The Nonpartisan Leader Newspaper, October 18, 1920, Page 6

R B A = o - dled, but not on a percentage Record of Thirty-Six “Farm Papers” Why Farm Implement and Machinery Prices Remain High, as Shown by Federal Trade Commission Report All data in the following article is taken from the “Report of the Federal Trade Commission on the Causes of High Prices of Farm Implements,” issued by the Gov- ernment Printing Qffice, Washington, D. C. :]URING the European war, and es- pecially after the United States be- came engaged in the struggle, all manufacturing costs in the United States increased sharply. Iron and steel both went up under the influence of European and American government purchases. Labor was in demand and commanded higher wages. Naturally the manufacturing costs of farm imple- ments and machinery went up also. LS But, according to a searching investigation made by the federal trade commission, prices went up a great deal faster than the cost of manufacture. Here is a comparison of increased cost of manu- facture and increased prices on 10 typical farm implements, between the years 1916 and 1918: Increased Increased cost, price, Implement pet. pet. Walking plow: e i b s 58 78 Sulky plow ......... . 66 90 Spike-tooth harrow 72 108 Single-disk harrow 73 93 Corn planter ... 57 86 Walking cultivato . 64 90 Mower ......—...... =62 76 Hay loader . 53 79 Grain binder .. . b2 73 Farm wagon ..........ccoiosescins 47 60 With the price to the farmer, in every case, in- creased much more than the cost of manufacture, it is natural to suppose that the manufacturers’ prof- its would show a big increase in 1918 as compared with 1916. This is true, also. For the 10 imple- ments cited above, the average manufacturers’ prof- its, in 1916 and 1919, were as follows: Profit 1916, Profit 1918, Implement o pet. pct. Walking plow ... 21 30 Sulky plow ........... 18 - 28 Spike-tooth harrow ... S 23 Single-disk harrow ... 13 23 Corn planter ... 16 29 Walking cultivator dede ] 21 Mower ... 56 13 Hay loader . 8 22 Grain binder .. 3 15 Farm wagon ................... 8 15 There is some defense, of course, for the increas- ed profits taken during the war. “Everybody’s doing it,” was the motto and watchword. Prices of farm products were increasing and implement manufacturers felt justified in getting their share of the increase. Dealers’ profits also increased, the trade commission report shows, on the total amount of business han- basis. That is, on $100 worth of business the dealer made a smaller commission in 1918 than he did in 1916, but on the price of any single implement he made a higher profit because the sale price was so much higher. PROFITS DOUBLED DURING WAR YEARS In 1916, at the start of the war, the 22 leading implement manufacturers of the United States, embracing over 85 per cent of the industry, made a net profit of 9.7 per cent on their investment. In 1918,-as the re- sult of increased prices and in- creased profits on each sale, their total net profits amounted to 19.9 per cent on their invest- ment, an increase of 105 per This was the situation at the close of the war at the end of 1918. Manufacturers were mak- Why are the prices of farm implements and farm machinery still high? Iron and steel have gone down. Almost the same materials enter into the construc- tion of automobiles and farm imple- ments and machinery. Henry Ford has restored the prices of his cars to a pre- war basis. Other automobile manufac- turers have cut as much as $1,000 from the price of their cars. Yet farm im- plements and machinery stay high. - The article on this page tells what in- terests, pretending to represent the farmer, have been working against any reduction in prices. The data is all taken from official government records. ing larger profits than ever before. But with -the war over the demand for iron and steel lessened. Labor became more plentiful. It became apparent that price reductions would be due soon in many lines of industry. Implement manufacturers and dealers naturally wanted to keep up their high prices and high profits. That is human nature and they can hardly be blam- ed for it” The implement manufacturers had their national organization—the National Implement and Vehicle association. This association had been used, during the war, to advance prices step by step. According to the federal trade commission’s report, the meth- ods used in bringing about concerted price advances were: . “Price comparison meetings, at which advances in prices recently made or intended to be made were discussed. > “Frequent exchange of price lists by mail, so that members could check up each other’s prices, terms and equipment furnished. “Exchange of letters stating what advances were contemplated in the future and when effective and asking for similar data. ' “Letters urging low price members to increase their prices. ; : “Complaints of price-cutting, the complaints fre- quently showing that the price-cutting member was held as not keeping faith in maintaining the prices agreed upon.” The federal trade commission adds: I NO, YOU DON’T l Morris drew this cartoon after learning of the action of farmer officials' in North Dakota in stopping the grain combine from buying wheat at future prices, 30 cents below the pre- vailing cash price. North Dakota papers friendly to the farmers aided the officials in ex- cent. posing and preventing the attempted $6,000,000 steal. On the other hand, so-called “farm papers,” as told on this page, have been taking a stand against the farmer when there was a chance to secure lower machinery prices and actually urged manufacturers to keep prices up. PAGE SIX L] “That the officers and members of the manufactur- ers’ associations realized that they were engaged in illegal activities is indicated by the attempted secrecy they sought to throw over all price activi- ties.” But with the war over and price reductions due the manufacturers saw they would have to have other help to hold prices—and profits—up. The farmers all over the nation were getting restless. They had accepted the excuse given for each price raise from 1916 to 1918 “on aécount of the war.” The manufacturers had to go on a new tack to ex- plain the failure to reduce prices now that the war was over. SO-CALLED “FARM PAPERS” READY TO SELL OUT FARMER The manufacturers wanted someone else to do their explaining for them, preferably someone sup- posed to be in the farmers’ good graces. So they turned to the Agricultural Publishers’ association.® This is an organization of 386 so-called “farm papers.” A few of these papers have from time to time taken up individual fights in behalf of the farmer. The great bulk of them, however, are re- actionary publications, existing for the benefit of the advertisers who support them, the subscription price being insufficient to meet even a small part of the expense of publication. These are among the leading members of the Agricultural Publishers’ association: “Successful Farming,” Des Moines, ITowa. Owned and edited by E. T. Meredith, secretary of agricul- ture in President Wilson’s cabinet. Meredith is a close friend of the packers. Before his appointment to the cabinet he conferred with the packers and of- fered to run their propaganda in his paper as his own editorial opinion. Since his appointment he has ruled against the farmers in the most important ‘case that has come before him—the demand of spring wheat producers for a revision of wheat grades. “Nebraska Farmer,” Lincoln, Neb., Governor Mc- Kelvie’s paper. Governor McKelvie’s two-year ad- ministration has thus far been marked with num- berless scandals. He has refused to protect Nebras- ka farmers in their rights of peaceful assemblage and free speech. He is generally opposed by Ne- braska farmers, who have put up Arthur G. Wray, gayor of York, as an independent candidate against im. The Pacific Northwest farm trio, “Washington Farmer,” “Oregon Farmer” and “Idaho Farmer,” owned by W. H. Cowles, million- aire Spokane newspaper proprie- tor, land. speculator and would- be political boss. The Cowles influence has been cast in the main against progressive polit- ical movements and his papers have attacked not only the Non- partisan league but also the Grange and organized labor in the Northwest. The “Orange Judd FEarmer,” “Northwest Farmstead,” “Amer- ican Agriculturalist” and “New England Homestead,” all pub- lished by the Orange Judd.com- pany, which has notoriously close relations with big manu- facturing interests. The papers named above are . among the most prominent in the organization and apparently have been largely responsible for shaping the association’s policy. The other papers in the associa- tion are: American Farming, American Fruit Grower, Better Farming, Capper’s Farmer, Dakota Farm- er, Farm Life, Farm and Home, The Farmer, Farmer and Stock- man,®Indiana Farmers’ Guide, Iowa Homestead, Journal of Agriculture, Kansas Farmer and Mail and Breeze, Michigan Busi- ness Farmer, Missouri Farmer, Missouri Ruralist, Modern