The talking machine world (Jan-Dec 1916)

THE TALKING MACHINE WORLD 75 J. NEWCOMB BLACKMAN DEFENDS THE STEPHENS BILL Presents Some Exceedingly Strong Arguments for Price Maintenance Before Governmental Committee as a Representative of the National Association of Talking Machine Jobbers At the recent hearing on the Stephens bill before the Committee for Interstate and Foreign Commerce, House of Representatives, Washington, D. C, one of the most interesting addresses was made by J. Newcomb Blackman, president of the Blackman Talking Machine Co., New York, Victor distributer, and also one of the representatives of the National Association of Talking Machine Jobbers. In the first part of his testimony Mr. Blackman briefly pointed out the unlimited arguments in favor of price maintenance, and after answering a number of questions propounded by members of the committee, was requested by the chairman of the committee to present his closing arguments in a limited time so that the hearing could be adjourned temporarily. Mr. Blackman thereupon gave the following testimony which is an unusually valuable brief for price maintenance, and which, considering the fact that it was extemporaneous and given against a time limit, deserves special praise: Mr. Blackman: Until the recent decision of the United States Supreme Court, by a vote of five to four, deciding that it was against public policy to permit restriction in price after the title had been given to an article, it was legal to conduct business restricting the re-sale price, regardless of the passing of the title. Let us not lose sight of the fact that this decision might easily be reversed were the Supreme Court to re-hear the case. Then, again, the Supreme Court was merely interpreting the law, as affecting public policy on a question of the conduct of business. It appears that the whole question sums up as to whether or not it is in the interest of public policy to allow a fixed price. This being the case, then why not decide that question instead of allowing it to be done through one process and prohibit it by another, which would appear as class legislation or interpretation of law. Let me give you some examples where the provisions in the Stephens Bill are in operation and considered perfectly legal. I will draw a comparison between a real estate operator, who practically manufactures land through a process of taking a large tract of virgin land and developing and improving it until it represents improved and highly restricted property, and a mercantile manufacturer. The real estate merchant has the land surveyed and mapped out, showing roads and lots to be sold, and offers the property for sale. The restrictions are obligatory only after we have exercised our option to purchase, and we can refuse to buy, because of the restrictions, for the reason that there is to be found other property unrestricted, or with restrictions to our liking. We recognize, however, that these restrictions, to become effective, and in order that we may individually enjoy them, must be binding on other property owners and run for a certain length of time and be binding on subsequent purchasers. Such property may not necessarily be sold direct by the real estate operator, but through any real estate agent, and we have noticed quite generally that the real estate agents' commissions are uniform. I have heard opponents of the Stephens Bill claim that when you take title to property you should be free to do as you please with it, and while you may reply that you could re-sell the property without restriction as to the price, the other restrictions certainly restrict your prospective purchasers to those who are willing to be bound by the restrictions. This universal method of developing residence property is so generally recognized as desirable and necessary that you would not be considered a good neighbor if you attempted to break down values for purely selfish reasons, as follows: Suppose you decided to lay aside the moral question as to what was right and fair to the other purchasers, but with an ulterior motive rented your property to a family of darkies. You know that this would affect the value of the entire property, but more particularly the adjoining properties. After you have in this manner damaged the values of the adjoining properties, you might indirectly buy them in, and by a pre-arrangement plan for your own selfish benefit, in that way ruin values and revert to yourself the benefit. Your action would not be approved, and you would not be respected, even though you might be able to get away with it. Why not say in this case that a real estate operator can still sell his property and get his price? You can readily see that he may not be able to sell it as residence property to the class of buyers intended and that values in the entire real estate development referred to have been seriously injured, although the land remains the same. Does this not compare with the manufacturer who erects a factory, buys raw material in large quantities, and proceeds to map out a plan for manufacturing of merchandise, and turns the bulk raw material into small lots, or a manufactured product? Does not the price cutter, who, regardless of business ethics, uses some of the product as bait, create a false standard, and does he not have an ulterior motive, as in the case of the real estate sharper, who rented to the darky family? There seems to me to be a strong resemblance in the effect of the damage to the producer in both cases. However, in the first instance, it is generally frowned on, and in the other considered quite clever, and the consumer, who does not regard the rights of others, but simply follows his selfish desires, takes ad vantage of these cut-price schemes and lauds the price cutter. If it is a good argument that the producer and consumer can take care of themselves without restriction, which some claim take away independence, then there are many laws on the statute books to-day that should be repealed. We know, however, that public policy demands laws, and that there shall be uniform observance. We need a police department in business, as well as in society. Here is another illustration. When Henry Ford found that he could not sell his automobiles at a uniform price through independent agents, did he agree with the government that a uniform price was unnecessary and not in the interest of public policy? On the contrary, being one of our largest and wealthiest manufacturers, he immediately J. Newcomb Blackman changed his system and distributed his automobiles at uniform prices through his own stores by a process of holding title to the automobile until it was sold at a uniform retail price. If uniform prices are wrong, wherein has the public been benefited, and if, as 90 per cent, of the merchants of the country believe, they are absolutely necessary to insure uniform quality and satisfactory service, then why make it possible for only the largest and wealthiest manufacturers to operate legally on a uniform price basis? The prices at which some standard trade-mark goods are sold represent such losses that were we not aware of the fact that the loss is made up on other goods, on which a proportionately high, profit was made, we would question whether the goods had not been stolen. The methods pursued by some price-cutters, I believe, constitute commercial stealing, and I believe the Stephens Bill protects the honest manufacturer, wholesaler, retailer and consumer, and will be legislation that will foster and protect honest merchandising. advertising, and that it was not the merit of the article itself which brought about such a large sale. I do not agree with this statement, nor the statement that any advertising of a reputable article increases the cost; on the other hand, have found that by quantity production through increased demand, better value has been obtained. I used to buy ordinary alarm clocks of the unknown variety without any guarantee for about 98c. each. They lasted a few months, and I threw them away. About two years ago I bought a Big Ben and a Little Ben. They are keeping good time, are apparently as good as new, and I think I have received my money's worth. You do not have to buy Big Bens, but can select the 98c. variety, but I want manufacturers who produce a good article to have the protection that will enable them to continue. The Gillette razor has been referred to. I bought one about ten years ago and paid the full list price, of $5.00. It is as good as new, and I feel that I have, in that case, value received. I tried a razor put on the market and widely advertised at 25c. After one shave, I decided that the price compared with the article. Then, again, I tried a dollar safety razor, and while it may be fairly said that it was worth a dollar, I believe that my experience with the Gillette is not one that calls for any complaint. Personally, I do not ask the government to give me the right by fair or unfair means to get merchandise I want at a price I want to pay, regardless of the injury to the merchant. So long as there are plenty of safety razors, shoes, hats and other articles of merchandise in competition, the law of supply and demand will give me ample protection. A Congressman from the South asked me whether the Stephens Bill would enable the cotton merchant to brand his cotton and sell it at a uniform price. I said, "Certainly, nobody will stop you." And then he said, "Can we get the price?" I ^replied, "I was not aware that it was the purpose of this bill to sell the goods for the merchant. If he has not enough real value in his goods, the branding of them and putting a uniform price on them will re-act, and he will not exercise his option to do business under the provisions of the Stephens Bill." In conclusion, I think the consumer should have the protection of the Stephens Bill, in order to insure him a steady supply of identified merchandise at a uniform price and quality. The small independent merchants of the country should be able to buy goods from manufacturers who desire to operate under the Stephens Bill, to protect them against being put out of business by the merciless price-cutter, or by the necessity of a manufacturer doing business through his own stores, to operate on the uniform price basis. The producers or manufacturers need the protection of the provisions in the Stephens Bill to enable them to manufacture goods of uniform quality, which is only possible with a uniform price. Before my time is up, let me get this home. It is strictly optional whether any one chooses to operate under the Stephens Bill. Any producer or manufacturer under the terms of the Stephens Bill must lay his cards on the table with the government, thus exposing his system to the fiercest competition. To qualify for operation under this bill there must be no monopoly, and if a monopoly develops, the operator would immediately disqualify. A privilege and a protection will be restored, which was only recently removed, by the closest possible decision of seven Supreme Court judges as to the interpretation of law in the interest of public policy. The underlying reasons calling for the passage of this bill are to foster and protect honest merchandising and discourage immoral practices in business. The element of competition is not lessened, but increased, and it is changed only to the extent that it makes it possible to more clearly Some one referred to the Big Ben clocks in a manner that would indicate that the price was inflated to pay for define what is honest competition. Truetone Combination Sets MADE IN U. S. A. Five different tones, each tone packed separately. 200 in a metal box, 5 boxes in a convenient container holding 1000 needles, retailing at 75c. Five of these containers packed in a carton and sent prepaid to dealers anywhere inU. S.for $1.50, and postage on 2h lbs. 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