August i, 1910.] 



THE INDIA RUBBER WORLD 



399 



RUBBER IN POLITICS AGAIN. 



/"* ERTAIN public utterances in relation to the india-rubber 

 ^** industry, made recently by some gentlemen of prominence 

 and widely diffused through the newspapers, evidently have not 

 been inspired from well informed sources. They have appeared 

 in connection with the never ending discussion of the tariff 

 question, and, by the way, it is singular how much misinforma- 

 tion creeps into discussions in this field, whether the speakers 

 favor or oppose a protective tariff. There is no intention in 

 this place to consider any tariff argument, but to put on file some 

 facts bearing upon the subject of recent public addresses, and 

 it may be added that this is done not at the instance of any 

 rubber company and without consultation with any such company. 



The Hon. Joseph L. Bristow, one of the United States senators 

 for Kansas, on July 8, addressed the Chautauqua Circle at Win- 

 field, in that state, on the Tariff act of 1909 which, he claimed, 

 had been manipulated by United States Senator Aldrich in 

 respect of the rubber schedule, for the enrichment of the latter's 

 family and a few friends. 



Points made by Mr. Bristow are that the new tariff act, which 

 became effective on August 5, 1909, raised the duty on imports 

 of rubber manufactures; in September "it was discovered that 

 the organization of a rubber trust was being consummated" ; 

 that this was completed on December 6, 1909, by the merger 01 

 the last of several companies with the Intercontinental Rubber 

 Co. The speaker continued : 



"Since the organization of this trust there have been rapid 

 advances in price of every rubber product from automobile tires 

 to babies' rattles. The profits that this gigantic monopoly is 

 making for its incorporations and promoters, the Aldriches, the 

 Guggenheims, and the Ryans, are illustrated by the dividends 

 that have been paid since these mergers became effective." 



Continuing, the speaker recites: "On January 10, 1910, one 

 month and four days after, a dividend of 7 per cent, was paid 

 on the preferred stock; on February 10, 1910, another 7 per cent, 

 dividend was paid ; on March 10, 1910, another dividend of 4.2 

 per cent, was paid, making 18.2 per cent, dividends in three 

 months and four days." 



A few facts bearing upon the above may be briefly stated here: 



1. The Intercontinental Rubber Co. is not engaged in the 

 manufacture of rubber goods, but in the production of crude rub- 

 ber in Mexico and on the Congo. . Crude rubber being on the 

 free list, its importation is not affected by the tariff. 



2. The Intercontinental Rubber Co. was incorporated Decem- 

 ber 6, 1906, by the same interests that already owned and were 

 operating crude rubber businesses under different corporate titles. 

 Their relation one to another was outlined in The India Rubber 

 World as early as June 1, 1907 (page 283). No real change in 

 the character of the businesses referred to is known to have 

 resulted from their consolidation. 



3. The dividends on the shares of this company are cumula- 

 tive, at the rate of 7 per cent, per annum. No dividend was paid 

 until October, 1908, the company's earnings having been retained 

 for the further development of the business and to place the 

 company on a firm financial basis. The first dividend was paid in 

 that month, followed by the other dividends mentioned by Mr. 

 Bristow ; in other words, accumulated profits were disbursed in 

 dividends at short intervals until the company had "caught up." 



* * * 



The Hon. Jonathan P. Dolliver, a senator from Iowa, in a 

 speech in the United States senate just before the recent adjourn- 

 ment, confessed that that body had voted on the Tariff bill with- 

 out having sufficient information. If the honorable senators 

 had known, for instance, that, under the old rate of duties, auto- 

 mobile tires were being made with such profit that a single com- 

 pany in Akron, Ohio, had declared stock dividends which 

 increased its capital from $50,000 to $10,000,000 — "if we had 



known that, do you suppose the senate would have listened with 

 patience to the senator from Rhode Island [Mr. Aldrich] when, 

 after admitting that rubber weaving material like boots and shoes 

 needed no protection, he said 'but there are rubber tires of 

 automobiles?' " 



Doubtless most readers, particularly those in the rubber trade, 

 would have been more interested if the speaker had appended 

 to his remarks details verifying his statement regarding stock 

 dividends. 



A MISDIRECTED "RUBBER" DISPUTE. 

 [FROM THE NEW YORK "JOURNAL OF COMMERCE," JULY 23. 



Senator Bristow, the "insurgent" of Kansas, and Speaker 

 Cannon have been indulging in a heated controversy over the 

 effect of increasing the duty on manufactures of india-rubber 

 from 30 to 35 per cent, ad valorem, a controversy that seems to 

 have been quite misdirected and futile. The Kansas senator 

 discovered that Senator Aldrich and his son and son-in-law had 

 a large interest in certain rubber companies which have been 

 merged in a combination since the Payne-Aldrich tariff raised 

 the duty. 



He also discovered, or thought he did, that the importation of 

 rubber goods had considerably diminished since the duty was 

 raised, presumably to the profit of the "rubber combine." Speaker 

 Cannon disputed Bristow's statistics and declared that rubber 

 imports had increased since the change in the duty, which would 

 not signify much if true. 



There is a good deal of mixing up of facts in this warm 

 weather controversy in Kansas, and a good deal of misapplica- 

 tion of assumptions. There has in fact been a considerable de- 

 crease in the importation of manufactures of rubber in the last 

 year, but there was a still larger decrease in the previous year, 

 before the change was made in the tariff. What effect the in- 

 crease in the duty had, no man can calculate, but it was probably 

 not large. A more pertinent question would be how much the 

 domestic manufacture increased as the result of the tariff. 



But where Mr. Bristow failed to aim straight was in directing 

 his shafts against certain companies and a combination which 

 are not engaged in manufacturing rubber goods in this country 

 at all, but in the production and importation of crude rubber 

 upon which there is no duty. Whether or not the Aldriches are 

 interested in what is known as the "rubber trust" does not ap- 

 pear, but the concern with which their names were associated 

 by Senator Bristow is not "it," but an entirely different organ- 

 ization, not directly concerned in the manufacture or in the 

 manufactured goods. 



Still, the increased tariff on the manufactures, if it increases 

 the domestic industry, may add to the profit of the American 

 importers of the crude material. Their relation with the man- 

 ufacturers may produce a community of interest sufficient to 

 account for Senator Aldrich's part in having the duty increased 

 and give color to the insurgent senator's charge of a personal 

 interest in the result. 



INDIA-RUBBER GOODS IN COMMERCE. 



EXPORTS FROM THE UNITED STATES. 



OFFICIAL statement of the value of exports of manufactures 

 of india-rubber and gutta-percha for the month of May, 



1909, and the first eleven months of five fiscal years, beginning 



• ruly I: Belting, Boots All 



Moxths. Packing and Other Total. 

 and Hose. Shoes. Rubbers. 



May, 1910 $173,994 $198,995 $540,133 $913,122 



July-April 1,580,088 1,593,696 4,082,427 7,256,211 



Total, 1909-10 $1,754,082 $1,792,691 $4,622,560 $8,169,333 



Total, 1908-09 1,371,586 1,208,473 3,468.945 6,049,004 



Total, 1907-08 1,225,618 1,486,959 3,443,465 6,156,042 



Total, 1906-07 1,135,116 1,082,003 3,358,459 5,575,578 



Total, 1905-06 1,119,010 1,425.324 2.685. 511 5.229,845 



