The Birmingham age-herald., 1922-02-06
PITTsBURG PLUS

To the Editor of The Age-Herad:
 In your editorial appearing in The Age Herald of January 31 you make the statement that the "courts can scarcely settle the ques- ton (Pittsburg plus) because there are several ways in which the Pittsburg base could be preserved in practice although not in name. Trade demands and physical conditions will de- eide this natter"
 The federal trade commission began hearings at Milwaukee yesterday, and will continue them at Chicago and other points including the south in support of it's complaint which charges that the Pttsburg base practice is in violation of the law The complaint alleges that purchasers Of steel in the Birmingham, Chicago and Duluth markets, buying from the local mills in those districts are being dscriminated against in favor of their competitors around Pittsburg buying the raw steel such as plates, shapes and bars, from the Pittsburg mills The Clayton law, which was passed by Congress to prohibit such discrimination, is invoked by the trade commits sion at the instance of western and southern manufacturers and ultimate consumers of steel products for the purpose of stopping this prae tice of quoting all steel prices on the Pittsburg base irrespective of the point of actual manu- fracture.
 This is not an unfriendly proceeding against the steel interests. Indeed, it is proceeding by consent of the steel producers themselves, especially the United States Steel Corporation. For Judge Gary, speaking for the corporation, at the outset appeared before the federal trade commission and stated that the controversy was one of such long standing and yet so important that he really hoped the trade commission would take jurisdiction of the matter and settle whether the practice is right or wrong. On the preliminary trial the steel producers attempted to defend the Pittsburg base the ground that it was a question of supply and demand. They pointed out that Pittsburg mills made more steel than could be consumed in that territory and that they had to sell their surplus in the Chicago and other markets, and that this fact of overproduction at Pittsburg and underproduc- tion at Chicago, Duluth and Birmingham fixed the price in those markets at the f. o. b. Pitts burg price plus the freight rate from Pittsburg to the point of destination of shipments even from the other mills
 Those opposing the Pittsburg base practice deny that it is question of supply and demand and assert that the common use of the single base practice itself arti6eially maintains the alleged supremacy of Pittsgurg in the markets of the country and retards the production of steel at Birmingham and the other mills And in order to get relief, appeal having been made in vain to the producers for than a decade, the secondary manufacturers and ultimate con- sumers such as the farmers buying wire fenc- ing, pows nails and other articles containing steel brought proceeding before the trade comn,ission, alleging that this practice was in violation of law. They could not get a foothold in court unless they proved that it is vio- lation. The unsworn testimony so con vincng in their behalf that the federal gov ernment finally, after more than two years de- liberation, decided to issue complaint. In criminal jurisprudence this complaint would be the equivalent of an indictment Which Is to say, that after volumes of testimony and ar gument, this federal tribunal has concludes that those originating the proceeding before them had made out prima facie case.
 Unquestionaby, therefore, the courts can set tie this question of the complaint if the trade commission is sustained. I am confident that this is the only effective means of relief av able to the suffering industries of the sg th and west unless the producers volunt .rliy abandon the discrimination. What you say about the gradual disappearance cf the Pitts burg base by the changing trade conditions does not alter the fact that Birmingham manu- lecturers buying steel made at low cost frqm the Birmingham mills are shut off from mhrkets even in Tennessee and Texas anc other oath- ern territory by the competition f, on Fltisbufg manufacturers in the same lines Their trade territory which by all rights should be theirs.