Harrisburg telegraph. [volume] (Harrisburg, Pa.) 1879-1948, 1919-05-09
WILL
BUY 100000 TONS
OF STEEL RAILS
Purchases VIII Be Made de-
spite High Prices,
Hines Announces
By Associated Press.

| lStratlon VIII ask imme ediately for
competitive bids for 100000 tons of
steel rails
Mr.. Hines announcement was
made after he had been informed by
his representatives that they had
been unable to induce representa-
tives of the large manufacturers at
a conference here yesterday to agree
upon reduction of the schedule OF
steel prices approved by the Indus
trial Board of the Department of
was his settled purpose to buy steel
materials upon the competitive bid
ding basis as rapidly as they are
needed. He issued the following
statement:
I'm accordance with the sugges-
tions from Secretary Redfield and
| Chairman Peek, of the Industrial
! Board, the railroad administration
I representatives, Messrs. Henry 3.
Spencer and T. c. Powell, had IL
conference yesterday with represent
| atives of the steel interests. Messrs.
| Spencer and Powell offered specific
| criticisms of the steel prices hereto
| fore proposed and suggested maxi
! mum prices which the railroad ad-
ministration would feel justified in
| paying for the various steel articles
which the railroads use in important
| quantities, including steel rails.
To Ask For Bids
! ut was made clear that the rail-
road administration did not wish to
obtain preferential prices compared
with the general public. The steel
interests were unwilling to make any
change in the prices announced in
March. The conferences on this
| subject are at an end and the rail-
| road administration will. in accord
! ance with its settled purpose, pro-
| ceed as rapidly as it needs steel ma
! terials of any kind to ask for COM
| petitve bids and purchase according
| ly. The railroad administration will
at once. in accordance with this pol
icy, ask for bids for 100000 tons
of steel rails.
by way of comment on the prices
| proposed in March. as we'll as in
support of the prices suggested by
the railroad administration, the fol-
lowing views were expressed by
Messrs Spencer and POWELL
! The reduction since the war in a
| single element of cost is so great as
| to make the prices proposed by the
steel interests and the Industrial
! Board practically as profita BILE to the
! prices that prevailed during the war.
upon the basis of which the steel
interests made enormous profits.
! This item of cost is the price of
scrap materials, which is not a con-
! trolled commodity. but the price of
! which fiuctuates according to supply
| and demand and which, of course,
| can be and is used Verv largely in
the making of steel products.
Making Big Profits
The fall in the price of scrap
material from $40 per ton to about
SIS per ton has been so great that
the resulting decrease in the cost of
steel products is practically as grea'
as the total proposed reduction in
the prices of steel products. There
| fore, while the public has thought
the steel interests ought to make and
could we'll afford to make important
concessions to encourage the re-
sumption of business, the fact is that
on account of the reduction in the
prices of scrap material alone the
prices proposed for steel products
represent no concoss ons whateve
from wartime profits.
That the steel interests have
| made profits so large as to make
substantial concessions practicable
under existing conditions without af-
fecting the wages, is strikingly illus
! trated by a consideration of the
profits made by the steel interests for
the calendar year 1918.
The United States Steel Corpora
ton for the year 1918 reports the
net earnings from all rolled tom
mage, before deddcting income tax,
excess profits tax, ETC., a profit of
about s33 per ton.
The Midvale Steel Company for
the same period shows a profit of
approximately S35 per ton.
This statistical information for
other steel producing companies for
the year 1918 is not yet published,
but their financial statements indi-
cate results which were correspond
ingly favorable.
The arguments which have been
presented in the effort TO support
the prices proposed by the steel in
terests and the Industrial Board
have rested upon costs incurred dur
ing the war period. Even those costs
show exceedingly handsome profits
to the low cost producers, but it is
obvious that these costs, without
reduction in wages, on account of
the termination of the war, will be
subject to very important reductions
in addition to the great reduction
in the cost of scrap material already
referred to.
THE war costs appear in many
Instances to involve a heavy increase
IN tho ROYALTY on the assumed value
~f t,,o cro IN tho ground. This in
o"oo-o d'd not represent an actual
;-,o-o~ CO in cost so far as the pro-
ducers of the ore were concerned,
but simply represented a heavy ad-
ditionaI profit. Yet this increased
profit in ore appears to be included
in the war cost upon which the
figures have been based. The cost of
coke has fallen substantially from
So to 81 per ton, representing q
saving of from $3 to s5 per ton OF
iron.
THE steel interests and the In
dustraI Board have proposed price
of S2S50 for steel billets and yet
they have proposed prices for finish
ed steel products which are wholly
out of line with the price for steel
billets. The differentials which the
steel interests and the Industrial
Board propose for the finished prod
ucts as compared with steel billets
are so great as to make the prices
for the finished products altogether
unattractive and altogether unjusti-
fable, especially in the light of the
considerations already pointed out"
Girl Fakes Suicide in Cell
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