Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1919-02-19
HOOVER REPORTS
Continued from Page onel

lated and to a considerable extent
owned by the packers. Added 10 this
was the application Of refrigeration
processes for the preservation OF
meat, which a. once extended the
period Of preservation and the radius
Of distribution from the slaughter
ceaters. enabled larger Strengthening
nearer the great Western producing
area and further contributed 10 the
Capitalization oil the industry. This
enlarged scope, particularly the rc-
frlseratlon operations. require not
only the expensive primary equip
ment, tut a network Of refrigerator
cars. icing stations and cold storage
at distribution points. This soecia,
car service III products is Of the ma
'ure OF the Pullman service: it must
traverse railroad lines independent of
ownership, and. moreover i is sea
sonal and varies regicnally in diff
fercnt seasons. For each railway TO
have ioresecn and to have provided
sufficient of this highly specialized
equipment Is asking the impossible.
and, in any event, no particular rail
way could be expected TO provide
sufficient OF these cars TO answer the
shifting of seasonal and regional dc
nands outside its own lines.
Thus, the provision Of large part
of the stock yards and car services
has naturally fallen in considerable
degree to the larger and more
wealthy packers who have used their
advantages as in effect a special and
largely exclusive railway privilege
with which to build up their own
business.
From the stage of establishment Of
! multiplicity of marketing facilities.
such as cold storage. warehouses.
branch offices. etc. grew direct deal
ings with retail dealers and finally
resulted in a large elimination OF the
wholesale traders.
Through this practical railway
privilege. the numerous branch es-
Establishments. the elimination Of
wholesale Intermediates. and with
large banking alliances, this group
have found themselves in position,
not only to dominate the distribution
of interstate animal products. but to
successfully invade many other lines
Of food and other commodity
preparation and distribution. Their
excellence of organization. the stand
ing of their brands. and control of
facilities now threaten even further
inroads against Independent manu-
facturers and wholesalers Of other
food products. They now vend
scores of different articles, and this
constantly increasing list now an
proaches dominating proportion Of
the interstate business in several
different food lines.
1t is matter of great contention
as to whether these five firms COM
pete amongst themselves. and the
records Of our courts and public
bodies arc monuments to this con-
tention.
Entirely aside from any question Of
conspiracy to eliminate competition
amongst themselves and against out
sioers. 1t appears to me that these
five firms. closely paralleling each
others business as they do, with their
wide knowledge Of business condi-
tons In every section. must at least
follow coincident lines Of action and
must naturally refrain from persis-
tent. sharp. competitive action
towards each other. They certainly
avoid such competition to considerable
extent. Their hold on the meat and
many other trades has become so large
through the vast equipment Of
slaughter houses. cars and distribut-
ing branches. and banking alliances
which each of the five controls, that
1t is practically inconceivable that
any new firms can rise to their class,
and IN any event even sharp competi-
ton between the few can only tend
to reduce the number OF FIVE and not
increase it. OF equal public impor-
lance is the fact that their strategic
in marketing equipment.
capital and organization must tend TO
further increase the area Of their in
vasion into trades outside of animal
products. Furthermore. as these few
firms are the ffnal reservoir for all
classes of animals, when the few
Yards where they buy become ezra
tically oversupplied with more ami