The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1897-01-06

attention 20 the fact that the companies
made no attempts until he had returned
from Europe. where lie had procured two
estimates OF the cost of armOr plate. An
Inspection of the prices paid the Amer
lean companies" Mr.. Herbert says. will
Indicate that they agreed with each other
as TO prices. They divided the contracts or
this government between themselves. each
bidding lower on oie-half Of the armor re-
CURED by the government He speaks OF
the armor furnished by the companies TO
Russia at $40 per ton. and later at 500 per
ton. and concludes from a comparison Of
prices that there is at least a friendly I'M
derstanding or agreement among the pow
erfut armor manufacturers OF the world TO
maintain prices at or about the same level
In summing up. the secretary asks:
"What will be a price sufficient TO justify
manufacturers In maintaining armOr plantS2
These two contractors have already been
repaid the cost of their plants, together
with fair profits The government Is under
no obligation to pay them more than the
OSt OF their original investment. but should
pay them enough To maintain the plants"
ACTUAL COST OF ARMOR PLATES.
II has been determined, he says. that
the cost OF labor and material in a ton
OF double-forged nickel steel HarveyiZed
armor. including allowances for losses
AMI manufacture, is $1eS.76. This COM
prises every element in cost save main
tenance OF plant. He allows 10 per
cent for this. and says 1t is enough and
more He estsmates the cost OF the plants
OF the two companies TO be 81 100000, and
an allowance Of $4,000 per annum would
be sufficient for maintaining the plants.
Supposing that 900 tons Of al NOR is manu-
featured year ~. it gives an of
$50 per ton. n liking In round numbers the
cost or armor plate $50 per ton III 1000
tons were manufactured the price could be
asceItained by adding $50 to the original
cost per ton tS1esi. or s24s. He concludes
that $50 may be taken as the cost of "A
ton OF armOr when the companies have
fair orders for work.
This estimate is almost the exact figure
which the Bethlehem Company bid for fur
nishing armor TO the Russian government,
watch was S2f9 per ton The cost of trans
portation and Insurance was "a per ton, and
the nickel furnished. $50 per ton, leaving
the net cost SD per ton. which, the sec
retary says. IL the company can barely
make armor at a cost of $50 per ton was a
loss of 50 per ton, or SO 900 on the 400
tons furnished He points out that in the
last contract this company made with
Russia the price was 500 per ton for
LIZ tons. and says that the profits must
have been very large
The secretary says that it is essential
that these or other armor plants be kept
in operation. The Carnegie and Bethie-
hem companies have erected plants costing
at least Sl,OVO.O0O. but this was done upon
the faith of immediate contracts guaran-
teeing then. large profits. III Congress shall
decide. as the report recommends, that no
such profits as have heretofore been earned
are TO be allowed in the future. it is not
probable that other business corporations
Will NCHt4lC III lit JiiStlllltill Vi DidillS,
although IL has been shown by testi-
mOny that plants can be erected at a much
reduced cost. Should the present armor
contractors refuse to make contracts at
the figure decided on by Congress il is
not probable that others would undertake
the work. Mr.. Herbert says il Is not deSir-
able that the government should manu-
facture a. NOR, and for this reason very
liberal profits should be offered to the
present contractors to induce them to con-
tinue their plants in operation, and he rec
ommends as a fair profit 20 per cent. of
the cost of manufacture, which would be
The secretary further advises hat the
contractors hereafter furnish the nickel.
which now costs the government about $50
per ton. making the cost 1896 per ton, or
in round numbers. $400. This figure he be-
leves "A fair and equitable price TO pay
for the armor for the Wisconsin. Alabama
and Illinois, the three new battle ships last
) authorized The report continues that this
sum may seem a very large profit, but
that the government demands the very best
armor- The secretary says that in fixing
a price he has performed a very delicate
duty. and suggests that Congress keep in
treatment to the Bethlehem and Carnegie
companies. The government Is now paying
1868 per ton for armor, ana with the nickel
added $3.50. AT the prices suggested by Mr..
Herbert 100000 would be saved on each
battle ship.
In concluding his report, Secretary Herb
ert says that il is possible his conclusions
are erroneous. and therefore suggests that
If his methods of securing Information are
not correct the facts can be ascertained by
an exhibition to Congress of the books of
the companies If Congress should fix the
prices, he that provision be
made for "A course to be pursued in case
the companies refuse to make contracts at
the prices determined on. Unless the pres
ent law is changed the secretary could not
obtain armor for the battle ships already
under contract If the companies
refuse to bid within the limit Congress
might fix To eliminate this difficulty Mr..
Herbert recommends that upon fixing a
price for armor Congress also authorize the
secretary to erect or buy or lease an armor
plant or a gun plant. IL necessary. If this
Is done better results. he believes, could
be obtained