Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-08-21
BETHLEHEM BONUS
PENSION IS SEEN
System Probably viii Be Re.
vamped if Steel Merger
Is Approved.
BY JOHN r. SINCLAIR.

Inc 6eLTleneIn SVeBI W, JULIUS
system" through which half dozen
i1igher-up officials of that company re-
ceived millions of dollars in extra COM
pensation during 1929, probably will BE-
revised, no matter whether the Bethle-
hem Steel-Younstown Tube merger is
finally approved or not.
Harry G. Dalton of Cleveland, di-
rector in both the youngstown ana BETH
lehem companies, said on the witness
stand that he thought the system
should be revamped if the merger is
finally approved"
eff YOU had known that Mr.. Grace was
getting $1,600,000 in 1929, and the hlgh
executive officers collectively were get
ting about So ,400, 900, would that have
made any difference 10 you! MI OaA-
ton was asked
II don't think So" replied the Cleve-
land capitalist, explaining that Mr..
Grace and his associates had trans
formed the Bethlehem Steel from
war time" concern to a peace m
stitution in a way most satisfactory TO
the stockholders.
No subject in the business world has
been discussed more widely since the
bethlehem youngstown hgnt pegan
than this bonus system. Judge DaVlo
G, Jenkins, who heard the testimony,
said that the question OF the amount OF
bonus paid to Mr.. Grace and the other
ofScials has absolutely nothing to do
with the questions at issue-namely,
whether or not all information regard
ing the bonus should have been given 10
the youngstown directors before tney
passed on this merger" and TO the
stockholders before they voted on us
ratification. sx,,+ con-
tinues.
Harvey S. Firestone's emphasis on
"business REIMBURSEMENT IN MS aouleee
before New England business men SHOWS
the trend of business. Some nave 1op5
heavy inventories; some, TOO reStrlcteu
markets: Others too heavy executlVe
oyerheads: still others, too much lole
cash Every business, in these Gays
requires frequent individual examna-
ton and overhauling, for business reao-
justment is the order of the DAY.
e. r. Johnston, former president OF
the Victor Co., champions high indus
trial wages to enable the country 10
snap out of the present slump"
"All Europe, with the exception OF
France and Holland, is in state OF gen
eral business depression" says Mr.
Johnston. lone of the reasons why
Holland and France are more prosper-
Gus than the others is that they manu-
facture specialties. They do not go IN
for mass production. They also are fur
ther developed on a firm agricultural
basis
American business recovery will be
much more rapid than European, pc
cause America sis made up OF free IN
dividuals filled with personal ambition.
whose requirements and demands know
no bounds" Mr.. Johnston thinks.
High wages is the secret of Amer
IL tor
of the Department of Labor in recent
article. and advised the rest of the world
to enrich itself by such methods.
CAS- I see it, the main need is to get
the wage scale up, to increase pur-
chasing power, to enlarge the market,
to help more people to consume more
and finer things" wrote the secretary:
Fine, in a great free trade zone like
the United States, where mass proouc-
ton methods can be applied.
But the statement of Mr.. Johnston,
quoted above, that Holland and France
were prosperous above other European
nations because they did not go in for
mass production, but for specialties,
shows the other side of the problem.
Europe would like to pay more wages.
She would like to sell more goods NO
nation desires low wages and growing
unemployment. Her leaders are aware
of the difficulties involved, but the mar
kets all through are so restricted that
the mass production basis hasn't any
chance to develop.
Another thing! Wages even in the
United States cannot be maintained II
unemployment continues.
Says the conservative Commercial
and Financial Chronicle:
Unemployment in time will force
wages down. No employer listening to
the false plea of consuming power can
pay more wages than the conditions Of
his own business and the conditions of
the country warrant. No union can
continue to exact tribute against pro-
longed general depression.
If, as is so often said, the United
States is in a period of readjustment
after period of imitation, the country
must expect wages to follow the trend
and respond to the new era"
More wage reductions took place last
week than increases. In several COM
munities around New York, for example
members of the building trades are paid
full union scale wages each week, but
refunds to employers are made on the
following Monday.
In this way, the formal union wage
scale is maintained and the work goes
on.
1t looks as if the investment guaran-
teed" market, a term which refers in
lllb ~SUIlenJ circles 10 the sale OF new
SC ,arity issues below the public offering
price to certain buyers who agree to
hold them for a period of time. will
have to be changed.
This has grown rapidly in recent
years, coincident with the vast expan-
sion of securities offered and sold. The
original object was to prevent gluts on
the securities market, for the aim was
to assist in an orderly marketing of the
various securities offered.
But it hasn't worked out. Roland A.
Wilbur Of Mitchell, Herrick g. Co, who
is heading a committee of the Invest
ment Bankers Association, wants the
practice ended upon the ground that it
threatens the orderly conduct of syn
dictate and retail distribution Of securi-
ties"
The investment guaranteed market
is pretty well loaded up now and has
become real handicap in recent bond
distribution.
Copyright, 1902