New-York tribune., 1919-09-27

that any useful purpose is served by
the public ventilation of interde-
partmental disagreements as to gov
ernmental policy.
"The matters at issue are matters
Of considerable Importance and prin-
ciple. If Congress passes sufficiently
strong excess profits legislation. it
will automatically correct the situa-
tion and meet the views of both the
Trade Commission and ourselves. If
Congress does not do so. l am afraid
you will need to make some decision
in matters of principle.
my proposal is, therefore, that the
whole matter shall be laid aside until
the action of Congress is determim-
able. If, however, you think it de-
sirable to have the matter inquired
into at once, | would like to suggest
that the trade commission report, to-
gether with the letter which l en-
close, should be submitted to some
independent person, say Mr.. Baruch
or Ex-Governor Stuart. of Virginia.
both of whom could advise upon the
matters of principle involved without
necessarily entering into details Of
fact"
Reply to Report
Mr.. Hoovers letter of reply to the
commission report read:
July 8, 1918.
Dear Mr.. Presidents:
81 beg to acknowledge the report
of the Trade Commission. which you
have so kindly forwarded to me, upon
the effect. Of the Food Administra-
tion regulation of the packers
profits.
II realize fully that in the discus
sion of this matter any sentence
uttered that can be interpreted as in
support of profits to the packing
industry subjects one to the charge
of corrupt influence and, on the other
hand, | recognize equally the easy
road to popularity through denuncia-
tion of these profits. 1t is, how
ever, our duty to separate the emo
tional aspects in these matters from
justice and national necessity to
secure war results.
IL. At the initiation of these reg
ulations last October we called upon
information and advice, and mem
bcrs Of the commission participated
in the discussions with the packers
which led up to the final regulations.
"The per cent limitation Of profit
on the most efficient meat packing
plants is out of all proportion to the
much larger profits made by the rcla-
lively similarly efficient steel and
copper producing agencies.
During the month of March, when
it appeared that the profit limita-
tions set out by the food adminis-
tration were proving to be possibly
larger than was anticipated, we re-
quested through you that the Trade
Commission should investigate the
working of the regulations and ad
wise as to their fairness. and we ar
ranged that they we're to take over
the auditing Of the accounts to de-
termine the accuracy of the packers
profit statement.
Explains Regulation
"(2). The initial regulations were
formulated on the basis that they
should limit the maximum percentage
or turnover to figure no greater than
the pre-war average, with the fur
Their limitation that the bulk of the
business is. the meat business
should not earn more than 8 per
cent, and that the speciality business,
involving foodstuffs, should not earn
more than Is per cent. Certain
classes of business were excluded al
together. That is, the businesses in
foreign countries and nom food bust 4.
nesses, such as sporting goods. banks
and manufactures into which food
stuffs did not enter, all these being
outside the legal function of the food
administration. The application of
the per cent limit fell upon rs per
cent of the regulated business-the
meat business-plus transfer value
of by-products, and Is per cent linn