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About Eagle Valley news. (Richland, Or.) 191?-1919 | View Entire Issue (July 18, 1918)
L'. i. f - Are the PACKERS PROFITEERS? Plain Facts About the Meat Business The Federal Trade Commission in its recent report on war profits, slated thai the five large meal packers have been profiteering and that they have a monopoly of the market. These conclusions, if fair and just, are matters of serious concern not only to those engaged in the meat packing business but to every other citizen of our country. The figures given on profits arc misleading and the state ment thai the packers have a monopoly is unsupported by the facts. The packers mentioned in the report stand ready to prove" their prolils reasonable and necessary. i 9 9 9f The meat business is one of the largest American indus tries: Any citizen who would familiarize himself with its details musl be prepared for large totals. The report states that the aggregate profits of four large packers were $140,000,000 for the three war years. This sum is compared wylh $19,000,000 as Uie average annual profit for the three years before the war, making it appear that the war profit was $121,000,000 greater than the pre-war profit. ' t This compares a three-year profit with a one-year profit a manifestly unfair method of comparison. It is not only misleading, but the Federal Trade Commission apparently has made a mis.lakc in the figures themselves. v v v v The aggregate three-year profit of $140,000,000 was earned on sales of over four and a half billion dollars. It means about three cents on each dollar of sales or a mere fraction of a cent per pound of product. Packers' profits are a negligible factor in prices of live stock and meats. No other large business is conducted upon such small margins of profit. Furthermore and this is very important only a small jortion of this profit has been paid in dividends. The jalance has been put back into the businesses. It had to je, as you realize when you consider the problems the packers have had to solve and solve quickly during these war years. To conduct this business in war times, with higher costs and the necessity of paying two or three times Jtlie former prices of live stock, nas required the use of two or three limes the ordinary amount of working capital. The. V additional profit makes only a fair return on this, and as lias been stated, the larger portion of the profits earned has been used lo finance huge slocks of goods and to provide additions and improvements made necessary by the' enormous demands of our Army and Navy and tthe Allies. 3 Sfi Sfc If you are a business man you will appreciate the signifi cance of these facts. If you are. unacquainted with business, talk this matter over with some business acquaintance with your banker, say and ask him lo . compare profits of Uie packing industry with those of'v any oilier large industry at the present time. .' ft.! No evidence is offered by the Federal Trade Commission in support of the statement that the large packers have a monopoly. The Commission's own report shows the large number and importance of other packers. The packers mentioned in Uie statement stand ready to prove to any fair-minded person that they are in keen competition wiUi each other, and Uiat they have no power to manipulate prices. If this were not true they would not dare to make this, positive statement. Furthermore, Government figures show that the five large packers mentioned in Uie report account for only about one-third of Uie meat business of Uie country. They wish it were possible to interest you in the details of tl lieir business. Of how, for instance, Uiey can sell dressed beef for less than the cost of the live animal; owing to utilization of by-products, and of Uie wonderful story of the methods of distribution throughout this broad land, as well as in other countries. The five packers mentioned feel justfied,in'co-operating with each other to the extent of together presenting this public statement. They have been able to do a big job for your Government in its time of need; Uiey have met all war time demands . prompUy and completely, and Uiey are willingsto trust their case to Uie fair-mindedness of the American people : with the facts before them. Armour and Company ' Cudahy Packing Co. Morris & Company Swift & Company Wilson & Company , f 4 - f