Morning Oregonian., March 22, 1920, Page 3, Image 3

TIIE MORNING OREGONIAN, MONDAY, MARCII 22, 1920
3.
STANDARD
DEFENDS
F
MFL OIL PRICE RIS
E
Stimulation of Production Is
Hoped For by Advance.
CONSERVATION IS DESIRED
Head or California Concern De
tails Reason for Increase to
Railroad Commission.
SAN" FHAXCISCO. March 21. The
Standard Oil company of California,
through its president. K. R. Kings
bury, in an open letter today ad
dressed to the state railroad com
mission, defended Us recent advance
in fuel oil prices "in the hope that
an increase of 2D cents a barrel would
stimulate production and restore the
balance between supply and demand."
The letter was. issued as a result
of, an Inquiry addressed to the oil
company last week by the railroad
commission asking why an Increase
was necessary. As many public util
ities operate their plants with power
obtained from fuel oil, the commis
sion said it believed the public
should know the reasons for the in
crease. The oil situation in Cali
fornia, whirh the company declares
to he serious, is reviewed in detail
in the company's letter, which points
out "that an increase in price tends
to conserve the use of fuel and to
check the depletion of stocks. This
is the only known remedy."
. Market Depletion Frared.
On the subject of gasoline, which
the company says has an equal inter
est with that of fuel oil, the letter
says:
"Gasoline must be kept at a price
level where it will not be shipped
to other markets in quantities suf
ficient to di plete the California mar
ket. For example, at the present time
casoline is selling in New York at
2S', cents a gallon wholesale. Pre
vious to the recent advance here, it
was selling at 19',i cents per gallon
wholesale, a difference of 9 cents
a gallon. The rail rate to New York
is 7 cents a gallon and the water
rate not to exceed 4 cents. Obviously
unless a proper differential exists be
tween the Pacific coast price and the
eastern prices.vPacif ic coast gasoline
will be shipped east by wholesalers,
jobbers and others' and sold at a
profit to the complete demoraliza
tion of the local market.
"That the gasoline market is short
may be illustrated by the fact that
this company, to supply the require
ments of its trade, several months
ago purchased about 50.000.000 gal
lons of gasoline in the mid-continent
field which the company is shipping
to points ciiK.-iniariiy supplied from
California.
Prirc enrlj' Constant.
"In this connection it may be noted
that the price of gasoline has
mained practically constant compared
to the increase in the cost of other
commodities. In July, 1919. the price
of gasoline on this coast was in
creased 1 cent per gallon. This was
the only advance that had been made
since December. 191b, except an
crease of half a cent a gallon, which
was ordered in 1918 by the fuel ad-
ministration to absorb the genera
freight increase throughout the coun
try." The letter in part follows:
"The Pacific coast supply of fuel
oil end of petroleum products is rap
idlv aDProaching exhaustion. Since
Slav 1. 1915, crude oil stocks in Cali
fornia have decreased from over 60.-
000. 0U0 barrels to 28.738.921 barrels on
March 1. 1920. The available supply
of crude oil in stock is today less
than 13,000.000 barrels. The balance
of the stocks are taken up in the
factor of safety of 10,000.000 barrels
which the petroleum committee of the
state council of defense found essen
tial to the safety of Pacific coast in
dustries, and in the oil in pipe lines
and tank bottoms which the same
committee estimated at 6.000,000 bar
rels not available for use.
"At the present rate of consump
tion and of production the available
stocks will be exhausted in about 12
months, at which time consumers of
California fuel oil will be cut off from
between 25,000 and 30.000 barrels per
day.
Ootlook Deemed Alarminff.
"It must be obvious to your honor
able commission that those engaged
in the oil industry view this condition
with serious and just alarm. The
condition is not a temporary one, but
the culmination of a steady growth.
Stocks for the past five years have
declined; consumption has increased
and prices for crude oil have mounted.
But no advance in the price of fuel
oil has been made by this company
for nearly two years, or since May 1,
1918, when, at the direction of the
United States fuel administration, all
marketing oil companies advanced the
price which they paid for crude oil
at the well 25 cents a barrel and the
price at which they sold fuel oil Id
cents a barrel.
"The California market for fuel oil
and its products has ceased to be of
local Interest only. Economically It
has acquired a national and inter
national importance. The United
States shipping- board Is establishing
oil fueling stations throughout the
world and will supply these points
from the cheapest market. Thus
California will be1 drawn upon or
spared In the relation that California
prices bear to prices elsewhere, liven
at the new price this oil market Is
lower than many other points with
which this market is In competition.
The inevitable result will be that the
Pacific coast will be further drained
of Its supply by buyers who seek the
cheapest market. Shipping board ves
sels' have already sought cargoes of
fuel oil which formerly were obtained
in Mexico, so that the Mexican car
goes could be released for the At
lantic coast.
"It is obvious that there will not be
enough oil to go around unless first,
production Is increased; second, the
demand conserved.
Incrraae Declared Essential.
TVe know of no other step to -accomplish
these results except an in
crease in the price paid for crude oil,
and In the price at which fuel oil is
old. The same reasons which actu
ated the fuel administration in 1918
in ordering- price Increases in order
to stimulate production, and to con
serve the supply, actuate us now. The
condition today is even more serious
than it was in 1918, for California
stocks are 4,000.000 barrels below the
figure at that time and consumption
of California oil has counted half
a million barrels a month above the
demand then, with the added require
ments already referred to also in
sight.
"There la further the fact that im
proved refining processes will in
crease the volume of refined products
extracted from crude oil and thus re
duce the resulting residum for fuel
oil. This company is now installing
at a cost of 10,000.000 new processes
by which the company estimates that
more refined products, including gaso
line, will -roooTored from crude, oil.
in such quantities that the company's'
production of fuel oil, within a year. I
will be necessarily lessened about SO
per cent, or 20,00 barrels per day.
"In the face of increased costs, this
company has maintained its price of
$1.60 for fuel oil without change for
the past two years. The developments
oi the arst two months of this year
finally convinced the company that
some stimulus should be provided to
increase production and some action
taken which would lead to a con
servation of crude oil and Its prod
ucts.
'In its efforts to promote conser
vation of the products of petroleum
this company sells no crude petroleum
for fuel oil; it sells only the residum
resulting from distillation and crack
lng of crude oil.
Consideration of profits did not
enter into our last price advance. Our
action was designed simply and solelj
to protect the fuel oil and gasolm
supply of this coast and to stimulate
the production of crude oil. In fur
therance of this, the company is cur
rently declining export orders which
would return a larger profit than local
sales.
TRADE SESSIONS CLOSE
California Building Council Urges
Anti-Asiatic Laws.
BAKERSFIELD. Cal.. March 21.
With re-election of virtually the in
cumbent administration, including P.
H. McCarthy, president, and A. O.
Tveitmoe, secretary-treasurer, as offi
cers for the ensuing year, and voting
Los Angeles the site of the 1921 con
vention, the twentieth annual conven
tion of the California Building Trades
Council adjourned here today at noon
after a five days' session.
Immediately before election of of
ficers and adjournment, the conven
tion went on record in favor of strin
gent anti-Asiatic resolutions con
demning the "gentlemen's agreement,'
between this nation and Japan, and
urging legislation denying the right
of Japanese to own or lease land in
the United States. Granting of citi
zenship to the Japanese was also
severely condemned.
STAGE COMPLETELY' SET
'Continued From First Pas?.)
jority in this respect. The senate
caucus probably will conclude its
work tonight and at the general
caucus that will be held late tonight
or tomorrow morning. Although it
now appears that the lid will not be
tilted to admit consideration of other
legislation than the five enumerated
in the programme agreed upon last
week and the two resolutions ap
proved by the house caucus, the de
termination of some of those matters
will involve bitter struggles. No set
tlement of the demands of the com
mon schools has been reached and
the fight will be carried to the floor
of the legislature.
The two houses at noon tomorrow
will be called to order by the same
officers who presided at the regular
session last winter, Dr. P. H. Carlyon,
president of the senate, and Fred A.
Adanis, speaker of the house. Soon
after the call for the special session
is ready in both houses, the four rep
resentatives and two senators elected
to fill vacancies will be called to be
sworn in.
Contest Rumor Heard.
There still persists a rumor that
C. W. Anguish of Snohomish county
will insist upon his old seat in th5
house, and, if he should, his demands
will have to be passed on in opposi
tion to the claims of the two repre
sentatives elected from the 49th dis
trict to succeed him and C. W. Gor-
ham, who died last year. On the theory
that such a contest will not arise it
will take very little time for the two
legislative bodies to get by the for
mality of swearing in new members,
far less time than is usual at the
beginning of a regular session.
Afterward each house must notify
the other that it is organized, then
the two must name a joint committee
to tell the governor that they are pre
pared for business and ready to re
ceive any communications from him.
The response of Governor Hart will
be that he would like to deliver a
message to the legislature and the
house will then have to invite the
senate to meet with it, and the two
bodies will have to send a committee
to bring in the governor, who will
arrive bearing his message.
Old Measures to Come l"p.
It will also bo necessary for the
legislature to consider seven measures
passed by the last legislature and
vetoed by the governor. Five vetoed
senate bills and two vetoed house
bills have been prepared by the sec
retary of state for submission to the
legislature Monday. These will re
quire considerable consideration be
cause two or more of them are im
portant in their scope.
The vetoed bills which this session
is required by law to consider are:
Senate bill 224 (chapter 194). The
veto is based on an error in tne
amendment to the fraternal insurance
bill and can quickly be remedied.
House bill 214 (chapter 201). The
governor has vetoed section 7 Be
cause "the scrivener erred in drafting
the bill." As this is only a slight
error, it also can be remedied in quick
order.
Senate bill 136 (chapter 209), in
which the governor has vetoed sec
tions 9. 11. 12 and 13. Section 9
would eliminate stocks from securi
ties which trust companies may nan
die. The governor in his veto sees no
reason for the restriction. Section 11
prohibits banks and trust companies
from carrying any asset on the books
of the corporations at a value in ex
cess of its actual cost to the bank
or trust company.
3fo Reason Seen.
In vetoing this, the governor de
clares he sees no reason why the leg
islature should discriminate against
state banks. "It appears to me that
assets of the bank," saya the gover
nor In his veto, "especially those that
have a staple value should be carried
in the assets of the bank at their
value."
Section 12 applies to banks the
same as section 9 applies to trust
companies as investments in stocks.
Section 13 requires that no real es
tate shall be carried as an asBet of
a bank at a greater valuation man
the actual cost of the acquired title.
The governor maintains that the
banks are entitled to the unearned
increment.
House bill 263 (chapter 202) Sec
tion 2 is vetoed because of the omis
sion of a line in the enrolled bill.
House bill 90. the amended drain
age bill, in which the last 22 lines of
the bill are erroneously added.
Law Held Unpatriotic.
Senate bill 98, which amends the
bond bill. This measure authorizes
the purchase in the market of certifi
cates of Indebtedness or bonds and
requires county treasurers to sell the
United States bonds in the open mar
ket for the purpose of redeeming dis
trict bonds when due. The governor
holds that this is not .patriotic legis
lation for the' purpose of assisting
the United States government in float
ing .a loan, as it requires the treas
urer to go into the open market
and buy bonds. "It seems,'' says
the governor, "that the only re
sult from this legislation would be
to encourage county treasurers to use
this redemption fund to speculate in
securities on a floating value."
Senate bill 152, which permits drill
ing for oil wells on state lands. The
governor in his veto of this measure
declares that It violates a compact
with the United States through which
this land was secured.
I
mm
ucxs
EFFICIENCY
Cause Found in Scarcity
Food for Workers.
of
MATERIAL IS LACKING
Soviet Government Unable to Pro
vide Knives for Use of Har
vesting Machines.
(Continued From First Pasre.)
an equally Inexperienced mechanic.
while the supreme council's nominee
was a draftsman. It may be stated.
parenthetically, that the head of the
metallurgical department, by whom
this draftsman was appointed, had
himself been an unskilled metal
worker up' to the time the Soviets
Ditchforked hira in a post that in
America would carry with it a salary
of 50.000 a year.
The Bromley plant presents a aoice
far niente appearance, to say tne
least. It was underheated to such a
degree that the personnel spent most
of their working hours huddling over
the furnaces, tolling at their allottea
tasks only for a few moments at a
time. Production was naturally at a
very low ebb. and nobody seemed to
know how long things could be kept
running. Some of the old technical
staff had remained, but were ob
viously performing their duties with a
complete lack of enthusiasm. ineir
salaries had been increased only 40
per cent, while the wages of the
workers had been doubled, so that in
many cases they were earning less
than the manual laborers.
Workers Too Tired.
Here is a sample taken at random
from notes of the diminished pro
ductivity: A group of eight nail fac
tories, whose production before the
war was 2100 pounds per worKman
per month, now turns out oniy tv
pounds per man per month. Kelly
estimated, after personal inspection
of these factories, that even under the
present unfavorable conditions the
output should be 600 pounds per man
monthly, a standard which, in his
Dinion. was not attained simply be
cause of the workers, fatigue due to
malnutrition and the lack of labor
iscipline. These plants, in common
with most others, only run from 10
A. M. to 4 P. M., which in part is
caused by the fact that there is only
daylight between those hours in the
winter time in Moscow.
The picture of the Russian indus-
rial collapse that I have sought to
paint In as objective colors as possi
ble was what confronted the third
congress of economic Soviets of Rus-
ia, to give the economic convention
requently referred to above its of
ficial title, when it met in the second
oviet house at Moscow on January
4. What measures this assemblage
of all the economist brain power at
the Soviet's disposition decided upon,
at the instigation chiefly of Comrade
Trotzky, to ameliorate a situation so
fraught with direful potentialities,
has already been sketched as fully as
space permitted. There remains.
therefore, only a recapitulation of
certain salient points. Chief among
them is the convention's recognition
of Russia's vital need for railroad re
construction the leitmotif of her eco
nomic symphony. It was formulated
best, perhaps, by Professor Lomonos
sor, former soviet purchasing agent in
America, in the following impassioned
harangue:
Railroads the Keynote.
"The destiny of the republic de
pends on the railroads; the destiny
of the railroads upon the repair of
locomotives. Thus upon the repair
of locomotives depends today the fate
of the state so gloriously created by
the heroic efforts of the Russian pro
Ictariat. Three months ago Trotzky
launched the cry, 'Proletarians to
horse!' (a reference to the establish
ment of the red army cavalry
corps). The Russian proletariat
mounted on horseback and won the
victory. Now we must launch this
new cry 'Proletarians to the work
shop!' for the repair of our locomo
tives. And here also the proletariat
will conquer."
It was characteristic throughout
the long discussion about Trotzky's
proposal for militarizing labor that
the term was never used, orators
speaking always of "mobilization of
labor." The economic convention drove
home to all concerned that the com
munist aim is not merely a temporary
readjustment of national industries
but the transformation of Russia
from a semi-agricultural to an in
dustrial country.
In foreign eyes the absence of fi
nance as a subject for deliberation by
a convention dealing with the eco
nomic structure of a great nation will
be regarded with amazement. From
the communist standpoint, however,
to talk about money would be sheer
waste of time. To the communist so
viet, finances, as I have had occasion
to remark before, are in the best of
shape, and administered with ad
mirable logic. Until such time as it
can abolish money altogether, the so
viet government will pay for what it
has to buy at home in paper fresh
from its own printing presses, and for
what it buys abroad in gold or in
commodities. Soviet rubles at present
possess no value whatever outside of
Russia, the only exchangeable ruble
being that bearing the crown and
double-headed eagle of the czar..
Soviets Show Indifference.
Whether the notes which they Issue
in such seemingly reckless quantities
will ever acquire negotiable worth In
foreign money markets Is a matter
of complete indifference to the bol
sheviki. Indeed, since they prohibit
citizens of the Russian republic from
engaging in foreign trade, to have
their money recognized abroad is, in
a sense, a disadvantage, because it
makes it easier for individuals to
evade the laws against private com
merce across the frontier.
So long as they deal with the Mos
cow government, foreign business
men nrd not concern themselves
with paper money rates of exchange,
for the Soviets are unlikely either to
offer or to accept such currency In
commercial transactions unless they
depart from their communistic prin
clples. It Is In dealing with private I
persons that paper money values will
count, and this, according to the
Soviets, is not going to be tolerated.
Although the amount is hedged
about with much secrecy, there is lit
tle doubt that the soviet treasury
contains as much as 1,000,000,000 ru
bles in gold. At the time Kolchak
captured several hundred millions
from them they were supposed to
have half a billion left. Since then
they have mined and minted a con
siderable quantity, and in Siberia re
cently they captured a Kolchak train
said to be carrying 300,000.000 rubles.
All the gold they have will be re
served for essential payments on pur
chases abroad.
The Soviets have long since pro
claimed their intention to liquidate
foreign loans made by the czar.
French peasants and other unfortu
nate folk who Invested money in Rus
sian imperial bonds are likely to have
to wait a long time before recovering
their Investment, however, for with
the best will in the world the Russian
republic will not be able to make
good the ancient obligation in the
immediate future except perhaps
through the medium of concessions to
governments or groups interested.
There is no intention on the part of
the bolshevik!, it may be added, of re
funding the money Invested in private
industrial enterprises in Russia since
nationalized, either to foreign or na
tive stockholders.
Seek to Rea-nlarlse Budgets.
Principally for facilitating the
bookkeeping, the Soviets have sought
to regularize their budgets. From a
capitalistic point of view the budget
ary system must remain chaotic, how
ever, since it only required authori
zation from the council of the peo
ple's commissary for any govern-
mental department to spend whatever
sums It desires. Probably there are
figures of how much is expended an
nually for administrative purposes,
but in view of the fact that expendi
tures are made In paper money pos
sessing an entirely fictitious value, I
never bothered to collect them.
As for currency actually In circula
tion, it consists of four kinds the
Czar. Duma, Kerensky and Sovietski
rubles. Legally all possess the same
worth: in practice, one obtains
through speculators 8 to 10 Sovietski
for 1 "nikelai," or Czar ruble; 3 for
a Duma ruble, and maybe 2 for a
Kerensky.
In his next article Mr. Eyre will tell
of conditions in rural Russia, how
the peasants are growing fat and rich.
individual, communal and soviet
farming will be explained, along with
political divergencies between the old
and young peasants. - How the ban
ishment of vodka benefited husban
dry will be outlined, as will the soviet
collection of grain at the point of the
bayonet.
GUARD ANNOYS EX-KAISER
Ex-Emperor Rebukes Sentinel for
Following so Closely.
AMERONGEX, Holland, March 21.
The constant pacing of the sentinel
behind Ex-emperor William when he
walks in the Bentinck castle garden
has greatly annoyed the one-time
German ruler.
On several occasions the ex-kaiser
has told the guard not to follow him
so closely but to stay out of sight.
Are you giving
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PERU ROILS BOLIVIANS
Escutcheon of Consulate Dragged
Through Streets of Oruro.
ORURO. Bolivia. March 21. There
was a great demonstration here last
night against Peru. ,
The escutcheon of the Peruvian
consulate was dragged through the
streets and demonstrations were car
ried out before the homes of Peru
vians and also before tho offices of
La Patria, a pro-Peruvian newspaper.
EBERT IS BACK ON JOB
(Continued From First Paffe.)
sidered probable that he will retain
his post for a time at least in order
to restore the confidence of the Berlin
population generally.
It is declared that the new cabinet
will include active representatives of
labor, Carl Rudolph Legien, president
or the federation of trades unions,
being named for chancellor.
CABINET OHAXGES PROMISED
Agreement Also Provides Punish
ment for Revolt Leaders.
STUTTGART, March 20. (By th
Associated Press.) A government an
nouncement today gives the terms ot
the agreement readied by Chancellor
Bauer and other government repre
sentatives with leaders of the striking
elements in Berlin.
The statement enumerates eight
points to which the government
agreed, in order to secure a cessation
of the general strike.
The points follow:
Revision of the cabinet.
Disarmament and punishment of
those who participated in the Kapp
revolution.
Changes in the personnel of the
staffs of certain federal officers.
Speedy democratization of the entire
administration.
Enactment of new social legisla
tion. Immediate nationalization of the
coal, potash and otther industries.
Campaign against food hoarders and
profiteers.
Disbandment of disloyal military
units and the substitution of demo
cratic organizations without class dis
tinction.
The document concludes:
We learn that Ministers Noske and
Heine (Gustav Noske, minister of de
fense, and Dr. Karl Heine, Prussian
minister of the interior) have ten
dered their resignations."
Sailor Visits Winlock Home.
CENTRALIA, Wash.. March 21.
(Special.) Carl Seaman is back from
a three-months' cruise in oriental
waters, during which he visited ports
In Japan, China and the Philippines.
and is visiting his home in Winlock.
The sailor made the cruise on a Se
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COXSTAXTIXE OP GREECE IS
PLAXXIXG COCP, REPORT.
Allies Receive Information of Plot
to Regain Throne; Venizelos
in Danger, Is Rumor.
(Copyright by the New Vork World. Flib-
usnea Dy Arrangement.;
LONDON. March 21. (Special Cable.)
The allies are watchingr the activi
ties of ex-King Constantine, especial
ly as there have been rumors of a
renewed plot in Greece for his resto
ration. Greek officials admit the llke-
ihood of his making: a move in this
directon. It Is rumored that the lat
est plot envisages such a coup in two
or three months.
Although Venizelos is overwhelm
ngly strong in Athens itself, it is
understood that the monarchists are
powerful in opposition to sending a
Greek army of 90,000 men into Smyr
na. Were Greece to send a big army
nto Smyrna, Constantine's support
ers would probably put out appeal-
npr propaganda that f'onstantine s old
policy was for peace, while the pres
ent Greek government is still engag
ing in warliko adventures.
Confirmation of the existence of
such a plot, which Is also said to em
brace the assassination of "Premier
Venizelos, was obtajned tonight from
the Greek minister in London, M.
Caclamanos. He said: "There are two
opposing wings of monarchist in
triguers one desiring restoration
through political action and the other
by force of arms." The latter group,
he intimated, is now strongest, and Is
supported by Gounaris, formerly
president of Constantine's council in
Athens, now in retirement in Siena,
Italy.
NON-PARTISAN IS IN RACE
Nebraska Governor Petitions Out
for State Senator Tnylor.
LINCOLN. Neb., March II. A pri
mary election petition not Included in
the list in the secretary of state's
office Saturday night is that of V. L.
Taylor, state senator from , Custer
county, who filed as a democratic
candidate for governor.
Senator Taylor Is a member of the
Non-Partisan league.
Read The Oregonlan 'classified ads.
If
CASTO R IA
For Infants and Children -
In Use For Over 30 Years
Always bears
the
Vpnature of
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For Economical Pencil Luxury Use
7K?
PERFECT PENCILS
..American Lead Bsxicil Co22o fifth AvemtesOT
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Your Every
Drugstore Need
FuMled
at Nau's
WHILE the store of
"Dependable
Drugs" is especially the
place to have your pre
scription filled, you'll
find everything else here
that a fully equipped
drugstore should have.
Every night all night
Every day all day
-1 . Victor Records j
tea
WJJLli.'iL'liltlPjilig
II
It
Jrm- PORTLAND ORt. I
PHON E. MAIN 721 U J
cox. 6 ANoAioe J
Victor Records
on the
VICTROLA
will give
Ideal Dance Music
Try These Late Records
"Kchind Your Silken Veil" Fox Trot '
"Roses at Twilight" Waltz
Both by Yerkes Jazzarimlia Orchestra Kc
'Patches"
"I Might Be Your Once-in-a-W hile"
Both Fox Trots, played by Smith's Orch. 85c
"Mystery" and "Oh"
Medley Fox Trots by Paul Biese Orchestra 80c
"Peggy" Medley Fox Trot
"On Miami Shore" Waltz
Both Played by Joseph C. Smith's Orch. S5c
Victrolas 25 Up Convenient Terms
Shermanj(May& Go.
Sixth and Morrison Streets
Portland
(Opposite Postoffice)
Seattle Tacoma Spokane
i -
!.
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