The Birmingham age-herald., 1919-02-19
HoOver's Report on Packers Made to the President Six
 Months Ago, Is Published
(COnfinued from Page One) largely dependent upon a small group of buyers"
 REPORT IN FULL
The rennrt tn Nha PreSidant follorur.

The report to the President follows:
 II September, 1918
 Dear MT. President In response to your request I beg to set out my observations on the recommendations of the federal trade commission, with regard to the five large packing firms.
 l scarcely need to repeat the views that expressed to you nearly a year ago. that there is here growing and danger ous domination of the handling of the nations foodstuffs.
 l do not feel that appreciation of this domination of necessity implies wrong do- ing on the part of the proprietors, but is the natural outgrowth of various factors which need correction. In an objective understanding of this situation, it is nec- essary to review the underlying economies Of it's growth.
 At one time our food animals were wholly slaughtered and distributed To- cally The ingenious turning to account 1 of the by-productS from slaughtering when dealt with on large scale gave the foundation for consolidation of slaugh- l tering in the larger centers. From this | grew the necessity for special cars for | live stock transport and the large stock yards at terminals. The creation of those l facilities were largely stimulated and to | a considerable extent owned by the pack | ers Added to this was the application DTeSer- vation of meat, which at once extended
 the period of preservation and the radius I of distribution from the slaughter centers, enabled larger slaughtering nearer the great western producing area, and further contributed to the centralizaton of the n- dustry. This enlarged scope, particu- l larly the refrigeration operations, re- quire not only the expensive primary equipment, but a network of refrigerator
 cars, icing stations and cold storage at 1 distribution points. This special car serv- l ice in products is of the nature of the | Pullman service; it must traverse railroad lines independent of ownership, and, 1 moreover, it is seasonal and varies region l ally in different seasons For each rail- way to have foreseen and to have pro- vided sufficient of this highly special
 ized equipment is asking the impossible,
 and, in any event, no particular railway l could be expected to provide sufficient
 of these cars to answer the shifting of seasonal and regional demands outside | it's own lines.
 I Thus, the provision of a large part of
 the stockyards and car services has na- turally fallen in considerable degree to
 the larger and more wealthy packers
 who have used their advantages as in eff
 feet special and largely exclusive rail- way privilege with which to build up their own business.
 | From the stage of establishment of a
 multiplicity of marketing facilities, such as cold storage, warehouses, branch of fees. etc, grew direct dealings with re- i tail dealers and finally resulted in a large elimination of the wholesale traders. INVADE OTHER LINES i Through this practical railway privi- llege, the numerous branch establish
 ments, the elimination of wholesale in- termediares, and with large banking all lances this group have found themselves | in position, not only to dominate the dis | tribution of interstate animal products, but to successfully invade many other lines of food and other commodity prep
 aration and distribution. Their excel
 lence of organization, the standing of 1 their brands and control of facilities
 now threaten even further inroads
 against independent manufacturers and
 wholesalers of other food products. They
 now send scores of different articles and
 this constantly increasing list now ap-
 breaches a dominating proportion of the 1 interstate business in several different | food lines.
 1 It is matter of great contention as | to whether these five firms compete amongst themselves. and the records of
 our courts and public bodies are monu-
 ments to this contention.
 Entirely aside from any question of conspiracy to eliminate competition
 amongst themselves and against out siders, it appears to me that these five
 firms, closely paralleling each others
 business as they do. with their wide