« PreviousContinue »
CONNECTICUT AGRICULTURAL COLLEGE,
STORRS, Conn., February 16, 1927. Hon. Ralph GILBERT,
House of Representatives, Washington, D. C. DEAR SIR: Thank you very much for the copies of the bill providing for the collection and publication of tobacco statistics which you sent me. I would appreciate very much a statement as to the status of this bill and as to whether it is likely to pass in the present session and whether there is anything that New England can do in support of the bill. Personally, I believe that it is a very sound and progressive measure and one which is very decidedly in the interests of the tobacco industry. Very truly yours,
I. G. Davis,
Professor of Agricultural Economics. The CHAIRMAN. Mr. Gilbert, at this point I wish to put into the record a letter which I received recently from the president of the National Cigar Leaf Tobacco Association, saying they first opposed the bill but after it was gone over with your assistance and that of Congressman Fort, of New Jersey, they were satisfied with it and approved it. I do not know anything about this association.
Representative GILBERT. They raised the exact objections that the gentleman has raised this morning.
The CHAIRMAN. I want to ask, for personal reasons, does the association consist of manufacturers ?
Representative GILBERT. Of cigars; yes, sir.
Representative GILBERT. Yes, sir. They first opposed it and said that we were going too far into their business, and, finally, I agreed that perhaps we were and we changed the bill. I introduced an amendment to suit them and they agreed.
(The letter from the National Cigar Leaf Tobacco Association, referred to by the chairman, is copied into the record in full as follows:) THE NATIONAL CIGAR LEAF TOBACCO ASSOCIATION,
March 15, 1928. Hon. CHARLES L. McNARY, Chairman Committee on Agriculture and Forestry,
United States Senate, Washington, D. C. DEAR SIR: Permit me on behalf of the National Cigar Leaf Tobacco Association, of which I am president, to bring to your favorable attention the so-called Gilbert bill (H. R. 53), providing for periodical census reports on holdings of leaf tobacco. This bill recently passed the House and is now before your committee. It is earnestly hoped that you will report this bill to the Senate at the earliest practicable date and that it will become a law as soon as possible.
The National Cigar Leaf Tobacco Association is an organization composed of the leading packers, importers, exporters, and distributors of cigar leaf tobacco and its efforts have always been exerted in the interest of the tobacco-raising farmers of the country and of the cigar manufacturing industry, the materials of which it provides.
The prompt passage of this measure, known as the Gilbert bill because it was introduced in the House by the Representative of Kentucky, will relieve a feeling of uncertainty that has embarrassed all branches of the cigar leaf trade since this legislation was first proposed. At the outset this association felt that it could not give its approval to the measure first presented for the reason that the obligations imposed upon leaf dealers and cigar manufacturers were so burdensome as to be absolutely prohibitory. On this account our representatives appeared before the House Committee on Agriculture and protested against the passage of the original Gilbert bill. Subsequently Mr. Gilbert very courteously agreed to accept suggestions for the amendment of the bill and with the cooperation and assistance of Representative Fort, of New Jersey, a prominent member of the House Committee on Agriculture, the bill was redrafted to meet our conten
tions, while at the same time preserving all the important features urged by the representatives of the tobacco growers. In this form the bill was favorably reported in the last Congress, passed by the House and indorsed by your committee. In the legislative jam which marked the closing days of the last Congress the friends of this bill were unable to secure action by the Senate and it died on the calendar when Congress adjourned on March 4 last.
In presenting this bill in the present Congress Mr. Gilbert has brought it forward in the same form in which it was agreed upon last winter, and all interests are therefore united in desiring its early passage. Until it is enacted there will always be a feeling of uncertainty as to the outcome of the movement for this legislation, and we therefore consider it of great importance, especially to the tobaccoraising farmers of the country, that this measure should become a law without loss of time. I have the honor to be, Respectfully,
NATHAN I. BIJUR,
President the National Cigar Leaf Association. Representative GILBERT. Here is a letter from perhaps the biggest dealer of tobacco in the United States, the American Tobacco Co., signed by Mr. T. P. Littlepage, their representative here.
He said, under date of May 8, 1928:
I have your letter with reference to the hearings before the Senate Agricultural Committee on your tobacco bill. Unfortunately, I will have to be out of the city and will not be able to be present. On behalf of the American Tobacco Co., however, I desire to say that we have no objection whatever to this bill
, as Í think the separate companies are fully protected under the provisions which you included from the census law.
I first left them out. Frankly, I did not want them in, but the trade insisted that they should be in and I put them in. Practically all of the trade admit that it is a fair bill. The Department of Agriculture says that it is a fair bill and a workable bill.
We have had two long hearings before the Agricultural Committee of the House and it has passed the House unanimously. It passed the Agricultural Committee of the House unanimously with 16 members present, Mr. Fort being present, who comes from the manufacturing district and not from the agricultural district. The House has passed this bill twice unanimously.
I have a statement here under oath from Mr. Kehoe that if this bill had been in operation a year ago it would have saved the Burley tobacco growers $20,000,000.
The CHAIRMAN. Who is Mr. Kehoe?
Representative GILBERT. He is the head of the Burley Manufacturing Growers' Association.
The CHAIRMAN. That is in the House record?
Representative GILBERT. It is in the House record on the McNaryHaugen bill. He is opposed to the McNary-Haugen bill. He says:
And it is true that they carry on hand old stocks of tobacco that are absolutely worthless for manufacturing purposes. They print that and beat down the price on the market.
I thank the committee for giving me this hearing.
The CHAIRMAN. Is there anyone else that desires to be heard? If not, we will conclude the hearings.
Mr. CAMPBELL. Mr. Chairman, will you hear Mr. Dozier?
STATEMENT OF C. M. DOZIER, REPRESENTING THE UNIVERSAL
LEAF TOBACCO CO. AND ITS SUBSIDIARIES, RICHMOND, VA.
Mr. DOZIER. Mr. Chairman, you asked Mr. Carrington what injury, if any, the bill would do to the dealers. There seems to be just à desire to turn this off on that point. I think your committee ought to be glad to hear an expression of views on the merits of the bill as to whether or not the bill would be injurious.
We might say that there would be no permanent injury to the leaf tobacco dealers under this bill. At the same time, it may not be a good thing for the grower or for the Government to assume such supervision.
The CHAIRMAN. Mr. Carrington was given every opportunity to state his views. If he has not made his case clear and you can, we would be glad to hear from you.
Mr. DOZIER. I do not think any man in our organization who knows anything about the tobacco industry would take seriously the remarks of my good friend Senator Sackett and Congressman Gilbert that the refuse, the scrap, and tobacco that has no saleable value or no marketable value is held by anybody, dealers or manufacturers, for purposes of influencing the growth of tobacco by growers and influencing prices.
Tobacco is just like any other commodity. You gentlemen are all business men and you know very well that we are not going to hold large stocks of tobacco on hand merely for the purpose of depressing the price. What would be the object of doing that?
In so far as the leaf tobacco business is concerned, which I know more than I do about the manufacturing, and I am not referring now to cigar tobacco, but excluding it, because we have no companies that deal in that-anyone that knows anything at all about the leaf tobacco business knows that leaf tobacco is sold on a very quick turnover.
It has been said that we hold large stocks of tobacco for years as what you might call a subterfuge to influence the growth of tobacco and automatically control the price. I will interpolate here that the Universal Leaf Tobacco Co. is the largest leaf tobacco company in the world to-day and the organization in this country that comes more directly in contact with the grower than any other tobacco company. . Not only is the Universal Tobacco Co. the largest leaf tobacco company
The CHAIRMAN. We understand about the size of the company, but what is there about this bill to which you object?
Mr. DOZIER. Senator, I thought you would accord me just a few minutes.
The CHAIRMAN. I want to. I appreciate the extent of your company, but what I want to get is the objection that you have to the proposition.
Mr. DOZIER. In order to give weight to what I have to say about the knowledge we have of tobacco you must allow me to tell you the facilities that we have for contact with the
grower. In addition to what Mr. Carrington has said about the Government attempting to define the grades under which tobacco is to be sold, I want to call attention to the fact that tobacco graded this
year will not be graded the same next year; it will be an entirely different grade, perhaps. That frequently happens.
There would be no complaint on the part of the leaf tobacco dealers, and I take it on the part of the larger manufacturers, as you have a letter from the American Tobacco Co., to furnishing full statistics, but there is a complaint on the part of the dealers to the Government prescribing grades under which tobacco shall be put up and sold, because, as I say, there are no two men in the leaf tobacco business to-day that would always agree on a type.
Also following out the suggestion and giving the reason why I told the extent of our company, I want to say that I have heard no sentiment expressed on behalf of the largest group of leaf tobacco growers in America, and that is the bright belt of eastern United States. The support in favor of it comes from Kentucky principally.
I do not think there is anything else that I recall right now that I wish to say about it, but I simply wanted to get those views before the committee in order to show that we do really represent just as much the sentiment of the tobacco growers as Congressman Gilbert does from his end. The CHAIRMAN. Did you áppear before the House committee? Mr. DOZIER. I did not, sir.
The CHAIRMAN. Did any representative of your organization appear?
Mr. DOZIER. No, sir.
The CHAIRMAN. Is this the first opportunity that you have had to express your views on the subject?
Mr. Dozier. This is the first opportunity. I never knew about it until Saturday of last week.
The CHAIRMAN. And you add the additional point that you are afraid the department will prescribe grades that would make it difficult for you to conform to?
Mr. Dozier. I know they will. I am not a practical tobacco man, and I do not think that any practical tobacco man who understands grading of tobacco has appeared before your committee. Otherwise, there would have been some questions asked to-day regarding the difficulty of grading tobacco.
The CHAIRMAN. I appreciate that. Mr. Carrington was quite frank about that proposition. I know there are great difficulties in grading tobacco.
Mr. Dozier. We are in business to buy and sell tobacco. We can not make money unless we sell the tobacco.
The CHAIRMAN. How would the enactment of this bill and this administration affect that situation?
Mr. DoziER. I did not contemplate that this bill had any effect upon that. I was simply assuming that because that is used as an argument to induce your committee to pass the bill.
Mr. GILBERT. This bill provides that tobacco more than 4 years old shall be separated. The frost-bitten tobacco was put up as low as a cent a pound, and they have held that on hand time after time. It is still on hand. And it is reported in the stock on hand, and it is absolutely unfit for manufacture.
Mr. Dozier. I would like to put in the record that we come from a section of the country that raises nearly 800,000,000 pounds out of a total production in America of possibly a billion two hundred thousand. The cigar tobacco is a small part.
I would like also to extend the remarks of Mr. Carrington in regard to the proportion of the production of tobacco in America that is exported and elaborate on that just for a minute or two.
It has been testified that only about 35 per cent of the tobacco produced in America is used in America, 65 per cent being exported to foreign countries. Now, if this bill is passed the Secretary of Agriculture has said that this will be the means of affording the farmer information so he may know how to regulate his crops. If these reports are filed with the Government and the information is given out, it does not require very much of a stretch of the imagination for you to see that it represents only 35 per cent of the total production of tobacco in America. The 65 per cent of tobacco that has been exported may still be on hand; it may be on hand next year and the
That is another reason why we think and we contend that the benefits to be derived by the growers under this bill are nil, and that the effect of the bill will be futile and will be merely a gesture in so far as benefits to the growers are concerned.
The CHAIRMAN. Do you know of any other opposition outside of the district which you represent.
Mr. DOZIER. I have not had time to even get up a very strong opposition myself, because I did not know about it until Saturday. We had a meeting yesterday in Richmond and came here hurriedly as soon as we saw the importance of the bill.
Representative GILBERT. The pendency of this bill has been on for four years; it has been published in every tobacco trade journal, and the Wall Street Journal has reported on its effect on prices of tobacco. If these gentlemen have a big organization and did not know the pendency of this bill, I am very much surprised. The CHAIRMAN. What is the organization? Representative GILBERT. The Universal Leaf Tobacco Co.
The CHAIRMAN. Did any of those appear before the House Committee, Mr. Wilson? Mr. WILSON. I do not know of
any. The CHAIRMAN. Quite a number from North Carolina at first objected seriously to this bill. When did you first hear about this bill, Mr. Carrington?
Mr. CARRINGTON. About two months ago.
Mr. CARRINGTON. Mr. Reed is a tobacco grower. Will you hear him for a few minutes?
The CHAIRMAN. Very well.
STATEMENT OF WILLIAM T. REED, RICHMOND, VA.
Mr. REED. Mr. Chairman, I have known about this bill for quite a while. I never paid any attention to it because I did not think there was any possibility of its passing. I can not see that it would be of any benefit to anybody; it certainly will not be any benefit to the farmer, as far as I can see. I am a large farmer as well as a tobacco manufacturer.
Representative GILBERT. Well, 500,000 of them unanimously thought otherwise.
Mr. REED. I beg to differ with you on that.