New-York tribune., 1918-06-30
Soaring Prices Are
Not at All Justified,
1t Reports to
Congress
Juggling of Cost
Accounts Shown
Flour, Meat, Leather,
Coal and Oil Firms
Some of Those Ac-
cused of Abuses
By Theodore M. Knappen

By Theodore M. Knappen
WASHINGTON, June 29.-In TWEEN
ty-page report to the Senate made pub
lie to-day, the Federal Trade Commits
sion declares in effect that pro6teering
is rampant, and so far as it's investiga-
tions 60, almost universal
There is nothing in the report to
show that the government has been
especially mulcted on its war contracts,
but the whole tenor of the report is to
the effect that prices in every field are
excessively high and that the increase is
for the most part out Of all relation to
the increased cost Of production; that
it has come about since the beginning
of the war in Europe and largely since
Americas entry into the war, and is,
therefore, to be classified as profiteer
ing.
Even in those lines of industry
where the percentage of profit has not
been advanced the total of profits has
increased, and the commission holds
that in a strict sense, viewed in the
light of the highest patriotism, this
form of profit is also profteering,
though = very yenal offence compared
with the other kind.
Listed as Profiteers
Of the industries which the commits
sion has Investigated in the course OF
cost-finding for various governmental
agencies, in industrial surveys directed
by the President or Of its own initia-
tive, or in the enforcement of the law
against unfair competition, the follow
ing are unreservedly classed as profit
eers:
Flour millers.
Meat packers.
Leather manufacturers.
Shoe manufacturers and retailers.
Coal producers.
Steel manufacturers.
Vegetable Gamers and bottlcrs.
Copper smelling and refining, with
exceptions.
Sulphur producers.
Petroleum and it's products.
Milk eanners.
Salmon cszners.
The three inductries investigated
which the commission concludes are not
profteering are lumber, zine and nickel.
The two last are making enormous
profits, but they are not larger now
than before the war.
Nj III in hn at
groups are profiteers in fact. but as
general statement it is fair inference
from the commissions conclusions that
such individuals as are not profiteers
are such because their costs are 80
high that prices which mean 100 per
cent profit for !. lov-cost producer
leave only a small margin, If any, for
them.
Three Conclusions Drawn
The commission arrives at these three
general conclusions governing tne
three forms Of its Investigations:
"The outstanding revelation whicn
accompanies the work Of cost finding is
the heavy profit made by the low-cost
concern under q governmental fixed
price for the whole country.
"The outstanding fact in the in
dustrial surveys which the commission
has recently made is the heavy profit
made by the meat packers and by those
allied with them and by the dour
millers.
"The outstanding feature on the
score of profit revealed in the regular
work Of the commission under the
statute creating it and the Clayton act
is the trade tendency to increase and
maintain prices against the forces Of
competition"
The commission also makes this gen
eral statement:
The commission has reason to know
that profteering exists. Much Of 1t is
due to advantages taken Of the neeessi-
ties Of the times, rs evidenced in the
Some a it is attributable to o>inordinate
greed and barefaced fraud.
Some interesting comments are
made on the effects Of price fixing. In
The case Of basic metals, such as steel,
the government established q high
nxed price to insure and stimulate pro-
cuction. The result was that, while
the market was prevented from "run-
nlng away" wide range Of profits re-
'Under the device Of a cost plus mar
gin Of profit these profits are neces-
sarily great in the case Of low-cost
mills. and ~the stronger factors in the
INDUSTRY are further strengthened in
sneir position and enriched by profits
which are without precedent"
Hardship for Public
The commission finds that the ex-
peraence with price fixing in coal, four
sad steel shows that, while . high
STIMULATING fixed price stabiIizes an as
sending market, ait is fraught with
= aardship to the consuming public and
sish ultimate peril to the high-cost
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