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use sisal unless other material is found to take its place. Kansas in a good wheat year uses 15,000,000 to 20,000,000 pounds of twine. An increase of 1 cent per pound means $150,000 added to its harvest account. The Kansas penitentiary twine plant, with its convict labor, sells twine approximately 1 cent per pound less than the dealers. This year their price is $9.25 per hundred pounds, as compared with 7 cents a pound last year. On their output of three and one-half million pounds they are charging the farmer nearly $90,000 more for his twine than he has ever paid before, and this merely from their own institution. A cent a pound on the entire harvest area means approximately $2,000,000 increased cost to the American farmer.
These are the facts, as I get them, and with them comes the inference that the New Orleans bankers are nervous, and the feeling that there is something unfair in the proposition. I am attaching an extract from a late copy of the Implement News, which has carried on considerable campaign and which contains some matters of interest. The remarks of Mr. Browne stated above were made in the presence of several Kansas business men and, I take it, represents the idea that the Reguladora wants to have accepted as its side of the project.
The CHAIRMAN. What is that data, Senator?
Senator CURTIS. This is a statement I have prepared from the various letters I had received, and it is copied virtually from the letters.
The CHAIRMAN. Yes.
Senator CURTIS. There were some letters written personally and confidential, and some local.
The CHAIRMAN. You know nothing about the facts?
Senator CURTIS. I said not. I have absolutely no information at all.
The CHAIRMAN. You just prepared that statement from your correspondence?
Senator CURTIS. I just prepared it from my correspondence from the letters on file in my office.
Then I have a statement showing the distribution in this country, and if you gentlemen have not already had it put in your record, I think it would be well to place it there. It shows the amount used by the different plants in the United States, and especially the penitentiaries.
The CHAIRMAN. We have not had that.
Senator CURTIS. If you will just put that in; it is not necessary to read it, I think.
(The statement referred to by Senator Curtis is as follows:)
Distribution of sisal from Progreso and Campeche in 1914.
Estimated amount used by the Kansas State Prison during 1915, 12,000 bales.
Then I had presented to me some wires, and an affidavit, which 1 think should be called to your attention. This wire was from Jack Danciger, Mexican consul at Kansas City, dated February 1, 1916 [reading]:
Can you quote me price on current white sisal in amounts 5,000 to 20,000 bales in Yucatan; wire answer collect.
Mr. SPENCER. Who is that addressed to?
Senator CURTIS. Jack Danciger, to which the following reply was received [reading]:
JACK DANCIGER, Mexican Consul, Kansas City, Mo.:
FEBRUARY 1, 1916.
Are not quoting sisal in Yucatan; to-day's price f. o. b. New Orleans 7 cents, New York 78, February, March, or April shipment.
V. A. RENDON.
Then a letter dated February 2, 1916, from the comision office in New York, 120 Broadway [reading]:
Mr. JACK DANCIGER, Mexican Consul, Kansas City, Mo.
DEAR SIR: We confirm telegrams exchanged yesterday, as per inclosed copies. As you were informed in our telegram, we are not quoting prices for sisal delivered to Yucatan. Our object being to make the same price to all buyers, it can only be done by quoting prices delivered at some United States port. These prices are as follows: Current sisal, February, March, April shipment, 73 cents New York; current sisal, February, March, April shipment, 7 cents New Orleans.
The same as in the statement [resumes reading]:
We hope you will advise us the name of the party interested in the purchase of 5,000 to 20,000 bales, in accordance with your telegram, as it is our intention to keep in direct touch with all consumers of sisal fiber in this country.
Then, here is an affidavit made by John H. Cook. I do not know whether the subject has been covered or not. If it has, it will be unnecessary to put in the record, and if not, it will do no harm to put it in [reading]:
STATE OF MISSOURI, County of Jackson, ss:
John H. Cook, of lawful age, being by me first duly sworn according to law, upon his oath states that on January 21, 1916, he landed at Progresso, in the State of Yucatan, Republic of Mexico, and from there he went to Merida, which is the capital of Yucatan. He made this trip for the purpose of buying sisal hemp. Affiant found that on about the 1st of June, 1915, the preceding government of Yucatan had been overthrown by Gen. Salvador Alvarado, who by force installed himself as governor, which office he continues to hold. Most of the officials of the preceding government fled the country. Gov. Alvarado immediately assumed full control of the sisal hemp industry. Alvarado was immediately elected president of a syndicate, or trust, called Comision Regoladora Del Mercado de Henequen. This comision or syndicate has maintained an office at 64 Wall Street, New York City, for a number of years. Under the preceding government, before Alvarado assumed control, this comision had not monopolized the business. Victor A. Rendon is the secretary in charge of the business at 64 Wall Street, and all buying and selling is done through that office and all money is collected in that office.
In October, 1915, Alvarado and Rendon held a conference in New Orleans, and at that time and place they borrowed $10,000,000 according to information given to affiant at New Orleans. They borrowed this money from New Orleans bankers to enable said Comision Regoladora Del Mercado de Henequen to handle the sisal hemp of Yucatan. Alvarado then returned to Yucatan and procured or compelled 60 per cent at least of the growers of sisal hemp to sell only to the Comision Regoladora aforesaid, of which comision Alvarado was president, and said Rendon is secretary. Rendon's clerk at Merida, Yucatan, informed affiant that affiant could buy sisal hemp from the other 40 per cent of the growers. That privilege, however, is comparatively worthless because there is no practical way to ship out the sisal hemp which might be bought from the said 40 per cent of the growers. There are only three docks at Progresso, and these are all under the control of the said Comision Regoladora. There is no other port in Yucatan except the one at Progresso, having harbor facilities that could be utilized for shipping sisal hemp. This Comision Regoladora issues money, or scrip, having the appearance of money, in Yucatan, redeemable in gold at a discount. This Comision Regoladora buys sisal hemp at 3 and 4 cents per pound. The reasons affiant could not buy sisal hemp when he was there are because the shipping facilities are controlled as above stated, and for the further reason that growers seemed afraid to sell for fear of offending the Comision Regoladora and its officers and managers, including Gov. Alvarado and his associates. Were it not for the conditions above specified affiant could have bought sisal hemp for less than the prices above quoted, especially if affiant had offered to buy and pay in American gold.
Previous to Gov. Alvarado becoming president of the Comision Reguladora that comision had not done a controlling or extensive business, in comparison to what they are now doing. At this time they absolutely control every pound of sisal hemp that comes out of Yucatan, as the growers whom they do not control are so cowed that they make no aggressive attempts to sell. Before Alvarado assumed the control one Montes, a son-in-law of the preceding governor, was the principal operator in sisal hemp in Yucatan, Rendon being then as now, in charge of the Comision Reguladora. At the present time the government of Yucatan being associated with the Comision Reguladora through its governor, as above described, seems to be lending official sanction in a very pronounced way and against all competition.
JOHN H. Cook.
Subscribed and sworn to before me this 16th day of February, 1916. My commission expires July 18, 1918.
B. B. ANDERSON,
Notary Public in and for Jackson County, Mo.
Senator CURTIS. This gentleman lives in Kansas City.
Senator CURTIS. I do not know the gentleman. I never met him, that I know of.
And so, after this question came up, I wrote letters to various people who had written me, and I have gathered this data, and
some of it was handed me here in Washington and some of it was sent. The statement was made from the letters I have received. This affidavit I found in an envelope at my office. I do not know whether it was sent by mail or whether it was handed to my secretary.
The CHAIRMAN. You do not know whether it is correct or not? Senator CURTIS. No, sir.
STATEMENT OF MR. PETER E. HATCH, ATTORNEY FOR MID-CITY BROKERAGE CO., KANSAS CITY, MO.
Mr. HATCH. Mr. Chairman, with your permission, and gentlemen of the committee, I would like to make some statement in reference to that affidavit. I represent the Mid-City Brokerage Co., located in Kansas City, Mo., which sent this man to Yucatan to ascertain whether he could buy sisal hemp in Yucatan. This affidavit is the result of his investigations there, when he returned to Kansas City. I also called on Mr. Jack Danciger, to whom this dispatch refers. He was the Mexican consul at Kansas City, and he informed me there, after telegraphing to various places, that I would have to see Dr. Rendon if I wanted to get any sisal; that he had control of it exclusively the buying and selling of it and he was the man that handled it, and he was the man I would have to go to see.
The CHAIRMAN. Who was it said that?
Mr. HATCH. The Mexican consul, Mr. Jack Danciger. I there met. Mr. Alperedon, a member of the Mexican Embassy, or connected with it there in Kansas City at the time. He also informed me that I would have to see Dr. Rendon, and he would meet me at New York to meet the doctor to go over this matter.
I met him there about the 10th of this month and had another talk with him. I went down to New York-I had some business in New York and Boston-and I stopped over in New York to see Dr. Rendon, but he was engaged at the time and I did not see him. I went on to Boston and was there for some time and returned to New York on the 18th, called on the doctor again, and there learned that he was then in Washington.
In coming back here I have learned that Mr. Alperedon, with whom I had these conversations, was on his way to Mexico.
The CHAIRMAN. Who is Mr. Alperedon?
Mr. HATCH. Mr. Alperedon is connected with the Mexican consulate, and so represented himself to be, and he informed me emphatically that if we wanted to get this sisal we would have to see Dr. Rendon to get it.
The CHAIRMAN. What do you know about this man Cook?
Mr. HATCH. Mr. Cook is an employee of the Mid-Continental Brokerage Co., and was sent there by that company to Yucatan to make this investigation. He has been engaged for years in selling commodities of various kinds to the penitentiaries throughout the Middle and Western States, and it was at the request of the superintendents of the different penitentiaries that handled this sisal for the penitentiaries, especially for the penitentiary at Leavenworth. Mr. Kline repeatedly requested him to see if he could not get this sisal for the penitentiary there; that they were advancing the price constantly on him there, and it was getting beyond their reach, almost prohibitive.
The CHAIRMAN. Do you wish to ask the Senator any questions? Mr. HATCH. None at all.
The CHAIRMAN. You just wish to say that in conjunction with the Senator's statement?
Mr. HATCH. Certainly. If the Senator wishes to ask any questions I would be pleased to answer them.
Senator CURTIS. In our State we are simply trying, through the penitentiary, to manufacture twine for the farmers, and we feel that by manufacturing it with the prison labor, which might otherwise be unemployed, much of it, that we can supply it cheaper, and of course citizens of Kansas are very anxious to prevent any trust shooting up the price; and we hope the committee will give all the matter that is presented very careful consideration, and if you can give us any relief we would like to have it.
The CHAIRMAN. We are very much obliged to you, Senator; and you may be assured that if you can throw any light on this subject we shall go into it fully.
Senator CURTIS. It has been urged by some of the people who have talked with me on the subject that the people down there ought not to be held responsible, because the question of supply and demand controlled. That ordinarily would be true, but it can not be true if these people control 60 per cent of the product and also control the ports of shipment. They are then in control of the supply, and you cut off the rule of supply and demand. And that I think the committee should consider.
The CHAIRMAN. That applies to what comes from that country? Senator CURTIS. Yes, sir.
The CHAIRMAN. There are other countries, of course.
Senator CURTIS. You take into consideration the other countries, especially the Philippines. If anyone has ever been in the Philippine Islands they know that the hemp there is better for rope, and probably would bring a larger price. It is a different material, I think. I do not know whether it is produced any differently, because I have never been in Yucatan, but the method of production is such in the Philipppine Islands that you can not depend so much upon that supply. I know that, because I have been to the hemp fields, and to the different plantations in the Philippine Islands. I have seen them cut their little abaca and strip it and work it up. I visited various places, and their method was at that time very crude, indeed. That is all I have to say.
The CHAIRMAN. We are very much obliged to you, Senator.
Mr. MAYER. Senator Curtis, would you indulge me? I do not want to ask you any questions, but will you be a spectator while I ask a very few questions of the gentleman from Kansas City, representing the Mid-City Brokerage Co. ?
Mr. HATCH. Yes, sir.
Mr. MAYER. Senator Curtis has handed in a statement headed "Distribution of Sisal from Progreso and Campeche, in 1914." Mr. HATCH. Yes, sir.
Mr. MAYER. I understood you to say that your client, the MidCity Brokerage Co., prepared that?
Mr. HATCH. It is prepared by Mr. Cook, an employee, the gentleman who made this affidavit.