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About The Alliance herald. (Alliance, Box Butte County, Neb.) 1902-1922 | View Entire Issue (June 15, 1916)
io JUNE, 1116 Valuable to Stockmen Information Regarding the Service Rendered Shipper by Live Htixk Exchanges Will Reget Appreciation -!. " -.'.To 1 A. F. STRYKER, Secretary and Tradic Maiuier, Omaha Live Stock Exchanpe I'rivilie of (livinK Infoiniation To have the privilege of dissemin ating Information that helps to pro mote and develop the live Btock in dustry affords us great pleasure. Having this opportunity puts upon us the duty of making use of it. From time to time, glowing ac counts are published, and properly, too, of the facilities at the large mar kets for handling live stock and transacting business; but the good work that has been quietly done for some years past by the live stock raisers and shippers, has not been given the publicity that It deserves. Recently the editor requested Mr. A. F. Stryker, secretary-traffic man ager of the South Omaha Live Stock Exchange, to write an article for pub lication stating the practical opera tions of live stock exchanges. Pur suant to that request, Mr. Stryker sent us the following letter: Secretary Slrykers Letter Omaha, Nebr.. May 27, 1916. Mr. John W. Thomas, Alliance, Nebr. Dear Sir: Referring to our several conversa tions relative to an article which I am to write concerning the live stock exchnnges at the several public mar kets, I hand you herewith a paper read at the last meeting of the Nat ional Live Stock Exchange by Mr. A. C. Davenport, manager of the Journal-Stockman published at South Omaha, which in my Judgment more fully, thoroughly and capably pre sents the benefits of live stock ex changes to the public than could any paper I might write. 1 am going to ask you to substitute ,Mr. Davenport's paper for the one which I was to write. This paper has been very favorably commented on throughout the United States. It has th iDDrov&l of tha National Live Stock SMbaaft, 1TM mil rclTd by them and ought, coming as it does from one outside the exchanges, car ry considerable weight. If you don't agree with me on this matter and still want me to write an article, I shall of course be glad to do so. Yours truly, A. F. STRYKER. Secretary-Traffic Manager. Replete With Information The address of Mr. Davenport, to which Mr. Stryker refers and which follows, is replete with Information. While we do not share the disparag ing remarks which Mr. Stryker's modesty prompts him to make re garding his own ability as a writer, we heartily endorse his commenda tion of Mr. Davenport's address. Persona who want information on the subject of live stock exchanges In general should not fail to read it. Mr. Stryker has kindly consented to furnish us an article descriptive of some of the work of the South Oma ha Live Stock Exchange, which will be of special Interest to Nebraska Stockmen. Mr. Davenport's Address Address delivered before the annual meeting of the National Live Stock Exchange at Cincin nati, May 20, 1916, by A. C. Davenport, general manager Journal-Stockman. The value of the Live Stock Ex change Is fully appreciated by its members and by all old-time shippers who remember the disadvantages un der which they labored before there was such an institution to protect their interests. But a new generation of shippers has grown into the business since the exchange was organized, that is not so familiar with old-time conditions. It is to the new generation of ship pers that my remarks are addressed. f or tmrty years my newspaper work baa kept me in touch with the marteti whera lira stock and other farm products are bought and sold. Mr experience as a live stock report er began Just before the Live Stock Exchange was organised at South Omaha so that I bad a good oppor tunity of witnessing the chaotic and unsatisfactory conditions then pre vailing. At the same time, and for many years after, I was a dally visit or to markets handling other com modities than live stock, where there was no exchange, or at least none with sufficient power to discipline un scrupulous traders and prevent un fair or dishonest operators from con tinuing In business. I believe that my experience and the fact that I am not a member of any exchange and hence unprejudic ed, places me In a position to render a fair and Impartial Judgment and I can say without reservation "The more I see of markets the more high ly I value the live stock exchange." but I will not nsk the new generation of shippers to take my word for it. I will present the proofs. Why Kxchnnge Started To give an adequate idea of the VHlue of the Live Stock Exchange it will be necesstiry to recount in brief its early history. It cmue Into exist ence not through the whim or fancy of stock yards people. It was noi called Into being I .. scheming or plot ting buyers or sellers of live stock at the big market centers. It was cre ated In answer to a loud and distinr. call from the country for relief. Every old tinier will rememhei that in the early days the buyer: liai the whole say as to t ho shrink a re ot hogs. A commission man would sell a car and then would come a great wrangle at the scales ns to how th hogs should be docked. It was surprising how many dock able hogs those old-tinie buyers could find in a car load, and the bulldoz ing tactics that they could summon to their nid in maintaining their de mands were wonderfully effective. Under such a system thM'e could lit no Justice, no fairness. The count ry got the worst of it all the time, and commission men were powerless, act ing as individuals, to protect their patrons. The situation at last became ab solutely unbearable and the demand for relief so strong that back in the 80s Chicago commission men began taking steps looking toward a reme dy for the evil. Meetings were held and the packers called in to see if some friendly arrangement could not be made whereby the docking of hog should be done by some disinterest ed party, employed Jointly by com mission men and packers, instead of being left to the buyers alone. It took a lot of hard work and a long fight extending over several years. but the commission men in the snd carried the day. The desired agreement was finally made and in order to carry it out and keep it alive a permanent organiza tion was formed. For the want of a better name the organization was called the Live Stock Exchange. There you have it, the whole Btory In a few words. The same system was adopted at other market points which organized live stock exchanges to carry on the work. At first packers were mem bers of the exchange, but later on most of them dropped out so that the exchange as it exists today is prac tically a commission man's organiza tion. Other Abuses Remedied Although organized for the sole purpose of supervising the dockage of hogs it was only natural that other abuses should be taken up from time to time, and remedies found for them. Thus it happened that the exchange under the control of com mission men, acting for the best in terests of their patrons, became the great exponent of better market con ditions. Commission men banded together and working shoulder to shoulder through the exchange have been able to secure results that never could have been attained by the same com mission men working as Individuals. But what are the results, and what is their value to the producer of live tok? To begin with the value of the live stock exchange must be measured In millions of dollars saved to the coun try in the one item of hog dockage alone. A disinterested expert at the scales docks each car as it Is welsh ed. If either buyer or seller Is dis satisfied he can call upon a chief In spector and if still dissatisfied he can call upon an arbitration committee. Think what such a system means to the producer ns compared to the old system where the buyer took all the dock he wanted. Think of the millions of cars of hogs sold at the big market centers during the thirty years elapsing since the exchange came Into existence. Then think of what the saving of a few pounds of dockage per car on all this vast num ber of hogs mans to thp country. Again the Live Stock Exchange Is of very great valiiv to the producer of live stock because it fixes commis sions. If any producer doubts this let him read up on the past history of live stock markets. Let him study market cond'tions as they exist in other lines than live stock where commissions are not under regula tion Unfair Methods of Old Days Shiiipers who were in business be fore t!ic exchange was organized will envM' her the unfair and unbuslness ike system of commissions that was ii exi fence in the old days. One .un with a big pull could get his tock for little or nothing. Another 'l'Pl'er with less pull could perhaps :et half commissions, while the smnll diipper paid full commissions. Attain cut-throat competition many iniev caused the reduction of com nisiot s below the actual cost of the ervicp. With incomes reduced . hroutth unbuslness-llke methods, nid with no Regulation or supervis on wlr tever, there was a strong in entivc to indulge In transactions of i decidedly questionable character to make the. income balance the expense account. Unfair and uncommercial conduct can be banished from the business world only by placing business on a business-like basis through suitable regulation. The live stock exchange has done this for the live stock com mission business. CouM anything be of greater val le to the producer and shipper of live stok than the absolute assurance, backed by a powerful organization, that his live stock will be sold open ly and fairly to the highest bidder, with no over charges to one or under "hHrees tc another? But right here is where the exchange had its first and only controversy with tho coun try. With the fixing of commissions many shippers, especially those who previously had the benefit of cut commissions forgetting what it had done for them in reducing dockage on hogs, came back with the charge that the live stock exchange was a trust, and many of them gained the impression that its whole aim and object was the fixing of commissions for the benefit of Its members. Un fortunately various advances In com missions necessitated by increased service still further magnify this idea especially in the minds of the new generation of live stock shippers. However, the question as to wheth er commissions are too high does not rightfully belong in a discussion as to the value of the exchange. The size of the commission charges will al ways be open for controversy the same as the question of wages be tween employer and employe, but the real value of the exchange is shown in the fact that it fixes commissions at a definite point, placing all ship pers on the same basis, at the same time nnttini? fl stnn tn Irratnilupitiuu iiuu yuetsuonuuie pUfjUVMI- I'JcnOflS. . (iuard Against Dishonest Men Again the Live Stock Exchange is of great value because it has raised the standard of the character of the men engaged in the live stock com mission business. It has done this by throwing every safeguard possible around the admission of members so that men of the get-rich-quick vari ety, or men with a shady past, or (Continued on pare 14)