The Nonpartisan Leader Newspaper, December 28, 1916, Page 5

ness is business,” and the sooner the livestock producers learn this . is the motto of the livestock com- mission men and speculators in their great market, that at South St. Paul, Minn.,, the sooner will they begin to conserve their rightful profits for them- selves. In an opening article on the livestock deal in the Nonpartisan Leader’ December 21, it was said the South St. Paul market is a monopolized market. It is worse than that, it is a market of Tobbery, injustice, high handed methods, and bonuses that®are near bribery. If these are not near- bribes, then there is nothing that ought to be called bribery. Some of the commission men and speculat- ors justify their methods, and others - practice them per- haps without the bother of justify- ing them. SOUTH ST. PAUL, Dec. 23.—“Busi- True, there are very impressive - rules against some of the most glar- ing wrongs, . Tre- wards of hundreds of dollars to any member, who will “squeal” upon a brother = member, . and heavy.fines for the -convicted, but these are conces- gions to conscience —and also hand- me-down . evidence to be shown any.- inquisitive or in- dignant farmer, who 4 o { “pals who. SR E ‘" have winked at each others’ shrewdness “through a-decade or two. Why should anyone go tattle on his neighbor of the next block of pens, when he:can make more money keeping still-and doing the " same thing himself? Or why should anyone subject himself to the powerful, but sub-rosa resentment of the yards?. So much for the rules made to enforce honesty upon the makers of the rules.\ They do not affect the smooth and even tenor of the stockyards way and many an intelligent farmer goes on being mulcted and doesn’t know how. _ Shrewdness is the keynote of it all, although at times the men who control the yards become desperate and resort to clubbing methods. One of the worst abuses is the secret connection between certain commission houses and certain speculators or yard dealers. Maybe -as a shipper you have thought the man to whom you consigned your load of steers gave every prospective buyer a chance to “bid on them, and that you would get the advantage of competition and the highest price paid for that kind of steers. Not at all. There is no such competition in the yards. In that respect it is worse even than the way grain is sold on the Chamber of Commerce. There a pan of your grain is set on.the tables and the millers ‘look at it and can bid as freely as they like, but the buyers do not get a chance to bid on’ all of the livestock shown. Once & carload of stock goes into the clutches of a commission firm linked up with a yard dealer, or with a chain of yard dealers, it is in the grip of a trust. Suppose an instance: - OLD. TIMER TELLS OF SOME DEALS _Brown of Milbank, South Dakita, sends a carload of steers on commission to-the. . Live Wire Commission company at-South St. Paul. The Live Wire company takes them fo its: own yards 'and sends an “ employe ‘down to the “speculators’ -alley” or the “feeder and stocker division.” “Go down and tell Skinnum & Shaver 7 to come up here—got a load of pretty good stufl,_" he says. The employe does as he is bid. Now listen. No one else is invited to bid on the cattle. Country buyers —farmers like Brown, if you please—may be standing in the alley waiting for a chance to offer a price, but they don’t get it. The steers are not for them or ‘their money. They are for the Live Wire Commission company’s cronies down in the speculators’ alley. Pretty soon Skinnum comes up, yanks open the heavy gate, strides into the yard with ~_Spring lambs being loaded into cars _ billiard ball. The Live Stock Ring at Work Second Article on South St. Paul Yards by Ralph Harmon, Staff - Correspondent of the Nonpartisan Leader of a poker player while a nation’s birth- right is bandied among politicians like a The value of the first chance can be readily comprehended, when it is realized that often there isn’t _ any second chance. It is the first chance that wins—and the first chance is given to a friendly speculator that he may make-his own little rakeoff at the expense of the commission man’s client. Courtesy, or whatever it is, also pre- vents “splitting a dime.” It is small business to “split a dime” even though you make for your client more than the \ at the South St. Paul stock );ardé, after having gone through the hands of the commission: men and speculators and having been sold to country buyers to be taken bac! the Live Wire salesman, and, standing together in a far corner of the pen, amid the shuffling feet of the cattle, they make their deal. a word. “COURTESY” STANDS IN WAY OF JUSTICE When told this by several persons who have worked at South St. Paul for years and in other yards, I could not believe I understood correctly. Certain that the farmers who consigned cattle got some- thing like a square deal, I repeated my question in many ways. Same old. answer. The commission men pick their buyers from among the speculators. Then I asked Charlie Fitch, the oldest commission man in the yards. Charlie Fitch received the first carload of cat- tle ever sent to South St. Paul on'com- ‘mission, away back in 1887. He has been there ever since. He knows every man in half a dozen states who buy at South St. Paul. He knows all the practices and is ready to defend the system at-many points. The question was put’ thus: “But suppose I am there with my money and want to bid on Brown’s _cattle—" \ He interrupted before the sentence was finished. * 4 “You wouldn’t dare to,” he said. “No one bids on a load of cattle unless he is asked, It is the courtesy of the yards. The commission man picks out the man “he wants to bid on them. . The old rule was for the buyer to line up and toss a _coin for. the first chance, but they've abolished that now. No one bids unless : he js asked.” “Courtesy of the yards” steps in to prevent ‘the farmer who trusted a com- mission: man to make a square deal for him, “and prevents a square’ deal. It is like “senatorial courtesy” of the United States senate that sits by with the face Not another living soul hears ° ~—-other buyer. k for fattening, or for breeding purposes.’ cost of your commission. = “Ethical” com- mission men don’t do such: things. “Splitting a dime” is selling to a:buyer who will give five cents more than some: If X offers-$6.50 per 100 pounds for heifers, and Y offers $6.55, X gets the beef, because traders won’t “split a dime,” but if 'Y will give $6.60 then - your commission man may" deal with him unless he is determined to throw the carload to a handpicked speculator. On a minimum carload of 22,000 pounds - this would amount to $11, on a large car- load of 31,000, $15.50. Again, a commission man will not fill an order from livestock he has on com- mission. It is-an understanding. of the yards that everything is to be sold -into the hands of the speculators first. Once sin a while someone breaks -over, but the rule is never, and it is seldom violated, for there are many subtle ways in which " a man in the yards is reminded of his disloyalty to the ring, and it doesn’t pay to be disloyal to the ring. If Brown’s neighbor, Jones, goes down from ' Milbank the same day Brown’s cattle arrive at South St. Paul, to buy his carload of steers, he can not buy them from the Live Wire Commission company. He must wait until the Live Wire com- pany has sold them to its selected specu- lator, and then buy them back from the speculator at an advanced price of $1 or maybe $2, and pay a.buyer’s commis- sion beside, unless he closes the deal himself with Skinnum & Shaver. " BRIBES TO SALESMEN ) ANOTHER YARD ABUSE Another abuse that is common is pay- ° ing ‘bonuses to salesmen to dispose of certain lots of livestock. When a man comes to a speculator to buy cattle he supposes that the price he pays re- sents the real value of the cattle. Very often’ it contains a costly bribe to the : “They work on the buyers who look easy. _speculator, asks to be let-in on. the bonus, ° -steers to a particular yard dealer or \fl? Aoy salesman and a rakeoff to the dealer, In ; addition to the value of the cattle. 54 Suppose Skinnum & Shaver have a load 5 of heifers in their pens and have beeg ) offered from $5.26 to $5.50 by different country buyers, but no one wants them at more than that. Skinnum & Shaver know they have been offered the highest price the animals are worth, and are about to close them out when along comes another man whom they have not seer X before. Skinnum takes his salesman { aside and tells him if he can dispose of : that lot of heifers to the approaching 1 countryman at $6.75 or more, the sales« ] man can have 15 Ve cents out of every }‘ additional quarter £ be can extort. The M salesman disposes of the heifers at $6.75, and the next day or so Skinnum meets him in a4 saloon over town and hands him $39, If someone ig standing by and might notice it, Skinnum concealg the bribe-giving by telling the salesa ] man to hand this 3 to Mr. So and Seo & the next time he 4 sees him, or cordi« € ally thanks the b salesman for hav- | ing loaned him the ( money in a pinch . ? 1 the day before. T+ The $39 is the § speculator’s bribg i to the salesman to extort an extra quarter from the country buyer in g addition to the 35! actual value of the | cattle ‘as: shown by a series of offers, ~‘on a carload o “weighed - 26,000 pounds. Selling at $6.75 per 100 the carload would cost the buyer: $175. of which $65 would be - un'dilutj extortion. divided between the specu- lator -and his salesman. Usually the biggest portion goes te the salesman, for if it didn’t the salesman could spoil that kind of a game by quietly tipping off the system. # Among the initiated this practice is not concealed. They communicate their good luck by a nod, smile or widk, ‘0 that they may rejoice together. S FITCH IS EXPELLED BY OLD GUARD RING “I have known of salesmen. here in the yards making several hundred dollars a month in addition to their regular wages,” said Jim Barrett, veteran buyer of the yards, now working for the Equity Live- stock Exchange, and formerly for more than 10 years, a salesman for different commission houses and speculators. They settle up whenever it is handy. Sometimes - the -comimission man who swings the farmer's divestock to the and it is split three ways, part to the commission man, ‘part to the speculator, and part to the salesman. It all comes out of the farmer who buys. the. stock. But the farmer who 'sold them to the commission man didn’t get in on it; He got stung at the other end.” Why: should a commission man be so determined to dispose of a certain lot of speculator? This question is answered in the facts told last week, wherein men saw .stock sold to favored dealers. for i less than someone else was willing to pay.- The speculator divides up with the com- : ‘"’ ® mission man. Sometimed this is “dbne’ only at long peripds of time. Tt is one. f speculators 80 - powerful they control ‘commission ! & ht;:xses. B;t hi;:v can & commission man Dt who owes his Livestock Exchange 3 - (Continued on page 12) of the ‘evil results of havi mem- Y