Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1919-01-21
ARMOUR DEFENDS
PACKER METHODS
Meat Corporation Head APP
pears at House Hearing
on Control Bill
CALLS 1T REACTIONARY
Says U. S. Ownership Would
Be "A Monkey Wrench in
Machinery Of Industry
CALLS 1T REACTIONARY

Washington, Jan. 21.--J. Ogden Ar
mour told the House Interstate Com
merce Committee today that the pend
ing legislation to regulate the meat
packing industry was "reactionary' and
part of it probably unconstitutional, and
warned Congress tnat IF monkey
wrench is thrown into the gears OF this
business" its effects would be felt in
many other lines of industry.
II interpret this bill as an effort 20
dissolve an alleged monopoly and TO de-
centralize the meat-packing industry
Mr.. Armour said "lt seems TO be con-
structed in the belief that great num-
ber of small units engaged in the pur-
veying of food is preferable TO few
that are organized on a national scale.
IF the ability of the packing indus
try to function properly is impaired Il
will affect the livestock industry, and
IL, in turn. will affect corn prices, Wheat
then will be drawn in and so will
bread. and so vii, labor, and so will
everything that has for its basis the
wealth produced by agriculture.
"The theories on which this pending
legislation is based are not constructive:
they are not progressive: they are re-
dictionary. They would disrupt the
great manufacturing and marketing
prise has evolved and the result would
be detrimental. not alone to the leading
Industry of this nation, but even more so
to that part OF the public that pro
duces food and to the entire public that
consumes it,"
The project OF government ownership
or stockyards and other adjuncts to the
packing industry drew from Mr. Armour
reference to ''red tape" and controversies
over trivial matters" such as under
ground mail chutes
ownership by the government" he
said, implies red tape and restrictions
that cannot help add to the costs OF the
service, costs that eventually must he
borne either by the producer or by the
consumer. 1t is only because / fear less
enicient operation and the consequent
serious results that l make these COM
ments, but | am entirely willing and
ready to relinquish a. once my holdings
on being allowed just compensation"
Profits made by Armour & Co, Mr.
Armour said, were negligible so far as
either the producer or the consumer was
concerned.
On our total volume Of business" he
said, they represent a return of less
than two cents on every dollar of sales
The margin Of profit in the packing in
dustry is the smallest in al the industries
OF national consequence"
Gross volumes Of sales by his company
IN 1918, the witness said totaled S36l-
100000, compared with s575.OOO, 900 in
1917, but the net income was at the
rate of per cent on the average net
capital invested.
The 400 per cent stock dividend in
1915, whereby the capita. stock was
raised from S2o,000.000 to 800. .Ooo. 600.
was said by Mr.. Armour to have been
made possible by reinvestment during
preceding years Of Il per cent OF the
aggregate earnings, so that the increase
represented not water. but money
actually spent in development. In this
connection he directed attention 10 the
fact that the firm was owned almost
entirely within his family.
Within the last four years, he said.
the price OF live hogs had increased o45
per cent and costs OF labor clerical helm
and fuel had doubled As only 20 ner
cent Of hog is edible, and the remain
ing 80 per cent Of by-products has nor
incrft sed in value as RAPIDLY as tho i've
am kl, Mr., Armour said. it could be
sStood why bacon today costs three
what IL did four Years ago, lie
= that prices Of live cattle and
p also had advanced a = pace with
nose OF hogs.
Charges by the commission OF col
fusion among the five big packing firms
to central prices were denied catagorl-
cslly by the witness for his firm.
Packer interests in stocNyards and
adjunct institutions, such as rendering
works, serum works, market rewspa-
pers and cattle loan associations Mr.
Armour said, were a necessary out
growth of the business. but not detrt.
mental TO the public Welfare, as the
Federal Trade Commission CHARGED