Mr. WELD. I think they are. I think fertilizer would be enumer-
ated by the census, one of the subsidiaries of the Big Five, as a
separate establishment in the fertilizer industry.

Mr. ANDERSON. So that the figures as to the first 10 items would not
indicate the extent to which these lines of business had been
centralized.

Mr. WELD. Not entirely, no; as to ownership. It shows a very
large increase as to the number of establishments. For example.
there is fertilizers; the number of plants almost doubled in 15 years.
Mr. ANDERSON. Of course, Armour has been very active in the
establishment of fertilizer plants all over the country.

Mr. WELD. I guess you would find that the number of packer-
owned fertilizer plants would be a very small part of the total. Of
course, the Federal Trade Commission shows the total of the ferti-
lizer business done by the large packers, but I forget the figures now.
I think it is 15 per cent.

Mr. CHAPLIN. Between 15 and 20 per cent.

Mr. WELD. I see here that the large packers handle 19 per cent
of the mixed fertilizer and 11 per cent of the acid phosphate. The
largest is Armour with 9 per cent of the total. That is according
to the report of the Federal Trade Commission, page 212, part 1
Mr. MCLAUGHLIN. What is your next subject, Mr. Weld?
Mr. WELD. I would like to put this statement in.

Mr. MCLAUGHLIN of Michigan (in the chair). That may be done.
(The statement referred to is here copied in full in the record, as
follows:)

Number of establishments in various industries, United States census of
manufactures, 1914.

[Shows that a number of establishments in packing industry and many allied industries
has increased, while number in many other important industries has been decreasing.]

Mr. WELD. On page 613 there is a list of Armour plants, 32 of them. Swift, I think, has about 15 plants, and the total over the country was 794 in 1914. If that increase has been kept up, and it has been, probably, there are pretty nearly a thousand now.

Mr. YOUNG. Of course, as the country gets older lands become more in need of fertilizer, and the necessity would arise for increased production thereof?

Mr. WELD. Yes, sir.

Mr. YOUNG. And call for new plants or the enlargement of old plants. Of course, the section of the country along the Atlantic seaboard is the oldest settled country, and where the soil has been more largely used up, and where the greater necessity for fertilizer now exists. In the location of fertilizer plants has it ever been taken into consideration that it is important for the producing sections that these plants should be located in the sections of the country where the fertilizer is most needed so as to save large freight charges? Fertilizer ought to be a cheap article.

Mr. WELD. Yes; and it is a heavy, bulky article to transport. I think that has been taken into consideration. We have tried to encourage the use of fertilizer in the Middle West, for example, and we have our plants located accordingly.

Mr. CHAPLIN. You see the most of this fertilizer does not come from the packing houses. Only the ammoniates come from the packing houses. The solid or heavy and bulky part of the article is the phosphate rock.

Mr. LEE. And that comes from Florida and Tennessee?

Mr. CHAPLIN. Yes, sir.

Mr. WELD. In the location of the fertilizer plants that also has to be taken into consideration.

Mr. CHAPLIN. No plant that is not advantageously situated as to freights will be profitable.

Mr. WELD. I now call your attention to the character of the testimony that has been given here, the character of the evidence of the driving of the small packers out of business by the large packers through unfair competitive methods; and you have been given one typical case, so called. but in which there is no evidence that the packers have driven even that one smaller packer out of business by any unfair methods. And the Federal Trade Commission makes that broad, sweeping generalization without being able to substantiate it

at all.

Mr. ANDERSON. That is another character of evidence that is difficult to get and it has only an incidental effect on this propositionand that is evidence that shows unfair methods of competition. And that is for the simple reason that no concern would come here to testify before this committee that it has been treated unfairly because of the fact that that testimony would have a bad effect upon its

credit.

Mr. WELD. I guess if a concern had been driven out of business by any unfair methods it would not hesitate to come here and give you evidence to that effect.

Now, gentlemen of the committee, just a word about Mr. Colver's statement about the cattle loan companies in which the packers are interested, and his insinuations that they wield a power over the live

stock producers by being able to call loans. You will remember that when Mr. Colver was asked for specific instances where that had been done that he side-stepped that question and said that there would be cattlemen here on the stand whom you could cross-examine and get their views. I think this cross-examination developed this matter pretty well, and I am wondering how many instances of unfairness you found in your questioning of them on the point. Of course, you found no evidence whatever that the ownership in cattle loan companies had ever been used in any unfair way. On the other hand, I believe it is perfectly obvious to you that by interesting ourselves in live-stock banks and cattle loan companies we have been a positive benefit to the live-stock producing interests by furnishing credit, by making credit more available than it otherwise was or would have been.

Mr. MARSH. Mr. Weld, on that point do not you think that if the Government would loan money on a cooperative basis, on the principle of a three-name note to live-stock producers at 4 or 5 per cent, whatever the Government is paying for the money, with a small charge for reasonable insurance and administration, that it would be better than to have the live-stock producers remain dependent upon the packers?

Mr. WELD. Well, it is a very serious question whether we want to go into Government banking. Do you mean to have the Government exclude private corporations from doing banking businesses and supplant those private corporations by Government institutions?

Mr. MARSH. No; but simply have the Government go into the business, and if the other people want to go on with it, all well and good. but have the Government help a little in this matter instead of subjecting producers to having credit manipulated by the big banks.

Mr. WELD. Credit is not manipulated by the big banks, but every facility is now given by those in the business to help the live-stock producers. If it could be shown that the live-stock producers could not produce cattle because they could not raise funds to finance their operations, I am not sure that I would be opposed to some kind of Government aid-although that is an extremely dangerous step to take, I believe. But no business can prove to the committee

Mr. YOUNG (interposing). Yes: I think the further we can get away from that proposition the better it will be. I do not think the average American citizen wants the Government to go into that business, and I know that I for one do not want to see us go into it.

Mr. MARSH. Well, the Government has gone into that kind of business.

Mr. YOUNG. Well, I do not care to take up the time here now to argue that point with you, but that is my view of the situation. Mr. WELD. I do not think there is any evidence to show that any such socialistic step is necessary.

Mr. MARSH. As far as the live-stock producers are concerned, such action is considered socialistic, but not when banks are permitted to manipulate credit afforded by the Government and make big profits thereon.

Mr. WELD. I do not think there is any proof of any necessity of a thing of that kind.

Mr. MCLAUGHLIN of Michigan (in the chair). You may continue your statement.

Mr. WELD. I call attention to Mr. Colver's statement that the packers have been responsible for more agitation and unrest_than anyone else in the country. Of course, it is needless to say that I heartily disagree with that statement. My feeling on that point is this: The unrest and development of unsound and radical thought is due to a misunderstanding of the economic fundamentals; it is due to a misunderstanding of the benefits of large corporations, large businesses. It is due to a feeling that there is illegitimate profiteering, and that some people are becoming poorer because other people are becoming richer, and the general feeling that the present economic system is unsound. I believe that the unrest and that the propagation of unsound radical doctrines are due to these misapprehensions of our economic organizations. In the case of the packing industry, every possible misrepresentation of the industry has been

Mr. ANDERSON (interposing). Before you get away from that, let me say that if I recall correctly, Mr. Colver did not make that statement himself, but quoted from a speech made by Senator Lodge in which it was made.

Mr. WELD. He quoted from a speech made by Senator Lodge made way back in 1905 or 1906, but I am very positive that Mr. Colver indorsed that statement himself. If he did not, that was the insinuation, and I am very sure he indorsed that statement himself.

I am saying that every misrepresentation of our present economic organization, every misrepresentation of the packing industry, for example, tends to inflame that prejudice, tends to lead to greater misunderstanding and greater prejudice. And I hold that it is that kind of misunderstanding that causes bolshevism, that causes unrest, that causes socialism. And I say that that very misrepresentation of the present economic organization tends to inflame that prejudice and hence leads to greater unrest.

When such a thing as that pork-loin chart is put out, it tends to make people believe that there is some illegitimate manipulation of the price of pork loins. It makes them dissatisfied with the present order of things. When you put out a chart like the liveand-dressed-lamb chart, it is an absolutely false impression. Every time you refer to such an ordinary business transaction as wiring on as though it was an illegitimate practice; and then you accuse the packers of having an agreement as to the lard compound, without mentioning the fact that that agreement was brought about by the Food Administration, it brings about unrest and the propagation of unsound doctrines and preachings.

It is not the packing industry that has been the cause of the growth of unrest in our country, but the misrepresentation of the packing industry that has caused and is causing the unrest.

Mr. MARSH. On the subject of radicalism, may I read here a letter bearing on the subject?

Mr. MCLAUGHLIN of Michigan (in the chair). If it is not too long and is to the point.

Mr. MARSH. It is.

Mr. MCLAUGHLIN of Michigan. What paper are you proposing to read from?

Mr. MARSH. The New Majority, a labor paper, published in Chi

cago.

SWIFT & Co.,

UNION STOCKYARDS, Chicago, December 26, 1919.

Name of addressee omitted by request.
American Legion.

GENTLEMEN: At a meeting held on December 23. 1919, presided over by Mr. Thomas E. Wilson, there were present representatives of the different stockyard interests, and it was voted that they contribute $10,000 toward a campaign for funds for the American Legion.

A national drive is being made for the Legion, and the amount asked from Illinois is $100,000, Mr. James B. Forgan, chairman of the First National Bank, being treasurer of the fund for Illinois.

The Illinois enrollment in the legion, in comparison with other States, is very much less than it should be. We are all interested in the legion, the results it will obtain, and the ultimate effect in helping to offset radicalism.

It is very important that we assist this worthy work, and at the meeting I was asked by the chairman to write to the different stockyard interests for their contribution.

In prorating the amount, it was suggested that we use an arbitrary percentage as a basis, and the amount you are asked to contribute is $100. Will you please make check for this amount payable to Mr. Thomas E. Wilson, chairman?

Kindly send me copy of your letter to Mr. Wilson.

Very truly, yours,

NATHAN B. HIGBIE.

United States Food Administration license No. G-09753.

Mr. WELD. I am very glad to have that read into the record, because it shows a desire on the part of some of the packers to attempt to overcome these radical tendencies in a perfectly legitimate manner. What does that paper stand for?

Mr. MARSH. For democracy in industry as well as in politics. This is a labor paper, published in Chicago.

Mr. WELD. Does it have Socialistic leanings at all?

Mr. MARSH. Anything that interferes with the existing rule of privilege nowadays is by some people called socialism. On that basis I accept your statement, and on no other.

Mr. WELD. Is it in favor of Government ownership of railroads? Mr. MARSH. That is not socialism. Must I define it for you?

Mr. MCLAUGHLIN of Michigan. No; we have not the time for that. Mr. WELD. NO; I have not the time, but my impression is you are probably in a pretty good position to define it.

Mr. MARSH. Is the packers' movement allied with Mr. Rockefeller's $20,000,000 drive to eliminate "radicalism"?

Mr. WELD. I do not know anything about that. But I know that Swift & Co. would be glad to join with any other people to teach sound economic doctrines; and I think that is the greatest need of this country to-day. And I think that the Congress itself should consider that problem and help the work along in some way, but just how it should be done I do not know. I think it is the greatest need to-day-that is, to get a popular education along fundamental, economic lines.

Miss HAVER. I would like to know if the American Legion is to offset radicalism, and if so, how it is going to offset radicalism and teach sound economic doctrines? How does Swift & Co. think it is going to do that?

Mr. WELD. I do not know at all. I do not know what the American Legion's plans are at all.