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About The Oregon statesman. (Salem, Or.) 1916-1980 | View Entire Issue (Aug. 30, 1925)
... rr ." r tn snura-.sv ftm m , ... , ...... 4 - - TnEOREGOJt STATES1IAN, S ALEil; OREGON SliriUJVr- ilUIiTtriU. w, , Bk. . . . . - - - - ... , , - . - -' t The Truth About the Current Rubber Price By SHERMAN ROGERS Reprinted from the September Issue ot "Success" Magazine by special arrangement with the pub lishers. J :' i 4' v'.':.-' Copyright, 1 92 5, Success Magazine , Corporation M t . : . ' .. - " : Whs 4 to blame tor the present inexcusable-, satiation f rubber prices? . :.:' ,'. The American! rubber manufac turer says, with a great deal, ot sincere rigor, that the inflexibility of the British Restriction Act, backed by the British Government, is the cause. t . , i i But the Plantation Owners' As sociation- and the 'Stevenson com mittee, with Sir Erie Mller. rub ber leader; as spokesman, are just as itlgorous in their contention tha the American manufacturer is mostly to blame for being sad deay caught in a situation Where the, rubber plantation owner and British trader la In control of a runaway marcei. ; They claim they gained this control because the tire i(nufac turrs in the United States failed to take long term contracts at a time when the price ot rubber hovered, between 24c and 37c a pound. ' , .. , ; " . The "American 'manufacturer replies: "Why should we load up on ' WdtyefiV committments when the 'very spirit jof the Stevenson Act 1 was to stabilize the market and1 thereby make long committ ments unnecessary. . Back of the present controversy l.i a story of geographical changes In Rubber production. The enter prising British colonial developers in a short period of years switch ed the production center from Southern Africa' and the Para sec tion of Brazil to the British East Indies. .: "'3 . ;; V..v.'' In 1920 theEast Indian plan tations produced - and marketed orer' 300,000 tons from 3,000,000 acres, while Brazil and the re mainder xf the world produced es4 than 38.000, tons. Aadatthis time, the develop ment in the East Indies showed thai from a plantation standpoint, the British produced 75 per cc-nt. of rubber ttrown, the Dutch...? 2. per cent, with the balance of the world 3 per cent. And at this samettme,. the Fnlt- ed States of America imported 7 i per cent of all the .rubber grown in the world. But In the falK of 1920 the great rubber market ' demands ceased on the heels jf Jihe Ameri can commercial depression. The plantation owner now faced a crisis. The entire English in vesting public faced a crisis. The rubber investors of Great Britain walked around with grave faces. The storm was on, and they hadn't the slightest idea when it would stop. The condition became critical. ' . j Critical because a rubber plan tation will grow back Into Jungle in less than one year. If not cul tivated, and the enterprise ruined. The Englishmen 'now got busy, A few far seeing leaders develop ed. , Sir Eric Miller rapidly loom ed as a storm center in the rub ber world, x The land nnder f iTlvation in the East Indies had now grown to the tremendous area of over 4,- 000,000 acres, with a total. invest ment of nearly $1,000,000.00. In 1920 the price of rubber was 48c. In 1921, 19c a pound. In 1922; it had dopped to 14c (wa pound, or 9 under the estimated cost of production. In December, 1923, due to various causes that we will, describe later, rubber jumped to 27c but t it dropped back by March, 1924,to 22 c A recognized crisis faced plan tation owners in 1921. A commit tee was formed of prominent En glishmen interested in rubber pro duction. This committee .' recommended to the colonial secretary a scheme to be enforced ia Malaya, .Ceylon, and the Netherlands East' Indies. The Dutch, producing around 23 per cent of the world rubber, had becoma the fly In the ointment. The British leaders Importuned both the Dutch .government and the Dutch investors, to co-operate with them, but the Dutch refused. was again called together and re- j commended a concrete scheme to apply to Malaya and Ceylon only. The suggestions -of this committee were viewed with favor by. the colonial secretary and brought In to force In November, 1922. While the Colonial Restriction act .that followed only applied to Malaya; and Ceylon, most all Bri tish plantation interests adhered to t. j The government edict was vig orously enforced on the following basis: Taking the 1920 production as a 100 per cent basis of calcula tion, only 60 per cent ot that capacity was allowed to be ship ped. Ia was figured (hat this rigid restriction of exportation would,! in a short time, clean up the stocks on hand and create a condition that would bring back rubber production to a profitable basis, j If the price of rubber went over 36c a pound the Gov ernment would release 10 per cent more rubber at Intervals vf every 90 days., ,. ' At the present time the amount of rubber that each plantation is permitted to ship is only 75 per cent of its rated capacity. . Of course, it takes more than one man to fight. When the res triction proposition was broached in America it had both friends and foes amvmg the rubber con sumers warm trlends and vigor ous foes. . At this time Mr. Eric Miller took the spotlight with its full glare, i He made a trip to America he put up his proposition as stre nuously as possible to the Ameri can manufacturers of rubber. . He called on vur spirit of fair ness. He requested faith in Bri tiBh'iair play. And here was a case where faith was necessary Mr. Eric Miller said so, and there wasn't; any doubt about it in the minds of anyone at that time, i He wanted the American Rub ber association to endorse the Idea. ! . . Our; tire producers pondered over this because of commercial pride, j ' -They had consistently lowered tire prices year by year, at the same time turning out a product of a much higher grade. They didn't want to jeopardize their well earned reputation for playing fair with the American After this refusal the committee i automobile owner. So they ques V Iri 'Eveiry Drop j s ' 1 Power, Mileage Pep ! ! Power that adds wings to your car; Mileage that cuts dol lars off the cost of operation; Pep that gives you immediate response, quick start, speedy pick-up all these are yours when you use GENERAL, the planned and balanced gasoline. Made by a new, distinctive process solely for the purpose forwhich it is sold, GENERAL gives you all that yQU could; have got from the good old-fashioned gas of years ago and more . It assures, from any engine, the best performance of which that engine is capable. I Sold Only by Authorized, Independent Dealers, j at the Green-and-White Sign "FiU Up Your Tank and lit Your ENGINE Decide W. R. SPECK, Distributor I Salem, Oregon Phone 2102 ' n 'it- o SI UUU.U tloned Sir Eric quite pointedly re garding the stabilization ot a rub Lr price at an amount that would grant a reasonable profit to the plantation owner and the British trader as well, at the same time protecting our own customers. They were entirely frank In these discussions and were per fectly willing to help protect the East Indian planter. It meant their own protection in the long run to do so. However, the Rubber associa tion 'officials pointed to Sir Eric that they were not favorable to the principle of the Stevenson act. But as long as the British were going ahead on that ide?. there was nothing more to be said on that subject. But they wanted to know how rigidly the restriction act was going to work In emergencies They wanted to know if there would be a flexibility in the 10 per cent quarterly increase in ex portatlons under emergency condi tions. : . At this time the American rub ber people pointed out to Sir Eric that if there was no flexibility In the releases,. it would mean that rubber traders in London could juggle the market to suit them selves pretty much in a case of emergency shortage. And their contention regarding the flexibil ity was based on this danger. According to several of the leading tire manufacturers in this country, whose integrity I believe is beyond question, representa tions were made that if the British restriction caused rubber prices to mount too rapidly past the 36c a pound, the 10 per cent release in the restriction clause would be augmented to throw more rubber on the market and stabilize prices. Harry Firestone bitterly fought the whole arrangement, declaring that the government interference plan was fundamentally unsound; that it new In the teeth, of the age old law of supply and demand "But the vast majority of Amer ican manufacturers had confid ence and faith in the British sense of fair play. They had Sir Eric's wordand they endorsed the propo sition," declares a prominent rub ber manufacturer. And then the shoe began to pinch.:; A queer turn of affairs caused the pinch. William O'Neil, president ot the General Tire com pany In Akron, brought up an in teresting phase of the situation. He said this: "Under normal conditions the Stevenson act may have worked out all right, but all of a sudden the balloon tire came into being. It was accepted as a new signpost of progress; and almost immedia tely every tire distributor throughout the country found himself in a position where his customerj . were calling for ba!- loon tires and they were calling vigorously. Tbey didaVwant' to use old size tries any more.' "As a result: tire prices started j up and the 10 per cent increase allowance under the Restriction act each 90 days was not heavy enough to stabilize the market. l and rubber has Jumped nearly 500 per cent in twelve months. In other words the, flexibility verbal ly promised was not forthcoming i imnK Air. obeli's point is well taken. I believe that the balloon tire had a great deal to do with the situation. Be that as it may. Sir Eric, when importuned ny the American tire roanufactur ers who saw prohibitive tire In the offing, refused to recom mend a flexibility of 10 per cent increases. Even in the face of COc rubber In July, he obdurately re r used to do so. Now the American manufactur er charges Sir Eric with broken faith, and they make their charg es in no uncertain language The British plantation owners arei in a position to dictate a rub ber price, and they will be in that f . position ior some time if they desire to force the issue, although i personally believe that the con tinued 10 per cent increase in im puiiuuuns every so days will more rapidly bring us back to I normal than we have any idea of iat the present time. In fact the J high market is breaking now wnat Is the next step? That's the question that is burning in the minds of many leading Ameri can tire men. They are not asleep but the public and the American manufacturer must remember one thing. Regardless of all talk, we cannot grow rubber commercially in large quatities in Mexico and compete with the East Indies We cannot grow it in South America and compete with British and Dutch owners. It canot be pro duced in the Philippines under present laws in competition for two reasons, first, a Philippine law that onlv normiti tlon to own but 2.500 ocres of land, and second, labor restriction laws that prevent the importation i lu'iito coone labor Into the Philippines. These two restric tions place the Philippine Islands beyond the pale of competition at! the present time. -.Sumatra, the most fertile sec tion of the tropics for rubber cul-j tivation. is only a short distance! from Java, a country smaller than the state of Texas, that contains! 35.000 people, industrious work ers who are deeply concerned in making enough money to keep body and soul together. And all of the British East In dian possessions lie In close prox imity to the 400,000,000 people ot India and the hordes of coolie labor in China. Therefore, they will always be In a position to command tremendous snppliea ot extremely cheap labor, labor that only demands a IracUon oj the amount ot wages commanded by people of any section of either Central ot South America, where rubber can be produced. ' In the meantime what? Some of the well Informed believe that America tire manufacturers j will go Into Sumatra where millions ot acres ot fertile rubber lands can be obtained and develop a reserve supply of their own that will sta bilise the market. This can be done and it the American rubber manufacturers feel that tbey are going to be taken advantage ot. there isn't the slightest question but they will protect themselves adequately. W SEES PUN i . . . . . - i the eales drive recently! started piria cottage ior a wwW' by the entire Star and Durant or- . , . 7lo,, Durant Motors Innucoirate Policy to Enable Every one to Have Car However, my own personal view of the whole affair is that there exists in London and Singapore a misconception of the spirit that actuated American endorsement of the restriction arrangement., When the British public, the East India planters, and respon sible British political leaders be come thoroughly acquainted with the truth of the situation, cool heads that have always been friendly and fair will cause reason and.common sense to prevail. It is incomprehensible , that Americans who consume 74 per cent of world's rubber, and Brit ish interests who produce 75 per cent of world's rubber should pro long a controversy that must eventually bring grief to both sides. . . We know that Englishmen are fundamentally honest. We know that they are noted for being fair sportsmen in business. The rub ber leaders of America are both honest and fair sportsmen. My opinion is that before many weeks have passed, a new leader ship will have been obtained in the Rubber Planters association of the British East Indies. Such action will create lasting confi dence and mutual faith between tbem and the rubber manufactur ers of the United States that will spell continued prosperity and re newed progress in one of the world's greatest industries. BUS CARRIES ORCHESTRA A new role for the flexible mo tor has been found by Arnold Johnson and his Hollywood, Flor ida, Golf and country club orches tra who are touring the country this summer in a specially design ed White double-deck tally-ho bus. Johnson and his musicians left Chicago June 1, for an extended tour to fill concert and dance en gagements in the principal cities of Illinois, Indiana. Ohio, Pennsyl vania. Michigan. Kentucky and New York. During the past week the Dur ant Motor company throughout the western territory Inaugurated one of the. most revolutionary yet practical sales plans ever devised by any automobile factory, and the overwhelming response as report ed to the factory from the north west dealers is a clear reflection of the instantaneous public appro val for the Star Gold Certificate Save and Earn Plan. Thousands of people over the west have enlisted under this new plan a factory report shows which has Just been received by Salem Automobile company, local Star and Durant dealer. In discussing the plan that promises to create a new method of selling automobiles, Mr. Delano, local Star and Durant dealer pointed out the following remark able features: "This newly created plan gives every man, woman and child an extraordinary opportunity of be coming an owner of a Star car without the outlay of any money. By putting forth a certain amount of effort devoting a portion of one's spare time to the interest of the Durant organisation, any one may earn an automobile with a wide choice of the various mod els included in the Star line. "This Gold Certificate plan Is not limited to present Star own ers. It Is not limited to districts, but Is open to all who may wish to become owners ot an automo bile. " "Details ot the plan have been carefully worked out and it is amazing how even the most skep tical people have given their en thusiastic cooperation for the plan after all details have been care fully explained." In the entire western territory which is under the general super vision of Norman De Vaux. actiVe bead of the Star and Durant or ganisations In the west, this new plan promises to create sales rec ords which will shatter the sensa tional sales records of June and July which were the largest in the history ot the western organiza tion. This plan Is in accord with eanlzation and has already added an em pet us to sales which will cause the factory to step up pro duction which is now running at record making capacity and will continue on this basis for many months to come. Several weeks of careTuI plan ning and checking of the results nf ifiA nlnn ftr It Tnarf Tneen In effect at the company's branches tne Iowa in California where sales plans and ideas are tried out, definitely showj the advantages ot the plan for the dealers and the invaluable assistance to those pemons desir ing a Star car. Every phase of the plan is carefully explained in the literature prepared for the pros pective Star car owner and will prove of considerable assistance. Mr. and Mrs. J. Ham and fam ily Portland. Harry Rustard and wife, Port land. Mr. and Mrs. Wm. Echlamd. Mr. and Mrs. Brubell. Evelyn Seittlnger., Doris Barkstrom and Arnold. Alice," Frank. Wayne, Hugh and Melba are spending the week at Mr. K. If. Warren spent tn week end with his. family st the Welch cottare. ' Mr. and Mrs. "Weather and son Kenneth spent the week end at Manhattan. Mrs. William II. Witt and chil dren Dorothy and Wilms are spending the remainder of the sea son at their cottage Wilwet inn. Mrs. Spieker of Hillsboro sad Mrs. .'Koethe of Lacronse were Twenty-six sawmills are oper-lweek tni guest at the Wilwet. ating In territory tributary to Cot tage Grove. . ! BEACH NEWS I (CnUnmd fra 3) W Mann. Mrs. George McNalley ot Tort- lanJj Is spending a few days In cottage on the the McNally ridge. - Mr. and Mrs. George Bassen- dale and Mr. Uassendale's mother at the Daylight Inn. Arthur Wm. Tarkhnrst. Miss Margery Charette. Mis Francis Wright and Miss Ruth McDonali. are staying with MK He!n Mc Donald for a week in the Oregon cottage. . Mr. and Mrs. P. E. Day. ; Mr. and Mrs. John Tunzat, Mrs. W. P.. Smith are, staying at the Walklay cottage. William Stetnhauser and Miss Alice Cook spent the week end at the Mir-a-Mar. Mrs. Irene ? pence spent a week and sister. Mrs. II. H. Bassendale and Miss Ruth, of Portland, are vacationing in the Minnehaha cottage this week. Mr. and Mrs. F. M. Cole of Dallas and W. H. Prunk of Salem were guests of Mr. and Mrs. Joe Glath In the Pocahontas cottage. over last week end. Mr. and Mrs. E. A. Dunham and family, of Klamath Falls and their guest. Mrs. Anna A. Dun Mr. A. E. Graves has gone to Portland for a few days on busi ness. - 1 Mr. and Mrs. II. Warren and daughters Marian and Verna. have returned to Portland after spend ing three weeks In the Welch cot- tape. ; v i . daughter Lo's ot Hoqiuam, Wash., spent the week end at the Welch cottage. "i Roy Swltzer spent the week end &(f Via f mil. at titm fmm X7m ham of Elynla. Ohio, were guests I pott. . j at the Driftwood Inn tor several days' last week cottage. t M. A. Welch spent a week with In the Neth-er-lands cottage for hU fam,,T t the Welch cottage. two weeks are Mr. and Mrs. C, Howard Knapp and , daughter. Jean, of Portland Mr. and Mrs. H. B. Ingram of Portland, -visited last week with Dr. and Mrs. Chandlee at the Wallula cottage A. J. Butler and two daughters. Miss Ethel and Miss Verl of Port land, are domiciled in one of the Astman cottages. In the p. W. Mann Eacajawea cottage are Mr. and Mrs. L. S. Kirchner of Multnomah. George Welch motored down for the week end to Join his fam ily. ' I JIAMIATTAX Otto Dennton and Noah Toates ot Portland are staying at the Aa- Have Your Lights Tested Here! j i ! We are an authorized Light Testing- Station - i Barrett Bros. GARAGE 1999 N. Capitol Phone 520 Formerly Texas Garage I M . ' . II 4 ElcadlctteiPj gow cgro vy-fceed decreets, $3L13)S 22E ET3 tone 3$aim . . .u-.-. v IT Ad A All FriccsTn. TUSf lLorrfs TheseTrrices foliow the greatestseasoiiJooii ever hLTI-v creased volume, the Jesuit of oti.f?i;tndhTgTnlncs rflcrsrs Moca . to emphasize thissrjpe The cars are allstrictly 1926 -models on the new year ahead chassis. They4nclude.new style-creating Ixxiiesyiimshed in duo-tone Daco, hydraulic 4-wheel brakes, new finger-light steering, especially degnrd for the balloon tires. ' Be surand-seethis Intert-prodoctof aTSyOOOjJOO-conv -v , . I - - - JS, V; . Salem Automobile Co: . 151 North High- . ' ' .Salem .diana" "EIGHT" "is'eorD ANP'smvLmr'iivm.y winonririn.tot-i deaxeiis X
