Evening star., 1925-04-19
Wartime Shipbuilding.

Wartime financing is brought vivid
~ to the attention of the American
people again with the filing of suit
and counter suit by the United States
Government and the Bethlehem Ship
buildtag Corporation, involving $685.
eo0,550. This huge total represents
the sum of what the Government
claims was an overcharge by the Beth
lehem Corporation and it's subsidiaries
for shipbuilding, and what the cor
poration claims is still due it for ship
construction for the Government. A
quarter of a hundred million dollars
represents a very wide divergence be-
tween the Government accountants
and legal experts and those of the
shipbuilding concern. The Govern
ment is seeking the return of SIS. .000,-
600, and the corporation is demanding
payment of more than S9,00o,000 al
legged to be still due it.
1t is to be assumed-and hoped
that the courts will be able to unraveI
the tangled skein in which are in
volved these great sums Of money. Eff
forts to settle the matter out OF court
have been unavailing. But wrapped
up in the controversy are basic mat
ters, involving both patriotism and
patriotism with the dollar mark as bar
sinister. Two phrases about which
the American people heard much dur
ing the war financing are used by
cambridge Colby, former member of
the United States Shipping Board and
later Secretary of State, in his pub
lished defense of Charles NJ Schwab.
who is assailed by the Government in
its suit against the Bethlehem Ship
building Corporation. They are cost
plus" and the know how" The Gov
ernment, and the people through the
tax burden imposed. learned much
about them by way of the pocketbook
route. While men were being drafted
to fight in the front lines in defense
OF their country, others were demand
ing large sums for the use of their
talents by the Government.
The making of large fortunes out of
war and the materials which are de-
manded for the prosecution of war is
not new. War profiteering has gone
on throughout the centuries, and was
found in all the countries involved in
the World War. But in the event of
another war it is not unlikely there
will be popular demand for the draft
ing OF men for other services besides
actual fighting.
The Government. in its suit against
the Bethlehem Shipbuilding Corpora
tion and its subsidiaries, has attacked
Charles M. Schwab, who acted in the
dual capacity of director general of
the Emergency Fleet Corporation and
president Of the Bethlehem Shipbuild-
ing Corporation during the war. 1t
charges that Mr.. Schwab permitted
his companies to make excessive
profits out of the shipbuilding opera
tions for the Government. although
he wrung millions OF dollars OF exce.
sive profits from other shipbuilders
on behalf of the Government. In de-
ASHSC VI t4l oSHWdD mr. COiDy
Eugene G. Grace, president of the
Bethlehem Corporation, and Edward
n. Hurley, former chairman of the
United States Shipping Board. have in.
sisted that Mr.. Schwab only took the
position OF director general of the
Fleet Corporation at the earnest solicit
tation of President Wilson. and with
the understanding that he himself
would nave nothing to do with the
Governments dealings with the Beth.
iehem Corporation and it's subsidiaries
Unless the Government has the best
OF grounds for its charges it is unfor
tunate that an attempt should have
been made to blacken the reputation
of man who rendered, it is said.
great services to his country during
the war. The gratitude of republics.
unfortunately, has too often been
shortlived. On the other hand, a man
who takes advantage Of a position of
trust to benefit himself in the hour of
his country's distress deserves little
compassion.