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Author: 
 
 McElheny, Victor K. 
 
 Title 
 
 Analysis of the Joint 
 report on foods and. 
 
 Place: 
 
 [New York] 
 
 Date: 
 
 [1917] 
 
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 ORIGINAL MATERIAL AS FILMED - EXISTING BIBLIOGRAPHIC RECORD 
 
 } j«U.3tNKftS 
 
 255 
 
 L115 
 
 McElhony, Victgr IC 
 
 Amlyaic of the joint report on foods and 
 iiarkots of Governor V/hitinan*G market ooriiniLision 
 und others, by Victor K«I.IoElheny, Jr... j-Kew 
 York, 1917? J 
 
 31 p. 23^- cm. 
 
 Caption-title. 
 
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Columbia Winiotviitf^ R 
 
 intljeCitpof^ttogorb 
 
 LIBRARY 
 
 School of Business 
 
 ^^m^:^ 
 
 Given by 
 
 tnoxqa.trr~'M^^^H 
 
a 
 
 Analysis of the Joint Report on 
 Foods and Markets of Governor 
 Whitman's Market Commission 
 and Others : : : : : 
 
 BY 
 
 Victor K. McElheny, Jr., 
 
 President of 
 
 THE FRUIT AUCTION COMPANY, 
 
 204 Franklin Street, 
 
 New York City. 
 
 
 CONTENTS. 
 
 W^ 
 
 I. Introduction. 
 
 (A) Views of Agricultural Econo- 
 mists. 
 
 (B) Views of Business Men. 
 
 n. Aids to Clear Thinking in Consid- 
 ering the Report. 
 
 (A) Refutation of Sophistry. 
 
 (B) High Cost of All Commodities. 
 
 (C) Economic Laws Govern the 
 Distribution of Foodstuffs, 
 
 (D) Recent History of Foodstuffs- 
 Investigations. 
 
 (a) Gov. Dix's Commission. 
 
 (b) Mayor Gay nor' s Market 
 Commission. 
 
 (c) Mayor Mitchel's Food Sup- 
 ply Committee. 
 
 (d) Wicks Legislative Com- 
 mittee. 
 
 (e) Gov. Whitman's Market 
 Commission. 
 
 (f) State Department of Foods 
 and Markets. 
 
 m. Alleged Causes of the High Cost 
 of Foodstuffs as Set Forth in the 
 "Joint Report." 
 
 (A) Purely Illusory Causes. 
 
 (a) Lack of a Comprehensive 
 Market System. 
 
 (b) Lack of Transportation 
 and Terminals. 
 
 (c) Lack of Municipal Whole- 
 sale Terminal Markets. 
 
 (1) Alleged Savings. 
 
 (2) Cost. 
 
 (3) Details of Construction. 
 
 (B) 
 
 <• 
 
 k^ 
 
 (4) Handling and Conges- 
 tion. 
 
 (5) Cartage. 
 
 (6) Alleged Self-sustaining 
 
 Features of these Mar- 
 kets. 
 
 (7) Waste. 
 
 (8) Fundamental Obstacle 
 to the Proposed Mar- 
 kets. 
 
 (9) Present Wholesale Ter- 
 minal Markets. 
 
 (d) Laws as to Monopolies. 
 
 Tangible Causes of the High 
 Cost of Foodstuffs as Stated 
 by "Joint Report." 
 
 (a) Excessive Exportation and 
 Short Crops. 
 
 (b) Ignorance of the Public on 
 the Question of Foodstuffs. 
 
 (c) Failure of the Public to 
 Act up to the Light that 
 it Has. 
 
 IV. Remedy for the High Cost of 
 Livingv 
 
 (A) No New Legislation Needed. 
 
 (B) Encourage Private Business. 
 
 (C) Education. 
 
 (D) Action by the Public. 
 
 V. A popular Misconception. 
 
 VI. A Word as to New York City. 
 
 VII. Efficiency of Present Methods of 
 Food Distribution. 
 
 VIII. Conclusion. 
 
 tfl 
 

 I. INTRODUCTION. 
 
 The ** Joint Report'' of Governor Whitman's Market Commis- 
 sion and others is so revolutionary in its recommendations, direct 
 and implied, as to the future economic policy of the State, so 
 socialistic in its aims and so fertile with possibilities of huge 
 State expenditures that it is the duty of both the Legislature and 
 the citizens to consider well before the State takes this leap to 
 certain failure. 
 
 The public needs to beware! Those favorable to the views ex- 
 pressed in the report have begun to accelerate public opinion. 
 One flagrant instance is the following : Teachers in the pubUc 
 schools of this city have been instructed to ask parents to come 
 to the school buildings on certain evenings to learn how to take 
 action in favor of the passage of bills to be introduced in the 
 Legislature to put into force the recommendations of this report. 
 
 (A) Views of Agricultural Economists: Professor Edwin G 
 Nourse in his book (recently published) entitled '^Agricultural 
 Economics" under the heading *' Marketing and Market Prob- 
 lems" very aptly says: 
 
 ''Here lies the happy-hunting-ground of Reformers." 
 
 Professor L. H. D. Weld of Yale University, author of the book 
 (also recently published) entitled "The Marketing of Farm Pro- 
 ducts" in an article entitled "Popular Illusions Regarding the 
 Price of Eggs" printed in the NEW YORK TIMES of the issue 
 of December 17, 1916, uses this language : 
 
 "Apparently the fundamental truths (regarding the sub- 
 ject of marketing) that have been established have not yet 
 had time to reach many of the foremost agitators whose 
 names are appearing in the paper every day." • * * 
 
 Also in closing the article Professor Weld very cogently says : 
 
 "Enough has been said to show what serious misconceptons 
 the public has with regard to the problems of egg prices 
 There are many other just as serious fallacies abroad in the 
 land with regard to other branches of the marketing system. 
 
 (3) 
 
'. t 
 
 Let us hope that no remedial legislation w,ll be Wted 
 until the problem has really been studied sc.entif Ically and 
 passionately and until some of the funda.uentals of mar- 
 keting and market prices are better understood. 
 
 I could quote similar views by other ^'^'^^^^'''''^'''^f ''fZt 
 mists but brevity forbids. What they would say would be but 
 riaSve. ThI foregoing quotations strikingly jepresen^^^^^^^^^ 
 almost unanimous opinions of the economists as to the vagaries 
 proposed to be enacted into legislation by those ^gnor^^^t ;/ ^he 
 Sect of marketing. Those are the views of Ihe real students 
 By that I niean the men that are educated in the fundamentals o 
 marketing just as the doctor, lawyer, the engineer, etc., etc., are 
 Tducaterin their respective professions. They -e -t -en who 
 play with the intricate subject of marketing and d^^oje their 
 Lfous energies to and earn their livelihood m other walks of life. 
 (B) Views of Business Men: Now, what is the view of the 
 business man who has had actual ezperience i'^^th', ma*f ^^ 
 of foodstuifs' The writer has been engaged in the marketing ot 
 is ft Public Auction in New York City for many years. 
 During that period he has observed the marketing of other food- 
 stuffs The writer regrets to differ with the State Commissioner 
 of Foods and Market?, as he does totally, with respect to Muni- 
 cipal Wholesale Terminal Markets. The writer has had very 
 pleasant business dealings with him and can attest to his energy 
 Sigh-mindedness and sincerity. The writer see. that there is a 
 large portion of the public as well as many members of the Legis- 
 lature who in good faith desire a knowledge of the facts. They 
 are bewildered by the extravagant claims made as they appear 
 from day to day in the public press. They are bewildered by a 
 report such as the report of the Governor's Market Commission. 
 We all know how occupied the ordinary business man is and how 
 prone he is to treat such reports with contemptuous indifference. 
 He silently pays the unnecessary and wasteful extra tax caused 
 bv the follies. The writer feeling strongly that the actual facts 
 should be set forth believes it to be his duty to issue this pamphlet 
 and give the views of men of actual experience. The view of the 
 men experienced in the distribution of foodstuffs is all the more 
 necessary because of the ignorance of those attempting to revolu- 
 tionize methods. Mr. George W. Perkins on Friday, January 26, 
 1917 in addressing a meeting of Wholesale Food Distributors 
 made the amazing admission that this was one line of business of 
 which he knew nothing. 
 
 (4) 
 
 n. AIDS TO CLEAR THINKING IN CONSIDERING 
 
 THE REPORT. 
 
 (A) Refutation of Sophistry : Mr. Balfour has well said that, 
 
 "No stable system can be built upon reasons which are 
 essentially and hopelessly defective." 
 
 The main reason given in the report for the acceptance of its 
 views IS unsound and fallacious. 
 
 I quote from the report : 
 
 "We also have two Public Service Commissions to look 
 after the people's interests in the matter of transportation. 
 Yet It is estimated that but 10 percent of the average man's 
 income goes for transportation while upwards of 40 percent 
 of his income goes for food." • • • 
 
 The report then proceeds: 
 
 "If experience has shown that the public's interests in the 
 matter of health, education and transportation need to be 
 safeguarded by the State, through supervision and regula- 
 tion, does it not follow that in the all important matter of 
 their food supply the people's interests should also be safe- 
 guarded by the State in a similar manner." • • • 
 
 In another place in the report "water supply" and "highways" 
 are used similarly to the way "health" "education" and "trans- 
 portation" are used in the above quotation. 
 
 You will note the language is very broad. It recommends flatly 
 that the State adopt toward the production and distribution of aU 
 foodstuffs the identical policy that the State adopted at the time 
 of Its foundation toward those weU recognized pubUc functions. 
 highways," "health," "transportation," "education" and 
 water supply. " Heretofore the State has scrupulously abstained 
 from entering the domain of private enterprise.. Now we are 
 adnsed to turn to socialism. The difficulty with the argument 
 used IS that it proves too much. If it be followed logically aU 
 private business should be placed under the control and super- 
 vision of Public Service Commissions. If 40% of the family 
 budget should be placed under State supervision and control 
 Why not the remaining 60% of the family budget? Certainly the 
 Items coming under the remaining 60% are just as necessary 
 for the family welfare as the 40%. Let me enumerate the items 
 that make up the family budget : 
 
 (5) 
 
 II 
 
) 
 
 it 
 
 Foods, 
 Rent, 
 
 Clothing and Shoes, ) 
 
 Fuel and light, ) 
 
 Provisions for sickness and ) 
 
 accident, dental, surgical and ) 
 
 other care necessary for the ) 
 
 establishment and preserva- ) 
 
 40% 
 
 Let me enumerate some commodities whose prices have risen 
 
 ) 60% 
 
 ) 
 ) 
 ) 
 
 ) 
 ) 
 
 tion of sound health. 
 Insurance, 
 Recreation, 
 Carfares, 
 Furniture and furnishings. 
 
 Burial, 
 
 Education, books, newspapers, ) 
 Church and benevolences, ) 
 
 Incidentals. ' , 
 
 Not even the signers of the report of Governor Wh.tman s 
 Market Commission will deny that the items m the 60% are as 
 necessary to man's reasonable existence as the 40%. 
 
 Are we prepared to initiate State supervision and regulation of 
 an manufacture, production a.td distribution by takmgtlie tre- 
 mendous leap, now, of placing 40% of the family budget under 
 State supervision and regulation? 
 
 Let me further bring the reasoning of the report to a reductio 
 absu dum The production of foodstuffs is fully as import- 
 Sras their distribution. Agricultural implements are essential 
 ?o the production of foodstuffs. Why not place the manufacture 
 and distribution of all agricultural implements under the regula- 
 tion and supervision of the State? Would all the members of 
 Governor Whitman's Market Commission agree to such a 
 
 proposal? -, . X 4. n 
 
 The main argument upon which the report is based is totally 
 unsound as I have shown. Let me again repeat the quotation 
 given above : 
 
 "No stable system can be buUt on reasons which arc es- 
 sentially and hopelessly defective." 
 CB-) Hiffh Cost Of all Commodities: A second aid to clear 
 thhiking is to recall to your mind that the prices of practically 
 all articles of commerce have risen fully as much as the price of 
 foodstuffs. 
 
 (6) 
 
 Steel 
 
 Machinery of all kinds 
 
 Clothing 
 
 Medicines 
 
 Building materials 
 
 Cotton 
 
 Leather 
 
 Rents 
 
 Chemicals 
 
 Oils 
 
 Copper 
 
 Zinc 
 
 Shoes 
 
 Coal and coke 
 
 Textiles 
 
 Labor (if it be proper to class it as a commodity) 
 Other metals. 
 
 I might enumerate fully 95% of all articles used in commerce. 
 Now it is not for a moment suggested even by Governor Whit- 
 man 's Market Commission that the fundamental cause of the rise 
 in price of these articles other than foodstuffs is due to the lack 
 of a Public Service Commission to regulate their manufacture, 
 production and distribution. Remember in this connection that 
 the Commission solemnly says that the fundamental cause of the 
 high cost of foodstuffs is the lack of a broadened State Market 
 Department. If I were to follow out this reasoning and suggest 
 that the rise in price of these articles of commerce other than 
 foodstuffs is due to the lack of State supervision and regulation 
 of their manufacture, production and distribution my suggestion 
 would be considered very silly. Likewise it is just as foolish to 
 say that the lack of **a comprehensive Market Department" is 
 the fundamental cause of the rise in the price of foodstuffs. 
 We have the phenomena of high prices of all articles of commerce. 
 Some of the causes are patent. The Governor's Commission has 
 named some of these as I will later point out. Other causes are 
 deep and obscure, for the subject is very intricate. If the remedy 
 proposed by the Governor's Commission is not applicable to 
 aU groups it surely is not applicable to one of the groups ! 
 
 (C) Economic Laws Govern the Distribution of Foodstuffs: 
 
 A third aid to clear thinking is a recognition of the fact that the 
 same economic laws govern the production and distribution of 
 foodstuffs as govern other industries. Mr. Perkins in the address 
 above mentioned found himself in the anomalous position of advis- 
 ing the business men of the Food Distributing Industry as to 
 what they should do while at the same time stating that he knew 
 nothing about the business. He recognized his position and en- 
 deavored to explain it by saying that he is a business man and 
 that the same principles apply to all lines of business. That state- 
 ment IS sound. Let me ask Mr. Perkins this, why legislate differ- 
 ently for the Food Industry than he would for other Industries, 
 
 (7) 
 
when the same Economic Laws govern all? Why not be just far 
 and logical and advise that all private Industry be subjected to 
 the same legislation that he advises for the Food Industry ? And 
 conve'ely, as it is not intended to bring all private enterprise 
 within the purview of this proposed legislation, why have any 
 legislation? Do not forget that if laws are passed and action 
 taken contrary to economic law as is proposed in the Joint Re- 
 port" the result will be failure and the money used to carry on 
 the experiments will be wasted. 
 
 (m Recent History of Foodstuffs Investigations : As a fourth 
 aid to clear thinking on this subject I will briefly name the Com- 
 missions and Committees that have recently "investigated the 
 subject in hand and I will briefly state their conclusions: 
 
 (a)— GOVERNOR DIX'S COMMISSION. 
 
 The Commitee on Markets, Prices and Costs of the New York 
 State Food Investigating Commission appointed by Governor Dix 
 made its report under date of August, 1912. Its most uaportant 
 findings were as follows : 
 
 (a) That the railroad and steamship terminals on the lower 
 west side of Manhattan Borough be improved. That the 
 improvements would probably not cost exceeding $2,000 - 
 000 00 in all and that these improvc^ments could be paid 
 for out of private funds, that is by the railroad and 
 steamship companies having the lease. 
 
 (b) It found that the total cost of wholesaling, including all 
 handling and profits, did not exceed 10% and that some 
 wholseale units operated at a total cost of not exceeding 
 
 4%. 
 
 (c) It recommended that two hundred large retail stores be 
 organized throughout New York City at a cost of $200,- 
 000.00 each. 
 
 (d) It opposed Municipal Wholesale Torminal Markets. The 
 promoters of this wasteful scheme of Municipal Whole- 
 sale Terminal Markets state that this Commission found 
 against one Municipal Wholesale Terminal Market for 
 all of New York, but not against one or more Muncipal 
 Wholesale Terminal Markets for eacli borough. In answer 
 to this I assert that no one can read that report without 
 coming to the conclusion that it is squarely against Muni- 
 
 (8) 
 
 cipal Wholesale Terminal Markets. If that committee or 
 any member of it has since changed his mind let him come 
 out and publicly state his reasons for his change of 
 opinion. 
 
 (e) The report is very strong in its omissions. It failed to 
 say that the fundamental cause of the high cost of food- 
 stuffs was the lack of a State Market Department. 
 
 (b)— MAYOR GAYNOR'S MARKET COMMISSION. 
 
 The next commission to report on marketing was Mayor 
 Gaynor's Market Commission composed of Mayor Mitchell (then 
 President of the Board of Aldermen), Mr. George McAneny and 
 Mr. Cyrus C. Miller. Mr. Miller was Chairman of this Commis- 
 sion. Their report was issued under date of December 31, 1913. 
 They recommended the appointment for New York City of five 
 Market Commissioner's; also the erection of elaborate and expen- 
 sive Municipal Wholesale Terminal Markets, one for each of the 
 Ave Boroughs of New York City. They estimated (I should say 
 m guessed) that the markets that they recommended for two of the 
 iive Boroughs, that is for Manhattan Borough and the Bronx 
 Borough would cost respectively $8,500,000.00 and $10,000,000.00 
 or $18,500,000.00 for the two without the cost of raUroad siding's 
 or the land for the sidings. This Commission fathered the elab- 
 orate and intricate Pollock Bill to permit the erection of these 
 Wholesale Terminal Markets which bill passed the Legislature 
 early in 1914. Mayor Mitchell subsequently had to veto this bill 
 because of its serious defects and because the business men of 
 New York City in all lines rose up and demanded its veto. 
 
 (c)— MAYOR MITCHELL'S POOD SUPPLY 
 
 COMMITTEE. 
 
 The next committee to study the high prices of foodstuffs was 
 a committee appointed by Mayor Mitchell in August, 1914. The 
 Chairman of this committee is Mr. George W. Perkins. This com- 
 mittee presented to the Board of Estimate and Apportionment of 
 New York City for its approval early in 1915 a proposed bill to be 
 presented to the Legislature by which bill the City of New York 
 was to go into the Food Distributing Business. The opposition by 
 business men in all lines was so overwhelming that the committee 
 hastily withdrew the bill and revised it by eliminating this portion 
 of It. The bill as revised was presented to the Legislature both 
 
 (9) 
 
'« 
 
 ) 
 ll 
 
 'f: 
 
 in 1915 and 1916 but it was not reported out of conimitte(\ This 
 committee for a few months after its appointment carried on an 
 Educational Campaign as to the food values of various products. 
 
 (d)— WICKS LEGISLATIVE COMMITTEE. 
 
 The Legislature in 1916 appointed a Food Investigating Com- 
 mittee. The Chairman of this Committee is the Honorable Charles 
 W. Wicks. 
 
 (e)— GOVERNOR WHITMAN'S MARKET COMMISSION. 
 
 The latest commission appointed to investigate the price of 
 Foodstuffs was a commission appointed by Governor Whitman of 
 which Mr. George W. Perkins is also chairman. 
 
 It is the **Joint Report'^ of Mayor Mitchell's Committee, the 
 Wicks Legislative Committee and Governor Whitman's Commis- 
 sion that the writer is analyzing in this pamphlet. 
 
 Permit me here to point out that the ^^ Joint Report" of Gover- 
 nor Whitman's Market Commission and others has reported its 
 findings within the short space of five years from the report of the 
 commission appointed by Governor Dix and their conclusions are 
 essentially opposite. 
 
 Governor Dix's Commission reported in favor of new large 
 retail units; the *^ Joint Report" rather favors the present retail 
 unit. Governor Dix's Commission favored the improvement of 
 present wholesale food terminals with private money, and con- 
 demned Municipal Wholesale Terminal Markets; the *' Joint Re- 
 port" favors Municipal Wholesale Terminal Markets with their 
 huge cost. Governor Dix's Commission was silent as to the crea- 
 tion of a State Food Public Service Commission; the ** Joint 
 Report" says the fundamental cause of the high price* of food- 
 stuffs is the lack of a comprehensive Market Department. Now 
 which commission is right? Why not Governor Dix's Commis- 
 sion? The lesson of all this is that as these learned doctors dis- 
 agree within so short a period of time it is well for the State to 
 proceed very cautiously in turning from its historic policy to 
 Socialism. Permit the report to lie on the table for four or five 
 years and be thoroughly digested. This is an important matter. 
 A period of four or five years is a very short period of time in the 
 history of mankind. 
 
 (10) 
 
 (f)— STATE DEPARTMENT OP FOODS 
 AND MARKETS. 
 
 This Department was created during Governor Glynn's adminis- 
 tration just a few days before the close of the Legislature in 
 1914. The powers of the Department are exceedingly broad. In 
 fact it is difficult to conceive a State Department of broader 
 powers unless it is intended to have the municipality engage in 
 private business. The ** Joint Report" indicates that such was 
 in the mind of the drafters of the ** Joint Report. " Permit me to 
 quote just once from the '* Joint Report." 
 
 "And it might be advisable in working out this plan to give 
 such a City Market Department power to place the shipment 
 in cold storage or to sell it at public auction." 
 Here is a plain statement that the city might perform the busi- 
 ness of private merchants. Fortunately there is a constitution in 
 the land. 
 
 in. ALLEGED CAUSES OP THE HIGH COST OF 
 
 FOODSTUFFS AS SET FORTH IN THE REPORT 
 
 OF GOVERNOR WHITMAN'S MARKET 
 
 COMMISSION: 
 
 The *' Joint Report" purports to set forth the causes of the high 
 price of foodstuffs. The causes set forth divide themselves into 
 purely Dlusory Causes and Tangible Causes. 
 
 (A) Purely Illusory Causes: These are (a) Lack of compre- 
 hensive Market Department; (b) Lack of proper Transportation 
 and Terminals; (c) Lack of Municipal Wholesale Terminal Mar- 
 kets ; (d) Too drastic laws as to monopolies. 
 
 (a)— LACK OF A COMPREHENSIVE 
 MARKET DEPARTMENT. 
 
 The report recommends : 
 (a) The creation of a broadened State Market Department 
 under a State Commissioner. 
 
 That each municipality of the State be given adequate 
 Market Departments. 
 
 The creation of an Interstate Market Department. 
 A State Board of Foods and Markets of from seven to 
 nine members, in other words a Foodstuffs Public Service 
 Commission. 
 
 (11) 
 
 (b) 
 
 (c) 
 (d) 
 
!i 
 
 »i 
 
 Colonel Sellers never had a grander dream than that. 
 Permit me to quote from the report as to some of the powers 
 recommended for these new functionaries : 
 
 For the new State Commissioner the report recommends that he 
 be given extensive and important duties indcifint^dy enumerated 
 in eight paragraphs and then adds : 
 
 '*To this end the broadest possible powers should be given 
 to the State Department of Markets.*' 
 
 As to the Foodstuffs Public Service Commission the report says : 
 
 ''We further recommend that the State Board be given as 
 broad power as possible to deal with the questions of trans- 
 portation, distribution, terminals, etc." 
 
 The two transportation public service commissions of the State 
 which care for but 10% of the average man's expenditures spends 
 annually over $3,000,000.00. The expenditure for foodstuffs 
 in the State of New York can roughly be stated to be two billion 
 dollars annually. Foodstuffs according to the report under analy- 
 sis are of four times the value of transportation and much more 
 important. With these facts in mind may I not exclaim — What 
 possibilities of jobs ! What possibilities of the waste of State and 
 City moneys! What possibilities of increasing State and City 
 Taxes! What possibilities of teaching old-world bureaucracy 
 something really new as to State regulation and Governmental 
 parentalism ! And all to no purpose ! ! 
 
 As to what the municipalities will do if they are encouraged 
 in creating ''Broadened Market Departments" with the right to 
 build markets just read the 300 paged report on Municipal Whole- 
 sale Terminal Markets issued by Mayor Mitchell, Mr. George 
 McAneny and Mr. Cyrus C. Miller, December 31, 1913, and read 
 the Pollock Bill passed by the Legislature early in 1914 at the 
 suggestion of those gentlemen. That bill provided for five Market 
 Commissioners for New York City with the most intricate and 
 elaborate machinery conceivable. It started the machinery for 
 building Municipal Wholesale Terminal Markets for New York 
 City which markets would in my judgment have cost the City of 
 New York more than $60,000,000.00 without the added cost of 
 railroad tracks and the land upon which to place them and would 
 have made a great portion of the lower west side of Manhattan a 
 new large freight yard. 
 
 (12) 
 
 (b)— LACK OF TRANSPORTATION AND TERMINALS. 
 
 The ** Joint Report'' refers to delays on the New York Central 
 Railroad and also to the recent building of large passenger ter- 
 minals in New York City. It is difficult to follow the argument of 
 the report as to this last, but it seeois to be this: Since large 
 passenger terminals have recently been built in New York City, let 
 the State or the City build large food terminals. 
 
 Let me bring the following to the reader's attention: 
 
 (a) The New York Central Railroad brings into New York 
 City but a small part of the foodstuffs consumed there. Certainly 
 any deficiencies on its part as to transportation can be corrected 
 either by the Interstate Commerce Commission or the present 
 State Public Service Commission without creating a new Commis- 
 sion with concurrent jurisdiction. No charges of delay are made 
 against the other great railroads. 
 
 (b) These other railroads which bring the great majority of 
 foodstuffs into New York have large and efficient freight yards 
 in New Jersey and they also have the use of that vast freight yard 
 with its myriad tracks, Hudson River. Some of them have splen- 
 did food terminals (in some instances capable of handling 300 
 carlots in twenty-four hours). Improvements to these terminals 
 have been made, are being made and can be made at a minimum 
 expense without the expenditure of any State or City money. 
 They can be improved with private funds just as the passenger 
 terminals have been built with private funds. 
 
 (c) One reason why terminals have not been improved more 
 than they have been in this city is squarely chargeable to the New 
 York City Government in not giving to railroads sufficiently long 
 leases to justify improvements. First one city official indulges in 
 the thought that he will move certain freight to a different sec- 
 tion, another official changes that and so it has gone with the net 
 result that railroads have waited, not daring to spend money that 
 they otherwise would have spent in making improvements. It 
 needs no new and expensive system and no new and expensive 
 Municipal Terminal Markets to change this. 
 
 (c)— LACK OP MUNICIPAL WHOLESALE 
 TERMINAL MARKETS. 
 
 This is the third Hlusory cause of the high cost of foodstuffs. 
 In my judgment it is the desire for these markets that is back of 
 this entire legislative agitation. I am confirmed in this by the 
 
 (13) 
 
 i«^ 
 
 ['':\ 
 
1 
 
 1 
 1 
 
 
 1 
 
 i 
 
 
 i 
 
 
 ^■' J 
 
 make-up of Mayor Mitcheirs Food Supply Committee, by the fact 
 that the State Commissioner of Foods and Markets is coDimitted 
 to them and by the fact that Mr. Clifford S. Sims, of Governor 
 Whitman's Market Commission, according to the news items, 
 stated to the City Club, Saturday, January 27th, 1917, that he 
 had worked out the plans for one of these markets. The ** Joint 
 Report'' in speaking of improvments of terminal facilities uses 
 this language : 
 
 **In this connection, Terminal Wholesale Markets would 
 help materially." 
 
 It is therefore necessary that these Municipal Wholesale Mar- 
 kets be discussed. 
 
 (1) Alleged Savings: A good way to test the merits of these 
 markets is to examine the claims made for their possibilities in 
 saving. The State Commissioner of Foods and Markets states in a 
 recent issue of the NEW YORK EVENING SUN : 
 
 ''Some $800,000,000.00 worth of food is distributed in New 
 York City annually. It has been estimated that $200,000,- 
 000,00 would be the annual saving undcT this direct econo- 
 mic scheme." 
 
 Mr. Cyrus C. Miller, the Chairman of Mayor Gaynor's Market 
 Commission and father of Municipal Wholesale Terminal Market 
 schemes, in the Real Estate Magazine of November, 1914, says : 
 
 ''It is estimated that the value of foodstuffs handled 
 annually in the City of New York amounts to $900,000,000.00 
 and that ten percent, of this or $90,000,000.00 could be saved 
 annually by adequate terminal facilities. ' ' 
 
 Here is a difference between Mr. Miller and the State Commis- 
 sioner of $110,000,000.00 annually but like the constitution, "What 
 is that between friends?" 
 
 Bear in mind that these are Wholesale Markets; that Governor 
 Dix's Commission found that "the total cost of wholesaling in- 
 cluding profits is probably 10% and that certain wholesale units 
 perform this function for from 3% to 4% ; also that these markets 
 will be (in the words of the same Commission) '* subject to the 
 permanent disadvantage of municipal management'* and then ask 
 yourself the question. Can it be that the City or State by erecting 
 a building of brick, mortar and steel, that is by becoming a land- 
 lord, will be able to totally eliminate the cost of carrying on the 
 
 (14) 
 
 intricate wholesale business of New York City and in addition 
 cause each consumer to be paid a dividend of 15% annually on his 
 purchases. I am free to confess that such claims tax my patience 
 and I will let the reader answer that question. But to drive 
 home the error of such statements note the following : The family 
 foodstuff budget of the average family is composed of the follow- 
 ing items and the percentage of each item to the total budget is 
 placed opposite each item : 
 
 Meats and meat products 38.9% 
 
 Fish 5.39^ 
 
 Milk 8% 
 
 Butter, eggs, cheese, poultry 16.8% 
 
 Groceries 22.6% 
 
 Potatoes - 3% 
 
 Other Vegetables - 2.7% 
 
 Fruits 2.7% 
 
 Is it likely that the Meat Distributing Industry that has 
 22 central distributing plants throughout New York City would 
 give up these plants and go to these Municipal Markets? Is it 
 likely that the Butter, Egg, Cheese and Poultry Industry which 
 controls these articles by financing the shipper and which indus- 
 try is as firmly located as the Meat Industry would give up their 
 present market to go to these Municipal piles of brick, mortar and 
 steel? Similar questions could be asked regarding other Food- 
 stuff Industries. And the Milk Industry, is it contemplated that 
 it, with its specialized machinery, will patronize the markets? 
 Not exceeding 5% of the Foodstuffs consumed in New York City 
 would be available for these markets. Thus the $200,000,000.00 
 and $90,000,000.00 gently fade away. Require Mr. Miller and the 
 State Commissioner to name in detail how these savings are to be 
 attained. I have never seen a prospectus of this. 
 
 (2) Cost: Now as to the cost of these markets. The State 
 Commissioner in the NEW YORK EVENING POST of December 
 16, 1916, says : 
 
 ''Such a market could be founded for $3,000,000.00 to 
 $5,000,000.00 in a great centre like New York City.*' 
 
 And again he said in the NEW YORK EVENING SUN of the 
 issue of January 13, 1917 : 
 
 ''Ten to twenty millions would fully equip the markets." 
 Which sum is correct? $3,000,000.00 or $20,000,000.00? 
 
 (15) 
 
 J 
 
Ilii 
 
 Mayor Gaynor's Market Coiiimission estimated that th(^ cost of 
 such a Market in Manhattan Borough would be $10,000,000.00 
 and in the Bronx Borough $8,500,000.00 (together $18,500,000.00) 
 without the cost of railroad sidings and the land upon which they 
 would be laid. That estimate was made before the war. No facts 
 are given as to how that estimate was made up. I believe it was 
 a guess. Bearing in mind that it is to be a municipal enterprise 
 it would be well to double, treble and quadruple the sum. Add to 
 that result the cost of land for railroad sidings. Throw into the 
 computation the cost of these Terminal Markets in the three Bor- 
 oughs of Kings, Queens and Richmond making due allowance for 
 the agile figuring that will be done by the public officials of those 
 three boroughs when they see their sisters, Manhattan and Bronx, 
 receive fat plums. What is the total sum 1 The total cost of New 
 York City's new Court House and site, that wonder of efficient 
 city administration, would dwindle into insignificance in com- 
 parison. 
 
 (3) Details of Construction: I have never seen any details of 
 these Markets that were intelligible. The RURAL NEW YORK- 
 ER of the issue of January 6, 1917, purports to give a diagram 
 of one of these markets but it is the merest outlin^^ Thn impres- 
 sion made on me by the diagram and explanation was that they 
 set forth a scheme of an entirely new marketing system rather 
 than a plan for a new Municipal "Wholesale Terminal Market: 
 A system wherein all middlemen would be eliminated by having 
 the farmer's co-operative association ship to the municipal market 
 which would act as agent in selling to th(^ retailers. Mayor 
 Gaynor's Market Commission lias published more details but they 
 also are the merest outlines. 
 
 Certainly when spending tens of millions and possibly liundreds 
 of millions it would be well not to leave the citizens in any doubt 
 as to what is to be built. 
 
 (4) Handling and Congestion: It is said for these proposed 
 markets that they would reduce handling and congestion. Let 
 us examine these claims. It is difficult to dig out from the claims 
 of the proDioters anything precise as to the way these markets 
 are to handle freight. The most definite statements I will now 
 give. 
 
 The State Commissioner in a recent newspaper article says : 
 
 '* Carload lots from all railroads will run direct into this 
 market. Supplies from boats will move by automatic machin- 
 ery direct into the market. Here the bulk shipments will be 
 
 (16) 
 
 broken. Refrigerated rooms will protect the perishable pro- 
 ducts, and canners will preserve the tenderer goods." 
 That reads beautifully ! 
 Mayor Gaynor's Market Commission says: 
 
 '*The methods by which the freight at this terminal in- 
 bound and outbound will be most economically and expedi- 
 tiously handled are not discussed by us at this time." 
 
 *'Both incoming and outgoing freight would be handled at 
 this terminal. ' ' 
 
 Everything of a practical nature in this scheme of spending tens 
 of millions nay hundreds of millions of dollars is left to the imagi- 
 nation. One important statement is made and that is that it will 
 be a terminal (as it must be) for outbound freight. In other 
 words these terminals vitally affect not only the foodstuff industry 
 but the shipping of every important industry of New York City. 
 
 Permit me to examine this matter of handling critically. I will 
 take the Wholesale Terminal Market planned by Mayor Gaynor's 
 Market Commission for Manhattan as an example. It is to be 
 located near 14th Street and North River. 
 
 Foodstuffs must come to Manhattan by cars and by steamships. 
 When by carlots these cars either must arrive in Manhattan at the 
 present railroad food terminals, then be shifted on to a marginal 
 railway (not yet built or even planned) and then taken by this 
 marginal railway to the proposed market ; or these cars must be 
 taken by floats to a pier located at the proposed market. 
 
 When the foodstuffs arrive by steamship the steamships must 
 either discharge at their present piers and the foodstuffs be re- 
 loaded onto cars and then hauled on the marginal railroad to the 
 market or the steamship must discharge at the pier located at the 
 market. 
 
 Now just contemplate the result ! If the foodstuffs are sent via 
 the cars on marginal railway into the market it means more 
 handling. In the case of railroad companies it means an addi- 
 tional switching charge. In the case of steamships it means 
 discharging the cargo to be reloaded on to cars. A marginal 
 railway for your market would not only be necessary but you 
 would create an immense new freight yard on lower Manhattan. 
 It has been estimated that it would require the space of eight 
 square city blocks to accomodate the switching necessary for one 
 present food terminal. Thirty railroad piers along the North 
 River would at that rate require 240 square city blocks. A land 
 car lot delivery on Manhattan Island as is proposed by the pro- 
 moters of the huge markets is unthinkable. 
 
 (17) 
 
-1 
 
 
 If on the other hand It is contemplated that iloats carrying cars, 
 and steamships shall unload at piers connect(id with the market 
 you must have the same number of piers that we now have and we 
 are just where we started, excepting that the marginal railway 
 would be necessary. 
 
 If a delivery was attempted to be made on one pier or a few 
 piers adjacent to the proposed market there would be lines of car 
 floats and steamships, East, West, North and South on North 
 River that would remind one of the automobile congestion on a 
 gala night at the Metropolitan Opera House. And on top of all 
 this do not overlook the fact that all present food terminals are 
 busy shipping outbound freight. All this outbound freight would 
 necessarily have to be shipped (as contemplated by the pro- 
 moters) through the proposed market. If there is congestion 
 now, congestion would be increased tenfold, yes one hundred fold 
 under these proposed markets. 
 
 There is only one transportation line that would be free from 
 the trouble depicted above. That line is the New York Central. 
 The proposed Manhattan market would be located on the line of 
 its tracks and it necessarily would have a monopoly of the Man- 
 hattan Market which I have used as an illustration. The Man- 
 hattan Market would thus be a private Terminal Market. 
 
 I believe much of the cry about congestion has arisen from con- 
 gestion of trucks at Pier 29, North River at the height of the 
 vegetable and fruit seasons during part of May and June in each 
 year. No healthy business is without congestion at some time. 
 In addition the total value of foodstuffs handled at Pier 29 North 
 River during the six weeks in question is ridiculously small in 
 proportion to the total food supply of the city. This matter can 
 be readily corrected and I am informed that it would have been 
 corrected ere this at the railroad company's (expense had the city 
 administration given the lessee of the pier a h^ase sufficiently long 
 in time to justify the expense. I am also informed that the rail- 
 road has recently received such a lease and that it will now make 
 extensive improvements. This whole outcry about congestion 
 circles around not more than 5% of the food supply of the city. 
 Congestion has greatly decreased on the lower west side of Man- 
 hattan. Ask any merchant shipping there fifteen years ago, what 
 the conditions then were. 
 
 (5) Cartage: Much is said about saving cartage by the pro- 
 moters of these markets. Let me examine tliat critically. Cart- 
 age connected with wholesaling is a negligible item so far as in- 
 
 creasing the cost to the consumer. In my judgment it is much 
 under 1% of the consumer's price. I will give a few illustrations : 
 Take oranges retailing at 35 cents per dozen (a low price), the 
 wholesale cartage is less than 1/10 of 1% on the retail price. 
 Take a tub of butter selling at wholesale at $15.00 per tub. The 
 wholesale cartage is less than 2/10 of 1% on the wholesale price. 
 Take a case of eggs selling at $7.00 per case wholesale. The 
 wholesale cartage is about one-half of 1%. If you take the retail 
 price of butter and eggs the cartage is even more negligible. 
 That was the view of Governor Dix's Commission. I quote from 
 its report : 
 
 **The cost of trucking while very large in the aggregrate 
 does not add appreciably to the cost of the given items." 
 
 Furthermore fully 90% of the foodstuffs arriving by our present 
 Wholesale Food Terminals are sold from those Terminals, thus 
 eliminating a large part of the Wholesale Cartage. 
 
 And be it remembered there would be the same cartage from the 
 proposed markets as there is now. 
 
 (6) Alleged Self -Sustaining Features of These Markets : The 
 State Commissioner in a recent article in the EVENING POST 
 MAGAZINE states in reference to his proposed Wholesale Ter- 
 minal market : 
 
 ''It would, in my opinion, pay for itself in short time.*' 
 
 In another article which I have mislaid he says that it will pay 
 for itself in a year. Recall that he has also said as I quoted above 
 that it would take * 'ten to twenty millions ' ' to fully equip it. My 
 recollection is that when he stated that it would pay for itself in 
 a year he had just made the statement that it would cost $3,000,- 
 000.00 to build this market. 
 
 Mr. Cyrus Miller, Chairman of Mayor Gaynor's Market Com- 
 mission in a letter to Mayor Mitchell makes this statement : 
 
 "These markets will be an excellent investment for the city 
 because they are self-supporting and show a profit.'* 
 
 Again it is difficult to use parliamentary language in dealing 
 with such claims. 
 
 These statements mean that there will be sufficient income to 
 pay the following items and in addition show a profit: 
 
 -I 
 
 (18) 
 
 (19) 
 
Cost of operation, 
 
 Interest on investment, 
 
 Insurance, 
 
 Taxes, 
 
 Repairs, 
 
 Depreciation. 
 
 Now there is absolutely no foundation for the statement that 
 these markets will be self-supporting to say nothing of their show- 
 ing a profit. How will tenants be secured for these markets? 
 No sane man would say that the Meat industry or Butter, Egg, 
 Cheese and Poultry industries would go into these mark(»ts. . You 
 need only know how they are handled and financed to eliminate 
 them from consideration. The only things that might be available 
 for these markets would be a certain amount of fruit and vege- 
 tables amounting to not over 5% of the Food (Consumption of New 
 York City. Actually a very small portion of that 5% would be 
 available when one considers how it is financed. Municipal mar- 
 kets are a burden to the municipality whether they be retail or 
 wholesale. The history of municipal enter])rises is a trail of in- 
 competency, waste and graft. Look at oiii- present municipal 
 markets! They are an expense to the CUty of New York. 
 They render no service. Why will a Municipal Wholesale 
 Terminal Market be different ? Read what Mr. J. W. Sullivan, 
 a skilled investigator says as to this in his book recently 
 published entitled *' Markets for the People." He shows therein 
 that municipal markets wholesale and retail both here and abroad 
 are a burden to the municipality and a failure. In a letter to me 
 dated March 8th, 1915 when we were fighting the same proposi- 
 tion before the Legislature Mr. Sullivan says : 
 
 '*Mr. Millers's plan of Wholesale Municipal Markets is not 
 resultant upon consideration of these fundamental facts. 
 It is founded on false assumptions. It is not the logical con- 
 sequence of a showing of unnecessary costs in wholesaling, 
 with a detailed demonstration of effective methods in 
 lowering those costs. In so far as it is based on an 
 attempt to prove the proposed markets would "pay** by 
 citing European experience with wholesale markets, the 
 proofs I have offered are against it conclusively." 
 
 And as to Municipal Wholesale Terminal Markets abroad when 
 any one loosely states that they are a success just pin him down to 
 facts. There is no city in the world that has the wonderfully 
 
 equipped wholesale markets that New York City now has and 
 without cost to the city. When the facts are critically examined 
 Europe has much to learn from us in this respect. 
 
 If these Wholesale Terminal Markets be such a paying proposi- 
 tion they would be a splendid investment for one or more of our 
 captains of industry. There could be no objection to any individ- 
 ual *s investing his money in these. This would disarm all opposi- 
 tion and would be a gratifying solution. The public would 
 applaud the patriotism of any man or any group of individuals 
 that will invest his or their twenty to two hundred millions in 
 this way. The worst that could happen would be that it would 
 help to distribute their wealth and this would be applying Social- 
 istic doctrine. 
 
 (7) Waste: Some waste is inevitable, particularly in such 
 highly perishable products as lettuce, strawberries, tomatoes, as- 
 paragus, watermelons, etc., on hot days. The waste of these is 
 because of the character of the commodity. They cannot be 
 placed in cold storage. They must be consumed. They are hand- 
 led with extraordinary expedition. The total is a small percent- 
 age of the total foodstuffs sold in New York City. The same waste 
 would inevitably exist under the new plan of wholesale markets. 
 
 (8) Fundamental Obstacle to the Proposed Municipal Whole- 
 sale Terminal Markets : The configuration of Manhattan Island 
 and the present railroad situation are such that it is impracti- 
 cable and impossible to give a land carlot delivery on Manhattan 
 Island as proposed. For a market as proposed to be a success all 
 railroads and steamships must have access. That is a physical 
 impossibility on Manhattan Island. Furthermore the expense 
 attending the erection would be so large as to be prohibitive. The 
 New York Central is the only railroad that could give a land 
 carlot delivery to the proposed Manhattan Market. That road 
 would have a monopoly. I hold no brief for any road. I merely 
 state the fact. This talk of the advisability of giving a land car- 
 lot delivery is a great humbug. Why is it that the New York 
 Central which has the only freight station on Manhattan Island 
 instead of bringing butter and eggs to its St. John*s Park land 
 terminal in the wholesale district, puts these products on floats 
 and carries them to a railroad pier at the foot of Harrison Street, 
 the same as other railroads ? The reason is, it is the most efficient 
 delivery. 
 
 
 (20) 
 
 (21) 
 
fir: 
 
 t 
 
 (9) Present Wholesale Terminal Markets: It is necessary 
 and advisable to now describe our present efficient Wholesale 
 Terminal Markets. The present Wholesale Market is composed 
 of a large number of railroad and steamship piers projecting into 
 the Hudson River. These piers are like the wings of a large build- 
 ing if the market were entirely a land structure. In your imagi- 
 nation view these piers with a long building of concrete and steel 
 over them and you have a Wholesale Terminal Market somewhat 
 similar to the one proposed. It is located on the lower west side of 
 Manhattan. It is the result of a natural growth according to 
 economic law. It has not cost the city any money. It has the 
 Hudson River for a great railroad yard. This great railroad yard 
 upon which tracks may be shifted indefinitely performs the 
 service of a tract of land far larger than itself. The market is in 
 the center of the Metropolitan District. It is directly east of the 
 large New Jersey freight terminals and directly west of Brooklyn. 
 A line drawn east and west from the large New Jersey terminals 
 to Brooklyn bisects this district. This district is nearest to Rich- 
 mond. It is much nearer to the Bronx, and (iueena and the large 
 cities of New Jersey to which great quantities of food are sent 
 daily from this district than it was five years ago on account of 
 the enormous growth of the use of motor trucks. A circle drawn 
 with this district at its center shows that it is practically at an 
 equal distance from the large centers of the population of this 
 Metropolis. In this district are all the terminals of all the food 
 carrying roads and steamship lines ; eighty-five per cent, of all the 
 city's refrigeration with nearly all of its streets piped for refrig- 
 eration ; all the important ferries and all the subway tubes. The 
 bridges to Brooklyn with one exception are adjacent to this dis- 
 trict and the proposed vehicle tube to the State of New Jersey 
 is to be at Canal Street. A new trolley line connects Desbrosses 
 Street Ferry with Brooklyn, and a crosstown subway is planned 
 through Canal Street to West Street. The present market is the 
 most wonderful in the world. 
 
 And over and above all we now have the most wonderful Belt 
 Line to serve the present market, built by nature. I can do no 
 better than describe it in the language of Mr. J. C. Lincoln, 
 Manager of the Traffic Bureau of the Merchant 's Association : 
 
 ''The waters of the harbor and the rivers and waterways 
 connected with it form a complete belt line for the handling 
 of Commerce by the use of car floats, lighters and steamers 
 to the industries and freight stations along the waterfront, 
 
 (22) 
 
 and that no other community has a more extensive or com- 
 plete belt line, the maintenance of which does not fall upon 
 the users. *' 
 
 Some of the reformers complain that products ultimately 
 used in the Bronx pass by the Bronx to the present Wholesale 
 Terminal Market only to be sent back there for consumption. 
 Let me answer this. Every carload contains many grades. Some 
 of these grades are taken by Brookyln, some by the Bronx and 
 some by Manhattan. It is essential that there be a distributing 
 point. If a carload of some products were sent to the Bronx or 
 Brooklyn the result would be as the trade is not there the grades 
 unsuited to those places would have to go to the dump. As it is 
 the buyers congregate in the central wholesale market in Man- 
 hattan. Furthermore a large amount of this produce is shipped 
 to outside points and as the railroads are right in this wholesale 
 district they can take the produce and merchandise that is meant 
 for outside points early in the morning so that outside points can 
 get the produce in some instances for breakfast. There is, there- 
 fore, no economic waste in handling the goods from the whole- 
 sale market as it is today. The goods come there and are delivered 
 from there because of economic necessity. It is the result of a 
 gradual efficient growth. 
 
 No one compels these products to come to the present Wholesale 
 Market. They come through the operation of economic laws. In 
 fact, **bulk'' products such as bulk apples, potatoes, onions, tur- 
 nips, etc., do not. These ''bulk" products are now delivered in 
 car lots to railroad terminals in all parts of New York. 
 
 The railroads now have car lot delivery stations in New York 
 City to which any carlots can now be delivered if the shipper or 
 buyer desires. There are at least 126 wholesale terminals in 
 New York City to which carlots of all kinds of Farm Produce 
 can now be sent. I will enumerate some of these stations : 
 
 New York Central. 
 
 9 Manhattan delivery stations, 
 
 1 130th Street station (Harlem uptown,) 
 
 1 Melrose Junction Station (North of Harlem River, 
 
 7 Brooklyn delivery stations. 
 
 Pennsylvania Railroad. 
 
 5 Manhattan delivery stations, 
 1 Harlem '* station, 
 
 4 Brooklyn " stations. 
 
 (23) 
 
Erie Railroad. 
 
 9 Manhattan delivery stations, 
 1 Harlem '* station, 
 
 9 Brooklyn *' stations. 
 
 West Shore Railroad. 
 
 8 Manhattan delivery stations, 
 7 Brooklyn ** stations. 
 
 Lehigh Valley Railroad. 
 
 4 Manhattan delivery stations, 
 
 1 Harlem *< station, 
 
 2 Bronx *' stations, 
 
 9 Brooklyn *' stations. 
 
 Delaware, Lackawanna & Western R. R. 
 
 4 Manhattan delivery stations, 
 1 Harlem ** station, 
 6 Brooklyn " stations, 
 
 1 Long Island City delivery station. 
 
 Central Railroad of New Jersey. 
 
 5 Manhattan delivery stations, 
 
 1 Bronx *' station, ' 
 
 6 Brooklyn " stations. 
 
 New York, New Haven & Hartford RaUroad. 
 
 6 Manhattan delivery stations, 
 
 2 Long Island City delivery stations, 
 
 7 Brooklyn delivery stations, 
 2 Bronx '* stations. 
 
 New York, Ontario & Western Railroad. 
 2 Manhattan delivery stations, 
 5 Brooklyn " stations. 
 
 There are probably more than those enumerated above 
 I wish to emphasize the fact that the reason any commodity 
 comes past the Bronx to the present Wholesale Terminal Market 
 on lower Manhattan to be broken up into smaller h>ts, is because 
 It IS sent there by the operation of economic laws. 
 
 (d)— LAW AS TO MONOPOLY: 
 
 A further illusory cause of the high cost of living as stated by 
 the Joint Report- is the present policy of the State toward 
 monopolies Under a dissertation on ^Cooperation- the -Joint 
 Keport indulges in a hazy abstruse presentment of the evils of 
 our present laws on combinations. It is difficult to form an 
 
 (24) 
 
 opinion as to the entire meaning of the report in this respect 
 except that it seems to advise a **riot" of regulation and super- 
 vision by the State that would do justice to the imagination of 
 Don Quixote. 
 
 I quite agree with the ''Joint Report** when it says: 
 
 if 
 
 In anything that is done care must be taken that the 
 remedy provided does not prove to be worse than the ills 
 sought to be cured. * * 
 
 Indeed yes ; let us — 
 
 • • * ** rather bear those ills we have 
 Than fly to others that we know not of.'* 
 
 I feel that the Governor *s Market Commission itself believes 
 that it is in very deep water on this subject. 
 
 One thing is sure, farmers do not refuse to cooperate because 
 of present laws. They do not cooperate simply because they 
 have not the disposition to do so. You will secure cooperation 
 among them w^hen you change that disposition. And that takes 
 time and patience. 
 
 Mr. Perkins at the meeting of Wholesale Food Distributors 
 on January 26th, 1917 above mentioned stated that his chief 
 interest in the proposed Market legislation is in that portion of 
 it pertaining to changing the law so as to legally permit ''co- 
 operation'* in all lines of business. If that be the case it would 
 be a simple matter to amend the Donnelly Act (the statute 
 complained of) and omit all the remaining recommendation of 
 the "Joint Report.** There is no justification in linking-up with 
 a plan to change laws as to combinations, unscientific and un- 
 just legislation affecting a great private industry. 
 
 (B) Tangible Causes of the High Cost of Foodstuffs as Stated 
 by the "Joint Report": I have in the preceding page dealt 
 with the illusion in the "Joint Report'* as to the high cost of 
 living. I am pleased to be able to come to something that 
 appeals to the intellect. I feel with the editorial writer in the 
 EVENING POST when he says the following : 
 
 "This (referring to the statement of the "Joint Report" 
 that the foremost cause of the high cost of living is "the 
 lack of a comprehensive Market Department*') can hardly 
 be taken seriously when it goes on immediately after to 
 speak of short crops and the big exports to Europe. ' ' 
 
 (25) 
 
 ^"1 
 
 \ 
 
{a)-EXCESSIVE EXPORTATION AMD 
 SHORT CROPS: 
 
 report itseH ^ ''° ^° '^° ''^"^'" '^''' 'l^of' from the 
 
 tic nrrcisr '^^^ ^^ '^-^^^^ ^™-<^ - p-^- 
 
 101?^^ average yearly production of wheat from IQin f. 
 
 inevitable that prices would advance »' 
 again : 
 
 (b)-IGNORANCE OP THE PUBLIC ON THE 
 QUESTION OP FOODSTUFFS • 
 
 the cost of living. ^ materially increases 
 
 (c)-PAILURE OP THE PUBLIC TO ACT UP TO 
 THE LIGHT THAT IT HAS • 
 
 (26) 
 
 IV. THE REMEDY FOR THE HIGH COST 
 
 OP LIVING: 
 
 The NEW YORK EVENING SUN in an editorial of November 
 21, 1916 truly says : 
 
 ''The cost of living is the most vital problem in the lives 
 of a majority of our people today, but it is also the most 
 obscure in its causes, and the most difficult of solution. 
 The SUN does not pretend to know how it can be solved. 
 No one knows.'* 
 
 However, there are certain pitfalls of which we can beware and 
 there are certain things we can do to mitigate conditions to some 
 extent. 
 
 ^ r' 
 
 (A)--NO NEW LEGISLATION NEEDED: 
 
 We certainly do not need any more legislation or powers given 
 to anyone. Governor Willis of Ohio when he left office December 
 31st last said that he was convinced that we were over-inspected 
 and that the State was over-oflacered. The public is looking for 
 a Governor in office who has enough red blood in his veins to 
 make that smashing statement and to do his best to apply it. The 
 man that has the courage will go up higher. We need an econom- 
 ical administration, not talk, but deeds. Let the Government 
 be an example of economy to its citizens. Four years ago the 
 public was up in arms against cold storage. All kinds of Legisla- 
 tion was enacted to suppress it. Now it is recognized as a bless- 
 ing. If this ** Joint Report'' were permitted by the Legislature 
 to lie on the table for four years it would likewise be recognized 
 at the end of that time that its recommendations were not only 
 unnecessary but harmful. Outside of preventing unfair practices 
 in business, which is amply cared for by present laws, there is no 
 legal remedy for the high cost of living. You might as well 
 attempt by legislation to offset the Law of Gravitation. 
 
 (B)— -ENCOURAGE PRIVATE BUSINESS: 
 
 A way to reduce the cost of living is to encourage private busi- 
 ness as far as consistent with the public weal. We have plenty 
 of laws on our statute books to cut out unfair practices and we 
 have officers of the law to enforce them. We need no new legisla- 
 tion. Regarding transportation we have Public Service Com- 
 missions to attend to deficiencies in that. 
 
 (27) 
 
-.-«■' 
 
 (C)— EDUCATION: 
 
 A second way to ameliorate conditions is to disseminate knowl- 
 edge concerning production and distribution, what to buy, when 
 to buy, how to buy, the food values of different foods and the best 
 and cheapest ways to prepare these. We need no new legislation 
 to accomplish this. Present Departments have ample authority. 
 
 (D)— ACTION BY THE PUBLIC: 
 
 The most important problem is to get the public to act up to the 
 light and knowledge that is given to it. That is a long tedious 
 job and cannot be accomplished by additional leginlation. It is 
 a man's job. 
 
 V. A POPULAR MISCONCEPTION: 
 
 Suppose the Legislature appropriates the millions necessary 
 for a full application of the plans of the ** Joint Report'' who 
 pays for all this? The average non-property holding citizen 
 thinks that somebody else pays for these extravagances. There- 
 fore, he often is indifferent to expcMisive experiments. If a bill 
 were presented to him for his share he would be very wide-awake 
 and there would be less extravagance in public affairs. But 
 every citizen pays a share of all these appropriations and all 
 these extravagances just as surely as if the bill were presented to 
 him for his share. He pays for it in increased rent, increased 
 cost of food, clothing, shoes and other expenditures. The Legis- 
 lature is looking for new sources of income to meet proposed 
 increased expenditures; the Government at Washington for like 
 purposes proposes an unjust and probably unconstitutional ex- 
 cess profits tax. One seat of Government is an example for 
 another seat of Government in these things. Why not lop off 
 proposed expenditures that mean waste? 
 
 VI. A WORD AS TO NEW YORK CITY : 
 
 The Legislature has heretofore saved us from a spendthrift 
 city administration in regard to this wild dream of Municipal 
 Wholesale Terminal Markets. Business organizations practically 
 unanimously and business men almost to a man opposed the 
 efforts and plans of the city administration. Their first attempt 
 to start their markets was open and above board. They were de- 
 feated. They subsequently devised subtler ways. They pro- 
 posed bills to the Legislature that had large possibilities and 
 
 (28) 
 
 potentialities although Municipal Wholesale Terminal Markets 
 were not directly mentioned. The terms ' ' Home Rule ' ' and * * Per- 
 missive" and ''Co-ordination" were tried on the Legislature in 
 an effort to cajole the Legislature into passing these various 
 market bills. * * Home Rule ' ' and ' ' Permissive ' ' legislation are all 
 right when you have a city administration that has financial 
 sense. But they are all wrong when you have an extravagant 
 city administration. 
 
 Regarding ''Co-ordination" the city administration wants co- 
 ordination that means new departments and new executives 
 with the power of appointment in the Mayor. It does not want 
 co-ordination under some one present department. That is too 
 economical. Every wagon in a hilly country needs a good brake. 
 We are going over some tremendous hills in our finances in New 
 York City. Let the Legislature be the brake. Treat the city 
 as you would treat any other spendthrift. Keep supervision 
 over it until it can manage itself. 
 
 Vn. EFFICIENCY OF THE PRESENT METHODS 
 
 OF FOOD DISTRIBUTION. 
 
 A brief resume of present methods of Food Distribution is 
 necessary as the result of Mr. Perkins' confessed ignorance of 
 distributive methods. I fully believe that many others who 
 signed the "Joint Report" are equally ignorant. Another reason 
 for such a resume exists in the many extravagant and misleading 
 statements published about present methods. In consequence, 
 the ordinary individual has become convinced that present 
 methods of Food Distribution are fundamentally wrong. The 
 facts are that there are few departments of human activity, if 
 any, where there is greater efiiciency than to be found on the 
 whole in the present methods of Food Distribution. Few fields 
 of human activity have a greater degree of specialization. Ten 
 or fifteen years ago it was quite popular to attack the "middle- 
 man" and to assert that he was "an economic error." Today we 
 sometimes hear the echo of that cry. But sentiment changed 
 on this point. The best economists today recognize that the 
 "middleman" is a necessity, and that he represents a high degree 
 of specialization. Each class of middleman performs such func- 
 tions that did we observe the same degree of specialization in a 
 shoe factory or other manufacturing establishment we would 
 applaud. Not long ago the Merchants ' Association of New York 
 City in a report pointed out the valuable aid the much abused 
 
 (29) 
 
 
"middleman'' gives in broadening present markets and in open- 
 ing new markets. Contemplate the advance made in food distri- 
 bution within the memory of even the younger members of the 
 foodstuff industry. The consolidation of small contributions of 
 farmers into car lots, the furnishing of storage facilities at ship- 
 ping points, the introduction of the ventilated car, and the 
 refrigerator car, the fast freight service of the Railroads which 
 in the case of perishable commodities is almost as fast as the pas- 
 senger service, the system of reporting by telegraph to a shipper 
 the location of his car at different points in transit so he can 
 divert his car if advantageous so to do, the arrival of these 
 products in New York City practically on time notwithstanding 
 they may come a distance of 3000 mil(^s, the arrival in New York 
 of perishable products practically sound although they may have 
 come thousands of miles, the present efficient cold storage facili- 
 ties of New York City, the bringing of perishables to the New 
 York market early in the morning and the distribution of vast 
 quantities of perishable products to all parts of the Metropolitan 
 District within a few hours of their arrival, the furnisliing of 
 financial assistance by the distributors of the Metropolitan Dis- 
 trict to the grower and shipper. With all that I have said in 
 view (and I have not related all) how dare any man say that 
 present methods of Food Distribution are not wonderfully 
 efficient ! Especially, how dare any man ignorant of the business 
 advise legislation! I am not asserting that present methods of 
 food distribution are perfect. Nothing human is perfect. But I 
 do assert that, on the whole, present methods are essentially 
 sound. And I do assert again that the same economic laws apply 
 to Food Distribution as apply to any other industry and that 
 neither the State nor the Municipality has any justification in 
 attempting to legislate differently with respect to the Food In- 
 dustry than with respect to the Steel Industry. Help the Food 
 Distribution! How? By treating the industry as you treat 
 other private business. We ask no preference. Stop this cease- 
 less endeavor to turn this industry upside down by appointing 
 committees with members ignorant of the business they are to 
 investigate, ignorant before they begin and still ignorant when 
 they file their report! 
 
 In closing I will quote Mr. A. Y. Shoemaker, Sales Manager 
 of the East Texas Fruit and Truck Growers Association as to the 
 intricate and difficult nature of perishable Food Distribution: 
 
 (30) 
 
 The man who T^ill be able to evolve a plan for the hand- 
 ling of fruits and vegetables successfully, under any and all 
 sorts of conditions, will have immortalized himself ; will have 
 erected a monument to his name and memory that wiU 
 stand as long as such crops are produced.'* 
 
 Vm. CONCLUSION. 
 
 To the Reader: Will you not agree with me that if my facts 
 are true and my logic sound all the proposed market legislation 
 'craTw U '"f ^^'^^''' ^'^^^' '^ consigned'to the 
 tive then the only question before us is, are the facts set forth 
 herein true and is the argument sound? The writer is confident 
 as to the correctness of the facts stated, he is confident 
 that If you accept his facts you will agree with his argument. 
 
 The many proposals to the Legislature for market legislation 
 his year put me in mind of the ^4amb>' in WaU Street T^^ 
 lamb receives a tip. He says to himself, -If I buy 10 shares I 
 will make so much. If I lose, why, it will not hurt me. 'Then 
 the vision grows. He then says, -If this tip is a good thing with 
 respect to ten shares why not for twenty shares.^' This argu 
 
 and sinker. His aggregate purchases have finally amounted to 
 several hundred shares. The result is that he Lsted all h s 
 money and is bankrupt. ^ ^'^ 
 
 Let us take care that in this proposed market legislation with 
 the radical proposals contained therein we do not waste hu^e 
 sums of money with the net result not bankrupted brarnonu 
 ment to the folly of those who have proposed^Ld the State" 
 officials who assist in its enactment. 
 
 Put the recommendations of the -Joint Report- on the table 
 for four years and they wiU then appear as foolish as the ave^]! 
 comic supplement. average 
 
 (31) 
 
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 APR 1 7 193i 
 
 COLUMBIA UNIVERSITY LIBRARIES 
 
 AUG 8 1926 
 
 0041424026 
 
 FEB 20 1928 
 
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