The New York herald., 1922-06-25
Nine Years Profit Average
of Retailers Put at Half
of l Per Cent.
NO FORTUNES BEING MADE
National Retail Association
Demands Reply Go in Con-
gress Record


attack, mad Q on the Senate floor
June IA. on American newspapers as
being "venally subservient to adver-
tisers," in an open letter to the SEN
ator sent to him June %, and made
public yesterday by the executive COM
mittee Of the National Retail Dry
Goods Association of 200 Fifth avenue.
The committee in answering the at
tack made on both the newspapers
and retail merchants Of the country
in connection with the tariff bill now
pending before the Senate, states en-
phatically that the charge against the
press of the country "is untrue and
unsupportable, and unworthy of the
chairman of committee as important
and responsible as Is the Senate
Finance Committee" The committee
further demands that Senator Nc
Cumber withdraw his assertion Y he
cannot prove it.
The letter defends the retail merchants
of the country against the charge of
profteering launched by the Senator In
his tariff debate by stating "the truth
about the so-called profiteering' by de-
partment stores has been authoritatively
proven to be at complete variance with
your assertion"
Quotes Charges From "Record."
The letter follows in part:
"The Congressional Record reports you
to have said:
~. The great metropolitan news
papers to-day are attacking the McCum-
Der tariff bill because their prosperity
Tor the moment depends upon the pros
perity of their advertisers. With every
metropolitan paper the mouthpiece of
the importer who buys its advertising
pages. the very foundation of the tenn
pie Of protection is being undermined
by this insidious propaganda.
~. and their advertisers are
making fortunes, buying cheaply abroad
and selling at tremendously high prices
to the American consumer
"The answer to charge No. l. in ef-
feet that the great metropolitan news
papers are venal and corrupt, should
more properly come from the news
papers, but we desire to record our be-
lief that this charge is untrue and un-
supportable and unworthy Of the chair
man of committee as important and
responsible as is the Senate Finance
Committee. For the good OF our Ameri-
can institutions this assertion should
either be proven or withdrawn
1--WE consider 1t fitting that the Ma
tional Retail Dry Goods Association
should answer your second charge that
or profiteering, ms our membership in
cludes about 900 stores. both large and
small, situated from the Atlantic to the
Pacific, from the Canadian border to the
Rio Grande doing a net business yearly
of more than $4,000. 000.0 We shall
refute this charge, not by mere -asser-
tion, but by the actual published figures.
determined by the investigations of one
responsible, independent organization
and by three important Government
Commissions and agencies.
Without questioning the accuracy OF
the cost and selling figures presented, or
your method of computing them, or
whether they are due to depreciation OF
exchange, the truth as to the profits is
Of course. entirely different from your
statement, because to the foreign cost
must be added the cost OF foreign buy
ing inland freight abroad. consular fees,
freight and insurance, duty to the United
States Government. Custom House
charges, general overhead. the cost of
doing business in this country and Fed
eTal and other taxes. The spread be-
tween the cost so determined and the
price at which the goods are sold Is the
true profit.
Thus 1t Is apparent that every per-
centage of profit of importer and re-
taller stated by you, In some cases TO
be upwards OF 1000 per cent? is incor-
rect and misleading. 1t appears that
you have made the error Of designating
az profit the difference between the
first cost of the merchandise and Its
marked retail selling price. How crof-
table all business would be IL there
were no expense.
"As to the articles selected to create
this impression, 1t can fairly be said
that they are not important items or
representative of the imports which
come into America, nor do they reflect
the general condition of the trade.
Truth About "PronteerinG."
"The truth about the SO called prof.
teering by department stores has been
authoritatively proven to. be at COM
plete variance with your assertions. IN
1920 the United States Department OF
Justice completed under the Lever act
searching investigation into the charges
OF retail 'profiteering' so widely circu-
lated, I'm the press Mt that time. Their
agents visited practically every big store
in this country and called for invoices
and statistics OF every sort. which were
freely supplied by the stores.
ITO the best of our knowledge and
belief out of thousands OF department
stores Investigated profiteering was
found in practically no cases. 1t is
interesting. in view OF your charges
mat the newspapers are controlled by
their large advertisers. to note that for
a period of six or eight months the
press of this country Mt that time car
ried on the hue and cry against the re-
tail stores. although the members of our
trade were large users of their adver-
tising columns.
'--'he final record about the so-called
department store profiteering' has just
been written by the Joint Congressional
Commission of Agricultural Inquiry APP
pointed to investigate the prices OF food.
clothing. &C.. for the purpose of finding
out whether profiteering was going on
or whether the spread between the cost
of producing and what consumers have
10 nay was due TO other causes. The
complete report had not yet been made
publIc, but the commissions findings
eelating to dry goods and clothing were