attempted to) his own product. . . . The other salt districts of the United States are now organized, and are ready to treat with us (as soon as we have an association) relative to fixing and maintaining prices, dividing the territory, and making other arrangements which will inure. to the advantage of the trade. But we must first be organized. They cannot treat with individuals.

The appeal was successful. The meeting was held; others followed; and in April the Saginaw Salt Company and the Michigan Salt Association were consolidated and other outside firms were taken in, so that from the beginning more than 85 per cent of the product of the state was controlled. The new association took the name of The Michigan Salt Association.

When in 1881 the association expired by limitation, it was immediately reorganized under the name of The Salt Association of Michigan; and, in 1886, again expiring by limitation, it was again organized under its former name. The three associations have been, in fact, the same association under different names; the president and secretary elected in 1876 still hold their offices, and the business is conducted on the same principles, slight changes only having been made in the articles of association and by-laws.

The organization of the association, effective as it is, is very simple. Less than a page contains the articles of association, which declare that the purpose of the association is "the manufacture and dealing in salt," and the "transportation of its products to market"; that the amount of capital stock shall be $200,000, divided into $25 shares, of which the amount actually paid in is two dollars per share; that its affairs shall be managed by a board of nineteen directors (of whom not more than one shall be from the same firm or company of manufacturers) chosen by the stockholders; that the offices for transaction of business shall be in East Saginaw and Bay City, and that the business shall be carried on in the salt-manufacturing counties; and, finally, that the association shall exist as a corporation for the period of five years.

From the by-laws, we learn that the stockholders shall be manufacturers of salt, and that the number of shares taken by any one "shall not exceed one share of the capital stock for

every barrel of the average daily capacity of his manufactory on a fair estimate"- an excellent provision to prevent manipulation of stock to the detriment of the real business.

An annual dividend of seven per cent payable semi-annually on the amount of stock actually paid in, together with the losses, costs and expenses incurred in handling and selling, including the state inspection fees, is deducted from the proceeds of sales before division is made.

That the business management of the association may be as personal and direct as possible, the president is given the general supervision of the entire business, subject to the general rules laid down by the board and the executive committee. A secretary and a treasurer with the usual duties of such officers are appointed by the board, and also an executive committee, which has general control and is charged with the duty of auditing all accounts, inspecting all books, etc., at least once a month. The officers receive a stipulated salary. The organization, it will be seen, is such that the executive efficiency of a single head is combined with all proper checks to guard against any abuse of trust on the part of any of the officers. The fact that the chief officers of the association have held their positions since its organization, and the continued prosperity of the association, never greater than now, reflect the greatest credit on the management as well as on the authors of the plan.

The relations of the association with the members, however, constitute the main point of interest. A contract is made every year with each manufacturer who wishes to become a member, in accordance with Article vii of the by-laws, which reads as follows:

Every manufacturer, in becoming a member of this association, shall execute and deliver to it a contract for all salt manufactured by him or them, or a lease of his salt-manufacturing property, including all apparatus and appurtenances thereunto belonging, for the purpose of manufacturing. Such contract or lease shall be for the term of one year, or until the dissolution of the association, and shall not impose any restriction that will prevent the manufacture of salt at any and all times.

Each and every contractor shall manufacture salt for this association on the terms and conditions as follows:

That he will make salt solely on the association's account, of the best quality of the kind manufactured by him, according to the conditions of his contract or lease.

The contracts provide, further, that in case the manufacturer sells salt on private account, he shall pay to the association ten cents for every barrel so sold; that the contract, however, is not thereby forfeited, but remains in force throughout the stipulated time.

While this gives full control of the product to the association, and effectually prevents all competition among the manufacturers, the provision that no restriction shall be imposed which will prevent the manufacture of salt at any and all times, operates powerfully against any raising of prices to exorbitant rates such as might perhaps be secured otherwise, if combination with the New York and Ohio river manufacturers could be effected. The reason that this clause stands in the by-laws, and that the practice of the association differs so entirely, on this point, from that of the anthracite coal syndicate and other combinations of like character, is found in the peculiarity of the manufacture. A great part of the larger salt blocks are run in connection with saw-mills; and the slabs, sawdust, etc., from the mills are used for barrels and fuel. Not only would this material, if not so used, be a dead loss, but its removal would be a source of expense. Manufacturers so situated could never expect a rise in the price of salt sufficient to compensate them for the loss that would be incurred in stopping their works; and consequently they will not join the association unless assured that they will not be subjected to such a loss and inconvenience in their more important business.

Another provision of great advantage, especially to the manufacturer of comparatively small capital, is that which provides for an advance of money on all the salt inspected each month, whether the salt is taken from the bins and sold or not, if the manufacturer wishes such advance and is willing to pay interest on it. The rate of advance and the rate of interest are fixed by the board and may be changed from time to time; but liberality is always shown both in the amount advanced and in the rate of

interest. The advance has been lately 25 cents per barrel in the bins, or 45 cents per barrel if packed, with interest at 7 per cent. Money may be loaned in the state at 10 per cent, and this rate is often obtained on small sums for short periods of time.

The salt becomes the property of the association as soon as inspected; but the manufacturer is still bound to deliver it free. of charge on the wharf or on the cars, as the association shall direct, and to sustain all losses by fire or otherwise, if they occur before such delivery. The association agrees on its part to remove within a reasonable time all the salt manufactured.

Reports are rendered every month to each member of the association, giving not merely his own special account, but all the sales, with the average price both gross and net, and all the necessary expenses with principal items - average freight, commission, home and storage charges, etc. All the members receive credit at the same average rate, and for an amount proportioned to their manufacture as shown by the inspection—a provision greatly to the advantage of the poorly situated companies. The receipts of salt for each month are sold and accounted for separately.

The association keeps its agents most of them selling on commission, but some on salaries in Chicago, St. Louis, Cincinnati, Cleveland, Columbus, Duluth, Detroit, Milwaukee and other places, wherever this is warranted by the amount taken.

It will perhaps be well, further, to notice some attempts that have been made, since the manufacture of salt in Michigan became a leading industry, to form combinations of all the leading manufacturers in the country, and thereby to secure from consumers a price limited only by the competition of foreign salt and the lessened demand consequent on the rise in price.

Not many months after the Saginaw and Bay association was formed (April, 1868), the managers began negotiations with the manufacturers in New York and in the Ohio river district. This first attempt, instead of resulting as had been hoped, led, from a rather peculiar combination of circumstances, to an even fiercer competition than had existed before.

The president of the association gives the facts in his report of 1870 to the board of directors. The association in Michigan

succeeded in making terms with the Onondaga Salt Company, but failed with the Ohio river association, because the latter could not control the product of their district either as to quantity or price. Some new works at Pomeroy, it seemed, had refused to join the Ohio river association. The other manufacturers of that district, having sold all their product to the association at a fixed price, increased their output and flooded the market. As the association could not control the works at Pomeroy, there was a general cutting of prices in which, of course, Michigan and New York were compelled to join. As the eloquent writer puts it: "It was a Donnybrook Fair in the salt market. When you saw a head, you hit it." The immediate result was, naturally, detrimental to all the works. The final outcome was that the outsiders on the Ohio river joined the association, and a change in the character of the contract with the former members enabled that association to control the quantity as well as the price in that quarter. This being done, it became an easy matter to make the combination general. The Washington correspondent of The Chicago Tribune gave an account of the pool which is corroborated by other papers and by officers of the present Michigan association. The Syracuse, the Ohio, and the Saginaw and Bay companies entered into an agreement at Detroit, March 22, 1871,

To make a pool of all the salt in the market in the territory bounded by the lakes on the North and East and by the Ohio river on the South, the western and southwestern boundary to be entirely discretionary, according to the prices of freights to places whence orders for this article might be sent. This discretion was confided in a board, there appointed, which consisted of one representative from each of the three salt corporations, who are also empowered to fill orders and forward all supplies, to advance or reduce prices as occasion may require. The percentage of the pool, and all future supplies and profits under existing arrangements, were agreed to as follows: Syracuse, 40 per cent; Ohio river, 32 per cent; Saginaw, 28 per cent.1

The prices fixed were $2.00 per barrel for Chicago, Cincinnati, Cleveland and Detroit; $2.10 for Toledo; and $2.40 for St. Louis.

1 The Chicago Tribune, April 4, 1871.