Perth Amboy evening news., 1923-10-10
COOPERATIVE IMPORTATION
By Frederic j. Haskin

all probability congress will be ask
ed at the forthcoming session to en-
act legislation which will authorize
combinations of importers, dealing
in the same general line of goods, to
form associations or cooperative or
CARNATIONS through which they may
Jointly import their goods. Impor-
ters r in need of some new method
to enable them to keep possession of
their home market.
About a year ago a new flood of i'm
ports began coming into the United
States. The Fordney tariff ball was
designed o fkeep them out SO that
the American market would be kept
as a special prerogative of the Amer
lean producer and manufacturer, but
IL did not succeed very we'll at this.
The reason Is the high price and
wage level in this country. Over
the last twelve to eighteen months
prices have been climbing up. By
the first of 1928 they had reached a
level where foreign made goods, pro-
duced with cheap labor, could come
into the United States, pay the high
tariff rates and still undersell Amer
lean goods made with the highest
paid labor in the world.
There are many American manu-
facturers using foreign raw material.
They import this. manufacture it in-
to finished goods in the United States
and sell to the American consumers.
They can buy abroad on about the
same basis with foreign manufacture
ers using the same types of material,
but when the material is brought
here for manufacture, higher labor
and other costs operate. so that the
finished product must bring a higher
price than the same sort of article
manufactured abroad. Therefore,
the importers desire legislation which
will enable them to import their
raw materials more advantageously.
It is believed that an import com
bination would bring this about.
A typical example of the problem
is furnished by the rubber industry.
About a year ago, this industry
awakened to a realization that Great
Britain, which controls the best tire
rubber in the world. had placed an
import restriction and a high export
tax on the rubber produced in the
various British tropical colonies. This
added about 100000 900 a year to
the American rubber bill. Inasmuch
as the various crude rubber import
ers were all working Independently.
they were unable to combat the move
and had to pay the price. 1t Is
thought that had there been an i'm
mort combination in existence. 1t
could have exerted enough influence
to have prevented the British action
or at least could have made cooper
alive arrangements which would
have cut down the cost of importing,
The same situation is true of a
number of products which are neces-
sary to American manufacture but
which are not produced on American
territory. Spain, for instance, con-
trolls the cork, Japan the eamphor.
Peru the quinine, Mexico the sisal,
India the jute, and Chile the nitrates.
All of these products are used in
great quantities in American manu-
facture and all come from foreign
sources.
The Department of Commerce has
been assisting the importers in work.
ing cut more advantageous methods
than now exist for the importation of
these commodities and has even gone
SO far as to send forth expeditions
seeking places where rubber can be
produced under American control
but, as matters stand now, even
though the government can be of
much assistance, the importers are
all competing against each other be-
cause each is acting separately. The
foreign producers of these important
raw materials know the situation.
They know that two American con-
sumers are just as likely to bid
against each other for supplies as
an American and a Frenchman. AS
the result of this bidding, the price
Is u up to a high point and this
high price must be reflected in the
final retail selling price of the finish
ed product to the American consum-
err.
If American importers of rubber,
for instance. were permitted to form
an import association, competition
in buying the raw material would
diminish. The rubber planters in the
tropics would find that, instead OF
having a hundred separate Amerf-
can customers, all bidding against
each other and running up the price.
there would be but one customer. a
cooperative buying agency. The
United States consumes more rubber
than all the rest of the world.
The Sherman law forbids such
combinations at present. The govern
ment takes the position that it is un-
wise to permit dealers or manufac-
turers to combine and antitrust
suits are brought against all such
attempted combinations. The reason
for this is that it is feared hat If
the rubber manufacturers all were
working together they not only
would be able to get low prices in
buying their raw material but would
agree on uniform high prices in SELL
ing their product to the public. 1t
is recognized that there would be ar
advantage in permitting the manu-
facturers to combine to get low pric S
if the low prices would benefit the I'LL
innate The task before
congress, in framing the new legis-
lation, Is to devise some scheme by
which the manufacturers could be
permitted to combine in buying raw
materials from foreigners, but which
would not permit them to remain in
combination when 1t came to selling.
In a word, the new law must provide
that the rubber trade or the jute
trade can work as a trust or a COM
bination outside the three mile limit
but must divide into separate deal
ers and manufacturers within the
United States. This will prove a