The Washington herald., 1917-01-30
PRESS IS PILLAGED
BY PAPER EXTORTION
Don c. Seik Show What High Prices
Mean to Newspapers.

THE 1000 newspapers and periodicals
published In the United States are facing
not only complete extinction OF PROFITS,
but in many cases confiscatory losses
through the concentrated action Of news
print manufacturers imposing upon them
a tax of approximately s8, ,000. 900 a year,
says Don c. Seitz, in the North American
Review. The war harvests reaped by
the makers of semi-manufactured ma
ter1al find nowhere a richer or more un-
deserved rake-ofr than In this raid on!
the printing trade. After two languid
years of moderate demand and reason
able prices, the print manufacturers, TAX
ing leaf from the iron, steel, copper
and chemical industries, decided to suf-
Ter no amazement at their own modera-
ton. and following the annual conven-
ton OF the American Paper and Pulp AS
sociation held in New York, February a.
1916, began one of the most effective price
Ittlng movements in our history. The
huge catalogue contract of the Chicago
nall-order houses, amounting to some
3,5O0.0OO having been safely adjusted,
competition In the print-msnufacturing
trade came to stop. The hrst line to
test the printers pocket was that of the
olottlng paper producers. Stock sold
ordinarily at and cents a pound was
Incohenently marked up to 10 and IL
cents' In some instances reaching 1s
cents.
Demands Exceeds supply.
Fast on the heels Of this elevation the
book gentlemen discovered that demand
exceeded supply and that raw materials
We're scarce. Book stock selling at 334
cents or less moved up to 6 and cents
pound! Especial grades selling at and
cents were abruptly lifted from 4 to 7
cents additional Jobbers were given lit
Tie consideration and customers none at
all. The improvidence Of printers, ana
Ine quick deterioration of supplies, caused
httle stock to be kept on hand by GUS
TONER'S so the exploit OF eIevatinx was
easy. II only required that no dealer
should supply customers other than those
on his books, The few that failed to
meet this condition were speedily without
stock to draw upon The book and lob
bing houses being safely cornered II re-
manned to handle the newspapers. This
was hardly so difficult a task as the
earlier performance, though the load was
heavier and handicapped by the fact that
practically all roll paper such as daiies
use Is provided under contract. The first
warning came when excess demand for
paper above contracted quantities was
called In the spring of 1916. The Federal
trade Commission has shown that for
the first half OF 1918 the general cost Of
manufacturing news print was slightly
less than during the Same period of 1915,
Wnen war conditions also prevailed, but
"hen publishers were fairly treated
Inc news manufacturers were a little
slower than their brethren in the book
and magazine branch in perfecting their
organization. but when completed it oper-
ated with perfection that now promises
TO impoverish the great Industry depend
ent upon it Suddenly publshsrs who
were short found that paper could be
had only Of toboers and that these re-
CURED 80 per ton for paper usually sold
at $45 This was accepted as a necessity
and as a temporary pinch Soon $50 per
ton was the price and then 800; in some
instances of peculiar atrocity $40 and
even sl4O per ton was demanded and re-
ceiVed. The smaller and poorer the con-
sumer, as usual IN this world the higher
the price and the more oppressive the
conditions, for on top of these savage
increases came the curtailment of credits
and in many Instances a policy of pay
ment on delivery Ordinarily where In
the past such combinations were formed,
when not broken legally, they went to
pieces under the competition of the mills
making manila or other craft" papers,
which would turn their machinery to
news making when prices rose. But, for
the first time in the history OF the trade,
these grades Joined the procession
upward, going from 1-2 to cents per
pound, with the effect that a considerable
tonnage Of news machinery went on the
coarser product, thus curtailing a supply
soon TO be sufficiently scant II all the
wheels were turning on its behalf. Writ
Ing paper followed suit swiftly, doubling
and sometimes trebfng in cost to the
consumer
Excuse for Rise.
The basic excuse for the rise in prices
Of grades outside Of news was the short
.T,E.4
tincton of the German and the shorten
ing of the Scandinavian supply. upon
which many book. manila and writing
mills relied. either as a complete re-
source, or as a check upon the American
producers. Sulphite, which costs about
SS2 per ton to make, rose abruptly to
800 per ton in some cases more The
expense OF manufacturing the article did
not increase. The sulphur monopoly,
controlled by Standard OIL interests. did
not raise its price. Most Of the sulphite
producers were covered in their wood, |
lime and coal contracts.
"One reason why the combination of
news print mills delayed getting into COM
plete operation was because of the time
taken in organizing the Canadian COM
petition. This was done by forming the
Canadian Export Association to which
customers from America were referred by
the mills In this way secret deals were
prevented and the situation controlled.
One Western publisher was notified in the
morning that his mill could no longer
supply him. In the afternoon an agent OF
the association called to take his order at
a price of about $25 per ton above the |
figure he had been paying. In the States |
the combination worked as neatly, but |
with rougher methods. Each mill was
sold out when asked to compete or to
give a price. This left the publisher the |
choice Of accepting the figure named by |
his existing source Of supply, or going |
into the market where, despite the short |
age and desperate conditions a supply |
can always be had at 800 per ton!