Evening star., 1922-12-17

effect of this business upon the con-

effect of this business upon the con-
sumner.
Farmers and their families, and the
tiny rural communities which are de-
pendent almost entirely upon theiS
support, themselves constitute nearly
half of the consumers of this country.
Nevertheless, we will bar them from
this particular phase of the discus
sion. The consumers who are to be
| considered here are the non-farmins
half of the consuming public.
Admittedly. these new cooperative
marketing associations are compact
and powerful in form. Nay. more.
than half of the commodity in when
they are operating. and all OF them
Pare striving to become as large as
| possible and obtain control of a doml-
nant portion of their crop. Inese
crops are necessities which you and
| every other man must buy to eat and
| clothe yourself. Therefore. 1t is pos
sible that, before you understand, you
! view this movement with alarm ana
say to yourself, Good heavens! Wnat
! is this-another group OF terrlDie
/ trusts which is sprinGinG up to turn
! Mr.. Common People upside down ana
shake the last nickel out OF MS
| pocket?
] Nothing could be further from the
| actual truth, which is that these CO.
! operative associations nave eos 70
make themselves a positive benent 10
| YOU. the consumer, or go out Of busi-
! ness.
! Supreme Court View.
| The Supreme Court of the United
! States not long ago had before It pro-
| ceedings to dissolve the United states
| Steel Corporation, which seiis SOME
| thing like SO per cent of the steer pro-
duced in the United States IN splte
| lou
| Court refused to do this. holding that
| the United States Steel Corporation
| might be a practical monopoly ana
! not trust in the offensive sense. II
! did not. found the court. indulge IN
| pernicious practices to raise prices, II
! did not nut competitors out Of bust
| ness and, in general. it tended TO 90
good to the general public ny lts
J stabilizing influence in the steel mar
| ket. and not do harm.
| That decision was based upon the
way in which the United States steer
| corporation was being managed. Az
any time it might conduct itself dii
| ferentIy and come under the PROV
| Sions of the antitrust laws. ne
| case with your cooperative mar
| ing association is very different from
\ that. The cooperative marketing as
| sociation has not the power to become
an offensive trust. even II 1T wanted
| to. and here is the reason in q nut
shell:
A cooperative marketing associa-
] tion no matter whether 1t controls
| 10 per cent of the crop or 95 per cent
! of the crop, cannot control produc-
| ton
| This is not the case with your In
| dustrial trust or even with per
fectly organized labor organization.
Your trust can shut down Its rae
tories Your labor union can call lts
workers out on strike. But no CO.
operative marketing association can
make the American farmer strike or
| shut down American farms.
Have No Strike Power.
+, Please note that I am not saying
I that the cooperative associations 90
not do this; 1 am saying .nae ei .nSy >
! cannot do 1t. 1t is beyond their
power.
| One reason is that they are specifi-
cally given no such power In their
| contracts with their member farmers.
If they were they would become ille-
| gal as being in restraint OF trade,
| lust as any other monopoly OF SINH
| lar size would come under the COM
/ mon law governing restraint OF trade
! The. have to take in any farmer VINO
wants to join on the same basis as
| every other farmer. and they have to
| handle every bit or the prooucl y" hieii
! he produces.
| Another reason Is that even II they
i! were given the nominal power 70
control production they could not
exercise it. Attempts to make the
| farmer cut down acreage or other
wise curtail production in the race
| of higher prices have been made
, again and again by farmers move
ments of different type. They nave
! always failed. The only production
duction at loss; and then the farm,
| er, hoping always to win next year
| in the wild gamble that now charac-
! terizes his business. produces In the
| face of loss to a greater extent tnan
any other type ,a Of produeer' r ,,,t+e- .,
| economic law. that the instant the
cooperative associations secure bet
| ter prices for their farmers. barring
| the vicissitudes OF nature, you are
| going to have a greater productioL
the following year. The fundamenta'
law of supply and demand alWay:
| holds in the long run as the iroi
law of prices, and that means ina,
unless consumption Of the produc,
has been increased lower prices must
follow increased production.
Must Boost Consumption.
So you can see that 1t is absolutel!
| necessary for the co-operatives to In
| crease consumption, so that the IN
creased consumption will absorb the
greater supply of the product whicr
! the benefits which they confer upoT
their farmers bring into being. fot
cannot make the consumer buy things
! in greater quantity than he bougn'
them before. You can only induce
| him to increase his purchases. Anc
the only method of inducing him is
| to give him greater value for the
money that he spends. Thus your
| cooperative association cannot hole
up the consumer. but must actually
benefit him, or defeat its own ends
| 1t does this in many ways.
BY eliminating the purely specula'
tive middleman and dealing directly
! with the consumer, the legitimate
| distributor or the manufacturer. the
biggest part of the ,profits-an en-
| tirely unnecessary part-now taken
I out in the present system of distri-