The Great A&P and the Struggle for Small Business in America (52 page)

26
. Sumners to Adolf Mayer, Dallas, Texas, March 26, 1936, Judiciary Committee, U.S. House of Representatives, 74th Cong., RG 233, HR 74A-D21, box 187. Kurtz, Vorhies, and Ozment, “Robinson Patman Act Revisited.”

27
. Nancy Beck Young,
Wright Patman
, 81;
Congressional Record
vol. 80 (1936), 8102.

28
. Ross, “Winners and Losers Under the Robinson-Patman Act”; Adelman,
A&P
, 430.

29
. R. J. Coar (United States Recording Company) to Patman, June 10, 1936, box 76(C), WPP; J. A. R. Moseley Jr. to Patman, May 20, 1936, and Patman to Moseley, May 25, 1936, box 77(B), WPP; “Itinerary,” box 77(B), WPP; Patman to Roosevelt, October 6, 1936, PPF 3982, FDR.

30
. C. F. Hughes, “The Merchant’s Point of View,”
NYT
, January 5, 1936; Thomas F. Conroy, “Threat to Jobbers Seen in Chain Plan,”
NYT
, January 12, 1936; “A&P Is Ready to Fight,”
Business Week
, January 11, 1936.

15: THE FIXER

1
. Among the critics is Mayo,
American Grocery Store
, 146–47.

2
. Tr 438–39.

3
. Deutsch, “From ‘Wild Animal Stores’ to Women’s Sphere,” 147; Phillips, “Supermarket,” 199.

4
. “Brief for the United States,” 657–58, Danville trial; Adelman,
A&P
, 65–69, 436; “A&P Help Yourself Store,”
WSJ
, September 9, 1936.

5
. Gx 188; Tr 818.

6
. Dx 511, 512, box 66; Dx 388, box 67; Gx 221; Tr 983.

7
. E. G. Yonker (Sanitary Grocery Company, Washington) to L. A. Warren (Safeway Stores, Oakland), February 3, 1937, RG 60, General Records of the Department of Justice, Antitrust Division, Enclosures to Classified Subject Files, 1930–87, Class 60 enclosures, box 71, NARA-CP.

8
. Gx 194; Tr 849. Wilson,
Cart That Changed the World
, 88–93, credits the Oklahoma grocer Sylvan Goldman with the invention of the wheeled shopping cart, but did not search for antecedents or competing claimants. Catherine Grandclément, “Wheeling One’s Groceries Around the Store: The Invention of the Shopping Cart, 1936–1953,” in Warren Belasco and Roger Horowitz, eds.,
Food Chains
, 233–51, provides a more thorough and balanced discussion of the development of the modern shopping cart. Both authors agree that the wheeled cart was important in the rapid growth of self-service food retailing.

9
. In 1937, the peak year, A&P paid $2.4 million in chain-store taxes, equivalent to 26 percent of its after-tax profits. Such tax payments fell to $2.1 million in 1938, the year following the first large-scale store closings and supermarket openings. Adelman,
A&P
, 54.

10
. Patman to Sam Rayburn, August 1, 1938, box 129(A), WPP;
Congressional Record
, 76th Cong., 1st sess., January 24, 1939, 9.

11
. Patman to McIntyre, PPF 3982, FDR; “Coster-Musica Funeral Is Held,” Associated Press, December 19, 1938; “End M’Gloon’s Examination in Fraud Case,”
Bridgeport (Conn.) Times-Star
, April 19, 1940; “Head of Old Drug Firm Commits Suicide After Fantastic 15-Year Hoax,”
Life
, December 26, 1938, 18–19. See also the April 1940 correspondence between Patman and Robert R. McCormick, publisher of the
Chicago Tribune
, box 37(B), WPP.

12
. “Hughes Springs, Texas,” Handbook of Texas Online,
www.tshaonline.org/handbook/online/articles/HH/hjh14.html
, accessed December 2, 2009;
Congressional Record
, 75th Cong., 1st sess., 5936, June 17, 1937; Patman, “Absentee Ownership,”
Vital Speeches of the Day
, November 15, 1938, 71; “Fortune Survey,”
Fortune
, January 1937, 154.

13
. Patman to “Dear Friend,” June 23, 1936, box 90(A), WPP; “Manufacturers Likely to Get Early Benefits Under Chain Store Law,”
WSJ
, July 2, 1936; “New Patman Bill Aimed Directly at Chain Stores,”
WSJ
, October 5, 1936.

14
. Tr 18050; “Great A&P Tea Co.,”
WSJ
, January 1, 1936. On Ewing’s long and colorful career, see “Caruthers Ewing Dies at 75,”
Memphis Press-Scimitar
, August 20, 1947. On his predecessor, see the obituary “Charles H. O’Connor, Ex-Counsel to A&P,”
NYT
, January 21, 1946. John had begun to speak of working with grocery manufacturers to fight chain-store taxes as early as March 1935, but had taken no action; Gx 162; Tr 738.

15
. Fulda, “Food Distribution,” 1092–1100; “Forcing Price Law Issue,”
Business Week
, September 5, 1936.

16
. “First Price Probe Started by FTC,”
WSJ
, August 8, 1936; “A&P ‘Within Law,’”
WSJ
, August 28, 1936; “This Is Business!”
Time
, April 12, 1937; “New Buying Policy Adopted by A&P Following Patman Act,”
WSJ
, March 30, 1937; “Robinson-Patman Act Unlawful Says A&P,”
WSJ
, February 9, 1937; “Brief for the United States,” 245, Danville trial.

17
. See W. A. Ayres (chairman, Federal Trade Commission) to Roosevelt, April 14, 1937, and Roosevelt to Vice President John Nance Garner, April 24, 1937,
Congressional Record
, 75th Cong., 1st sess., 7490, July 23, 1937;
Congressional Record
, 75th Cong., 1st sess., 5911–14, 5936; Rayburn to Walter D. Adams (editor,
Texas Druggist
), June 22, 1937, box 3R275, SRP.

18
. Lebhar,
Chain Stores in America
, 223.

19
. Helen Woodward, “How to Swing an Election,”
Nation
, December 11, 1937, 638–40; Lebhar,
Chain Stores in America
, 224–33; T. Eugene Beatty, “Public Relations and the Chains,”
Journal of Marketing
7 (1943), 250; California Chain Stores Association,
Fifty Thousand Percent Chain Store Tax
, 11, 26.

20
. “‘Loss Leader’ Lost,”
Business Week
, February 29, 1936, 14; “Kroger Grocery, Great A&P Hit by New Kentucky Tax,”
WSJ
, May 11, 1936; “New Chain Store Tax Proposed,”
WSJ
, October 3, 1936;
Sphere
19 (March 1937), in box 37(B), WPP; “State Chain Store Taxes,” RG 56, General Records of the Department of the Treasury, Office of Tax Policy, Division of Research and Statistics, Subject Files, box 13, NARA-CP; “4 More States Consider Taxing Chain Stores,”
WSJ
, June 5, 1937; “A&P Sues to Test Minnesota Price Law for 10% Mark-Ups,”
WSJ
, September 2, 1937; “Anti–Chain Store Bill,”
WSJ
, May 7, 1937.

21
. “Chainsters’ Tussle,”
Time
, June 14, 1937; “State Drops Milk Action Against Atlantic & Pacific,”
WSJ
, June 25, 1936; “N.Y. Chain-Store Tax Proposal,”
WSJ
, January 7, 1938; Tr 17407-2, Dx 499.

22
. “A&P Goes to the Wars,”
Fortune
, April 1938, 134; Tr 19746. Later that year, Catchings was to make John Hartford one of the first U.S. subscribers to a service that pumped music into customers’ homes, marketed under the name “Muzak.” See “Muzak Music,”
Time
, November 1, 1937.

23
. “Carl Byoir Dead; Publicist Was 68,”
NYT
, February 4, 1957; “Cultivating Cuba,”
Time
, June 2, 1930.

24
. Byoir to Marvin McIntyre, October 2, 1934, PPF 3982, FDR; “To War,”
Time
, March 7, 1932.

25
. Joseph L. Cohn to uncertain recipient, May 29, 1933, PPF 3982, FDR; “Doherty Week,”
Time
, January 16, 1933; Gould,
Summer Plague
, 60; “FDR: Day by Day,” FDR.

26
. Byoir’s relationship with Roosevelt was sufficiently jovial that the president bet a necktie that the 1935 ball would raise less than raised in 1934. Roosevelt lost. “President Gets Birthday Ball Funds Report,”
Washington Post
, November 20, 1935; PPF 2176, FDR. Byoir to McIntyre, October 2, 1934; Early to Byoir, October 5, 1934, PPF 3982, FDR; “Party at Hotel Opens Its Season at Coral Gables,”
Washington Post
, December 6, 1936; McIntyre to E. M. Watson, memo, November 6, 1935; Watson to McIntyre explaining why such a promotion was impossible, memo, November 9, 1935, PPF 2176, FDR; Early to Byoir, January 14, 1938, Stephen T. Early Files, box 1, FDR. Byoir’s White House visits, with the exception of the one on inauguration eve 1937, are in Pare Lorentz Chronology, FDR; “President Is Host to Campaign Aides,”
NYT
, January 20, 1937.

27
. Tr 19752.

28
. Tr 19755.

29
. Tr 19763; “Campaign Planned to Fight Chain Tax,”
NYT
, March 1, 1938; “Chain Tax Fought by Trade Groups,”
NYT
, March 2, 1938; “Chain Tax Measure Argued at Albany,”
NYT
, March 3, 1938. On the Buffalo dairy situation, see “Report on Progress of Food Chain Investigation, March 30, 1942,” RG 122, Records of the Federal Trade Commission, Bureau of Economics, Records of Roy A. Prewitt, box 6, NARA-CP.

16: FRIENDS

1
. Wright Patman, “Happy New Year for Chain Stores?”
Barron’s,
December 27, 1937, 3; Patman to “Dear Colleague,” January 15, 1938, box 37(B), WPP; FTC, “In the Matter of the Great Atlantic & Pacific Tea Company,” Docket No. 3031, “Finding as to the Facts and Conclusion,” January 25, 1938, and press release, January 26, 1938. Patman also asked the FTC to probe the Hartfords’ newest venture,
Woman’s Day
, a glossy magazine started in 1937 that sold for two cents per copy only at A&P. Patman fumed that the magazine was an attempt to skirt the Robinson-Patman provision requiring that advertising allowances be paid proportionately to all retailers: instead of granting allowances, he thought, manufacturers might pay off A&P by purchasing ads. The FTC took no action.

2
. The original text proposed by Patman to his co-sponsors is in box 37(C), WPP;
Congressional Record
, 75th Cong., 3rd sess., February 14, 1938.

3
. “Patman to Reintroduce Chain Store Tax Bill,”
WSJ
, June 21, 1938. Estimated costs of the tax in 1938 appear in Lebhar,
Chain Stores in America
, 241. Due both to the impending tax bill and to the shift to supermarkets, most chain grocers’ store counts fell sharply during 1938; A&P, for example, had 13,268 stores in February 1938, including a couple hundred in Canada, but only 10,835 stores one year later. Chain-store interests estimated later in 1938 that the legislation would cost A&P $472 million a year and twenty-three other chains a collective $385 million. Sears, Roebuck, the second-largest U.S. retailer, was not on the list, but it estimated that the Patman bill would cost it $20 million a year; “1937 Was Best Year for Sears, Roebuck,”
NYT
, March 23, 1938.

4
. “Patman Offers Bill to Tax Chain Stores,”
WSJ
, February 15, 1938; Patman comment of February 18, 1938, in Ways and Means Committee, Committee Papers, Records of the U.S. House of Representatives, 75th Cong., RG 233, box 329, NARA-LA; Franklin D. Roosevelt, “Annual Message to Congress,” January 3, 1938.

5
. Bernard Kilgore, “Crackdown on the Chains,”
WSJ
, February 23, 1938.

6
. “Chain Tax Fought by Trade Groups,”
NYT
, March 2, 1938;
Congressional Record
, 75th Cong., 3rd sess., app., 893; Patman speech to National Retail Lumber Dealers Association, Washington, D.C., May 10, 1938, box 37(B), WPP. A variety of speeches and materials from 1938 anti-chain efforts are in boxes 37(A), (B), and (C), WPP. In one tiny example of the conflict between individuals’ interests as consumers and as producers, the April 1, 1938, issue of
The Farmers’ Friend
, the Louisiana Farmers’ Protective Union newspaper, criticized A&P for selling two pints of strawberries for twenty-five cents, barely above cost, even as it ran an A&P advertisement touting five pounds of sugar for twenty-five cents at the stores in Ponchatoula and Hammond; OF 288, FDR. See also Hass, “Social and Economic Aspects of the Chain Store Movement” (Ph.D. diss.), 166.

7
. Patman to Roosevelt and to Robert H. Jackson (assistant attorney general for antitrust), April 24, 1938, box 37(B), WPP; Roosevelt, “Message to Congress on Curbing Monopolies,” April 29, 1938, John T. Woolley and Gerhard Peters, American Presidency Project,
www.presidency.ucsb.edu/ws/?pid=15637
, accessed December 24, 2009; Public resolution 113, 75th Cong.; Harold E. Hufford and Watson G. Caudill,
Preliminary Checklist of the Records of the Temporary National Economic Committee
(Washington, D.C., 1944), iii–vi.

8
. Legislative Reference Service to Patman, March 24, 1938, box 37(C), WPP; “A&P Goes to the Wars,”
Fortune
, April 1938, 96.

9
. Tr 19763.

10
. See testimony of Raymond C. Baker, Tr 14182; “Brief for the United States,” 1046, Danville trial; “Victor Schiff, 53, a Publicist Here,”
NYT
, December 17, 1959.

11
. OF 172, box 5, FDR.

12
. The Patman appointment in Roosevelt’s office is noted in the Pare Lorentz Chronology, FDR.

13
. Silverman, “Hours of Work in Retail Trade” (master’s thesis), 19; “In New Jersey,”
NYT
, January 7, 1916; “Grocery Clerks Out, Ask Shorter Hours,”
NYT
, September 7, 1916; Brody,
Butcher Workmen
, 130; Great Atlantic & Pacific Tea Co.,
Three Score Years and Ten,
47;
Retail Clerks International Advocate
, September–October 1932, 2. Nationwide membership in the Retail Clerks International Protective Association, which represented principally grocery-store clerks, fell from 21,200 in 1921 to 10,300 in 1923, and was so low by the end of the decade that the union canceled its national convention; Silverman, “Hours of Work in Retail Trade,” 45.