380 LIVE-STOCK AND MEAT INDUSTRY 



"It appears," says the Report, " reasonably clear that the capital- 

 ization of none of these companies is excessive as compared with 

 its actual investments." In other words, there was found no 

 watered stock. 



(2) Extent of Control. " The six concerns described are 

 almost the only extensive shippers of dressed beef; that is, they 

 are almost the only concerns which slaughter cattle in the great 

 western markets and transport the product elsewhere for consump- 

 tion. At the same time these companies do a smaller proportion 

 of the beef business of the country than is ordinarily supposed, 

 and comparatively narrow limits are placed upon the control which 

 they could, even if they acted in harmony, exercise over the prices 

 of cattle and of beef." 



The Bureau estimated that in 1903 there were slaughtered in 

 the United States 12,500,000 head of cattle, of which these six 

 companies slaughtered 5,521,697 or 45 per cent. On the other 

 hand, these concerns slaughtered 98 per cent of the cattle killed 

 in the eight leading western packing centers Chicago, Kansas 

 City, South Omaha, East St. Louis, South St. Joseph, Fort Worth, 

 Sioux City, and South St. Paul. The proportion of beef consump- 

 tion which was furnished by these packers varied greatly with 

 different cities and sections. The area east of Pittsburg differed 

 greatly from the area west of Pittsburg. In New York these 

 packers furnished about 75 per cent of the beef consumed; in 

 Boston, 85 per cent; in Philadelphia, 60 per cent; in Provi- 

 dence, 95 per cent; in Baltimore, 50 per cent; Buffalo and 

 cities west (such as Cleveland, Cincinnati, and Indianapolis) 

 only from 10 to 33J^ per cent. In the dairy sections the 

 dairy industry was found to furnish a large number of surplus 

 cattle for slaughter. 



(3) Potential Competition. On this subject the Report says: 

 "Should the western packers try to obtain a much higher per- 

 centage of profit than they do at present, existing local slaughter 

 houses at all consuming points would tend to expand their busi- 

 ness materially, and new concerns would spring into existence. 

 The possibility of a rapid increase in competition of local slaugh- 

 terers was illustrated during the packing house strike of the summer 

 of 1904, when the shortage in the beef furnished by the western 

 packers was to a very considerable extent made up by increased 

 killing on the part of small concerns. . . . The business is not 

 controlled by patents, secret processes, or monopoly of raw 

 material, and the amount of capital necessary to provide even a 



