Ken Conklin at 20:12, 24 December 2005

2005-12-24T20:12:00Z

Jere Krischel at 04:36, 9 December 2005

2005-12-09T04:36:10Z

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back in the shape of duty-free articles and because the duty on sugar
is higher (computed ad valorem) than the average of our total imports.
A part of the California bullion and wheat and wine sent to England
pays for Hawaiian sugar, which is duty free. About one sixth of the
Hawaiian crop is thus paid for, and to that proportion there is a total
loss of revenue. While it is impossible to compute what the real loss
is, I think it safe to say that it probably does not exceed one-third, and
certainly does not amount to one-half of the $18,000,000 computed as
lost on sugar. In any event the duty never leaves the country. It is
paid over by the refinery to the consignee of the Hawaiian, and is paid
out again, with much more besides, to American shipping, banks, merchants,
and stockholders. The gross profit of $36,000,000 throws into
insignificance the possible loss of $6,000,000 or $8,000,000 of revenue.
It has been said repeatedly that all the profits of this magnificent
trade and industry go to the benefit of Glaus Spreckels and a small
clique of speculators. What nonsense! If it did, he would richly
deserve it, and a vote of thanks by Congress besides.
It will be going to the root of the matter at once to say that the
opposition to the treaty has arisen from the systematic and. in some
measure successful attempts to saturate the public press and Congress
with utterly false ideas about Claus Spreckels and his relation to the
islands, to create a bitter personal prejudice against him, and by implication
to illogically and unjustly extend that prejudice to the commerce
and industries of the Hawaiian Islands. Claus Spreckels certainly has
for many years monopolized the manufacture and sale of refined sugars
on the Pacific coast, and ruled that market to the extent of his powers
with a rod of iron. But the first grand mistake consists in supposing
that the Hawaiian treaty has or could have given any assistance to
the establishment of his monopoly or to its maintenance or confer upon
it any benefit whatever. The second mistake consists in wholly false
impressions about the wholly distiuct personal relations of Mr. Spreckels
to the industry and commerce of raw sugar. In these he is only one
of many men, and though individually his relations are large, yet relatively
to the whole they are small, and he can no more control the
whole than the Cunard Company can control our commerce with
England. As a monopolist of refined sugar he can notescape the odium
which always attaches to a monopoly. As a planter and stockholder, as
a director of an American steamship company, and a banker, his whole
career and course of conduct will compare favorably with that of any
great and successful merchant in America.
The monopoly of refined sugar in San Francisco is, like all other
monopolies, a perfectly legitimate object of attack; and if it can be
broken up in any way such an end is devoutly to be wished.
But Claus Spreckels's relations to the island trade and industry are
a totally different matter, and when rightly understood will present
themselves to the unprejudiced mind in a totally different aspect. In
this field his operations are perfectly legitimate. It is my purpose to
point out that any attempt to terminate the treaty is simply an attempt
to strengthen and fortify his monopoly and to break down commendable
enterprises which should be built up and sustained, and in which
Claus Spreckels is merely one of many participants. Whatever damage
might be inflicted upon him in respect to his island interest would
be more than compensated to him out of enlarged profits of his monopoly
as a refiner, while the blow would fall with full and disastrous
effect upon thousands of innocent third parties, both in Hawaii and
California, whose interests should be dear to Congress and to the American
people.

The Hawaiian'treaty has become an object of attack by the sugarrefining
interest of the Eastern States and of the sugar-planting interests
of Louisiana. The motives which have led to this attack are as
follows:
During the last few years the sales of sugar imported from Hawaii,
Manila, and Central America, and refined in San Francisco, have
been extending gradually into the markets of the Mississippi Valley,
advancing further eastward every year, thereby displacing the sales of
eastern sugars in the States and Territories west of the Mississippi
River. The Eastern refiners and the Louisiana planters believe that
the possibility of this arises from the free entry of Hawaiian sugars,
thus enabling (as they suppose) the San Francisco refiners to purchase
raw sugar much more cheaply than they otherwise could. Thus they
believe that the treaty discriminates severely against their interests,
and is unjust to them.
This position is denied by the San Francisco refiners and importers
of sugar and by the owners of Hawaiian sugar properties in California.
They contend that the San Francisco refineries get their raw sugar no
cheaper by reason of the treaty, but are obliged to pay the same price
for it as for equivalent dutiable sugar from Asia; that the ability of
the Pacific refiners to compete successfully with the Atlantic refiners
is founded upon conditions wholly independent of the treaty, viz: First,
because unlimited amounts of Asiatic sugar can be laid down in San
Francisco cheaper than raw sugars can be laid down in New York;
second, because through eastward freights over the Pacific railways
are scantier than westward through freights, and the railroads naturally
prefer to carry sugar at low rates to hauling empty cars. They
contend that this competition is a natural one; that it is not helped
by the treaty and will not be hindered by its abrogation; that it is destined
to grow, and would grow if the Hawaiian Islands did not exist.
Since it is also claimed by the opponents of the treaty that it fosters
and sustains a monor>oly of refined sugars, and that the benefits of the
treaty accrue only to that monopoly, and since the whole complaint is
founded in a gross misunderstanding of the nature and conditions of
the sugar business on the Pacific coa.it, it seems proper to discuss the
facts at some length. From these it will appear that these charges, as
well as others, are utterly without foundation.
It is a self-evident proposition that a cargo of Manila sugar delivered
in New York must sell at a price just equal to that of so much Cuban
sugar of equal grade. It is evident, also, that the price of that cargo at
Manila "free on board" must be less than the New York price by an
amount equal to the cost of transportation. It is further evident that
the price of a similar cargo of Manila sugar delivered in San Francisco
must exceed the Manila price by an amount equal to the total cost of
transportation. It is, therefore, an easy matter to compute whether
Manila sugar in San Francisco ought to be cheaper than Cuban or
Manila sugar in New York.
The rate of freight from Manila or Hongkong to San Francisco on
sugar is very low. A vessel can be chartered to go from San Francisco
to Manila in ballast and bring back sugar at $5 or $6 per ton, but during
the last eight years Asiatic sugar has largely come as mere ballast.
Freights from Manila to New York range from $9 to $12 per ton.
Interest, insurance, and shrinkage being proportional to the time of
the voyage are evidently in favor of San Francisco as compared with
New York. In brief, the San Francisco price of raw sugar is lower
than the New York price by three-eighths to five-eighths of a cent per
pound.

Template:470-471 - Revision history

Ken Conklin at 20:12, 24 December 2005

Jere Krischel at 04:36, 9 December 2005