Evening star., 1924-07-23
PITTSBURGH Plus
DECISION PRAISED
Federal Order to Abandon
Plan Hailed With Joy in
West and South.
ny j. C. ROYLE.

Special Dispatch to The Star. p. /
NEW YORK, July 23.-The decision
of the Federal Trade Commission or
dering the United States Steel Cor
poration and its subsidiaries to aban-
don the Pittsburgh plus" plan of
basing steel prices, as an unfair
method of competition and constitut-
ing price discrimination. was hailed
with Joy today by manufacturers and
business men in the South and West.
1t seems certain. however. that the
order will be the subject Of long drawn
out litigation in the courts by the
steel companies to test Its equity.
The Pittsburgh plus plan is the
practice which has prevailed in the
steel trade Of pricing all rolled steel
products except steel rails at the
Pittsburgh mill price plus the freight
from Pittsburgh to the destination
Of any shipment Of steel. no matter
whether II was manufactured In
Pittsburgh or not '.--
Method Declared Unfair.
The majority OF the mills, inde-
Steel Corporation, have been accus-
toned to quote only q delivered price
which includes the above factors and
Industrial centers other than those
In the immediate Pittsburgh district
claim that this caused discrimination
against them since steel made In
Chicago, Birmingham, Duluth. Pueblo
or any other important producing
center was charged for as though
1t were made at Pittsburgh. II steel
made in South Chicago was delivered
in Chicago. it nevertheless was
charged for a. II 1t were made In
Pittsburgh and shipped to Chicago.
Claim Made BY Mills.
The mills claimed that this practice
was made necessary by the laws of
supply and demand and was war
rantcd by free competitive conditions.
They asserted that Pittsburgh was
the only center where there was sur
supplied other districts where there
was Interpretations. The mills
argued that when steel was shipped
from Pittsburgh to supply underpro-
freight must be charged. Because
OF this they declared they charged
this freight on all rolled steel pro-
ducts so as not to discriminate be-
tween customers. -.--. =
On the other side of the case at
torneys for the Federal Trade Com
mission claimed that the other dis
trtcts could meet the demands upon
them If permitted to do SO. and that
the Pittsburgh plus plan tended to
restrict production in other sections
and enabled the mills to make greater
prohts and conserve investments in
and about Pittsburgh.
Thirty-Two States Push Fight.
Western manufacturers contended
that prices Of farm implements and
other manufactured products were
raised by the plan. asserting that it
Aided I 70 =
Of steel. Thirty-two States Joined in
opposing the practice and Illinois,
Iowa, Minnesota and Wisconsin raised
funds aggregating $55.o00 to fight the
farmers organizations.
The case was before the Federal
Trade Commission for more than two
and one-half years. Hearings neces-
STATED the compiling Of $4,000 pages
OF testimony and 5000 exhibits and
were required to appear and testify.
Some steel manufacturers in the
Middle West ceased to employ the
pittsburgh plus system Of basing
prices last year, quoting figures
O.. b. plant, but their example un-,
til the present time has not been
widely followed.
Will Appeal Decision. =
The rapid development of the steel
and iron industry in Utah and Cali
fornia makes the decision of the com
mission especially important to those
States at the present time.
1t Is expected that the drst move
Of the United States Steel Corpora
tion to secure the revocation OF the
commissions ase-and -desist order
will be to take the case to the
United States Circuit Court of Ap.
peals and II unsuccessful there. to
the Supreme Court OF the United
States.