New-York tribune., 1918-12-03
U. S. Charges
Five Packers
Strangle Trade
Federal Commission Alleges
Combination Exists to
Control Livestock Sales
Evidence Is Voluminous
Swift, Armour, Morris, Cud-
ally and Wilson Com
panies Named in Report

WASHINGTON, Dec. 2.-The Federal
Trade Commission, in a supplemental
report submitted to Congress to-day,
charged the five big meat packing COM
panies of The country with combina-
tion in restraint of trade and with con-
trolling the sale of livestock and fresh
meats.
Evidence is cited at length to sup
mort The charges. Swift q Co., Ar
uour & Co, Morris &. Co, Wilson
Company. Inc, and the Cudahy Pack
ing Company are named.
THE evidence of the present day
existence of meat combination among
the FIVE big packers is voluminous and
detailed" the report said. "This evil
dence is convincing, consisting as 1t
does largely of documents written by
the packers or their agents and inc I'D
ing the memoranda made by one Of the
participants in the combination of the
terms and conditions agreed upon at
various meetings of the packers
: Conclusions Outlined
The principal conclusions to be
drawn from this mass of evidence re-
lating to combinations among the
packers, the report says, are:
That Swift & Co.. Armour & Co.,
Morris & Co, Wilson CompaNy. inc,
and the Cudahy Packing Compan@ are
in agreement for the division Of live
stock purchases throughout the United
States according to certain fixed per
centages.
"That this national livestock division
is reinforced by local agreements
among the members of the general
combination operating at each of the
principal markets, as at Denver, where
Armour and Swift divide their live
stock fifty fifty
That these national and local live
stock purchase agreements constitute
restraint OF interstate commerce in
live animals and in the sale OF meat
and other animal products, sitting
competition among the five companies,
substantially controlling the prices to
be paid livestock producers and the
prices to be charged consumers of
meat and other animal products. and
giving the members of the combina-
tion unfair and illegal advantages
over actual and potential competitors
Joint Action Charged
That the five companies exchange
confidential information. which is not
made available to their competitors
and employ, jointly, paid agents to
secure information which is used to
control and manipulate livestock mar
kets.
THAT the five companies act col
lusively through their buyers in the
purchase of livestock.
That Swift & Co.. Armour & Co,
Morris & Co. and Wilson COMPANY,
Inc, through their subsidiary and cor-
trolled companies in South America
combined with certain other companies
10 restrict and control shipments ii
beef and other meats from South
America to the United States and other
countries.
"That the five companies act col
lusively in the sale of fresh meat.
mat there is joint contribution
10 funds expended under their secret
control to influence public oninion and
EoVefnmental action and thus to main
tam the power Of their combination
interests Extended
mat the agreements. understand
lHgs and pools hereinbefore recited are
reinforced by the community of inter
eSe among the tive companies above
named through joint ownership, eitber p
corporate or individual, of various on
terprises. Two or more of the inter
ests mus have Joint ownership or rep
resentatlon in 10S concerns as far az
ascertained to July. 1918"
IN a summary of its conclusions re-
gardlng colusive livestock buying the
omission said it finds:
mat the big packers together con-
irol the livestock markets.
That such competition as apnears 10
eNlst IS limited and not real.
That they together fix livestock
Colluslon in buying. the report said.
IS IN operation at all principal markets.
The buyers begin buying at the
same tlme the report stated. "If one
holds off the market all hold off. So
Strong IS the influence of the big pack
ers buying that the market is not
made until their buyers begin bidding.
Centralized Buying System
There exists, therefore, for each of
the big packers centralized buying
system so simply contrived and organ :
lzed that it controls the smallest de
tails of livestock purchases at each of
he markets and can be set in motion
and directed ny single word Only
a rev men IN each company need know
that there is an agreement or under
standing
The report said "the big five" Jointly
employ men at markets to gather mar
ket conditions and thus check one an
others operations.
at is obvious" the report continued,
that the livestock pool is not only an
automatic regulator OF the business of
each company but also secures sub
stantial uniformity of prices. With
each packer purchasing only certain
percentage on the hoof each Is bound
20 have relatively the same proportion
Of meat for sale Thus the competitive
chance that any one of the packers
'rl!l food the market is eliminated.
ne livestock pool, therefore is an eff
iective method Of accomplishing al
most the same results as the Veeder
pool system, so far as the sale of
dressed meats IS concerned"
Regarding the alleged packers com
binaton regulating the sale Of meat
products IN this country, the report
said
Their present agreement as to tho
division Of livestock purchases re-
suits IN limiting the amount Of dressed
meat each will have for sale In pro-
portion approximately to the percent
age of live animals purchased under
tAe purchase agreement. BY a regular
inspection cf one another's branch
house stocks they are enabled to pre-
nr