The Penn's Grove record., 1919-08-22
HOW GERMANY KILLED AMERI-
CAN DYE INDUSTRY
a. Mitchell Palmer
Alien Property Custodian

entire American industry, and it will
readily be seen that operating as they
did on German Intermediates they ex-
listed purely on s~uffrance and were alb
solutely at the mercy of the German
producers. They made neither aliz-
arm nor anthracine colors nor syn
thetlc indigo, which being the fastest
known dyes are the most valuable
products of the industry. The ex-
elusive ability to provide these fast
colors, most of which We're protected
by patents, would have placed the en-
tire trade in the hands of the Germans
even if no other factors favorable to
them had been present. These dyes
We're indispensable to the textile man
ufacturers, and by refusing to supply
them except to houses which would
buy their other supplies from the Ger
mar manufacturers-that is, by the
familiar process of "full-line forcing
the latter could have retained com
plete control of our market, even if
our manufacturers had been otherwise
fully able to compete in the manu-
facture of the simple colors. The 80
per cent duty payable on almost all of
the coal tar colors apparently offered
no real protection, nor, as will be
shown, was it possible for the Ameri-
can industry to secure any relief I'M
der the Sherman Act.
The condition of the other branches
of the American chemical industry
was, as has been stated, not quite so
bad. The manufacture of acids and
heavy chemicals was well established
or a profitable basis, though even in
this manufacture the employment of
numerous German chemists and pro-
cesses gave a certain Teutonic color
to the industry. In the manufacture
of fertilizers there was, in a measure,
a balance of power. The Germans had
a complete monopoly of potash and its
salts owing to their ownership of the
only considerable known easily work
ed potash deposits. This was some
pilates of which the Germans had no
considerable supply. There was a GER
tain amount of German ownership in
companies operating in the phosphate
field, most of which ownership has
been unearthed and taken over. In
nitrates, of course, the United States,
like the rest of the world, was mostly
dependent upon the Chilean supply.
In the manufacture of chemicals
in which electrical processes, requir-
ing large and cheap supplies of cleo
trio power, played an important part,
the situation was such that the Ger
mans had been induced to enter to
some extent into the manufacture in
this country. They had organized
and owned the Niagara Alkali Co.
which, utilizing the cheap electric
power of Niagara, became the largest
domestic manufacturer of caustic
potash, the latter produced from Ger
nan raw materials. The company also
supplied the chlorine gas which was
the raw material used by the only
considerable American manufacturer
of liquid chlorine. In the same way
the great Frankfurt chemical works
known as the Deutsche Gold und Sill
Der Scheide Anstalt, had through its
American subsidiaries, the Roessler &
Hasslacher Chemical Co., the Niagara
Electrical Chemical Co., and the Perth
Amboy Chemical Works, established
the only large American production of
cyanides and the largest American
production of formaldehyde and wood
distillation products. The Importance
of these industries will be recognized
when it is remembered that >cyanides
are indispensable to the mining and
electrotyping industries, while formal
dehyde is the basis of the only new
and important chemical industry OF
American origin, the manufacture OF
synthetic resin products, such as
Bakelite, Condensite, and Redmanol.
In medicinals very little real Ameri-
can manufacture existed. A few OF
the coal-tar pharmaceutical products
were produced by two Americans
houses in st. Louis, the Mallinkrodt
Chemical Works and the Mosantc
Chemical Works. By far the most
important factor in the field, however
was the New York house of Merck &
Co, which was a branch of the world
famous firm of Merck of Darmstadt
and has accordingly as such been taken
over. The enormous dispensing anc
distributing business of such firms as
Parke Davis & Co., Lilly & Co., g
Powers-W man-Rosengarten Co.
successful and efficient as it was be-
,ond comparison with similar buSl-
nesses in any other country, seems tc
have involved very little real manu-.
facture, and the materials used were
largely imported. There seems tt
have been but little, if any, German
interest in this branch of the indus.
try, except among small brokers anC
dealers.
From all the foregoing it will be
seen that the all-important portion o.
the chemical industry, the branch IL
which the Alien Property Custodian
would necessary be most arduous arr
in which its results might be mos
beneficial, was the dye industry. Tit
vital character of that industry wa:
due not to its financial Importance
since the consumption of dyes in thu
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