The Birmingham age-herald., 1919-04-04

refusal of the railroad administration to accept the new steel prices. 1t was said that there was no intention to. recom- mit-only the controversy with the rail road administration and Chairman Peek's amendment to the official statement is sued by Secretary Glass. in whose office the meeting was held, was declared by the treasury head to have been unauthor- ized and not to reflect the sentiment of the conference.
 Director General Hines refused today to comment on the controversy.
 TWO OPPOSING CAMPS
 Publication by the board for the public guidance of q list of steel prices which had not been accepted by the railroad ad- ministraton and insistence that the latter should accept the prices after they were published seem to be the points at issue, which have divided government officials into two opposing camps on the question of price fixing. As originally constituted, according to official announcements made at the time, the board was intended to be an instrument of mediation between in dustrY and government purchasing agen- ces, to see whether prices could be made sufficiently attractive to induce the gov ernment to purchase freely" It was declared by men active In the creation of the board that it was not intended that the board should indorse prices for the
 
 prices by the government was to be the assurance of the public that they were considered fair on the basis of known costs
 When the new steel prices were ar ranged, the railroad administration gave notice through it's representative on the board, T. c. Powell, that they were not acceptable to the largest purchaser of steel in the United States. It was said that there was some dispute between the board and the administration as to whether the notice comprised only rails, as claimed by the board, or all steel prod ucts, as alleged by the latter. At any rate, the announcement of the new scale made no mention of the prices being ac- ceptable to the government, but offered them only as satisfactory to the pub lie"
 Steel rails were priced in the revised lschedule at Si5 and $47 ton. The rail- road administration still is receiving de- | liveries on contracts at s36 to $40 ton. Charges by the National Coal associa- ton of unfair practices" on the part of 1 the railroad administration in it's pur- l chase of coal and the refusal of the coal 1 operators to undertake price revisions unless the railroad administration agreed 1 to accept them previously. were answered I by MT. Hines in a statement explaining the policy of the administration by pur- |
 HINES STATEMENT "An interesting fiction appears to be re- ceiving some currency as to the attitude of the United States railroad administra tion in purchasing coal. This fiction is | to the effect that the railroad adminis- ! tration is conducting it's purchases of coal ir such way as to force producers to self to it below the cost of production. thus l in turn forcing them to increase their prices to the rest of the community. The assertion of this fiction seems to carry with it the suggestion that in order to prevent the railroad administration from accomplishing this purpose. it is i'm portant to find way to remove all com petition in bidding for such government business, and instead to fix in the respec- ! tive mining districts uniform prices at which all producers would be willing to sell and at which the railroad admins tration would have to buy
 "The remedy thus suggested for this 1 fictitious evil would, of course, have the result of giving the coal operators the relatively high prices fixed without any competition, which they could use as a | basis for selling to the general public, so l that the element of competition would l fade from the picture and virtually the whole consuming public would be paying prices which in the aggregate would be far in excess of what would be necessary to maintain existing wages and pay suf- ficient profits.
 While it hardly seems necessary to do 1 so I wish to give the country the assur- ance that the railroad administration has no such unjust and short-sighted pur- pose as to force producers to sell below cost or impose a burden on the rest of the puhlic. There is no institution-puble or private--in the country that has a greater interest in the promotion of pros perity than the railroad administration lhas, because the more the business of the country increases, the more net rev ienues the railroad administration will l erioy. At the same time I believe it iwould be opposed to the interests Of the general consuming public. as well as of ,the government. to forego absolutely all benefits of competition and buy coal for ithe government at unnecessarily high lprices which would in turn immediately ibecome by. the standard prices for all pur- :chases z Such a course would have a strong tendency to continue to preserve lin the present period following the war nrofits having entirely too strong re- serpblance to the extraordinary profits
 which were realized during the war
 ROADS BUY OWN COAL i "As an illustration of the caution (which the railroad administration is ob-
 serving in this matter, it has established the policy that each railroad shall buy it.
 own coal thus avoiding any greate concentration of purchasing power thar existed under private management. Il has also instructed that in purchasina
 tCentinsea on Pare TAirteea)