The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1933-08-22
TUESDAY. AUG "a. 1879.
CIVILIZING STEEL
a sCRIPPs-HoWARD NKwsPAPEI

administration and the steel industry,
have met and agreed on a code Of fair compe-
tition. And If the meeting seems to have
taken place somewhere in the foothills they
have at least. met
The steel industry has by its behavior
always implied that it considers itself some
what more powerful than the United States
government and its behavior in the present
controversy exception.
Steel men took a code to Washington and
made it clear that they would go into the
courts and fight the whole recovery program
If it was not accepted The fact that three
important amendments finally were agreed to
is more remarkable than the fact that other
extremely desirable amendments were not
made
In the end the administration had to
choose between taking the steel code with
these changes or facing court fight which it
probably would have won, hut only after delays
that certainly would imperil recovery this
winter
The administration chose the first course
and doubtless it was wise in doing so. 1t
reserves for itself the right to watch, through
representatives, operation of the code par
ticularly its price-nxing features. and the real
showdown on steel may come when this code
expires three months from now
AT that time the administration should be
in excellent position to force elimination of
any monopolistic practices it finds in steel.
The governments three victories in the
code we're these:
The industry agreed to comply with the
letter of the recovery act in regard to collective
bargaining, though 1t still wants company
unions
1t agreed to impose forty-eight-hour
limit on each work week. in addition to
promising forty-hour week averaged over six
months, and to give one day of rest in seven.
and 1t agreed to limit the work day to eight
hours after Nov l.
The administration considers this last an
exceedingly important concession from an
Industry in which long hours have been
customary
The industry agrees to open its directors
meetings and its records to representatives of
the administration, ito the end that the
President may be assured the code does not
promote or permit monopolies'
On the other hand, the code retains wage
scales which Secretary of Labor Frances
Perkins condemned as inadequate for in
creaSing purchasing power it fixes lower wages
for the south, it fails to eliminate the spv
system, which has disgraced the industry for
so long and it fails to provide for employment
reserves.
Price-fxing provisions of the code present
serious hazards for steel consumers and for
competitors of the Morgan giants in the
industry. Under the code. purchaser of steel
Will pay fixed price plus freight charges not
from the point of shipment, but from a more
distant point arbitrarily fixed
For instance, if a manufacturer in Phil
adelphia bought wire rods from the big wire
mill at Sparrows Point Md. he would paw a
base price plus freight. not from this plant 100
miles away. but from Pittsburgh, 500 miles
away
He would at the same time perpetuate a
system which the Federal Trade commission
condemned monopolistc in 1924. when it
forbade the United States Steel corporation to
use the Pittsburgh plus price system, or the
practice OF selling upon any other basing
point than that where the products are
manufactured or from which they are
shipped
The new steel code retains for directors of
the Iron and Steel Institute the right to lower
any basing point at any time. right which
Professor Frank A. Fetter, an authority on
this subject, points out can be used to elm
mate independents who seek TO lower the price
fixed by the giants.
In these respects the steel code falls below
enlightened standards set in the recovery act.
Yet any steps forward in this difficult industry
are cause for congratulation.
And the way is open for the administration.
at less critical moment, to fight aggressively
for industrial civilization in steel