The Birmingham age-herald., 1917-09-25
Steel and Iron Prices
 Set by Government
ocontinued from Page One,

2 ' vestigation conducted at the Presi- dents direction
 | The chief point of difference that de- veloped in the prolonged conferences public and the allied governments should share in the prices to be fixed. President Wilson has insisted that the, should, and the administration has supported the Pomerene bill now pend- ing in Congress giving the government power to fix iron and steel prices gen. orally. Inclusion of public and the al : lies in the voluntary reductions will [still demands made in some govern ment quarters that the steel output be requisitioned under the national de- fense act, but the Pomerene bill will be pushed, it is understood, that it may be enforced in event the voluntary agreement does not work out satis- factorily. Officials in close touch with the situation said tonight the prices approved by the President were liberal and would allow fair profits to all steel plants. Some of the larger concerns. they said, would make handsome profits at the prices named and production, they declared, should be stimulated ac- cordingly.
 ONE GREAT PROBLEM
 In arriving at fair prices for both producer and consumer the great prob lem has been to set figures permitting small mills to produce without loss and at the same time prevent the larg- CT plants from taking too great a profit. At one time a plan was con sidered by which mills would have been paid varying costs based on cost of production and capital investment, the |entire output of all mills to be sold in pool at one price. This was aban- doned as too complicated and too diff ficult of administration
 Virtually the same purpose will be accomplished, officials said tonight, in the operation of the war tax bill, which will take for the government a large share of excess profits.
 COST OF PRODUCTION The cost of producing steel plates in some of the larger mills is now about $35 to $36 a ton, according to the testimony of Joseph E. Davies, vice chairman of the federal trade commis- sion, before the Senate committee which is considering the Pomerene bill This will give these mills a profit of $50 ton under the price of $65, ap- proved by the President. In the smaller mills, according to Commissioner Davies testimony, the cost runs much higher. Ninety per cent of the plants MT. Davies said at the time. could sell plates at $5S and make profit.
 CONTRACTS MAY STAND
 Nothing is said in the White House announcement as to contracts now ir force. but 1t Is believed they will stand except in instances where the war board decides a manufacturers prod uct is not essential for war purposes and that he must relinquish a part oi his requirements for more vital indus tries.
 It is the intention of the government to use to the utmost it's powers to con trol steel distribution. This may mean in some instances, 1t was said, to- might, the shutting down of entire in dustries where 1t appeares the steel these industries is using can be used more advantageously elsewhere. Build. ing construction and other industries that use steel, which already have felt the pinch of the steel shortage, will feel it. still more sharply as the wal prOgreSseS.