nouncement was made that the President had approved the formation of a corporation with a capital stock of $5,000,000 under the name of the Sugar Equalization Board, the duties of which should be those of equalizing the cost of various sugars, securing better distribution of sugar supplies, and facilitating joint dealings with the Allies in foreign sugars and the adjustment of differentials in overseas freight rates.

The entire capital stock of this corporation was subscribed for in the name of the United States, and Mr. Hoover, the Food Administrator, was made Chairman of its Board of Directors. On October 24, 1918, the corporation, Mr. Hoover as Food Administrator, and the leading refiners of sugar in the United States other than the refiners of domestic cane and beet sugar entered into an agreement by which it was agreed that the refiners during the period from October 1, 1918, to December 31, 1919, would purchase their entire requirements of raw sugar of all kinds from the Equalization Board; that the latter would furnish and sell to the refiners their entire requirements of raw sugar during this period at 7.28 cents per pound; and that the refiners would charge not more than 1.54 cents net per pound for their refining margin. The effect of this agreement was to stabilize the price of sugar refined from Cuban raw sugar at the same price agreed upon with the Louisiana cane growers and the growers of beet sugar, namely nine cents per pound wholesale. Between the price paid for the Cuban raw sugar and the price at which it was to be sold by the Equalization Board there was a margin of from 25 cents to 38 cents per hundred pounds which, after discharging the liabilities of the Equalization Board, will be turned into the Treasury of the United States as miscellaneous receipts. The legality of this agreement,

especially from the standpoint of not coming within the provisions of the Sherman Anti-Trust Act, was sustained in an opinion of the Attorney-General of the United States rendered at the request of Mr. Hoover.

It is hardly necessary to say that with the signing of the armistice the need for rigid control over the distribution and consumption of food products in the United States largely passed away, with the result that the Food Administration at once entered upon the work of cancelling the restrictions in force. The problem of supplying most of the countries of Europe, and especially Russia, Poland, the Balkan and the new Slav states with the food products required by them, continued, however, to be acute. The Food Administration, therefore, directed its attention largely to this phase of its work. On February 24, 1919, Congress passed an Act entitled "An Act Providing for the relief of such populations in Europe and countries contiguous thereto outside of Germany, German Austria, Hungary, Bulgaria and Turkey as may be determined by the President as necessary," by which an appropriation of $100,000,000 was made for the purchase and sale of food products to the countries named. By an executive order of the same date the President vested in Mr. Hoover, as Director-General of the American Relief Administration, the carrying out of the provisions of this Act. The order provided that he should have "full power to determine to which of the populations named in said Act the supplies should be furnished and in what quantities and further to arrange for reimbursements so far as possible as in said Act provided.”

In carrying out his duties under this order Mr. Hoover worked in close coöperation with the Supreme Council

of Supply and Relief for Extending Aid to the Needy Civilian Population of the Europe that had been created by the Allies, and Mr. Hoover and Norman H. Davis were appointed by the President as the American representatives on that body. Mr. Hoover was furthermore designated as Director-General of Relief or head of this body. To the United States thus fell the chief responsibility for handling all matters connected with the supply of food products to, as well as the relief generally of, the needy civilian population of Europe. This is a work which will have to continue for an indefinite period of time.

In concluding this account of the Food Administration it is important to call attention to what may be deemed its most fundamental feature. In making provision for the exercise of public control over the distribution and consumption of food products the Government had a choice between two systems: that of providing for a system of rigid legal control, to be exercised through a vast bureaucratic organization; and that of appealing to the patriotism of the people voluntarily to acquiesce in such measures of restriction as the Government declared to be necessary to meet conditions. Its decision was in favor of the second system. It had before it the experience of Germany and Austria and of its allies, England and France, and it was not entirely satisfied with the results that had been attained. Especially did it desire if possible to avoid the introduction of anything partaking of the nature of a system of food ration cards. Although large powers were conferred upon the President, and through him upon the Food Administration, the policy was pursued of keeping these powers in the background and of making use

of them only when absolutely necessary. The most striking feature of the whole system as actually administered was the extent to which the effort was made to fix conditions by agreements voluntarily entered into with the Food Administration by manufacturers and dealers; to secure the voluntary assistance of persons technically familiar with the conditions to be met; and to rely upon the voluntary compliance on the part of the consuming public with such restrictions as the Food Administration should from time to time declare to be necessary. The extent to which this voluntary cooperation on the part of the public was secured is one of the most remarkable features of the war. Such control as was exercised was exerted upon the manufacturers and dealers rather than upon the consumers. The whole vast field service of state and local food administrators rested largely upon a basis of voluntary service without compensation, and many of the force at Washington, including the Food Administrator himself, gave their services gratuitously or for but a nominal compensation. It is, of course, recognized that conditions were not so acute in thus country as elsewhere, and that had they been equally acute, a more rigid bureaucratic administration of food-control measures might have been necessary. It was nevertheless an act of wisdom to have recognized this difference and not to have considered recourse to the latter system until it was imperatively necessary.

CHAPTER XII

THE MOBILIZATION OF FUEL

Analysis of the fuel problem - First attempts to meet the situation by the Committee on Coal Production of the Council of National Defense - Repudiation of its price agreement by the Secretary of War - Powers of control derived from Congress - The Food and Fuel Control Act Creation of the United States Fuel Administration under Harry A. Garfield - Its functions and activities - In the stimulation of production In the adjustment of labor disputes — In the fixing of prices through State Fuel Administrators and local coal committees In the control of distribution and apportionment through zoning, priorities, and licensing In the promotion of economy and efficiency in consumption Control of fuel oil, gasoline, and other fuels Removal of restrictions after the armistice.

The necessity for the immediate assumption by the Government of control over the production, distribution, and consumption of coal and other fuel was, if anything, even more imperative than in the case of food. Coal, on account of its bulk and its deterioration when exposed to the air, is a commodity that cannot be stored to advantage. Practically all industrial plants are dependent upon the steady receipt of coal for their current needs; only to a slight extent can they stock up for the future. The same is true to an almost equal degree of domestic consumers. Consequently the greater part of the coal as mined must be immediately placed on cars for transportation to the place of consumption. In no small degree the ability of mines to produce coal is thus controlled by the ability of the railroads to furnish cars for the prompt removal of coal from the mines to

consumers.

On our entrance into the war everything conspired to