New-York tribune., 1919-05-09

Hines issued statement in which he
justified the position OF the railroad
administration in its controversy with
the industrial board.
AS Profitable as War Prices
He declared that the reduction in
steel costs since the war ended, IN a
single instance, has been so great as
to make the prices proposed by the
board practically as profitable as were
the higher prices during the war;
Ebert II. Gary, chairman of the steel
committee and head of the United
States Steel Corporation. said after the
conference that all the members of the
committee had adhered to their posi-
tIon that further cuts in prices could
not be made without necessitating e
lowering OF wage scales.
Other steel men present predicted
that an open market in the industry
would shortly be followed by increased
business and higher prices than those
suggested by the industrial board
Mr.. Hines, in his statement, said
in part:
I'm accordance with the suggestions
from Secretary Redheld and Chair
man Peek of the Industrial Board, the
railroad administration representa-
hiNSS, 4hSSSiS. I1titly spencer ana
1. {. Powell, had a conference to-
day with representatives of the steel
interests. Messrs. Spencer and Powell
offered specific criticisms of the steel
prices heretofore proposed and sug-
gested maximum prices which the
railroad administration would feel
justified in paying for the various
steel articles which the railroads use
IN important quantities, including
steel rail.
"It was made clear that the rail-
road administration did not wish to
obtain preferential prices, as COM
pared with the general public.
Unwilling to Change Prices
"The steel interests were unwilling
to make any change in the prices an
nounced in March. The conferences on
this subject are at an end and the rail-
road administration will, in accordance
with its settled purpose. proceed as
rapidly as it needs steel materials OF
any kind to ask for competitive bids
and purchase accordingly. The rail-
road administra ton viii at once, in ac-
cordance with this policy, ask for bids
for 100000 tons of steel rail.
"The arguments which have been
presented in the effort to support the
prices proposed by the steel interests
upon costs incurred during the war
period. Even these costs show exceed
ingiy handsome profits to the low cost
producers. But 1t is obvious that those
costs, without reducison in wages, will,
on account Of the termination of the
war, be subject to very important re-
ductions.
"The steel interests and the Indus
trial Board have proposed a price OF
$3.50 for steel billets, and yet they
have proposed prices for finished steel
products which are wholly out of line
with the price for steel billets.
Open Hearth and Bessemer
"Messrs. Spencer and Powell pointed
out that the cost of Open Hearth rail
was no greater than the cost of Besse-
mer rail, since the cost and price OF
both sorts of billets were the same. and
therefore that the price of Open
Hearth rail should be- no higher than
the price of 41.37 for Bessemer rail,
and that if the steel interests wished
to encourage the purchase of Bessemer
rail they should do SO by making the
price of Bessemer a differential under
the price so arrived al for the Open
Hearth rail rather than through in
creasing the price of Open Hearth rail
bv 50, the amount of the old ditferen-
tial.
"Messrs Spencer and Powell indi-
Gated a willingness or the part Of che
railroad administration to purchase
for the time being at the suggested
new prices based on so per cent in-
crease in differential plus the billet
price of S3650 announced in March.
"The steel interests were unwilling
to make any reduction in their pr1ce,
and, in order 70 repel the argument
that the prices for all other products
were out of line with the billet prlcess
manifested a disposition now to claim
that their own billet price OF $3.50
was lower than 1t ought to have oeen.
Biames 1t on Peek
"The uncertainty and hesitation
which have been injected into this situa-
ton would never have arisen If at tire
outset Chairman Peek (of the Indus
trial Board), had been willing to ac-
cept as final the position which the
railroad administration stated before
the Industrial Board made its public
announcement and which it has at all
times felt. forced to maintain. But
Chairman Peek has been so bent on
justifying his own mistaken concep-
ton of his functions that he has been
trying for weeks to get them accepted
and yet he has never succeeded in
getting the support of the President oc
the C&Dfnet or tne Attorney 0ener2ls
"In closing the discussions of this
subject, which have been carried on
for some time by MIR. Peek of the In-
dustrial Board, it is important that
the totally erroneous Impressions Gre
ated by him, particularly in recent
speech before the United Chamber OF
Commerce at st. Louis, be removed"
Discussed by Cabinet
"The fact is that the plan on which
the industrial board was supposed ID
operate was thoroughly discussed at a
special meeting of the members of the
Cabinet on February 3. and Mr. Peek
stated in his speech that that meeting
approved the plan of having the in
dustrial board determine prices and
make them effective by authoritative
governmental announcement. In thia
he is in error. The meeting distinctly
declined TO approve any plan for an
nouncing prices at which the general
public would buy, ana the only plan
which was approved was a plan to
bring about by voluntary action q re4
duced level of prices at which the raiL<
road administration would be justified
IN buying freely, and therefore the
plan actually approved specifically cons
tempiated that the board would act az
mediator between the producers and
the railroad administration.
The meeting of the members of the
Cabinet on February was called. and
presided over by Secretary Glass of the