Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-09-15
SPRECKELS SEEKS
! FIRM SUGAR TRADE
Producer Sees Hope for In
.dustry in 6-Cents-a-
Pound Price.
BY JOHN r. SINCLAIR.

Yes, know something about It. I've
been in the sugar business, both as
q producer and as q refiner, most Of
my life"
So replied Rudolph spreckels, presi-
dent Of the Spreckels Sugar Corp, when
asked in his New York apartment for
his views on the sugar problem.
Mr.. Spreckels, big, powerfully built
man, with perfect diction. fluent,
friendly, has q national reputation for
frankness and candor.
He has been in many fights. political,
financial and business. but In spite of
1t all has kept remarkably mellow
attitude toward life.
Mr.. Spreckels' father was In the
sugar business In California. when Ru-
dolph was born, 81 years ago.
Young Spreckels attended the public
schools there, but his restless nature
didn't register In the classroom. SO at
II he went to Philadelphia and
entered his fathers sugar refinery. His
father, Claus Spreckels, rich Western
capitalist, constructed his Eastern re-
finery primarily to fight the sugar trust.
The trust was beaten and compelled
to ask for terms. So Rudolph comes
by his fighting honestly.
BY the time he was %, Rudolph had
80 mastered the intricacies Of the bust
ness that he became president Of the
Hawaiian Commercial g. Sugar Co.
This company owned one Of the great
sugar plantations of Hawaii, but 1t had
been losing money for years. Rudolph
and his brother, Claus A., believed they
could make it pay. They bought it
from their father. Within year they
had put 1t on q paying basis and in
four years they sold it at q large profit.
After that Rudolph engaged in all
manner of business enterprises. First,
he won his fight for the control of the
San Francisco Gas Co. When Frico's
big fire occurred, he was chosen chair
man Of the executive committee which
handled the Red Cross funds, which
totaled $4,000. 900.
In 1906 he backed with all the power
of his personality and his money the
San Francisco graft prosecutions and
sent some former leading citizens to
threatened many times, but he was
fearless and nothing came Of 1t. He
drifted back to business.
In the sugar industry the factors
involved are the cane sugar growers OF
Cuba and other Latin American coun.
tries, the Philippine Islands and Hawaii,
the cane sugar growers Of Louisiana
and Florida, the beet sugar growers par
ticularly in Michigan, Minnesota,
Montana and other Western States. and
the refiners Of sugar. How can tariff
be worked out in such q way that all
Of these factors can be protected" Mr..
Spreckels began, and then continued at
length:
To-day there Is fixed tariff of 2.20
cents a pound on raw sugar entering
the United States; except Cuba sugar,
which comes in for 1.76 cents a pound.
II have read over the testimony OF
the different groups. The sugar indus
try will remain in a denoralized con-
dition until sugar IS selling net for
around cents pound. At that figure
the beet sugar farmers can receive about
So q ton for their beets. They are
the ones in the weakest position.
The price Of our beet and cane sugar
product on the mainland Is determined
by the price of refined sugar and not
by the price of duty-paid raw sugar.
This statement Is basic and funda-
mental. So I believe that Congress
| should understand that the Hawaiian
owned and operated refinery at Crock
world. might easily defeat any attempt
to give to the beet and cane growers
on the mainland, with whom they COM
pete, any benefit from increased duty
on raw sugar. This, too, is basic and
fundamental"
Mr.. Spreckels got up from the chair
and went over to the window.
you see any additional duty on raw
sugar would enable the Hawaiian
plantations interests, refining in Cali
fornia, to use the indicated increased
profit on their raw sugar as q contri-
button to their refinery. It would en-
able them to lower still further the
price Of refined sugar in competition
with beet and cane sugar on the main
land, and it could very easily deprive
our homegrown beet and cane industry
! on the sugar per Sc.
Let me say very frankly that any
| increased rate Of duty on raw sugar
| without appropriate legislation to pre-
vent Hawaiian interests from employ
| ing 1t as an added weapon to further
demoralize the beet and cane industry
on the mainland will do no good.
arrangement that believe will meet the
problem. But any tariff that ignores
the two important factors of Cd a very
low Cuban price Of raw sugar, and "a
refners' margin cannot assure any real
protection to the beet men.
II am convinced that the tariff on
sugar must be supplemented with an
internal revenue tax. Why should
Cuba be penalized If the American re-
finers reduce their margin from an
adequate $1.45 to an inadequate 60
cents? This is exactly what has hap
pened during the last year.. and the
beet sugar men have gone to Washing
ton and have blamed the low Cuban
market and the $1.76 tariff. I repeat
! that the reflners' margin affects the
best industry just as much as the tar
if itself. The Hawaiian interests in
California have been giving away part
of their protection. That's the trouble
When Cuban raw sugar. advances
to. say, $3.50. refined sugar should sell
for $500. Then only q $1.00 duty is
| needed for protection and not $500 per
100 pounds.
Let me take it up from another
angle. While Cuban sugar remains
cheap (under $500 no tariff rate SO
| far suggested would bring $500 sugar
unless the refiners themselves. retain
| an exorbitant margin for themselves.
Give the reflner the means to have an
adequate margin, but prevent him from
having an excessive one, by increasing
his internal revenue tax as the mar
| gin rises, and you have done the Job.
You have also given the cane and beet
sugar men on the mainland q chance
to live.
THE 1929 average of Cuban raw
sugar has been $1.96 per 100 pounds.
Now add, say . $500 tariff. This
makes 1926. The minimum internal
| revenue tax would be "a cents. The
refiner will now make the price Of re-
fined sugar anything he wishes. If he
| sells at $5.75 per 100 pounds, his mar
gin will be only $l.05. II he sells at
$500, his margin will be $3.50 But
If he sells above $500, the internal
revenue tax will be increased so that
his margin at any time cannot exceed
$50. 30 there would be no induce
ment to increase the price.
Eyes, I have been interested in
| sugar from the time I was a boy.
have given it the best part of my