The Washington herald., 1919-01-26
ARMOUR ADVOCATES
MERGER OF PACKERS
UNDER u. S. CONTROL
CONTINUED FROM PAGE ONE.

UNDEk U. ). CONIkOL
CONTINUED FROM PAGE ONE.
day on all the business the other four
are doing. was inquired into closely
by Heney. 1t was shown that these
agents have access to the branch
houses, and that each days shipments
by any one firm is reported daily to
the heads of the others. Armour de-
Tended this system, saying that il
stabilized the market and prevented
heavy shipments by one concern or
by all five which might tend TO glut
the market.
up in 1902, Armour testified. the pres
ent arrangement was made. He de-
clared II helped the independent pack
ers as much as those on the inside.
because anything which tended to
make a good market was beneficial to
the outsider Under the Veeder pool
any one of the Big Five who shipped
more than his daily allotment Of meat
was penalized and compelled TO make
restitution to the one who was short
The present arrangement does not
admit of this being done.
IF we find the New York market
glutted, for instance" said Armour.
explaining the working arrangement.
cit is our mans business to wire back
that the market IS in bad shape.
Then, instead Of shipping so much
meat to New York, We hold il back
in the icing plants until the market
has gotten better. The other packers
do the same thing We can handle the
New England market in the same
way by holding the meat at icing sta
tions."
Competition Not s.Intensc.@
Isn't it a fact that the five big
Packers are not aggressively inter-
fering with each other and that each
Of the five lets the market stay as II
was at the time of the Veeder pool
and doesn't attempt to interfere with
each other" asked Heney.
That is partially true" Armour re-
sponded. If any enc OF the big five
wants to get a larger market he has
TO make the market very bad. We
are all content to go along and make
little money and any failure to work
together would reflect back on the
prices paid for cattle. The only IN
terest the packer has in the price Of
livestock is that he doesn't want the
price to go so low as to stop produc-
ton. and on the other hand he doesSn 1
want the price OF meat 10 go so high
as TO stop consumption. We are mid
dlemen in that respect. and the onI.
interest we have is TO enable the pro-
ducer to make money and the con-
sumner TO save money"
Favors Merger of Packers
In explaining his proposal for an
amalgamation Of the packers. Armour
said he thought it would be a good
thing for the country. He said.
Il would 70 80 far as 10 say that II
this could he done and the livestock
men taken in under the same form
of government regulation. the live
stock men would get more for their
products and the consumers would
be saved a great amount OF money
The packing industry is very much in
the same condition as the railroads.
When the railroads were taken over
by the government. a great many
trains were taken on The same
rnethod Of economy could be en-
forced upon the packing industry and
there would be an enormous saving Of
money that is now wasted in duplica-
tion. I am a great believer in large
units. ! believe, first OF all. that II
the five big packing concerns would
be consolidated there would be a tire
mendous saving and the service would
be done just as well"
Heney brought out the fact that Ar
mCur owns 20 per cent Of the stock OF
Armour and Company. that he is a
director Of the Chicago. Milwaukee and
~ pa1Il TT1frzgs
and Stockholder in the Baltimore and
Ohio and Rock Island systems He
Is also a director In the National City
Bank OF New York. the Continental
Commercial in Chicago. and owns
stock in the Central Trust. First Ma
uonal and Union Stockyards banks.
Armour offered to give the commit
te" full statement OF all his bank
ard railroad holdings. but the COM
mittee decided details would not be
necessary.
senators Reprimand Armour,
Senators sharply rerrimanded Ar.
mour for excluding South America n
profits from his financial report. They
IOtalled SlGO0c0.
Armour included the investment in
South America in figuring the per
cenlaEe Of proft. Senators charged
"Nhy didn't you include the south
American profits i'm this statement 80
Senator Norris. Nebraska, demanded.
1t includes the capital invested but
not the profits"
Armour's counsel. Mayer. broke in.
Prior to 1917 the South american
profits were received by the Ameri-
can company" lac said. explaining
that since profits were re-invested in
the plants there.
Norris was Indignant
Il suppose this statement was pre-
pared to influence Congress- he
said. leaning across tn" table to-
ward Armour
Now 1t develops something L.
omitted which Is Of considerable i'm
pOrtanC". 1t makes a difference OF
about s1O.OOO.OOO."
a difference OF about 10 per
cent" senator Gore observed.
Mayer said il didn't figure out that
way.
Hasn't Armour refused the Fed
eral Trade Commission its South
American fiEures?" Heney asked.
TT has, sir, on my advice" Mayer
said. interruptinE Armour.
AS / get IL the statement showed
earnings Of s21.0O0,OoO last year. di-
vided by the whole capital invest
ment to arrive at the percentage OF
profit" Senator Gore remarked. 'But
the S1O.OOO,O 600 profit from South
America was not added. II seems 10
me that you should have added the
s1O.00O.0O0 to your profits here and
then divided to get the percentage
of profit"