"Mister East Texas"

In Lufkin, Texas (pop. 22,500), one cold night last week, 900 citizens jammed into the high-school gymnasium. There, over a $6 roast beef dinner, they listened to some famed Texans (including U.S. Senators Tom Connally and Lyndon Johnson) praise a fellow Texan in terms extravagant even for the Lone Star State. Said ex-Governor William P. Hobby: "He is the kingfish of free enterprise." Added Governor Allan Shivers: "He is Mister East Texas."

The "Kingfish" is big (6 ft., 200 lbs.), shy, pink-cheeked Ernest Lynn Kurth, 64, a jack of all trades--lumber, insurance, banking, theaters, construction, utilities, machinery--and master of all as well. Kurth's dozen-odd enterprises employ 3,250, indirectly support 50% of Lufkin's population. But the Kurth achievement that most East Texans boast about, and the one that is of prime importance to the Southern economy, is newsprint. Set up only nine years ago as the South's first newsprint producer, Kurth's $18 million Southland Paper Mills, Inc. last week was rolling out enough newsprint (132,718 tons last year) to supply some 70% of Southern newspapers, and was grossing $15 million a year.

Silver Spoon. No rags-to-riches hero, Ernest Kurth is the son of a German immigrant who came to Texas in 1871 and pioneered the South's lumber industry.

From the time he took over his father's lumber company and foundry in 1930, Kurth sought ways to make them bigger. Since his Lufkin Foundry & Machine Co. depended on outside companies for its castings, Kurth set up Texas Foundries, Inc. as his own supplier. It soon became the biggest Southern producer of malleable iron castings. The two companies now have combined sales of some $17.5 million a year.

Kurth's fondest dream was to convert Southern yellow pine, not good for finished building purposes, into newsprint. Not until the mid-'30s when a method of controlling the pitch content in pine pulp was discovered, was he convinced that it could be done. Then he had to spend five years convincing other Texans. After Kurth raised $2,689,684, including more than $400,000 from 25 newspapers, RFC lent him $3,425,000. He had hardly started to make newsprint when the war cut off his supply of chemically made pulp. With additional private loans and another $2,500,000 from RFC, he built his own pulp mill.

Green Thumb. He also campaigned tirelessly to educate Southerners in the economic importance of growing timber on submarginal Texas farm land. While his own companies planted more than they cut on their 250,000 acres, they gave farmers about 2,000,000 pine seedlings a year to rebuild depleted timber stands. With his newsprint plant furnishing an expanding market, Kurth estimates that farmers can get $5 to $7 an acre every year from timber alone, and "you don't need a subsidy or price support program."

His next problem is to find another $12.5 million to expand his newsprint-making. He thinks that the future of the economically backward South lies in such new industries. Says he: "Sweden plants timber on land that costs $100 an acre [v. Texas timberland costing $75 an acre], and they do it economically. But that land won't grow a third of the timber we can grow here in the South."

The South will soon get its second newsprint producer. The Coosa River Newsprint Co. at Childersburg, Ala. will begin making paper next month at the rate of 100,000 tons a year. Financed in part by stock sold to future customers (the New York Times, Washington Star, St. Louis Post-Dispatch, Kansas City Star and others), the $32 million Coosa River project was blueprinted by the Southern Newspaper Publishers' Association, will be operated for S.N.P.A. by Wisconsin's Kimberley-Clark Corp., a leading U.S. papermaker.

This file is automatically generated by a robot program, so reader's discretion is required.