Page images

sold in this country. It competed only with goods manufactured in Great Britain.

Mr. FORDNEY. How much corn-have you any idea how much corn was used annually in that manner?

Mr. WAGNER. It is not a question of annual use, because we-
Mr. FORDNEY (interposing). I mean imported-Argentine corn.

Mr. WAGNER. Well, I could only speak for that corn which was used in our factory, and I want to set you right, right here. That is not a question of how much was used annually. Your question should be, if I may suggest, How much of such corn have you used occasionally, from time to time?

Mr. FORDNEY. Annuaily, for each year for the last few years.

Mr. WAGNER. Well, we have run Argentine corn through our seaboard factory for a period of, say, two months; then we ran domestic corn for a period of four months or five months, and we got in another cargo of Argentine corn and ran that for a while, and all those goods came under Government supervision and went into foreign trade.

Mr. FORDNEY. It is generally conceded that Argentine corn is a second-grade corn compared with Ohio, Indiana, and Iowa corn?

Mr. WAGNER. That is very interesting. Argentine corn would not be bought extensively for use, for instance, in the manufacture of cornstarch, because, strange to say, the percentage of oil contained in Argentine corn is much greater than that contained in our American corn—that is, in the corn itself. That is one of the things we wanted to find out. We did not know at first that Argentine corn does not lend itself as readily to grinding in our factories as does our domestic corn.

Mr. FORDNEY. Then is it not true, Mr. Wagner, that the Argentine corn is cheaper corn thon American corn and the manufacturer of corn products is not so terribly anxious to take care of the American producer of corn as he is to get a greater profit out of the business in which he is engaged.

Mr. WAGNER. I should not say that.

Mr. FORDNEY. Then why did he buy the Argentine corn if it was not because of the greater profit in it?

Mr. WAGNER. He bought that Argentine corn for the sole purpose of getting a business in England which he could not get with American corn.

Mr. FORDNEY. You can not get an American corn product that you can sell in England to greater advantage than you could by making it from Argentine corn? Is that what you said ?

Mr. WAGNER. No, sir. We have a large business with Great Britain, which we supply with products made solely from American corn. There was a time, within the last few years—one of those unusual situations that we can not give a strict account of-where we were placed in a position to get some business in England which enabled us to keep our seaboard factory going, not at full grind, but at three-quarters grind, anyway, where otherwise on account of the general business depression in this country we would have been obliged to shut down that seaboard factory; it was primarily to get this export business that we took advantage of that temporary situation and ground Argentine corn.

Mr. FORdxey. You could not have controlled that English trade at that time if you had been obliged to resort to the use of American corn; you only captured it because you could get Argentine corn, do I understand you?

Mr. WAGNER. That was corn, as I recall the situation, which ordinarily would have gone to our English competitors; and because of the war conditions abroad our competitors in England found themselves short of labor and were not able to grind corn; and I am glad to say that to-day we are supplying our competitors, and when I say “competitors" I mean those English manufacturers who produce corn sugar and corn sirup-we are able to supply them to-day, and we do supply them in large quantities with American cornstarch, made from American corn, which they convert into English-made sugar and glucose.

Mr. FORDNEY. Mr. Wagner. I want to be clear about this. When you were grinding up Argentine corn and exporting the product to England, you could not have done it with American corn, during that same period. Is that what I understood you to say?

Mr. WAGNER. No; you misunderstood me, Nr. Congressman. We wanted to keep our factory at Edgewater-our seaboard factorygoing. That was the reason.

Mr. FORDNEY. And you could not do that by using American corn?

Mr. WAGNER. We could not do it from American corn; we could not compete abroad.

Mr. RAINEY. Your product was too high in price on account of the shortage of American corn at that time.

Mr. WAGNER. At the present time we are paying about 85 cents a bushel for our corn. The English manufacturer buys that raw material much cheaper than we buy it.

Mr. Sloan. You are obtaining Argentine corn now, are you?
Mr. WAGNER. No, sir.
Mr. Sloan. Some of it is being shipped into this country, is it not?
Mr. WAGNER. I do not know.

Mr. FORDNEY. Then it was not so much the quality of the Argentine corn as it was the difference in price between Argentine corn and American corn that enabled you to hold that foreign trade?

Mr. WAGNER. We are holding the trade to-day with Americanmade products from American corn.

Mr. FORDNEY. To-day?
Mr. WAGNER. Yes.

Mr. FORDNEY. Oh, yes: but at that time you say that you purchased the Argentine corn because there was a shortage of the American crop of corn and because of the price. Is that not true, that you held your foreign trade because you could purchase Argentine corn cheaper than you could buy American corn

Mr. Wagner. That is not stating it quite correctly, Mr. Congressman. It was not a question of holding our trade. It was a question of getting new trade which we did not have and could not get, and which we were able to get because we did grind for a short time Argentine corn, employing American labor in grinding that corn.

Mr. FORDNEY. You did not employ American labor in growing the corn, did you?

Mr. WAGNER. No, sir; but that was new business that we got.

[ocr errors]

Mr. FORDNEY. How did you manage to get it with Argentine corn when you could not get it with American corn?

Mr. WAGNER. Because of the
Mr. FORDNEY (interposing). Difference in the price of the corn.

Mr. Wagner. There is no duty on the corn, provided export goods are made from it.

Mr. FORDNEY. There is not any duty corn if it is on the free list. Mr. WAGNER. Not on the corn.

Mr. MOORE. Is not there a difference also in the cost of transportation of corn from the Argentine to New York?

Mr. WAGNER. Mr. Congressman, let me put it this way. We could not have

Mr. MOORE (interposing). Let me put my question direct. (an you get Argentine corn, from a freight rate standpoint, in New York, in normal times--can you get your corn cheaper from the Argentine than from Nebraska?

Mr. WAGNER. In New York?
Mr. MOORE. Yes.

Mr. WAGNER. Oh, I think you can, but you can not get a steady supply:

Mr. MOORE. That is to say, water transportation is cheaper than rail transportation; water transportation from a foreign country is cheaper than rail transportation from the interior of the United States?

Mr. WAGNER. Not at the present time.
Mr. MOORE. No; but in normal times. That is a fact, is it not?
Mr. WAGNER. I think so.

Mr. Moore. You could get corn by water from Argentina, in normal times, in New York, cheaper than you could get it from Nebraska by rail?

Mr. WAGNER. I think that would be the case, but there is this serious drawback. You could not rely upon a steady supply, therefore we do not consider it seriously.

Mr. FORDNEY. Then in 1913 and 1914 the reason you purchased Argentine corn and sold it abroad was because you could buy the Argentine corn cheaper than you could buy the American grown corn?

Mr. WAGNER. If you are interested in that question I woul suggest that you call and I would be glad to furnish the name of that man in our organization whose business it is to supply the factories with corn. That is entirely outside of my province. I am giving you the best of my information. I do not claim that I am entirely correct in my statement, and I do not claim that I am sufficiently familiar to give you now, without looking up the records and without consulting with my associates, intelligent and reliable information.

Mr. FORDNEY. Mr. Wagner, I am not trying to tangle you in your argument at all. I was asking for information. My information is that Argentine corn is a second-grade corn as compared with our own corn, but it is just as valuable for the use you put it to as our high-grade corn, and for those reasons you purchased at that time the Argentine corn.


Mr. Wagner. That is a pretty involved question, and involves quite a number of details which I shall take up.

Mr. OLDFIELD. Do you not buy your corn where you can buy it cheapest?

Mr. WAGNER. Certainly.

Mr. OLDFIELD. And of course if you can buy it abroad cheaper than you can buy it at home, you are going to do it, and let the American corn go begging for a market.

Mr. WAGNER. It is for Congress to make that condition impossible. If that is an objectionable condition, keep corn out, put a duty on it, but do not hold us responsible if that condition is created by Congress. It is up to Congress.

Mr. Moore. It is up to Congress, Mr. Wagner, you are entirely right.

Mr. WAGNER. You are trying to hold the American manufacturer responsible for conditions with which he has no concern.

Mr. MOORE. That Congress is concerned with.

Mr. Wagner. If we find upon the docks at New York or any other port of entry a cargo of good sound corn, the products of which, or the derivatives of which the English market calls for, do you think for one moment, that we would shut down our factory at the seaboard and shut our men out of employment simply because that corn happens to come into this country free of duty ?

Mr. Moore. You would do what any sensible, practical business man would do; you would buy your raw material where you would get it the cheapest, would you not?

Mr. WAGNER. Without a doubt, Mr. Congressman, that is what we would do.

Mr. Moore. Just because the law leaves it open for you to do it? Mr. WAGNER. Yes, sir.

Mr. RAINEY. Mr. Wagner, was there ever a time when you could not get corn without paying duty on it for your Edgewater factory?

Mr. WAGNER. Was there any time when we could get it?

Mr. RAINEY. You could always get the corn for your Edgewater factory for products to be manufactured and exported, could you not, or by paying a very small duty ?

Mr. Allex. There is no duty on the manufactured product for export.

Mr. FORDNEY. You would have to pay the duty, but you would get a rebate, if exporting the finished product. Mr. WAGNER. Let us call it a drawback; that is what it is.

a Mr. FORDNEY. But, Mr. Wagner. in purchasing, under a protective tariff, corn from abroad and paying the duty and then exporting your finished product at a rebate of 99 per cent, you were compelled to pay the duty on your by-product which you did not export, Were you not?

Mr. WAGNER. Well, now. Mr. Congressman, I am glad to say that we do a very heavy export business in our by-products.


Mr. WAGNER. We do a very heavy business in our by-products abroad.

Mr. FORDNEY. Your bran, and so forth?

Mr. WAGNER. Gluten feeds, corn oil, and other products-corn oil, corn-oil cake-that is what I wish to say.

Mr. Rainey. For breadmaking purposes, which is the better cornthe corn grown in this country or the Argentine corn? I have not seen the Argentine corn. I understand it is hard.

Mr. Wagner. It is a long, hard berry; yes. I said before that the Argentine corn does nct lend itself as well to the manufacture of corn products in our business as does American-grown corn.

Mr. RAINEY. Then, for that reason, you only use that for export purposes?

Mr. WAGNER. Entirely so.

Mr. RAINEY. And because there is more oil in it, therefore, it was available for the export service?

Mr. Wagner. I mentioned this oil only incidentally, as showing the difference between the Argentine corn and American corn. It is not worth while discussing. It is of no consequence at all, and if you ask me which corn I would prefer, as a manufacturer, I would say, unhesitatingly, that I prefer the American corn every time, because it is a much better product to grind than the imported corn, and the yields obtained from the domestic corn are much more satisfactory, therefore, the returns in the factory are more satisfactory than if Argentine corn is ground.

Mr. Moore. That comes back to where we were interrupted. I want to ask whether you prefer white corn to yellow corn.

Mr. WAGNER. In our factories?
Mr. MOORE. Yes.

Mr. WAGNER. We do not make any difference in that. We use a great deal more yellow corn than white corn.

Mr. MOORE. It is charged by the friends of the Rainey bill—those who favor the repeal of the bill—that the existence of the present law is a discrimination against corn generally. I have been pursuing some inquiries here as to the difference between white and vellow corn, and I want to ask you now, so that we may get it on the record, why the yellow-corn millers are not represented ?

Mr. WAGNER. The vellow-corn millers?
Mr. Moore. Yes.
Mr. WAGNER. We are the yellow-corn millers.
Mr. MOORE. Well, do you use the yellow corn

Mr. WAGNER (interposing). I do not think there is another industry, Mr. Congressman, which uses so much yellow corn as we do in cur business.

Mr. Moore. Why is emphasis laid on white corn all the way through these hearings and in the association ?

Mr. WAGNER. I can only explain that by saying that the manufactures of yellow-corn products have not had their say until I took the witness stand.

Mr. MOORE. Does the yellow-corn product, which you say you manufacture, enter into the making of bread in the United States now?

Mr. WAGNER. Yes.
Mr. MOORE. It does, under the existing law?

Mr. WAGNER. Only those corn products that I enumerated before that are used by the bakers, not in the mixing of the flour, but as adjuncts to stimulate the action of the yeast.

Mr. Moore. You spoke of exports. I am not unkindly to the establishment of trade between the United States and other countries,

« PreviousContinue »