PARAGRAPHS 216-219-CANE SUGAR, ETC. circle of the entire population of the land to a center composed of but a few of those interested in developing the industry and wealth of our Nation. This, one must concede, is not a healthy progress of the people at large, the wage earners who create the wealth of the country, as well as that created by the natural products of the soil, and if this wage-earning population is stunted in its ambition by reason of this continually high taxation exhausting its resources, which are finally collected by a few in the concentration of manufacture and wealth, it is certainly not a condition conducive to contentment in the country and may sooner or later bring about serious political disturbance. It is well, therefore, to start immediately, before such disturbance might even be discussed, to legislate for the welfare of the general public and not alone for the giving of legislative privileges to a few. The remedy for this is the reduction of the tariff in probably every schedule, but I shall here treat the sugar schedule only. The American citizen is a very patient taxpayer, and probably is such in the belief that the taxes paid go to a good purpose, namely, the maintenance of our Government and country. Our neighbors from the Western and Southern States, whom we might call the beet growers of the West and the cane growers of the South, have evidently the welfare of this Government in mind if only to a partial degree, for they say that sugar is a very good article to tax because it goes so proportionately into the consumption of every family and household of the United States in comparison with the income of such families and households, and as the price of sugar represents such a small value they say it is not felt at all by those who pay it. Let this be true, and we commend such spirit very highly-it is strange that our distant neighbors, and I believe we ought to call them patriots, the Porto Ricans, Hawaiians, and Filipinos, have changed their minds on this subject since they have become partly, if not entirely, annexed to the United States. Now, these neighbors do not feel quite the same as formerly when we talk of reducing the tax on sugar, and yet it is a well-known fact that only imported sugars pay a tax to the Government and toward its maintenance, while the domestic producers, both beet and cane, including the above-mentioned islanders, pay absolutely nothing toward the maintenance of this Government, yet they say so freely, as above stated, that sugar is a good article to tax for the benefit of the country and its Government. And why do they take this attitude? Because by reason of the tremendously high protective tariff on sugar they are enabled to bleed the people of the United States, as such protective tariff permits them to do. Such are the selfish motives, while at the same time they profess such concern for the maintenance of our country and its Government. Would it not be better if all sugar were taxed, both imported and domestic production? Then really all sugar would be contributing toward the maintenance of the Government, which would derive a revenue from all sugar consumed in the United States. This would permit of a material reduction of the present tariff on sugar, allowing sufficient taxation to stand which will give the domestic producer a slight advantage over the importer of sugars, and yet not give him such rediculous legislative privilege as to ask and take from the people of this country a large and unearned profit not legitimate to the industry. This country, it must be remembered, must be legislated for the benefit of the masses and decidedly not for the benefit of a few, nor is it intended that any one man, manufacturer, or corporation, whoever it may be, should receive any greater legislative license to carry on a business than any other individual or concern. We are supposed to be citizens and all alike as far as we stand before our Government. Therefore all should be treated alike. In order not to make too great or violent a change of the tariff I therefore propose a reduction of the duty on imported sugars down to three-fourths cent per pound, this being a flat rate on any sugar imported, whether high or low test of polarization or white or dark in color. Then I would exact an internal-revenue tax of one-fourth cent per pound on all sugars of domestic production in the United States and its Territories and dependencies which are consumed in the United States, this onefourth cent per pound also being a flat rate. This would give our beet friends, cane growers, Porto Ricans, Hawaiians, and the intelligent Filipinos an ample and good protection of one-half cent flat per pound over all foreign made and imported sugars, which ought to satisfy them, and still allow them to come before the people as being public spirited and looking toward the welfare of the Government by their small contribution derived as above stated. As mentioned above, this would place all sugars in a position as paying a tax to the Government, which at present is not the case, the burden being put on the foreign imported sugars entirely and which represent half the quantity consumed in the country, and this is certainly a discrimination and restriction of free intercourse of international commerce and trade. PARAGRAPHS 216-219-CANE SUGAR, ETC. There should be absolutely no joker to such proposition, such as the branding clause, nor should the provision of the Dutch standard of color remain; both of these should be entirely eliminated and absolutely nothing else substituted. I respectfully submit these suggestions to your consideration when the subject again comes before Congress. Respectfully, FRANK SCHaffer. BRIEF OF RIO GRANDE CANE GROWERS' ASSOCIATION, BROWNSVILLE, TEX. BROWNSVILLE, TEX., January 4, 1913. Mr. OSCAR W. UNDERWOOD, Chairman of Ways and Means Committee, House of Representatives, Washington, D. C. DEAR SIR: We understand that your committee will have the sugar tariff under their consideration on or about the 15th instant. The sugar growers of the Rio Grande Valley, through this association, beg to protest against any recommendation from your committee along the lines of a reduction in the present duty on raw sugar. In this protest we are joined by practically the whole of the adult population of this part of Texas, which is entirely an agricultural community. We have sent a circular letter to each of the Texas Congressmen, asking that they vigorously oppose any such reduction, in which we have presented some of the arguments and reasons for such request, and we are herewith inclosing a copy of said letter for the information of your committee. With confidence that your committee will carefully consider the facts which we have presented, we are, Yours, very respectfully, RIO GRANDE CANE GROWERS' ASSOCIATION, By R. C. WHARTON, Secretary. BROWNSVILLE, TEX., January 3, 1913. DEAR SIR: Much has been printed and stated regarding the question of the sugar tariff, with all of which you are familiar. There are, however, phases of the situation that we have not seen brought out, some of which we will endeavor to bring to your attention. The sugar tariff is a complex proposition for the United States Congress, but it must be presupposed that it is the earnest desire of the legislature to establish the sugar duties on a basis that will benefit the mass of the people and not the few. One hears legislators talk about reducing the sugar duty 1 cent per pound and thereby reducing the retail price of sugar by 1 cent per pound. Such statements show a misconception of the intricacies of the tariff, as applied to the business. To illustrate, allow us to compare the retail prices of granulated sugar in the United States and Great Britain, and also the tariffs or excise duties paid by the two countries under existing laws. We have selected Great Britain for comparison as she buys her sugars in the open markets of the world, and both her sugar tax and the retail price of her sugar is lower than elsewhere in the world. Great Britain manufactures no sugar. Buys in the open market. Sugar taxation is but 40 cents per 100 pounds. Her merchants retail granulated at lowest world's price. Said price in 1911 was 5 cents per pound. Retail price of granulated sugar in United States for same period was 5.69 cents per pound. The consumption of sugar in the United States is 3,406,205 metric tons, of which 1,772,058 metric tons, or 52 per cent, were free of duty, and 1,634,147 metric tons paid a tariff. Of the duty-free sugar, 824,844 tons, or over 46 per cent, was a domestic product, and 947,214 tons, or a little over 53 per cent, came from our island possessions. If the revenue from sugar is divided by the consumption, the United States sugar tax is but 0.666 of a cent per pound of consumption—a tax of only 0.266 of a cent per pound in excess of the British excise tax. PARAGRAPHS 216-219-CANE SUGAR, ETC. The retail price of granulated sugar in the United States was only 0.69 of a cent per pound higher than the English retail price for the same period. To equalize to British conditions, deduct 0.266 (the excess of our average tax per pound of consumption over the British tax per pound of consumption) from 0.690 (the difference in retail prices), and we find that the retail price to the consumer in the United States is but 0.424 of a cent per pound more than the English consumer pays for the same article. When the difference in cost of wages, material, distance of internal transportation, and necessary merchandising profits of the two countries are taken into account, the United States to-day is getting cheaper sugar than any other country in the world. The result of free sugar, or a reduced tariff, in the United States would increase rather than lessen the burden of taxation to the mass of the people. First. The fifty-odd millions of revenue would have to be replaced by some other form of taxation. Second. The price of sugar to the consumer would not be reduced correspondingly with the reduction in tariff. Eliminate its tax, and England would, on the basis shown above, retail granulated sugar at 4.60 cents per pound. Eliminate our present tariff, and we should then, theoretically, retail granulated sugar under like conditions at 4.342 cents per pound, or 0.258 of a cent per pound less than England. Without acknowledged higher commercial costs, our business acumen, and the philanthrophical methods of the refiners, as shown by the congressional investigation, it would be unreasonable to expect any such extensive reduction, even were it not impossible. Third. Even assuming, for the sake of argument, that such reduction actually took place, the taxpayers would still have to make up the revenue deficiency in other ways and would be unbenefited by the transaction. On the other hand, consider the people's losses that would follow. Twenty States are more or less interested in the sugar industry. There are now 76 beet-sugar factories in 18 States, exclusive of a large number of cane-sugar factories in Louisiana and Texas. All of those factories would be ruined and put out of business and their factory employees thrown out of work. In addition to the factories, there are 500,000 acres of land in sugar beets and 400,000 acres in sugar-cane plantations in the United States. Thus an enormous number of farmers and a large agricultural population would from necessity have to change their method of gaining a livelihood and revert to the growing of less profitable crops. The persistent agitation from certain quarters by interested or unthinking parties for the reduction or removal of the sugar tariff, and the resultant feeling of insecurity and unstability in the business, works a great hardship to the American people at large, for, as a consequence, capital hesitates to embark further in the industry, and thus agriculturists are denied the possibility of growing sugar-producing plants to the extent of the people's requirements. This would be an accomplished fact in a very few years could capital be assured that the present tariff could remain undisturbed. The only gainers by the reduction or removal of the sugar tariff would be the refiners, notably the American Sugar Refining Co. Congress is well aware of the magnanimity of this mammoth corporation from its partial exposure in the recent investigation, and it can not be conceivable that the Democratic Party would inaugurate its accession to power by enacting tariff legislation to uphold the Sugar Trust and increase its power to an absolute monopoly of the sugar business in the United States as against the interests of the people of the whole country. The future of the sugar industry in the State of Texas depends entirely upon the tariff being maintained. Sugar is rapidly becoming one of Texas's great industries. In the Rio Grande Valley alone several millions of dollars are invested in the business, and four new factories have recently been completed, one of which commenced grinding last season and two of them this season. We have just received an appropriation from the United States Government to aid in sugar experiment work, and we are now requesting the State legislature to make an annual appropriation of $25,000 for the establishment and maintenance of a sugar experiment station; but to what end are our efforts should Congress see fit to materially reduce or remove the tariff? Our growing industry would be irretrievably ruined, and the sugar-growing sections of the State, including the Lower Rio Grande Valley, would receive a setback from which it would take decades to recover. PARAGRAPHS 216-219-CANE SUGAR, ETC. We therefore strenuously request you as a Democrat, representing Democratic constituents, to urge upon the leaders of the party in Congress the dire disasters that will be brought upon your constituents and the people of the State of Texas in the event the tariff on sugar is removed or materially reduced, and we ask that you do everything possible to oppose such reduction in conversation with your colleagues, in committee, and on the floor of the House, and we pray that your efforts may be successful. Respectfully, RIO GRANDE CANE GROWERS' ASSOCIATION. NOTE. All statistics in foregoing have been taken from Senate Document No. 890, second session Sixty-second Congress, "Sugar at a Glance." BRIEF OF WARNER SUGAR REFINING CO., NEW YORK, N. Y. JANUARY 15, 1913. Hon. O. W. UNDERWOOD, Chairman of the Ways and Means Committee, House of Representatives, Washington, D. C. HONORABLE SIR: We respectfully submit our objections to the present duty on raw sugar, and request a reduction of 1 cent per pound, or an adjustment from 1.685 to 0.685 per 100 pounds on nonpreferential centrifugals not above No. 16 Dutch standard, and to 0.548 on Cuban sugars. The existing duty is manifestly excessive and unjust to the consumers of this country, and if this burdensome tax was reduced as broadly requested, there would be a decided increase in consumption by individuals and large manufacturing industries using sugar. Fruits are grown more extensively in the United States than in any other country and a cheaper sugar to the manufacturers of preserves, jams, and jellies should create a much greater development, not only for home consumption, but in the exportation of their products; and, furthermore, our great candy industry should also be placed on a basis to compete in the neutral foreign markets. Drawbacks are collectible, but as refiners are frequently compelled to use raws of different origin, mixing free and dutiable sugars, the export shippers do not get the full drawback. It is beginning to be understood in all parts of the country that the present tax is exorbitant and that it is unnecessary to hold such a high tariff on this great necessity, which could be materially reduced, and still maintain our beet-sugar industry. Fiftyfive to sixty cents per hundred pounds should be sufficient protection for the beet producers; otherwise there is a question as to the healthfulness of their industry. Our market fluctuations are governed by the prices of cane refined sugar, the beetsugar prices following on a differential of 10 to 20 points under, which is due principally to the superior quality of the former, and the country's constant demand for the highergrade product. Even in the beet sections and during the beet season, the superiority of the cane is recognized to such an extent that provisions are made on all orders that the containers must hold a distinct brand reading, "Pure Cane Sugar." BRANDING CLAUSE. An absence of knowledge of the importance as to color of refined soft sugars and the branding clause whereby all containers should plainly show the polariscopic test, would indeed involve a constant and endless controversy. In the distribution of these sugars they frequently lose between two and three degrees through chemical changes from sucrose to invert before reaching destination and particularly where the climatic conditions are unfavorable, but the intrinsic merit does not change. It has been the purpose to give considerable attention to the color when manufacturing these sugars so as to avoid the arising of this question, or, in other words, to keep within a color classification of the 15 grades, to meet the requirements of the trade. It is physically impossible for the sugars to hold the original polarization within one-half of 1° on shipments from time of forwarding to time of sale to consumers. Still further, soft sugars, although consumed in about every part of the country, with the exception of the extreme West, are not so rapid in the process of delivery as granulated, and therefore are held in stock by wholesalers and retailers for a particular use by the family trade and such manufacturers of foodstuffs requiring the invert sugar. This is also where the polarization would materially change. The New Orleans clarifiers would be seriously affected, as they are sold on color. Plantations in Louisiana can not afford laboratories, etc., to determine polarization, PARAGRAPHS 216-219-CANE SUGAR, ETC. and if enforced would work a great hardship on the planter, meaning the expense in following up and guaranteeing the polarization as marked on each container. The Philippine raws, being open-kettle sugars, are more favorable than centrifugals for the manufacture of soft sugars and consequently are purchased by all refiners making such sugars. Therefore, where the output of softs would be affected or eliminated, it would have a similar effect upon the Philippine sugars. In the event of Senator Lodge's amendment becoming a law, there can only be conceived a heavy expense to the refiners and distributors in an effort to keep within the requirements of such a law, and no advantage to the Government or consumer whatever, nor a benefit to anyone, but most probably an elimination of refined soft sugars, Louisiana clarifiers, and practically no demand in the United States for the Philippine sugars. DUTCH STANDARD. The abolition of the Dutch standard would mean the elimination of what is termed the "refiners' differential, or the difference between the duty on raws of 1.825 cents and refined 1.90 cents, both being on the same basis of 100°; raws figuring 1.685 cents per pound 96°, adding .035 per 100 pounds to each degree from 96° to 100°, in accordance with the provisions of the Payne-Aldrich bill. This protection is little enough, and if withdrawn or interfered with through the dumping on us of foreign primary sugars of light color and low test the result would be unfair to our cane refiners. Yours, respectfully, 79 Wall Street, New York, N. Y. WARNER SUGAR REFINING Co., By E. L. WEMPLE. LETTER OF COMMITTEE OF MANUFACTURERS OF CORN PRODUCTS. Hon. OSCAR W. UNDERWOOD, Chairman Committee on Ways and Means, House of Representatives, Washington, D. C. JANUARY 13, 1913. DEAR SIR: The committee of manufacturers of corn products consists at present of the following companies: Clinton Sugar Refining Co., Clinton, Iowa. Union Starch & Refining Co., Edinburg, Ind. American Maize Products Co., Roby, Ind. National Starch Co., Oswego, N. Y. Corn Products Refining Co., Argo, Waukegan, Granite City, and Pekin, Ill., Davenport, Iowa, and Edgewater, N. J. There is in the course of preparation a general brief on the subject of the whole line of products from corn, which lead up to the products glucose and grape sugar, known in this country as corn sirup and corn sugar. While it is quite true that these final products are sugars and are contained in Schedule E, page 26, paragraph 217, of the existing tariff, and dutiable at 14 cents per pound, we request that the most serious consideration be given to these products at the time of the discussion of the tariff upon the raw material-corn--and the other products of corn in the agricultural schedule. We are not prepared to express oursleves properly with respect to the need for the retention of the present rate of duty upon glucose and grape sugar without necessarily making reference to the products that will come up for discussion in connection with the agricultural schedule, and therefore beg that you will refer to that part of our general brief which will be filed in connection with the agricultural schedule, in so far as same refers to the products above mentioned, namely, glucose and grape sugar. Yours, respectfully, COMMITTEE OF MANUFACTURERS OF CORN PRODUCTS, By HULL & REEVE, Metropolitan Bank Building, Washington, D. C. |