The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1919-05-28
.SIEE[. BAR0NS
.GOlJ(,E RAILROAD
Uniform Bids Submitted by All
The Big Corporations
For Steel Rails
RAILS BOUGHT
UNDER PROTEST
UNDER PROTEST
Director General Hines Feels
That Railroads Have Been
Forced to Pay too Much

Washington, May 23.-Uniform bids
based on the prices agreed upon be-
tween representatives Of the steel
interests and the recently dissolved
industrial board have been submittci.
by six steel companies in response &c
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 "un-
der protest and with emphatic dis
approval of the prices and the man
ner in which they were established.
A uniform price Of SAT a ton FOX
open hearth rails, which Director
General Hines says was ''in strict &C
cordance with the prices approve
by the industrial board was sub
mitted 10 the railroad administration
by the Carnegie Steel Company, the
Illinois Steel Company and the Ten
nessee Coal and Iron Company, all
subsidiaries Of the United States Stee'
! Corpora ton, and by the Colorado
Fuel 6, Iron Company, the Bethlehem
Steel Company and the Lackawanna
Steel Company.
/ After his failure to induce repre-
sentatives Of the steel interests at a
final conference in New York several
weeks ago to reduce the prices es-
tablished in their agreement with the
| industrial board, Directo" General
Hines announced that in the public
interest he would request competitive
bids on the steel requirements Of the
railroad administration which is the
largest buyer of steel n the country.
The bids announced tonight We're
submitted in response to the director
generals reques.
In his recent opinion holding the
price agreement plan OF the industrial
board "to be unauthorized by law, >
Attorney General Palmer declared
that under the antitrust laws price
fixing agreements were Illegal anG
that such agreement might be
drought about through an informa'
meeting Of the minds as we'll as
through formal contracts" N1r. Pal
mer also held it to be an established
legal principle that the purchaser
Of government supplies shall be gov
eTned by the competitive system
Director General Hines N his state
n1ent tonight announcing the bids
charged that the action of the SIX
steel companies in submitting uni
form bids was taken under the leader
ship OF the United States Steel Cor
poration.
Explaining the position taken by
the railroad administration in placing
orders with the steel companies MIR.
/ Hines said:
when the industrial board ap-
proved the prices proposed by the
steel interests it became at once ap-
| parent to me and SO indicated in
various discussions with representa-
tives Of the government that that ap-
pToval would encourage the steel in
terests 20 stand together on those
| provaI was withheld. I felt however.
that even so, it would be far more in
the public interest for the government
to withhold approval ard if necessary
pay such prices. for the time being.
under protest rather than endorse the
prices, and that too. for the entire
calendar year, IS WIS proposed by the
industrial board and thereby given an
official sanction 10 prices which were
merely serve as a starting point for
still higher prices later on.
The result has been in exact &C
cordance with this forecast. Six Of
the leading steel interests, in response
to the railroad Administrations re-
guest for bids fer stel rails. have sub
mitted bios which are uniform in ali
respects as TO prices and conditions
Of manufacture and are in strict ac-
cordance with the prices proposed to
and approved by tho industrial board
In view Of the Immediate need for
10000 tons Of steel rails. orders
have been placed at the prices. but
with emphatic disapproval OF the
prices and the manner in which they
have been esta blished.
That action of these SIX steel COM
panies in making uniform bids was
taken under the leadership Of the
United States Steel Corporation is
clear from tfc fact that Immediately
after the railroad administration "a
nounced finally that it would rot ap-
prove TIE prices fixed by the industrial
board. Judge Gary, from the steel cor
poration took the initiative in an
nouncing publicly that the steel corr
poration wes strictly maintaining the
prices approved by the industrial!
board and that it seemed to him that
would be the attitude Of other man
ufacturcrs
Mr.. Hines then reviewed figures
showing, he said the "heavy profits
of the steel companies in recent
years in support Of his contention
that the rails prices quoted were un-
reasonable
"It is important to remember" said
Mr. Hines in conclusion that tl
present poicE Of the steel interests in
adhcrinS to high prices on the ground
that present costs necessitate them Isl
u