will be as follows: Wheat, 5 cents off; oats, 3 cents off; barley, 5 cents off; rye, 5 cents off; to arrive in Minneapolis. You received this in your mail from the Grain Bulletin? A. Yes, sir.

Q. These are prices at which you can not buy?—A. Can not help but lose money. The freight to Minneapolis from Hancock is 5 cents.

Q. Per bushel?-A. Per bushel.

Q. So, that if you paid this price, you would not have anything for your work, but you would have to pay a commission and freight? A. Pay all these handling charges. Q. The prices they quoted for this town are in round numbers and 4 cents above a fair price?—A. Just about.

At the Minnesota investigation the secretary of the chamber of commerce and other officials testified that the Grain Bulletin had absolutely no connection with the chamber of commerce. However, the testimony already quoted from the Interstate Commerce Commission hearing of 1906 shows that at that time the Grain Bulletin was in fact published by and under the authority of a committee of the association. It was then published in the chamber of commerce building at Minneapolis. It is still published in the chamber of commerce building and by the same individual who published it in 1906. This tardy disavowal of the chamber's connection with the Grain Bulletin is not accepted by the people of the Northwest, and it is believed to be one of the many devices employed by the combine to crush competition and promote unfair price discrimination. It is generally believed that the Grain Bulletin is the lineal descendant of the device employed prior to 1904, whereby prices were absolutely fixed and the amount of grain received by supposedly competitive old-line elevators pooled and divided at more than 950 elevators throughout the Northwest.

Another grave objection to the monopolized and private market place known as the chamber of commerce is the fact that the market news, as well as price and crop prognostications, are all within the control of that organization, and may easily be manipulated to suit the purposes of the consumptive interests who control the market place. It is the general opinion of producers throughout the Northwest who are acquainted with the many abuses practiced at the Minneapolis terminal that the crop news and gossip disseminated by the chamber of commerce is wholly and absolutely unreliable. It is believed that in times of threatened crop scarcity such news is disseminated in such a way as to produce enormous early shipments before the price of the commodity affected has risen to any considerable extent. It is believed, on the other hand, that if the crop is plentiful and the price of the commodity likely to become lowered as a result of such abundance, crop news and reports are disseminated which induce producers to hold their grain until the market price has reached the lowest ebb. It is an undisputed fact that almost invariably when the price of grain rises at the Minneapolis market the farmers' granaries are depleted, and, on the other hand, when the price of grain goes down the farmers' granaries are usually well filled.

The California Fruit Growers' Exchange is a cooperative institution, which markets from 65 to 80 per cent of the total citrus fruits of California. The sole function of the central exchange is to supply its district associations with market news and market reports. This organization, whose success is a byword throughout the entire United States, expends tens of thousands of dollars every year for the simple purpose of obtaining and disseminating accurate and unprejudiced

crop news and information. Under the system employed at the Minneapolis terminal the collection and dissemination of crop information, outside of public governmental reports, is entirely in the hands of a secret monopolized club, dominated by the very interests which buy the grain. This situation is intolerable. Beyond question a cooperative organization collecting and disseminating accurate and unprejudiced crop news could and would effect a saving to producers of grain amounting to millions of dollars annually. Again I repeat, the collection and dissemination of this news is the sole function of the California Fruit Growers' Exchange and the secret of its phenomenal success. Were such a system instituted at the Minneapolis terminal a rise in price would not find the farmers' granaries empty and a drop in price would not usually find them well filled.

At this time I submit the indorsement of the Equity Cooperative. Exchange adopted by the Farmers' Cooperative Elevator Association of South Dakota. This indorsement was made after actual investigation of terminal conditions at Minneapolis and sets forth many of the abuses practiced by the grain combine.

THE RESULT OF AN INVESTIGATION.

At the annual meeting of the Farmers' Cooperative Elevator Association of South Dakota held at Watertown, S. Dak., in January, 1913, the question of a selling agency in the terminal markets was taken up for consideration.

After a thorough discussion it was decided that a committee should be appointed to make the necessary investigation and report its finding to the board of directors. A committee of three was appointed. This committee met in Minneapolis in the early part of May, when it made a most careful and painstaking investigation, with the result that the following resolutions were adopted:

REPORT OF SPECIAL COMMITTEE ON SELLING OF GRAIN IN TERMINAL MARKETS.

Mr. President, your committee appointed to look into the matter of the farmers cooperative elevator companies entering the terminal grain markets for the purpose of selling their own grain through an agency controlled by them, begs leave to report as follows:

In our judgment the conditions in the terminal markets justify a serious consideration of the subject of selling or handling our own grain there. First, because by being on the ground will enable us to make sure that all our grain is treated fairly and justly in the matter of selling, grading, testing, and dockage.

Second, a selling agency of our own will enable us to sell all grain on a single commission, thus preventing a duplication of charges as is now the complaint against members of the chamber of commerce.

Third, if the cooperative shippers of North Dakota, South Dakota, Minnesota, and other States could unite and federate in this terminal grain-selling movement, we believe that the assured volume of business as well as added strength of the combined forces would tend toward the creation of a more public and open market at the great grain terminals.

We believe that the interests of these three States are mutual in this matter because we are all equally or proportionately affected by any irregular practices prevailing in the terminal grain trade.

We believe that the selling agency should be begun or established before investing in terminal elevators for storage facilities, for the reason that storage can be engaged readily as needed and at minimum cost.

We believe further that by selling their grain cooperatively in the terminals at actual cost, the farmers' companies can thereby save an amount greater than the commission now charged because all speculative cost which now enters in the handling of grain at said points is ultimately charged against the producer.

We recommend that our secretary, Mr. Belk, call a meeting of the board of directors to be held in the city of Sioux Falls, S. Dak., on the first Wednesday in June, 1913, at Hotel Carpenter, and also to invite delegates from North Dakota, Minnesota, and Iowa for the purpose of discussing the feasibilities of establishing a selling agency

as herein before described, and also for the purpose of devising plans for the organization of same.

We further recommend to said Mr. Belk that he notify all interested parties in the above-named States by personal letter with a request to attend this meeting and to participate in the discussions thereof.

Signed by full committee.

O. D. ANDERSON, Chairman.
H. G. SOLEM.
WILLIAM SEIPP.

REPORT OF COMMITTEE OF BOARD OF DIRECTORS APPOINTED TO DRAFT A STATEMENT FOR THE BOARD OF DIRECTORS TO SUBMIT TO THE MEMBERS OF THE STATE ASSOCIATION.

We, your committee appointed for the above-named purpose, beg leave to report as follows:

To the members of the Farmers' Cooperative Association of South Dakota, greetings:

We, your board of directors assembled in the city of Sioux Falls, on the 11th day of June, 1913, for the purpose of receiving and considering the report of the special committee on selling grain in terminal markets, appointed by the board of directors at a meeting held in Sioux Falls, March 24, 1913. The said committee was appointed in conformity with instructions contained in the resolutions and adopted at the late convention at Watertown, January, 1913. After having carefully considered the report of said committee consisting of O. D. Anderson, H. G. Solem, and William Seipp, accepts and approves of the entire committee report. In conformity with the conclusions and recommendations of said committee, we respectfully submit the following:

We believe it to be in the best interest of the members of the Farmers' Cooperative Association of the State of South Dakota to direct all shipments of grain, as far as practicable, to the Equity Cooperative Exchange, of Minneapolis, Duluth, and Milwaukee, a corporation formed under the laws of the State of North Dakota, and now established and maintained by the farmers of North Dakota and Minnesota, in the city of Minneapolis, for their mutual benefit and protection.

We find that the said Equity Cooperative Exchange is an establishment organized in good faith by the farmers of the respective States above named, and that it is now doing a legitimate grain commission business; and that said corporation has been established upon the cooperative basis whereby profits above necessary expenses are to be returned to the shippers of grain proportionately to the grain shipped, and that by its fair dealings and upright conduct it is justly entitled to the support of this association.

We further believe that the methods practiced at many of the terminals under the old system of docking, inspecting, and grading, vast sums of money have unjustly and wrongfully been taken from the farmers of the Northwest. In view of the above reasons, we earnestly recommend that all local elevator companies belonging to this association consign their shipments of grain to the organization above named; and we advise them to investigate the efforts made by the said Equity Exchange in the interests of fair grading and inspection of grain, to the end that the next State convention of the Farmers' Cooperative Association of South Dakota may take the necessary steps to establish a permanent selling agency, either in conjunction with the said Equity Cooperative Exchange or in such other manner as may seem advisable. Respectfully submitted.

J. E. KELLEY,
MATT WANKIN,
J. H. CREIGHTON,
Members of Subcommittee.

The above report was unanimously adopted by the board of directors, and is hereby respectfully submitted to the members of this association.

I further submit the unanimous report and recommendations of the House investigating committee of the Minnesota Legislature. This report was duly adopted by that body and sustains practically all of the claims made by this delegation as to the abuses practiced at the Minneapolis terminal:

REPORT OF THE SPECIAL HOUSE GRAIN-INVESTIGATING COMMITTEE.

To the speaker and the House of Representatives of the State of Minnesota: Your committee, appointed under resolution of January 21, 1913, to investigate the organization, management, control, and methods of doing business of any and all corporations or copartnerships and of every person in any manner engaged in the business of buying and selling or handling of grain or live-stock products in the State of Minnesota, and into the details in every respect whatsoever referring to the State board of grain inspection and its methods of procedure and of doing business, authorized by such resolution to employ counsel to assist the committee in the examination of witnesses and of books and papers and other instruments of evidence in the matter of this investigation and to assist in the preparation of its report on the conclusion of such investigation; this committee, consisting of C. M. Bendixen (chairman), A. F. Teigen, Martin Schwartz, D. P. O'Neill, and Frank Hopkins, respectfully make the following report:

James Manahan was employed as counsel for the committee and public hearings were held in the capitol at St. Paul, as well as at Minneapolis and Duluth, at which representatives of all parties interested appeared in person and by attorney.

The rules, by-laws, and reports of the Minneapolis Chamber of Commerce and of the Duluth Board of Trade, together with many letters from shippers, statements and tabulations prepared by commission merchants and elevator companies, and the rules, reports, and statistical tables prepared by the railway and warehouse commission regarding the inspection and moving of grain, were received in evidence and considered in connection with the testimony of a large number of witnesses, who testified, as shown by the transcript of such testimony submitted herewith in connection with the exhibits offered in evidence as a part of this report.

Your committee thoroughly investigated the manner in which grain received at the terminal markets of Minneapolis and Duluth is sampled, inspected, and marketed, taking the testimony of samplers, inspectors, and officers of the railway and warehouse commission and of the State beard of appeals, officers of the Chamber of Commerce of Minneapolis and Duluth Board of Trade, managers of terminal elevator companies and commission merchants, pit traders and independent dealers, as well as a large number of county elevator men, managers of farmers' cooperative concerns, representatives of the American Society of Equity, and farmers.

We find that the grain markets of Minneapolis and Duluth handle the bulk of the grain produced in the Northwest. The business of buying and selling grain at each of these terminals is well organized, and the commission men generally have adopted a method of promptly and accurately reporting all trades made by them. There seems to be no opportunity or inclination for individual traders on these markets to engage in any practice detrimental or unfair to either the shipper or receiver of grain, but in certain respects conditions have prevailed which your committee considers unsatisfactory and tending to burden the producers and to some extent the general public, and regarding these conditions we find and recommend as follows:

Committee's recommendations.--First The Chamber of Commerce of Minneapolis and the Board of Trade of Duluth are voluntary associations organized under the general laws and consisting of a limited number of members elected by the board of directors of these associations under rules which at the same time ccnfer upon such board of directors substantially absolute control over the admission of new members.

The number of members is limited, but any member may own an unlimited number of memberships. Notwithstanding the tremendous increase in the grain business of the Northwest, the number of members of the chamber of commerce has not been enlarged for more than 10 years past.

Your committee therefore recommends that the State should assert and have sufficient control over the internal management of these associations to insure at all times freedom of the market from any possibility of control by any combination (should such combination be attempted) and recommends that the by-laws and rules of such

associations should be so made and enforced that the general officers and directors and membership committees should be elected by the full membership by secret ballot, and that all nominations for such offices should be made by a suitable primary system.

Your committee also recommends that suitable rules and by-laws be adopted to enable an applicant for admission to membership to such associations to appeal from an adverse decision by the board of directors to the vote of the membership at large, and your committee further recommends that such legislation be enacted as will enable such applicant to appeal to a court of competent jurisdiction in any case where he is arbitrarily denied admission to such associations.

Rules criticized.-Second. The following rules of these associations your committee believes are arbitrary and objectionable:

(a) Upon violation of any rule, regulation, or custom of the association any member may be punished by a fine, suspension, or expulsion from the association by vote of the board of directors only.

(b) Another rule provides that members can not bid against each other for carload lots on track at country points. This rule makes such bids absolutely noncompetitive, which your committee believes is against the best interests of producers and shippers. Your committee believes and recommends that all secrecy as to the doings and rules of the Chamber of Commerce of Minneapolis and the Duluth Board of Trade should be eliminated so far as that may be done without unduly disclosing what may be termed private business relations of the members of these associations. Publicity is the greatest possible corrective of all public evils, and your committee believes that publicity in this would result in a wholesome improvement in matters referred to as well as strengthening of public confidence in the doings and practices of said Minneapolis Chamber of Commerce and Duluth Board of Trade.

3. Your committee also finds that for a number of years a private price-list bureau has been operated, with offices in the Chamber of Commerce, Minneapolis, and with access to the floor and in close relation with the quotation committee of said chamber. The business of this private price-list bureau is to furnish subscribers at country points a daily card showing what purports to be the price on grain at the local station where such card is sent and as a guide to buyers at such station, which price card is based upon the closing prices of that date at the terminal markets, with freight charges and what is supposed to be a reasonable margin of profit deducted. Under this practice this card is sent to subscribers at the various stations upon the theory that the prices quoted may be changed at any station whenever any subscriber at that station desires to pay more for the grain than is quoted by the card itself. The prices quoted on this card are generally followed at country points by the buyer, and on account of the recognition of the right of the buyer at any station to raise the price as given on these cards sent to that station it has often been used to crush out competition. We believe that this grain bulletin should be substituted by a public agency, and that the railroad and warehouse commission should be authorized and directed to adopt suitable rules and take the necessary steps to send daily price cards to all subscribers willing to pay therefor, showing on a uniform basis the prices that are being paid at the terminals and that may be paid at the country stations after allowing for freight and a uniform and reasonable margin of profit.

Switching charges. For years the members of the Chamber of Commerce of Minneapolis have imposed an arbitrary charge of $1.50 switching charge upon every car of grain handled at Minneapolis. This charge has been imposed under authority of the association and was made to appear to be justified on the ground that it was an "average" of the charges actually imposed by the railroads for switching services. As a matter of fact, the statistics of the railroad and warehouse commission show the charge to be in excess of the average imposed by the railroads.

Moreover, according to the testimony adduced before this committee, Minneapolis is the only grain terminal in the United States where a switching charge is charged against the shipper; and, as was admitted by addresses before your committee, this arbitrary charge of $1.50 a car has been assessed annually upon thousands of cars which actually paid no switching charge whatsoever. Consequently, this excessive and unjust switching charge has been an unfair burden inflicted upon the grain growers of the State, and your committee therefore recommends:

Fourth. Legislation that will abolish these unfair switching charges against grain marketed at Minneapolis and that the railroad and warehouse commission make and enforce such regulations as will secure to shippers and consigners of grain at terminal market at Minneapolis a free switching service to any industry located in said city. Fifth. Under the law of Minnesota corporations are permitted to transact business with subsidiary corporations when the dealings are fair, and, as a result, the buying and selling of grain by commission merchants at terminal markets to their own sub