Evening Star Newspaper, March 5, 1923, Page 12

Th12;-7 Standard Entirely Dominates Oil Industry, Committee Finds Methods More Subtle Than Formerly| W Used by New Jersey Company, Senate | NG Probers Charge—Predict $1 Gasoline. The La Follette oil-investigating committee, in a report submitted to the Senate just before the adjourn- ment of Congress yesterday, charges the Standard Oil companies. with complete control of the industry. The report declared the committee, through its inquiry had found that this control was exercised through methods “more subtle” than those used by the Standard Oil Company of New Jersey and its subsidiaries prior to the dissolution decree and With the result that “in some respects the industry as a whole, as well as the public, are more completely at the mercy of the Standard Oil interests’ than before the Supreme Court forced the splitting up of the New Jersey company. < Predicts Dollar Gasoline. The methods of control as set forth in the report include division of ma keting territory between various Standard companies Aimost the same basis as before the dissolution, ownership of the principal pipe line: interlocking stock ownership, fixing of prices in the producing fields, cessive and discriminatory freight rates, and ownership of the basic patents for cracking, or gusohll\:; manufacturing processes. 1If a few great oil compani permitted to manipulate ces ! the next few s as they have been doing since 1920,” the report asserted | after setting forth the evils in the industry as seen by the committee, | “the people of this country must be| prepared. befor ast | « gallon for on | of the change: ccommendation nd were contain report. These recommendati vere | sot forth a8 follows: { Establishment of a uniform sy of bookkeeping by all oil com doing an interstate busin which will show at any time. in detail, the costs and profits of the bu s =0 that the reasonablenessof the price charged for leum product can be ascertained on cost basis. Tnauguration of & compulsory sys- ! tem of reports to a government| bureau monthly, showing the opera- tions of ch oil company engaged in interstate commerce, and particularly the quantities of crude oil and its products in storage and transporta- tion, to show the exact condi- tion of the industry The making of pipeline real com- mon carriers” through divorcement | of their ownership from the oil trans- ported and compulsion of impartial service, nd the establishment of de- livery stations wherever a reasonable | 1 exists. Revision f freight rates on petroleum products “as will permit midcontinent refineries to once more find a market for their products through Michigan. Indizma, Ohio, Pennsylvania and New England ates. Prohibition or regulation of the ex- portation of petrolcum and its prod- ucts, for which there is pressing de- man in the United State Tustitution of grand jury proceed- ings, under federal or state laws, Whe: manipulation is at- tenmpted. wwest expressed trade and, of parties tempt cvils for the mplied” or lent or contract toj arbitrarily or to restrain| if facts warrant, citation the agreement for con- Supreme Court dissolu- any Inquiry by the Department of Jus- tice into ali claims for basic patents on pressure still processes used in the production of gasoline a Follette Mot Active. The report dec 1 further “the suggestion here made of certain remedies does not imply that other and moré drastic ones may not later be_found nec The investigation was in charge of a subcommittee of the Senate manu- factures committee, headed by Sena- tor La Follette of Wisconsin, and comprised Senators McNary, Oregon, and Brookhart, Tow republicans, | and Smith, South Carolina, and Jones, New Mexico, democrats. Most of the testimon er, was received at committe sions ‘attended only by Senators ollette and Brookhart, and_the committee attorney, Gilbert E. Roe of New York, a former law partner of Senator La Follette. The dominating fact in the oll industry today is its complete control the Standard companies.” the re- port contended. “The Standard Oil zroup divides among the members of that group all the territory of the Tnited States and with slight excep- tions avoids all competition’ with other members of the group in the business of retailing gasoline and kerosene. Not only this, but two of the leading Standard companies— New Jersey and New York—divide the world between themselves in marketing operations, and each care- fully abstains from entering the ter- ritory of the other, while both refrain from competing 'with the Anglo- American Oil Co. Ltd. (one of the original Standard group), in the retail trade in the British Isles. New Field Only Competition. “Through the Standard control of the pipe lines connecting the producing centers of the west with the consum- ing centers of the east and middle west not only is the pricé fixed ac- cording to the will of the Standard group, which may say what other in- terest must pay for the transportation of petroleum, but members of the group really ‘determine whether any concern outside their group shall have petroleum transported at any » ce. Whatever competition has existed between the Standard companies and the so-called independents since the decree of a dissolution in 1911 has not Dbeen the result of that decree, but has been the result of the discovery in the United States and Mexico of new oil flelds, largely through adventurous independent oB@rators, which flelds, in many instance, as soon as proven, have by various methods been brought under the control of the Standard in- terests. When the time comes, as it is certain to come in the near future, that there are no more ofl flelds to discover and exploit in this country, this competition, such as it is, will necessarily disappear.” The contention of the Standard com- panies in support of the maintenance {many ¥ itaken { statement of the pre-dissolution decree division of territory that it would be too ex- pensive to build and maintain mar- keting stations outside such territory, the report said, “is not persuasive in ‘view of the admission of substantially every one of those companies that they have mearly doubled their mar- keting investment in their respective territories in the last few years” and In view of differences of pricen suffi- clent to make a profit betwee ‘various territories. s Discussing interlocking stock own- ership, the report asserted the pre- sent holdings of the Rockefeller group in the various Standard com- panies “while representing only a minority of the stock of each com- pany are nevertheless so substantial as to assume effective control of the policies of those companies by the group in question.” directors are typical and an indica- tion of the lavish and wasteful man- ner in which their. business is con- ducted when the public pays every- ‘th!nflg and is consuited about noth- ng. Taking up the subject of prices of crude oil, the report declared it to be “obviows” that the Sinclair Crude Oil Purchasing Company, which is half owned by the Standard of Indiana, and the Prairie Oil and Gas Company. a Standard concern, absolutely fixed the prices of crude oil in the mid- continent field from January, 1920, to last November. It was further said to be obvious from figures presented “that not the law of supply and de- mand. but arbitrary manipulation, brought about the price changes in question.” The effect of these price changes. the report continued, disastrous alike for the small { pendent producer and refiner, and for the public as well.” The Investigation conducted by the committee, the report said, estab- lished these facts respecting the re- tail_prices of gasoline and kerosene: First, the Standard companies fix these prices throughout the country. and such prices in contiguous terri- tory between the different Standard companies vary all the way from 1 to 3 cents a gallon for gasoline. Pipe Lines Held Private. ‘Second, the companies of the Standard group co-operate with each other where such co-operation seems desirable or necessary in order to meet the competition of independents. "hird, While there is some respondince between the cost of crude and the prices of refined prod ucts. the price of the refined product far more apt to be kept abreast in the price of crude on a rising market than it is on falling market. With respect to pipe lines the re- port said that while they “were de- clared by law to be common carriers ars ago no steps have been to make them common car- riers in fact.” Criticism is expressed by the report in closing in the leasing by the De- partment of Interior of oil reserves, the assertion being made that the reserves “should have been held in sacred trust for the benefit of the whole people.” REPORT CALLED UNFAIR. Robert W. Stewart. chairman of the board of directors of the Standard Oil Company of Indiana id in a ed here yesterday that, in his opihion, the report of the La Follette oil-investigating committee was unfair to his company and to the industry generally. ‘The hearings by Senator La Fol- lette’s committee were ex parte in character. We were simply interro- gated by the committee and its at- torney along lines that they chose, and were not permitted to bring for- ward and submit our case for_the consideration of the committee of the public. peak for the Indiana company only, but the report is unjust in many particulars so far as my company is concerned. The Standard Oil Com- pany of Indiana is an independent corporation, and it neither owes nor acknowledges allegiance to any other corporation or organization. It has no understanding or arrangement of any kind or character with any other of the so-called Standard Oil com- panies. It stands squarely on its own bottom, and we are trying to do a big job in a big way, and to serve fairly the public with which we deal. “The charge that the Indiana Com- pany has a monopoly or dominates oil business in the territory in which_ it operates is manifestly "dis proved by the facts and a mere super- ficial examination of these facts will show it. Our competitors have prac- all the crude production in the mid-continent fleld which is largely our source of supply and clearly has as great an opportunity to procure crude for refining purposes as we have. These competitors in th same territory have as many bulk sales stations as we and have more than double the number of service sales stations and have five times more_refining capacity than we have. So that these competitors have in each of the three divisions of the oil industry—production, refining and marketing—a distinct advantage. “We have no more to do with the making of prices than our competi- tors, because the prices in any ter- ritory necessarily are dominated by the one who makes the lowest price. Our competitors make their prices without domination by or spggestion from us and with no agreement be- tween us regarding the making of the same. Clearly, it at any time our competitors lower the price we mus either meet it or lose the busines TEAGLE DENIES CHARGES. By the Associated Press. NEW YORK, March 5.—W. C. Teagle, president of the Standard Oil Company of New Jersey, has issued the follow- ing statement in reference to charges of the La Follette oil investigating committee: “The findings of fact made by the | subcommittee, in so far as they touch my company, directly or inferentially are wholly without foundation in truth and without support in the record. Practically the only references made to the Standard Ol Company (New Jer- sey) during the hearings were in my own testimony, under oath, in the course of which I deseribed fully and frankly this company’s position in the oil industry and its profits, practices and policies. “To any one who has followed the proceedings before the subcommittee it is obvfl;uu that the whole inquiry and the resulting report are based upon _the preconceived notion, as- sumed without proof, that there still exists among the various so-called Standard Oil companies, in deflance of the dissolution decree of 1911, a combination or conspiracy to domi- nate the American petroleum findus- try, to_which the Standard Oil Com- pany (New Jersey) is a party. “The subcommittee’s prediction of dollar gasoline is ridiculous. As to any unjustifiable increase in the price of gasoline, T will say that the availability of industrial alcohol, ben- zol and other substitute motor fuels at moderate prices fixes a limit be- yond which the price of gasoline can- not rise.” REPORT IS PRAISED. By the Associated Press. ST. LOUIS, Mo., March 5.—The re- port of the Senate investigating com- mittee, which charged the Standard Oil companies with controlling the oil industry, was commended last night by L. C. Nicholas, president of the National Petroleum Marketers Asso- clation, here to attend the annual convention of the association, which opens Tuesday. The association is composed of approximately 4,000 in- dependent oil jobbers. Mr. Nicholas declared his associa- tion has been ‘contending for years that “pipe lines should be diverced in ownership from the oil transported™ and it was common sense that the lines should be made into a “genuine common carrier” as recommended by the committee. When informed of the commit- cor- Huge Profits Cited. tee’'s allegation that discriminatory The report after presenting finan- |freight rates have been brought cial statistics from various Standard |about through alleged control by corporations’' -showing ' ‘“exorbitant|the Standard Oil compary, he con- profits,” in the opinion of the com-|tinued: “Every independent oil job- mittee, said “the Standard stockhold-|ber in the mid-continent region er’ who does not receive back In a|knows what the discriminatory rates few years the value of his investment (are doihg. The rates are such that in oash dividends may count himself | they can get competition abroad, but unfortunate while the increased value|not in the Atlantic seabroad, at 1% of the company's assets during the|cents a gallon cheaper than he, can same period has increased by several [ to the eaitern and Atlantio.states. hundred per cent the value of his| “The Senate committe recom- original holding: mendation that a uniform system of “These profits have not been made|bockkeeping be inaugyrated in the by economies,” the report added. ‘he | Standard companies is just another cxtravagant salaries paid by most of |of the common sense practices that the cempanles to their officers and certainly ought to be in force.” BEGIN WORK ,OF RECLASSIFYING QUARTER MILLION UNITED STATES EMPLOYES. M. LORD. | HARRSS 2WING GEORGE gtandard Group To Be Defied by “Independents”’| By the Associated Press ST. LOUIS, Mo., March 5 delegates described as tion of independenc: made at the convention of the Na- tional Petroleum Marketers' A sociation, which opens here tomor- row. The meeting will continue through Thursday. The “declaration” probably will be in effect the public display of emblems declaring members of the association are not connected with any of the Standard Oil co it was explained by delegat. | ing today; These emblems, it was explained, probably will be dis- played at all oil filling_station not controlled by the Standard companies, and an extensive ad- vantage campaign announcing companies which are not connected with the Standard companies is contemplated. S 'VAPOR FROM ACID 1 Disinfectant Fumes Rise From Chicago Restaurant to Apartment Above. H {TWO ARE HELD BY POLICE Bodies Are Found by Illinois Leg- islator, Who Had Room in Home. By the Associated Press. CHICAGO, March 5—An entire family of six was found dead vester- day, killed by the vapor of an acid used as a disinfectant by the pro- prietor of a restaurant under their apartment. | Peter Vordabyak, the restaurateur, and O. W. Hall, local manager of the Natfonal Hygienic Corporation of Cleveland, who had undertaken to rid the restaurant of roaches, were arrested. List of Dead. The dead are: Willlam Kratzenberg, tired wagon builder. Mrs. Mary Kratzenberg, sixty-nine, his second wife. John Kratzenberg, fity-four, a son. Mrs. Laura Szymanski, thirty-nine, a daughter. Henry Szymanski, thirty-nine, road engineer, Gary, Ind. Harold Szymanski, seventeen. Legislator Finds Bodies. The bodies were discovered by Wil- liam Powers, a member of the state legislature, who roomed in the Krat- zenberg home. Powers left his win- dow open and was the only person in the apartment to escape the deadly fumes. Dr. Joseph Springer, coroner’s phy- sician, who examined the bodies, said the gas would cause death within four seconds. Hall told the police that before placing the pans of acld in the restaurant he warned the oc- jcupants of the apartment to keep their windows open. PRAY FOR WORLD PEACE, AMERICANS ARE URGED Cardinal 0’Connell Declares Rulers Have Failed to Answer Pleas for Amity. By the Associated Pres BOSTON, March 5.—Americans are urged to 'unite in prayer for world | peace by Cardinal O'Connell, Who says those who have governed the would \have failed to answer the pleadings of the people. Speaking in the Cathedral of the Holy Cross, he declared yesterday that the nation's prayers and the na- tion's laws combined would work together for safety and order and Justice in a way which mere mandate could never achieve, “Whole nations are submerged In an ocean ot grief'and sadness and trial,” he sald. “Humanity is utterly worn out with the war-and its consequent horrors and still war goes inglo- riously on. * * * "We have united loyally in send- ing material Aid. Shall we not unite loyally in a_ spiritual endeavor and seek that all hate and discord be driven from the war-torn peoples of the earth? ¥ eighty, re- rail- | KILLS FAMILY OF & | HERBERT D. BRO RENT COMMISSION RULING IS UPHELD D. C. Court of Appeals Af- firms Finding on Value of Meridian Mansions. - |RENTAL HELD TOO LOW| i Court Says Allowance Should Be Made for Risks of Business. The District Court of Appeals, in an i opinion by Judge James F. Smith of the United States Court of Customs Appeals, sitting as a member of the local appellate tribunal, today af- firmed the finding of the District Rent | Commission as to the value of Merid- {ian Mansions. The court disregarded {all the objections made by counsel tor Kennedy Bros. and Harry L. Rust, owners of the property, with j the exception of their claim that the value placed by the commission was confiscatory. The court found that while the commission did not over- step the bounds of confiscation It “barely avoided" it The commission placed a valuation of about $1,000,000 on the property and fixed the rentals of the apart- ments so at the return amounts to about 63-5 per cent. Takes Risks Into Account. The court points out that since Con- gress has committed to the Rent Com- n the regulation of rents the Judici should not interfere with the decisions unless they are at odds with applicable laws or so plainly and palpably unreasonable as to make their enforcement equivalent to con- fiscation. As long as the return does | not drop below 6 per cent, the court finds. it cannot be held confiscatory. “Taking into account,” says Judge Smith, “the risks of the business, the unremitting supervision which is re- quired of the owners and considering that there may have been 10ss of rents by reason of vacancies or failure to collect, an annual income of 6 3-5 per cent on the value of the property must be regarded as very low—so low, in fact, that it leaves the un- pleasant impression that it was the purpose of the commission to cut the income as close as possible to the line of confiscation without crossing it. “If that was the purpose of the com- mission we do not hesitate to say that, should the very great power vested in that tribunal continue to be exercised in such a way as to reduce the income from buildings to a point that barely avolds conflscation, investment in that class of property will inevitably cease to be desirable, and the second condi- tion of the tenants will become more burdensome than the first.” Other Decistons Announced. The decision of the Rent Commission was confirmed in the case of Elina P. Campbell against Ethel E. Helm. The opinion was rendered by Judge George B, Martin of the United States Court of Customs Appeals. It upheld the ruling of the commission in the matter of service of a notice to quit, which the commission had held to be good. Justice Van Orsdel rendered the de- cision of the appellate court in the case of Harry L. Rust against George ucker and R. E. Pilkington, in which the decision of the Rent Com- mission was reversed. 'The cases were remanded for further proceed- ings. The testimony showed the Lamont apartments to be worth between $50,- 000 and $70,000 and the commission placed a valuation of only $52,500 and reduced the rentals of the two tenants. If this reduction were car- rled out throughout the whole build- ing, the court finds, the return to the owner would not exceed 3 per cent. The decision was reached. the court determined, through a faise method of computation. {FRENCH SEE MORE HOPE IN FUTURE FOR RUSSIA PARIS, March 5.—The bellef of Basile Maklakoff that reconstruction will be possible in Russia when the moderates gain control of the soviet government and carry out essential reforms was commented upon today by representa- tive Frenchmen as indicating a new orientation of the Russian problem.:| Maklakoff, appointed ambassador to France under the Kerensky regime, is a well known constitutional democrat. There is a widespread sentiment that France should resume relations with Russia_at the earliest practicable mo- ment, for many Russian bonds are held by the French public. The difficulty is in'the soviet govern- ment’s tefusal to recognize the old for- elgn debt. The bolshevik suggestion | that The Hague conference be permit- ted to deal directly with the French bondholders over the heads of the French government is interpreted here as an attempt to extend soviet propa- ganda. Announcement that American con- gressmen are planning to visit Russia also has served to revive interest in that country. _————— BEATEN TO DEATH. ANDERSON, 8. C., March 5.—Cecil Hall, a white farmer, was beaten to death on his plantation, seven miles from here yesterday, by a negro, ac- cording to word recefved here today. The negro, said to be named Hall, is reported to have become enraged when taken to task for being late in arriving for work and to have beatsn his employer to death with a hoe handle. Officers today were searching through- out the country for the negro. \ ! D. C, MONDAY REPAIRS DELAYING PORTO RIGAN FLIGHT By the Associated Press. MONTGOMERY, Ala., Mareh 5.—An- nouncement was made here shertly before noon today by officers of the United States Army air service squad- ron, stopping here en route from Ban Antonio, Tex., to Porto Rico, that the MARCH 5, 1923, —_—— e —————— planes will not hop off on the third leg of their flight to Arcadla, Fila, until tomorrow morning because of repairs that cannot be completed be- fore tonight. Jt was belleved at first that the planes would be able to leave this afternoon, but advices from Maxwell Fleld, near here, where the planes landed, state that the repairs were greater than at first believe: The planes arrived here late yester- day from New Orleans in good con- dition with the exception of the ship plloted by Lieut. Newton Longfellow and carrying Lieut. C. H. Austin as obeserver, which landed four miles from Maxwell Fleld on account of a broken ofl line. This was guickly mended and the airplane hopped over to the landing fleld within an hour. Other than the slight mishap, the trip from San Antonlo here was with- out incident. The fleet will be met and inspected at Arcadia by Maj. Gen. Mason M. Patrick of the alr service. —_— From the Argonaut. The recent death of the Siamese twins, Josefa and Rosa Blasdek, re- calls a story about the original Slamess | j twins, Chang and Eng, who were joined together at the hips. It is sald that when the absent-minded Duke of Bt. Albans went to see them he bent a di trait look upon them for a few seconds and then perfunctorily asked the tendant, “Are they brothers?’ 1508 H STREET, N. W. (Opposite the Shoreham) MODERATELY PRICED FURNITURE AIM OF CATHOLIC LAYMEN. Promotion of Wider Knowledge of Bocial and Economic Subjects. NEW YORK, March 5.—Announce- ment was made today of the forma- tion of the Calvert Associates, Inc. for the purpose of ‘“carrying into American secular life a wider under- standing of soclal and economic sub- ects and all the modern development fence, philosophy, music and drama as seen from the vantage &round of a robust Christianity.” The members are Catholic iaymen and members of other denominations. r s _taken from George Calvert (Lord Bal Catyeni( altimore,) founder of W. & J. SLOANE Well Built and Well Designed Furniture of Today Is the Treasured Antique of the Future Lasting satisfaction is as much dependent upon fine design as bstantial construction. Furniture should be bought for life—and for liveusp;nc::ume-and poorly desi.gned.Fumiture is frequently discarded long before its usefulness has been mmd, simply because its design has become tiresome and displeasing. We have carefully avoided all “faddish” effects and adhered to those ductions and adaptations of the early English and Colonial masters, repro- whose creations are today as desirable and pleasing as they were a century ago— J now the treasured and much sought after Antiques of today. Our Carefully Selected Furniture Exacts No Premium In Its Cost Compare the prices, even with the special opportunities widel advertised at this time — e You will be agreeably surprised to find them no higher Note the Prices of a Few Examples Given Below BED ROOM SUITES Mahogany Bed Room Suite, comprising two beds, dressing table, toilet mirror, two side chairs (9 pieces) . . . " Hand-Decorated Bed Room Suite, comprising two beds, two mirrors, chiffonier, dressing table, toilet mirror, bench, side chair 1 Mahogany Bed Room Suite, comprising two beds, night table, burea table, bench, chifforobe, miror, side chair (9 pieces) sy Hand-Decorated Bed Room Suite, comprising two beds, night table, commode, 11 pieces) . . . night table, dressing table, bureau, three mirrors, chest of drawers, dressing table, bench, chair ( two chifforobe, side chair, bench (8 pieces) . . . Mahogany Bed Room Suite, comprising mirror, chiffonier, dressing table, two side chairs (9 pieces) Walnut Bed " Weinvitea Centre Tables . Nests of Tables Console Tables Sewing Tables . 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Prints. 45 up i 55 up 15 uwp dining table, special note be made of Tea Wugonl‘ 985 h . Our stocks of Carpets, Domestic and Oriental Rugs are equally large and moderately priced. We would be glad to have you make a critical comparison with other stocks of a similar nature. We desire especially to have you Compare the prices—You will find them no higher than elsewhere. Insp ect the selection—We are confident it is unequalled. As to the qualities—We are pleased to endorse them. The store will remain open from 8 A. M. t0 5.30 P. M.