Arizona republican., 1919-05-24
HINES BUYS BIC ORDER OF STEEL
 UNDER PROTEST
Hints at Conspiracy To Maintain High Prices Purchase Price Sam e Agreed Upon Between Mills and Industrial Board He Issues Statement

WASHINGTON, May g. - Uniform bids based on the price agreed upon between representatives of the steel interests and the recently dissolved industrial board have been submitted ny six steel companies, in response to the railroad administrators request for bids on open hearth rails.
 Director General Hines announced tonight that he had placed orders with these companies for 100000 tons of rails. but that he had done so under protest and with emphatic disapproval of the prices and the manner in which they were established"
 A uniform price of $47 per ton for open hearth rails, which director Gen eral Hines said was fin strict accord ance with the prices approved by the industrial board" was submitted to the railroad administration by the Carnegie Steel company, the Illinois Steel company and the Tennessee Coal and Iron company, all subsidiaries of the United States Steel corporation, and by the Colorado Fuel and Iron company, the Bethlehem Steel com pany and the Iackawanna Steel com pany.
 After his failure to induce repre-
 
 iuce the prices established in their agreement with the industrial board, Director General Hines announced that in the public interest he would request competitive bids on the steel requirements of the railroad admins traton, which is the country's largest buyer of steel The bids announced today were submitted in response to The director generals request.
 Price Fixing Illegal
 Tn his recent opinion holding the price agreement plan of the industrial board to be authorized by law, At torney General Palmer declared rha+ under the antitrust laws, price fixing agreements were illegal, and that such agreements might be brought about through an informal meeting as well as through formal contracts"
 Mir Palmer also held it to be an established principle that the ''pur- chase of government supplies shall be governed by the competitive system Director General Hines, in his state ment tonight, announcing the bids charged that the action of the six steel companies in submitting uniform bids' was taken under the leadership of the United States Steel corpora tion"
 Explaining the position taken by tht railroad administration in placing orders with the steel companies, MT Hines said:
 When the industrial board approved the prices proposed by the steel inter ests, it became at once apparent to me and l so indicated in various discus sions with representatives of the gov erument, that approval would encour age the steel interests to stand to gether on those prices, even thougl governmental approval was withheld. felt that even so, it would be far nor in the public interest for the govern ment to withhold approval and, if nee essary, pay such price for the time be ing. under protest, rather than endors the prices, and that, too, for the entir calendar year, as was proposed by tn industrial board, and thereby given a official sanction to prices which wer unreasonably high, and which woul merely serve as a. starting point for still higher price later on.
 Sees Concerted Action
 '1rhe result has been in exact aC cordance with this forecast. Six of tf leading steel interests, in response the railroad administration reQue. Tor DlQS TOT SLe6l TAILS, nave bids which are uniform in all respect as to price and conditions of manr facture. and are, in strict accordahC with the prices proposed to and al proved by the industrial board. view of the immediate need for 200,0I tons of steel rails, orders have bee placed at the prices submitted, bl with emphatic disapproval of u prices and the manner in which the have been established.
 That action of these six steel con panies in making uniform bids W; taken under the leadership of u United States Steel corporation clear, from the fact that immediate after the railroad administration al nounced finally that it would not al prove the prices fixed by the indu trial board, Judge Gary, for the Ste corporation, took the initiative in al nouncfng publicly that the Steel co poration was sthrictly maintaining | poration was strictly maintaining | board, and that it seemed to him th would be the attitude of the oth manufacturers"
 MT. Hines then reviewed figur showing. he said, the ''heavy profit
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