256 THE BUTTER INDUSTRY IN UNITED STATES [480 



lower than in the past; and, despite the color limit, they 

 are buying it more generally than ever ".' 



THE FEDERAL ACT OF MAY Cj, IOX>2. 



The federal law of 1886 imposed a flat tax of two cents 

 per pound on oleomargarine regardless of whether it was 

 colored or uncolored. The dairy interests were not 

 satisfied with this arrangement because it allowed oleo- 

 margarine to go on the market in a highly colored form 

 and caused it to be bought as butter. They believed 

 that if the oleomargarine interests could be compelled to 

 market their product in its uncolored form, its shade of 

 pale yellow would enable people to distinguish oleomar- 

 garine from pure butter. The dairy people also probably 

 thought that easy recognition of oleomargarine would 

 be enough to frighten the prospective purchaser from 

 taking oleomargarine and that it would result in increas- 

 ing the demand for butter. The way in which this was 

 to be accomplished was to enact a federal law imposing 

 a tax of ten cents per pound on colored oleomargarine 

 and to leave the tax on uncolored oleomargarine at two 

 cents. It was believed that the ten-cent tax was pro- 

 hibitive and would put an end to yellow oleomargarine. 

 These ideas were embodied in the Grout Bill. 2 As in 

 practically all other dairy legislation, the ten-cent tax 

 idea was conceived and propagated by the dairy interests. 

 It originated with the National Dairy Union and the 

 question was agitated through the various state dairy 

 associations whose members saw to it that the dairy 

 farmers in the various states wrote letters to their con- 

 gressmen and senators asking them to support the bill. 3 



1 Monthly Bulletin of the Dairy and Food Division of the Pennsyl- 

 vania Department of Agriculture, August, 1914, p. 10. 

 '56th Congress, 1st Session, H. R. 3717. 

 3 Report of Michigan Dairymen's Association for 1900, pp. 87-96. 



