Moon of Alabama Brecht quote
December 28, 2008

A Story On Free Trade And "Trustfrei" Marketing

Just back from visiting my brother. He owns and runs the family wholesale business in the fifth generation. For a long time that business also dealt in tobacco products.

While there I came across this artifact.


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The thing above is ceramic and about 4 inch long and 1 1/2 inch high. It contains thin pieces of wood.


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The artifact is a promotion tool for, obviously, a cigarette brand. These were given to pubs and guesthouse where they were set on the tables. The sticks were used to pick fire from a candle to lighten up cigarettes and cigars.

The company Eckstein & Söhne (Eckstein & Sons) was owned by a well settled Jewish family in Dresden up to 1928 when it was sold. As the front side is emphasized that the company employs about 2,300 workers.

The interesting about this is the use of "Trustfrei" (trust-free) as a product marketing argument. It also allows to date the piece.

Trust here is an economic term:

Trusts gained economic power in the U.S. in the late 19th and early 20th centuries. Some but not all were organized as trusts in the legal sense. They were often created when corporate leaders convinced (or coerced) the shareholders of all the companies in one industry to convey their shares to a board of trustees, in exchange for dividend-paying certificates. The board would then manage all the companies in 'trust' for the shareholders (and minimize competition in the process). Eventually the term was used to refer to monopolies in general.

In the U.S. the American Tobacco Company was one of such trusts. Around the turn of the century it gained a horizontal monopoly with 80% of the tobacco market share in the U.S. and was vertically integrated from tobacco plantation down to its own retail outlets.

The equivalent in Great Britain was the Imperial Tobacco Company which was formed in 1901 out of 13 independent tobacco and cigarette companies in defense against, but in the same spirit as ATC. A year later both of these giants made a contract that excluded each other from their home market and formed a joint venture, British-American-Tobacco to capture and monopolize new markets, especially in continental Europe. Due to anti-trust legislation ATC had to sell its share in BAT in 1911 but Imperial held on to it until 1980.

BAT's attempt to capture the continental market met resistance. While, like in the U.S. and UK, it tried to get market share by bribing wholesalers not to sell any competitors products, the response was less enthusiastic than it had expected.

In 1901/02 the continent was in a deep economic crisis and in Germany there was a long and hefty national discussion for (the industrial side) and against (the agrarian site) free trade. The conservative and nationalistic agrarian side included the tobacco growers and small business like my grandfather's who himself rolled some of the cigars his company sold. There were more than a thousand cigarette factories in Germany in the early 20th century which employed ten-thousands of people. (Until 1918 cigarettes were mostly produced by hand.)

The owners and their workers lobbied hard. They founded an "Association for the Defense Against the Tobacco Trust" and marketed their products as "Trustfrei". Later in 1915 and  going with the general nationalistic streams of that era the associated "Committee for Good German Advertising Language" issued a "Germanization Brochure for Commercial Advertising", urging that commercial entities employ "No foreign term for what can well be expressed in German."

"Trust" is not a German word, so the reason why "Trustfrei" on those wooden sticks above is printed in quotes may well be related to the anti-foreign language thrust.As the ceramic does not put quotes around "Trustfrei", but the refill sticks do, I think it was made between about 1910 to 1914.

Their nationalistic push was also reflected in the collection pictures that came with each pack of cigarettes.


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There were series with pictures from German colonies, 'heroic' German historic figures (above Henry the Lion) and the German military. Dads smoked and the children collected and exchanged the pictures. They glued them into special albums of which millions were printed: Nationalistic education through product marketing.

One of the original famous Eckstein brands is still available today.


It is a filter-less cigarette and even for this role-your-own addict quite strong stuff.

British-American-Tobacco, which is still conducting dubious business, never got a hand on it. But in 2002 one of BAT's original parents broke the "Trustfrei" spell. Eckstein, Dresden in 1928 sold to Neuhaus, Cologne which was bought by Reemtsma, Hamburg in the 1950s. In 2002 Reemtsma was sold to the British Imperial Tobacco Company which thereby today owns the Eckstein brand.

With the current economic crisis and huge world-wide corporations again overwhelming local markets we may again see "Trustfrei"  like campaigns (Private Equity Free?, Hedge-Fund-Free?) as a defense against all-out free trade.

This time, hopefully, without the nationalistic attitude that killed so many in the first half of the 20th century.

Posted by b on December 28, 2008 at 18:14 UTC | Permalink

Comments

Didn't realize the Moon was a smoking establishment. I try to refrain from polluting the air around non-smokers, since the laws here in the US can carry hefty fines for smoking in places where the public gathers. I've never been given a hard time about it, other than recently when I went to visit someone in the hospital and this 22 y/o female police officer informed me there was no smoking area for the hospital - even in the parking lot.

This whole bit makes me think of the "Free Trade vs. Fair Trade" argument Kucinich used to make. Nothing free about "free trade", when it involves outsourcing the work to a third-world country where the corporations write the laws and are free to gut the environment.

Posted by: Jim T. | Dec 28 2008 19:28 utc | 1

You know, every year, the US oil companies meet in the White House to discuss US Energy Policy.

And because these meetings are of such strategic significance, they are held in secret.

But they only discuss matters that would benefit the USA as a whole, they certainly would ever think of trying to enhance their own interests.

Trust me.

Posted by: ralphieboy | Dec 28 2008 20:20 utc | 2

this is fun.

actually they even called their cigarettes "antitrust wehr"

Posted by: outsider | Dec 28 2008 20:22 utc | 3

Just for the record ya know...
Tobacco CEO's Before Congress 1994 News Clip "Nicotine is not addictive."

Hearing on the Regulation of Tobacco Products House Committee on Energy and Commerce Subcommittee on Health and the Environment April 14, 1994

Watch em lie like every goddamn other capitalist pig that wants to make a buck no matter who it kills. War on [some] drugs, indeed...

Posted by: Uncle $cam | Dec 28 2008 20:37 utc | 5

fascinating. 'trust free' - heh.

Posted by: Tangerine | Dec 28 2008 20:37 utc | 6

link

Posted by: | Dec 28 2008 20:40 utc | 7

Germany has a fairly balanced view with respect to smoking. Even though it is a European Directive to forbid smoking nearly everywhere, the decision was left up to the individual "Lander" to set a timetable. In a couple of them near where I live now, the rauch verbot is being rolled back a bit in that if you own and run your own bar, and it is smaller than a certain size, your patrons may smoke if they wish to. There are also smoking areas in certain restaurants if the smoking area is sealed off from the non smoking area and the owner is the only one to serve in the smoking area.

Cigarettes sales are controlled a lot, you have to have a drivers license with a microchip built in in order to get cigs out of a vending machine.

I was recently in Portugal and they too are accomodating to smokers.

Recently some people came over from the US and they were absolutely astounded that one can smoke in public places. How quickly those things become common place.

Posted by: dan of steele | Dec 28 2008 21:04 utc | 9

as someone sd dan - it is easiier to pull out a gun in america than a cigarette

Posted by: remembereringgiap | Dec 28 2008 21:24 utc | 10

my son was once practically jailed in the US - he was a young teen trying to look cool and pulled out a cigarette (never lit) in a public place, outside not inside - just gesturing and acting like in (he thought) an AmeriKan movie...Ouch!

Posted by: Tangerine | Dec 28 2008 22:10 utc | 11

In a way, we already do: "Fair trade" products, like coffee and such. In all honesty, I can't help but wonder "trustfrei" was the product of contemporary political correctness with dubious economic consequences, which I suspect the whole "fair trade" movement today to be.

Posted by: kao_hsien_chih | Dec 29 2008 1:00 utc | 12

It's not taught in most economics courses, but monopoly is the achilles heel of capitalism. Unbridled competition in a free, unregulated market leads inevitably to the survival of the fittest--one company. The winner takes all, marking up prices and reducing service.

A virtue of globalisation is that it has delayed the inevitable. Reducing national trade barriers forced national monopolists and oligopolists to fight outsiders. Those benefits now seem to have run their course. The world will be faced with global monoplists/oligopolists which will be harder than ever to control, since they are extra-territorial to any regulatory agency.

Posted by: JohnH | Dec 29 2008 1:10 utc | 13

The interesting about this is the use of "Trustfrei" (trust-free) as a product marketing argument.

Sounds a lot like the current http://www.globalexchange.org/campaigns/fairtrade/>"fair trade" label being put imports. Wouldn't mind seeing this model being expanded beyond agri-goods like coffee and bananas and into manufacturing.

Posted by: anna missed | Dec 29 2008 1:12 utc | 14

Cross posting I see, but with differing intent. What might those dubious economic consequences be?

Posted by: anna missed | Dec 29 2008 1:17 utc | 15

With regards to the "dubious economic consequences," I suppose it's a little hard to elaborate without sounding too much like a free trade extremist. I think a lot of "fair trade" business is deceptive, intended to segment markets and undermine international trade by imposing barriers that are often undesirable and unnecessary. I should add that I don't think all the barriers are undesirable and unnecessary--but, all too often, overconscientious consumers in the developed world are duped into supporting smallish monopolies that trade under "fair trade" label and caters to a segmented market. Not necessary new phenomenon: fear of Wall Street financiers kept banking markets in United States segmented for well over a century (even before Wall St. Financiers became what it came to be) through excessive regulations on interstate banking, which may have kept out-of-state bankers out, but also created local monopolies (and made difficult spreading risk beyond the state lines--although, whether this is actually a "bad" is not all that clear, esp. from certain perspectives.)

Posted by: kao_hsien_chih | Dec 29 2008 5:35 utc | 16

They glued them into special albums of which millions were printed: Nationalistic education through product marketing.

On a similar note, this reminds me of my childhood. Around '72-'73 the gas station chain Sunoco used a marketing promotion using stickers of then current NFL players (primarily the starters on offense and defense, plus the punter and kicker); the stickers were then placed in an album. My friends at school and I collected and traded the stickers, sometimes going down to the gas station on our own to ask for a few more stickers, the attendants usually obliging. I probably filled up about 1/3 of my album. I have no idea if my mom has thrown the thing out by now or not; it'd probably be a collector's item by now.

Posted by: JDsg | Dec 29 2008 5:38 utc | 17

http://www.organicconsumers.org/articles/article_4738.cfm>pros & cons of fair trade coffee.

Posted by: anna missed | Dec 29 2008 6:35 utc | 18

I smoked for decades. Quit in my early 40's, 15 years or so ago.
How I survived smoking all those years, I've long forgotten.

It's a hideous and addictive habit. It will kill you later in life, likely.

Now that I and mine don't smoke, our clothes and WE don't stink.

And yes, I look at smokers as weak. As drug users are. I was weak from 15-42 among many things . . *G*

Cold turkey was the ONLY way to quit any of them. Ruthless, cold turkey, and the knowledge that if I didn't I was going to hurt myself, or regress. And money wise, I just couldn't afford that regression.

Drugs are not recreational. Sooner than later, they overlap into your ability and productivity, regardless of what that might be. Usually sooner. *G*

And smoking, is drugs. Nicotine is addictive, and enslaves.

I'm delighted with the 'harsh' common sense that's come to USA and CA especially, WRT smoking bans. *G*

Nice post though, B, that's quite a story and history put forth and I applaud the comments for their insights. As always. *G*

Posted by: | Dec 29 2008 7:29 utc | 19

I've always looked at the self-righteous as weak.

Posted by: biklett | Dec 29 2008 17:11 utc | 20

ow, biklett.

"The sticks were used to pick fire from a candle to lighten up cigarettes and cigars."

But, but what about all those dead sailors, b?

Posted by: beq | Dec 29 2008 17:36 utc | 21

"The sticks were used to pick fire from a candle to lighten up cigarettes and cigars."

But, but what about all those dead sailors, b?

The dead sailors are a North-German/Hamburg issue. Eckstein was driven from Dresden - no sailors near to that.

But it is nice that you remember the story :-)

Posted by: b | Dec 29 2008 18:05 utc | 22

It was considered bad luck to light a cigarette directly from a candle.

Sailors used to earn their livelihood in the winter season by manufacturing matches. Lighting up without a match was considered depriving them of their chance to survive. Talk about solidarity with the working classes...

I don't know if sailors made the little wooden sticks that the containers held, but they were a good idea, lighting a ciggie directly from a candle means you're inhaling paraffin fumes.

Posted by: ralphieboy | Dec 29 2008 18:08 utc | 23

yeah, there is no one more unpleasant than a militant ex-smoker. what biklett said.

Posted by: dan of steele | Dec 29 2008 18:43 utc | 24

i'm a bit like this fellow

December 29, 2008 - 4:51PM
A chronic smoker who uses a ventilator to breathe blew himself up when he lit a cigarette while still attached to his oxygen tank.

The explosion happened as the 75-year-old man lit up in his home while attached to an oxygen tank that had plastic tubes running to his nose because of lung disease caused by his smoking habit.

A doctor quoted by today's South China Morning Post newspaper says the man knew he should not smoke while attached to his ventilator, but apparently craved a cigarette so badly he took the risk.

AAP


Posted by: remembereringgiap | Dec 29 2008 19:34 utc | 25

b,

Since you're largely German through and through and especially since you show no trace of having a single imperialist bone in your body, I'm more than a little surprised that you'd choose to measure things in imperial units as opposed to metric ones.;~)

Posted by: Cynthia | Dec 29 2008 19:58 utc | 26

Didn't Eckstein make a cigarette called Slaughterhouse-Five?

Posted by: Obamageddon | Dec 30 2008 2:02 utc | 27

Of course, the marketing method employed by Eckstein was not innovative, by any means. It had been employed by cigarette makers for quite some time.

B. Cigarette Cards

Posted by: Obamageddon | Dec 30 2008 2:15 utc | 28

newhouse

Neuhaus, Cologne. Are they the same people? The journalism school at Syracuse University is the newhouse school, and the local paper is also owned by newhouse. They are also a large stakeholder in Time Warner Cable. Conde nast traveler is probably the most notable national/international brand they own.

The paper, the Post-standard, can be found at syracuse.com It is the most colorful paper in the world. Their journalism is prettied up with color. Mostly one sided neocon crap. Check out the story on Gaza.

There is still quite a contingent of German americans in syracuse, most of whom were wealthy, industrial leaders. Candles were a big one, and Beer, FX matt.

It fun tracing the roots of some of these guys.

Posted by: bobby | Dec 30 2008 21:54 utc | 29

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