his government to the sccrc-
tary's inquiry as to the action com
planned Of. The German answer de-
tends the action of the German gov
ernnent in Imposing the penalty tax
as a measu necessary to conserve
the valuable potash DEPOSITS Of the
empire, and protect them from speedy
exhaustion, auch as might be expected
10 follow Il ruinous reduction in the
price of potash. resulting from unreg-
ulated competition between these syn
dicates and the independent potash
miners.
Because of The Importance of the
matter, Secretary Knox is conducting
the negotiations himself, and there are
indications that they will not lag. In
view of the length Of the German an
swer to his inquiry, he secretary was
not able TO read it in detail before he
was called to the regular Tuesdays
Cabinet meeting, but from the anbas-
sador's explanation he was able to se-
cure an outline of the German con-
~,ention.
This is believed TO be based on the
theory that the imposition of the tax
on potash production is regarded by
Germany as a purely internatio af-
fair, and that as a matter Of fact it
is not an export. 1t is also asserted
that the TAX is not chargcablc against
the American purchaser, but should
be paid by the German mine owners.
Furthermore, 1t is charged that the so
called independent potash producers,
who made the contracts with the Amer
leans for the delivery OF potash in
1909, did so with full knowledge that
the German government had for some
time been contemplating, and had prac-
tically decided upon the imposition of
a tax on the production Of potash, in
order 10 conserve the limited supplies
in the mines.
Careful Investigation.
Some OF these contentious are in di-
rect conflict with those made to the
State Department by the American con
tractors, who claim to have been
by the action or the German
government. hence it will be neces-
sary for the department. to make a
very careful investigation OF the facts
before determining upon a line of ac-
ton.
some idea Of the bitterness of the
feeling That las been aroused by the
action Of me German government in
levying this potash tax may be gath
cred from the fact that som of the
American contractors. who We're in
conference n this city last week. have
announced ;heir intention of request
ing the Department OF Justice 20 begin
action u punish the American connec
lions of the German potash trust or
syndicate under the criminal sections
Of the tariff act OF 1891.
They assert that section % Of this
act is SSH III force, Notwithstanding
subsequent tai1G legislation. This sec
tion was designed to prevent the i'm
portation into the United States Of
commodities produced by foreign
trusts. -And provides for a fine OF from
500 to s.. geo and imprisonment from
three months 10 twelve months OF any
person engaged in importing any ar
ticlc as the result of a combination
agreement Or trust intended TO oper-
ate in restraint OF lawful trade or to
increase tie market price In the United
states of any article Of import.
Not mIcn Importance is attached to
this threat ny the German kali syndi-
cate, as represented in the United
states. as it is felt that the iurisdic-
ton of the United States does not run
beyond .he seas, and there is no evil
dence Of existence of any potash trust
in this country.