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Business & Finance: Caoutchouc

2 minute read

Thomas A. Edison, Harvey S. Firestone and Henry Ford give, at inter-vals, a thought to the production of rubber in the U. S. Last week, Mr. Firestone gave an interview. His points:

1) A great part of the world’s rubber is under British control. In 1922, the British Colonial office, headed by Winston Churchill, pursuaded Parliament to limit rubber production in the Empire and to reduce exportation to 60% of the normal production. The price of rubber promptly advanced from 15 to 37c. a pound.

2) Last year, “Winnie” Churchill became Chancellor of the Exchequer, responsible for the enforcement of the rubber-prohibition. He enforced. He told his fellow-countrymen that Americans should pay at least 50c. a pound. Last August, the British Government made a further reduction of 5%, a similar one in November, so that now only 50% of normal British rubber production may, by law, be exported.

“Today,” said Mr. Firestone, “rubber is about 43c. a pound−and the world is threatened with a shortage.”

3) “Every ten-cent advance in the cost of crude rubber means an assessment of about $75,000,000 against America.” Thus, in 1925, the Rubber Restriction Act of Great Britain is likely to take at least $100,000,000 out of U. S. pockets.

The inference, from Mr. Firestone’s remarks is that, Nature willing, rubber must be grown in the U. S. Failing that, rubber plantations must be obtained in non-British territories. This, in fact, has in recent years been done. According to U. S. statistics, approximately $32,000,000 is invested in U. S. rubber plantations in the Far East, most of the large ones being located in Sumatra. The most extensive plantation is owned by the U. S. Rubber Co., which owns three in Sumatra and several smaller ones on the Malay Peninsula.

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