The Manitowoc pilot. [volume] (Manitowoc, Wis.) 1859-1932, 1921-03-03
Gain in Two Years by Great
Corporation Has Been
Enormous.
WILLIAMS ISSUES STATEMENT
Comptroller of Currency Declares Cor
poration Has Oefrauded the Gov
eminent Out Of Large Sums of
Income and Profits Taxes.

TWO years more than billion dollars
of profits, the eXaction of which has
had most disturbing and Injurious
effect on our country and our allies
according to Il statement Of John
Shelton Williams, comptroller of the
currency.
This Swollen and uncOnScionabIe
profit" Mr.. Williams charges, was
made selling steel at prices averaging
$50 a ton in excess of the amount nee
essary to pay dividends on steel
stocks" He also charges that by
manipulation of its accounts the cor
poratiOn defrauded the government
out of large sums in income and eX-
cess profits taxes
The statement by Mr.. Williams fol-
lowed Il letter sent to Ebert IL. Gary,
president of the corporation, on Feb
ruary 10, and heretofore unpublished,
in which Mr.. Williams said:
"No insiduous, sneaking propaganda
of high-brow or low-brow apostles OF
ruin could put in the popular mind so
much poison as refusal by such a cor
poratiOu to do its part toward solving
a great difficult problem, rcyiving IN
dustry and business activities and pro-
noting industry and the peace and
happiness Of humanity
In his statement Mr.. Williams said:
Unnecessarily high prices eXacted
by the United States Steel corporation
during 1918 for supplies of all kinds,
especially steel and iron products, cost
the government many hundreds of mil
lions of dollars.
Official figures of the corporation
show that il charged, for every ton Of
its steel products, an average of about
$50 more than necessary 70 pay dtvi-
dends on steel stocks.
"The United States Steel corpora
ton produces close to one-half of the
steel made in the United States and
through its subsidiary companies and
powerful financial and industrial al
liances holds a dominating position in
the steel and iron trade.
The company officially reports total
value Of its business for 1918 at
81 Loss, O29,225. To create this product
the corporation paid out a total of
S452, GG3, 524 on pay rolls. We find that
they received an average of $SI.70 per
ton for every ton of the 14124,9S6 tons
of rolled steel and other products
shipped to domestic and foreign
trade
The net earnings of the United
States Steel corporation for 1918, as
shown by its annual report, amounted
to S5491S0,000. In its report to its
stockholders, however, the company
deducted from net earnings an esti-
mate for war, income and excess
profits taxes amounting to S2T1, 277,-
OOO leaving net earnings of $2749O3,-
GOO
This deduction included an item of
500 $4,000 for maintenance and re-
pairs, though the company was carry
ing on its books to the credit Of de
probation and extraordinary replace
ment' the impressive sum Of $l9l 2S1,-
600
THE earnings of the company were
so large during 1918 that it could have
doubled the wages and would have
had a surplus left of $0G,51IO0O
IF the United States Steel corpora.
tion had held prices to a moderate
basis during the war, the government,
our allies and the public would have
been saved eXactions amounting to
many times the $2SS,0O0,OOO to be paid
by 1t in federal income taxes.
"The United States Steel corpora
ton with its plethoric treasury could
richly afford to say to the government
that for the remainder of this year it
will sell its products at net cost, hay
ing made in the last two years more
than a billion dollars Of profits, the
exaction of which had a most dis
turbng effect not only on our allies
bur upon our country IN the midst Of
war.
"The company's report states that
its inventory was arbitrarily reduced
by more than S5O,0000OO December 81.
1918, by marking down stock on hand
from actual cost or market value to
normal prices But ii does not say
what prices they regard as nor
NAL.
MY conclusion from the foregoing
figures is that the United States Steel
corporation should make a radical and
sharp reduction from the prices recon-
mended by the Redfield committee"