The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-05-09

L Y
in differential plus the billet price of
$3.50 announced In March.
THE steel interests were unwilling to
make any reduction In their price, and,
In order to repel the argument that the
prices for all other products were out of
line with the billet prices. manifested a
disposition now to claim that their own
billet price OF $3.50 was lower than II
ought to have been.
Another fact which the Railroad Ad-
ministration regards as a significant in
dication of the unrclability of using war
costs as a basis for current prices Is
that one important element In the war
costs was the cost Of the water carriage
Of ore. and this was especially burden
some with respect to some of the high
cost producera This condition has radi-
cally changed since the termination of
hostilities has released 80 much shipping.
"As an illustration. the Bethlehem
Steel Company has fled claim against
the Shipping Board for the use by the
latter. during the war, OF the formers
ships. which were desired by the steel
company to carry ore from Cuba to the
plant pear Baltimore. The steel COM
pany claims that the actual cost Of trans
porting ore was s1.96 per ton during
1918. while the Shipping Boards rate
which the Bethlehem Steel Company paid
during 1918 was $3.50 per ston. Hence
by the Bethlehem Steel Company's abil-
ity to get back its ships there appears to
be saving Of approximately $3.50 ton
for delivery of ore. which represents at
least SIS per ton on pig iron. since 1t re-
quires two tons Of ore or more to mako
ton OF pig iron.
Due to Temporary Conditions.
THE steel interests urged that their
costs In March were unusually heavy
notwithsta nding the cessation of HOSTILE
ties, but the representatives of the Rail-
road Administration claimed that these
abnormally high costs at the present
moment were due to temporary condi-
tons of readjustment and ought not to
be taken as a basis for prices designed
to stimulate a general buying movement
1T should DO remembered in this
| connection that the Industrial Board
justified its approval of the steel in
terests costs for the month of october
involving the elements which. as above
pointed out, have so radically changed
After the most prolonged discussion,
tne' personalities of the Railroad Ad-
ministration still remained entirely
satisfied that the reduced prices in
dicated by them could. and ought to be.
adopted without affecting the wages paid
labor In the steel industry.
The uncertainty and hesitation which
have been injected into this situation
would never have arisen IL at the outset
Chairman Peek had been willing to
accept as final the position which the
Railroad Administration stated before
the Industrial Board made its public an
nouncement and which It has at all
times felt forced to maintain. But
Chairman Peek has been SO bent on
| )ustifying his own mistaken conception
OF his functions that he has been trying
Tor weeks to get them accepted and yet
ne has never succeeded in getting the
| support of the President or the Cabinet
or the Attorney General.
I'm closing the discussions of this
subject which have been carried on for
some time by Mr.. Peek, 1t is important
that the totally erroneous Impressions
created by him, particularly In a re-
| cent speech before the United Chamber
OF commerce at st. Louis be removed.
The fact is that the plan on which
the Industrial Board was supposed 10
| operate was thoroughly discussed at a
special meeting Of the members of the
cabinet February 3, and Mr.. Peek
stated in his speech that meeting ap-
proved the plan of having the Industrial
BOARD determine prices and make them
enective by authorized governmental
announcement. In this he is In error.
Tho meeting distinctly declined to ap-
prove any plan for announcing prices at
which the general public would buy and
the only plan which was approved was
plan to bring about by voluntary ac-
| ton reduced level OF prices at which
the Railroad Administration would be
justified in buying freely. and therefore
! the plan actually approved specifically
| contemplated that the board would act
! as mediator between the producers and
| the Railroad Administration.
Glass Contradicts Peek.
The meeting of the members of the
Cabinet on February 3 was called and
presided over by Secretary Glass of the
Treasury Department and as indicating
| Mr.. Peek's erroneous conception OF the
plan approved at that meeting Secre-
| tary Glass telegraphed to the Director
| General after reading Mr.. Peek's ad-
dress In st. Louis sharply contradicting
Mr.. Peeks assumption that the Presi-
| dent and the Cabinet ever sanctioned
the policy of price fixing engaged in by
the Industrial Board.
'Mr. Glass. in his telegram to the
Director-eGeneral. stated that Mr.. Peek
had conveyed the impression that the
Industrial Board pursued the exact
course suggested by Mr.. Glass's first
cable to the President. whereas quite
the contrary was true and the Industrial
Board under Mr.. Peeks leadership ut
terly perverted the suggested policy OF
those who initiated the movement for
! resumption of business activities and
brought the scheme into dire&t conflict
with the Federal statutes against IN
lawful agreements.
"Mr. Glass called attention to the fact
that this was the very thing against
which the President at the outset gave
warning and precisely the thing that the
members Of the Cabinet who had part
in the initial conference refused to coun-
tenance. Mr.. Glass concluded by stating
that although Mr.. Peek had made II ap-
pear that his advocacy Of unsatisfactory
prices had the sanction of the President
and Cabinet and has been opposed sole
ly by the Railroad Administration, the
very reverse is true"
Again there was an entire aloofness
between the regulating body and the
private management, There was no
common ground upon which they could
meet. The private management saw its
difficulties and appreciated the business
needs OF the situation and acted ac-
cordlngly. But public regulating bodies
did not have that knowledge. 1t did
not see the thing as II developed as an
| actual fact in business management. 1t