Febrjary 10, 1910 



HARDWOOD RECORD 



29 



absolute standard of sizes of all hemlock planing mill products, these 

 sizes to be determined by a universally used steel gauge. 



H. L. Kussell, dean of the college of agriculture of the University 

 of Wisconsin, told of the plan for constructing an ideal farm dwell- 

 ing with accessory buildings on the campus at Madison, to be used 

 in connection with the work in farm and home economies. He asked 

 that the association provide the necessary wood materials to erect 

 such buildings, and stated that the model farm will be used con- 

 tinuously for training and will be inspected by farmer visitors con- 

 tinually, lie said it should necessarily be made of Wisconsin woods 

 throughout. 



Ml. J. Quinlan moved that C. C. Collins of Madison, Wis., be desig- 

 nated as a committee of one to make arrangements to provide for all 

 woods to be used for this puipose. 



A. L. Osborn, chairman of (he bureau of transportation, brought 

 to the attention of the membership the bill making it incumbent upon 

 railroads to present claims to lawful payers of freight bills within 

 ninety days. That was refijrred to the resolutions committee. 



On motion a resolution was adopted on the death of the late D. M. 

 Kneeland. 



In speaking of the suggestion made by Dean Russell, Secretary 

 Kellogg of the National Lumber Manufacturers' Association, said 

 that this is but the beginning of a big campaign in this same direc- 

 tion. He said that the trade extension work of the National associa- 

 tion is meeting with the enthusiastic co-operation of retailers every- 

 where and that there is already in sight $500,000 for well-organ i7.e<l 

 promotion. 



Before the Federal Trade Commission 



President R. B. Goodman presented the following address, reiKirt- 

 ing on the progress made before the Federal Trade Commission: 



So much has been written about the lumbermen's ease before the 

 Federal Trade Commission that I will not consume any time In trying to 

 outline the tesliniony. Every member of this association has received 

 from the National association a copy of the testimony presented last 

 July in Chicago. I'ou have all read Mr. Worcester's splendid presenta- 

 tion of conditions in our Industry in Wisconsin. 



The commission continued Its bearings on the lumber Industry In the 

 West last fail, and In December Gen. L. C. Boyle and J. N. Teal sub- 

 mitted oral briefs summarizing the testimony. These briefs will soon be 

 published, and :i copy mailed to each memljer of this association. You 

 should read these briefs for tliey pertain directly to your business welfare. 



This case is Just as vital to each of us today when prices are nearly 

 normal and the volume of business above normal as it was last July when 

 shipments were much below production and the market prices below the 

 actual cost of manufacture. The same influences that brought about the 

 depressed condition of our Industry for the past two years are working 

 silently and surely even now to bring about these conditions again, perhaps 

 not this year nor next, and perhaps sooner than we expect. With a 

 further advance in price, which appears most prooable, we will have just 

 the conditions that bring about over-production, and no amount of preach- 

 ing and no amount of moral suasion and In spite of past experience, this 

 over-production will go on until we have the history of 1907 and 1908 

 and 1913 and 1914 repeated. 



Tou all know very definitely the difliculty with our situation in Wis- 

 consin and upper Michigan. Mr. Worcester has pointed it out very 

 clearly. We have suffered from the competition with lumber produced 

 in fire prevention be made permanent and asking congress to aid in the 

 In the West and in the South. In normal times this competition Is fair 

 and we can meet It, as we are meeting It now. We have just as good If 

 not better lumber than Is produced In any other section of the United 

 States, and we are developing the same faith in the merits of our prod- 

 ucts as the lumbermen In other sections of the country have shown, as Is 

 evidenced by our hemlock promotion campaign. We can hold our markets 

 against the competition of all other sections when this competition is fair, 

 but when the producers In these other sections of the country ship lumber 

 Into this market and offer it for sale at less than the cost of production, 

 we cannot meet this competition and live, and just as surely as the 

 pendulum swings, we know that this condition of affairs is lying In wait 

 for us, and this grievance Is our one particular Interest In the case before 

 the Federal Trade Commission. Section 5 of the Trade Commission Act 

 reads as follows : 



That unfair methods of competition in commerce are hereby declared 

 unlawful. 



The commission is hereby empowered and directed to prevent persons, 

 partnerships, or corporations, except banks and common carriers subject 

 to the acts to regulate commerce, from using unfair methods of competition 

 In commerce. 



Whenever the commission shall have reason to believe that any such 

 person, partnership, or corporation has been or Is using any unfair method 

 of competition in commerce, and if it shall appear to the commission that 

 a proceeding by It In respect thereof would be to the Interest of the public, 

 it shall Issue and serve upon such person, partnership, or corporation a 

 complaint stating its charges in that respect, and containing a notice of a 

 hearing upon a day and at a place therein fixed at least thirty days after 

 the service of said complaint. 



If, upon such hearing the commlsion shall be of the opinion that the 



method of competition in question Is prohibited bv this act, it shall make 

 a report in writing in which it shall ttato its findings as to the facts and 

 shall issue and cause to be served on such person, partnership or corpora- 

 tion an order requiring such person, partnership, or corporation to cease 

 and desist from using such method of competition. 



We contend that this clause gives the commission power to Issue and 

 serve to the manufacturers of lumber an order requiring them to cease 

 and desist from competition by the method of selling for less than the 

 cost of production. To be sure, such orders broadcast throughout the 

 industry would be novel and radical, and might In some cases work in- 

 dividual hardship, but this is within the power of the commission. 



The Federal Trade Commission consists of five members. Joseph E. 

 Davies of Wisconsin, ( bnirman, is a trained lawyer ; W. J. Harris of 

 Georgia Is a banker and an expert statistician ; Will H. Parry of Wash- 

 ington is one of the big men on the Pacific coast ; George Rublee of Kew 

 York is a well-known attorney with a high reputation as a polillcal 

 economist ; Edward N. Hurley of Chicago Is an inventor, manufacturer 

 and businessman. The record of the various achievements of these men 

 is a long one ; for instance, Mr. Parry was the manager of the .\laska 

 i'ukon Exposition, and this exposition not only paid off its bond holders, 

 but passed a 30 per cent dividend to the stock. Not only have these men 

 done big things, but they seem to have been successful in doing them. 



There is, therefore, no need for apprehension as to the powers of the 

 commission. It has all the power it needs to exercise, and when. In the 

 development of its functions It needs more administrative authority, this 

 authority will be freely granted it by Congress, as has been the case 

 with the Interstate Commerce Commission. Nor need we feel any appre- 

 hension that the powers and functions of the commission will be abused 

 by those composing It. The past record of these men is a safe guarantee, 

 and the fact that the commission has spent its first year in thorough, 

 painstaking and comprehensive investigation of industrial affairs. Is the 

 best guarantee that we can have that whatever findings or recommenda- 

 tions are made in our case will be fundamental, just and economically 

 sound, and If accepted by the Industry with the proper cooperative spirit, 

 they will also be practically effective. 



There is a mistaken notion that the lumbermen are trying to get out 

 from under the Sherman act. This is in no sense true. No one believes 

 that the reasonable regulation of production to such an extent as shall 

 be necessary to prevent unfair competition Is contrary to the provisions 

 of the Sherman act. If It were, neither the Federal Trade Commission 

 nor the Department of Justice could grant us any Immunity, for the 

 Sherman act is no different from any other Federal statute, but It Is 

 clear that the Federal Trade Commission can, in exercising its control 

 over unfair competition, state the proper, reasonable, practical, legal 

 course for manufacturers of lumber to pursue in order to avoid this 

 unfortunate condition of unfair competition, which has so greatly 

 'demoralized the Industry in the past and bids fair to be Its undoing 

 In the future. So much for the powers, and so much for the judgment and 

 ability of our commission. 



I am pleased to be able to add that my experience at Washington In 

 December, my tatks with members of the commission, the talks of other 

 lumbermen, the published utterances of the chairman and members of the 

 commission, all indicate the strong desire of the commission to be a con- 

 structive help to the great lumber industry and to all Industries. For 

 the first time in the history of our national association effort have lumber- 

 men been welcomed by any governmental agency to lay before it Its diffi- 

 culties, needs and vital problems. No longer is the lumberman without 

 the pale. We have been officially recognized as an essential part of the 

 nation's industrial prosperity. 



Market Conditions Improving 

 President Goodman took this occasion to state that M. J. Quinlan 



of Soperton, who for years has most energetically filled the position 

 of chairman of the bureau of grades, is compelled by conditions 

 beyond his control to resign from that chairmanship. Mr. Goodman 

 paid a marked and feeling tribute to Mr. Quinlan 's character, his 

 counsel and his work, and called upon Mr. Quinlan to talk to the 

 mem,bers on the general question of market conditions. 



Mr. Quinlan said that the board of directors of the National Hard- 

 wood Lumber Association has since July, 1915, reinspected less than 

 one per cent of amounts shipped, and that less than one-fifth of one 

 per cent of the amount shipped was proven to justify such re-inspec- 

 tion; that the members should therefore feel that they are getting a 

 square deal in this direction. He said that the amount paid back 

 on bonded re-inspection has been less than $500 in seven months. He 

 said that formerly the chief inspector was given the original inspec- 

 tion data in making re-inspection, but later a policy was adopted that 

 keeps this information from him entirely. 



Mr. Quinlan, being in the chair, called for reports of the sub- 

 committees on market conditions. These reports were printed on 

 account of the short time available and were distributed and not 

 read. 



Report op Sub-Committee on Basswood, Birch and Elm 



C. A. Goodman had prepared the following report on basswood, 

 birch and elm : 



