Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-04-17
TELEPHONE FIGHT
LOOMING IN SPAIN
zamora May Clash With
Behn Over Sale of UtiI-
ity Rights.
BY JOHN F. SINCLAIR.

NEW YUM, ApIu lI.-NOi oOSIilC-
mes Behn, head of the International
Telephone g. Telegraph Co., may find
himself in the glare of a sizzling batch
OF fireworks if Provisional President
zamora carries out his threat to pry
the lid of that company's activities in
purchasing the Spanish telephone mo-
nopoly from the old regime.
Col. Behn went to Spain in 1928 to
fight for the telephone monopoly, when
Primo de Rivera announced that the
royal government wished to turn the
system over to private interests. In
the teeth of fierce competition from the
Swedish Ericsson Co. and the German
Stems &c HalSke organization, he sue
ceeded. Details of the deal, however,
have never been made public.
But before he was through, Mr.. Behn
had to buy the International Western
Electric from the A. T. & T. Co. for
$4,000, 900 in order to comply with the
Spanish governments inSiStence that all
equipment be made in Spain and in
factories employing Spanish workers.
Previously he had asked the A. T. & T.
Co. to put up plant in Spain, but the
company had refused.
President Zamora at the time OPP
posed this selling of. publicly-owned
utility to private foreign interests, and
naturally the question now is what will
he do about it?
The provisional President is known
for his vigorous thinking and hard hit
ting. Mr.. Behn has won an interna-
tional reputation through his dynamic
character and spectacular exploits. al
though he has already passed the So
year mark. United States, Spain and
the world may be in for revelations.
Depreciation Problem.
What is it that dances through the
weary brains of worried executives these
nights and gives them bad dreams?
Depreciation! Who cared about depre-
citation in the piping times of prosperity
increased earnings could always take
care of that! But the morning after
has brought gray facts and red figures
to give the lie to such an unsound
theory.
This is clearly shown in the con-
trasting statements of two leading
motion picture heads-Harley L. Clarke
of the Fox Film Corporation and Adolph
Zukor of the Paramount-Publix.
Mr. Clarke has been busy trying to
explain the recent refinancing scheme
of his company and lull anxiety over
the depreciation figures. The Fox profits
show up rather poorly, due to the fact
that a new and more drastic method
of depreciation accounting is now in
force.
Mr.. zukor, by comparison, has no
difficulty with his figures. The profits
for the past quarter show $1.14 share
net This is not record amount-but
it is absolutely solid, when one re-
members that Paramount-Publ1x has,
since its inception, always leaned over
backward with its items of depreciation.
MitcheIPs Warning.
Attorney General Mitchell's warning
to American business men that they
cannot use the present hard times"
as an excuse for infringing on the
Federal antitrust laws merely reiterates
what he has said many times since he
took over the department
At the same time, the department. is
exercising extreme care in reviewing all
cases that come to its notice In order
that there may be no obstacle to de-
sirable and legal arrangements.
Mr.. Mitchell is to be commended for
his candid talk. No one ever accused
him of confused thinking or speaking.
His statement that no discretion rests
with the Attorney General to enforce
some laws and not others is sound. If 1t
is a bad law, the best way to.change II
is to enforce 1t. He recognizes there has
been widespread criticism OF antitrust
legislation, expressed by many members
of all camps of business and political
thought.
It is commended by such persons that
such restrictions On monopoly are
grotesQue in a vast and complicated in
dustrial society. This society depends
for its life on the elimination Of waste
full effort. Perhaps the solution lies In
the direction of unrestricted monopoly,
under powerful public control and regu-
lation. In any event, 1t would do no
harm, and probably much good, to sub
ject these laws to review. The Attorney
General admitted as much. In the
meantime, the Government position has
been stated clearly and fairly.
jackson e. Reynolds, So, Illinois. born,
who mixes successfully banking and
scholarship, has been appointed Ameri-
can delegate to the Bank for Interna-
tional Settlements meeting on May 10
at Basic. Switzerland.
Besides being president of the First
National Bank of New York, Mr.. Rey-
nolds is vice president of the New Jer-
Sey General Securities Co., and d.
rector in 10 other large American cor
porations, including the National Bis
cult Co., Southern Railroad and Mont
gcmery Ward g. Co. He holds degrees
from Stanford and Columbia Univer-
sites. in both of which he has lectured
as associate professor of law.
The Basic meeting will probably last
two days. 1t will afford an opportunity
for the heads OF the central banks in
the various subscribing countries TO ex-
change ideas.
Mr.. Reynolds appointment is ex-
planned, aside from his well known
qualifications, by the fact that the
statutes of the World Bank specify that
voting power is vested, not in stock
owners, but in representatives Of the
various national central banks. Since
our own Government had forbidden the
Federal Reserve System to have any off,
ci2l connection with the World Bank
the directors Of the latter gave the First
National Bank Of New York power OF
appointment.
Public Not in Market.
Yesterday was just another disap-
pointing day in Wall street. The total
sales, 100000, were greater in volume
than for Wednesday lest, but most
stocks were irregular, with tendency
towards lower figures
United States Steel, the Bellwether
closed at 1872. of 13s points, new low
for the year.
Lambert announcing record first
quarter, showing net equal to $2.85
a share, as against s2.T6 in 1880, did q
little better on the ticker and closed
at 1912. up about 50 of point. Para
mount Publix, showing net Of Sl.14
for the first quarter, dropped TO 373s
of ga points for the day.
The plain fact is the public Is not In
the market. 1t is a purely professional
market. and has been for weeks
IF ever the time for short selling
had an excuse for its existence, thai
time is right now" said an old-timer In
the Street. "This market has been go.
ing down by degrees, due to the short
interests constantly buying TO coveI
their short sales. This allows the mar.