Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-03-22
BY WILLIAM HARD.

OIL is certainly nooding washington
with trouble. Instead of stilling the
waves Of politics 1t is raising a first
class politicaf>storm. In fact. 1t is rails
ing many storms all over the country.
In the first place, Secretary of Com
merce Lamont Is battling to reduce oil
production in Venezuela on behalf Of
the oil producers Of Oklahoma, and the
Oklahomans are hooting him for it.
They say it is not enough. Senator
Borah Of Idaho, on the other hand,
says it Is too much and q violation Of
the Sherman antitrust law. Secretary
Lamont, contrariwise, and Secretary of
the Interior Wilbur, both Of them MEM
bers Of the Federal Oil Conservation
Board, say that they are not in any
way violating the Sherman antitrust
law, because their negotiations with the
oil companies In Venezuela are directed
toward those companies not as q group
Of companies, but as individual CON-
pantes.
In other words, as they assert there
will be no agreement signed, or even
spoken, between the four great Venezue-
Ian producing units--the Gulf Co., the
Dutch Shell Co., the Standard of New
Jersey and the Standard OF Indiana.
There will be simply an understanding
between the Gulf Co. and the Federal
Oil Conservation Board, between the
Dutch Shell Co. and the Federal Oh
Conservation Board, between the Stand
ard of New Jersey and the Federal Oh
Conservation Board and between the
Standard Of Indiana and the Federal Oil
Conservation Board. And let Senator
Borah turn that merry-go-round into
settled, combined conspiracy II he
can.
Moreover, the Federal Government.
under special authority from Congress,
is already conspiring with private COM
panies in the Kettlernan Hills oil pool
in California. There the Government,
as an owner OF oil land, has agreed with
a group Of private owners 70 choke the
pool down TO q very small percentage
Of Its potential production.
IL
Attorney General Mitchell is supposed
to gaze at this spectacle with woe or, at
any rate, with wonder. He gave this
administration its first black eye with
the oil industry year before last by issu-
ing an opinion to the effect that the
Federal Oil Conservation Board had no
authority to approve Q Nationwide
effort by the oil companies to restrain
production and that the oil companies
would not have sought the approval OF
the board had they not known that the
effort proposed was illegal.
Thereupon, nevertheless, the Federal
Oil Conservation Board Is diligently
seeking to encourage oil companies to
restrain production by agreements within
the boundaries Of the several States.
Such agreements and arrangements ex-
Al vfvae
States: Oklahoma, Texas and Califor-
MIA. Thus the thing which would be
criminal If done federally is beneficent
and laudable II done locally.
+
But the perplexity and the irony Of
the matter go farther. Secretary VIII
bur, as chairman of the Federal Oil
Conservation Board, assures this writer
! that there should be a compact be-
tween the producing States regarding
the control Of production. Oklahoma
and Texas and California, through their
| State governments, should combine, it
would seem, in the Secretary's view, to
deal with the menace Of excessive pro-
duction; and they should do this with
Federal sanction.
Thus the thing which would be Grim
inal IL done directly federally through
out 90 States is to become benehcent
| and laudable, for solid business reasons,
II done by three States with the specific
instant blessing of the Congress.
This is the equivalent, in economic
| effect, it is alleged by some legalists, of
repeating the Sherman antitrust law on
behalf Of producers of oil. It sheds light
| on President Hoover's repeated hints as
to the advisability Of a modification of
that law not only for oil but for all
| other basic natural resources. Secre-
tary. Wilbur's idea Of compacts for re-
straint Of production between States
must be taken as the forerunner of a
vast political conflict as to the proper
! operation Of the Sherman antitrust law
provisions In general.
X X X
! It is understood that the Secretary
will urgently present his idea Of COM
| pactS to session Of the Federal Oil
Conservation Board here next month
| when q multitude Of enraged Mid
western oil men are expected to be pres
ent to give national voice to their grew
ances and indignations.
They most Of them want a tariff on
oil, or an embargo, and they many of
them openly charge that Secretary of
the Treasury Mellon, on behalf Of the
Gulf Oil Refining Co., has been pre-
venting Congress from granting the tar
| III, or embargo. Secretary Mellon s
| friends reply that ne had as much
| influence with Congress in the matter
of legislation as he had in the matter
of the veterans bonus loan legislation,
which is we'll known TO have been no
! influence at ALL They also declare that
| Mr.. Mellon in fact has earnestly CO.
operated with Secretary Wilbur and
Secretary Lamont in causing his Gulf
Oil Refining Co. readily to agree to re-
strict its production in its Venezuelan