The sun. [volume] (New York [N.Y.]) 1833-1916, 1916-04-19
SCHWAB AGAIN OFFERS
TO CUT ARMOR PRICE
Bulletin Sent to Congressman
Is Argument Against Gov
crnment Plant.

"Any return. however small. on the
cost of our piant--any contribution
toward the administrative cNpenses--is
better than the loss of the whole plant"
says bulletin No. IL. ISSUED by Charles
VI. Schwab and Eugene 81. Grace OF the
bethlehem Steel Company and ad-
dressed to the members of Congress.
The bulletin reiterates the offer Of the
company tn reduce the price of armor to
the United states Government from S425
Ia $50, ~ ton. and calls attention to tho
fac; that the point has been cited by
come persons as proof that tho company
has made in%ordinatc profits in the past.
The bulletin continues:
"Thc fact Is hat armor manufacture
is and has been the least profitable
branch OF steel making. Japan has "A
Government plant. She pays wages very
much lower thar are paid In this country.
Her people are known for efficiency. yet
the actual cost Of her arinor plate tac-
cording to official data is $3.50 a ton.
H. there any reason To- suppose hat the
American Government could do any
hotter?
" have offered to reduce our price.
not because the present price 10 too high
The shop cost Of producing arinor was
found by Senator Tillmsu's mmitt
to be about see u ton. Those figures
represent our own cXperience-if our
plant ran AT run capacity.
The report in 1906 OF the committee
Of naval Officers, headed by capt. Kos
~uth Niles. estimated that the manufac-
turc OF armor costs ~ Ycr cent. more
for - plant running az only two-thirds
capacity. and 80 per cent. more when
running onl, oue-thirl capacity.
Senator Tillman'S production cost Of
see a ton. running at full capacity. did
not include administrative expenses. Il
did not ALLOW amy interest 81 the value
nf plant or working capital. " did no
provide for insurance. taxes or deprccia-
ton. Such i'ems would In one way or
another have 10 l., met by the Govern
m.nt. Just as much as by a private man
ufacturer.
The naval estimates call for $4,000
tons Of armor n wear for the neat nve
wears. " We receive orders for 5000
tons - year. Nc can run our plant AT
two-thirds caracity. and reduce our
price. In the past our plant has run
at an average OF onc-third capacity.
That is why si25 has been a low price.
II We could 'ha,e run AZ two-ihirds
capacity. as l. now possible, we could
have made a reduction then.
T provide for all items of cost with
our plant running AT two-th!ris capac-
itN would make the total CO.'S, about
S3H' u ton This covers merely ShoI,
cost plus the CARRYING charge on tho
7 plant II covers no allowance fo- proui.
w" OFFER the reduced price named. or
"" agree TO accept the findings Of the
Federal Trade Commission a. 20 VIVA, a
far charge would bc. Is i, likely that
We would suggest. a. Nc have done. an
Investigation hy tn" Federal Trade COM
mission II We feared their findings
would show eNtortion in the past?
I'VE have "A plant now bull, which
cost rs 5000. 600. II a Governmcn,
plant H. huilt ours is rendered useless
and valuelcSs. The whole OF our in
Ncs'ment will then he sacrificed. We
can make armor cheaper than the Gov
can do II. We want 20 save
the government a wasieful expense We
want 10 save our armor plant from
hcinS made valuelcss because useless.