Evening star., 1934-07-01
Competition Restored.

The price structure built up for in
dustry under the codes of the N. r. A.
has had the skids pulled partially, If
not entirely, from under 1t by the
latest executive order Of President
Roosevelt. The President has decreed
that bidders on Government contracts
may file secret bids with the Govern
ment which 60 as much as fifteen per
cent below the price schedules filed with
their code authorities. He has decreed,
further, that once having offered to
supply the government, Federal, State
or municipal, with products or services
at the lower prices, the bidders must
be willing to let the general public
have the advantage of the same prices.
Here, in effect, is restoration Of
competition in bidding, although 1t is
limited to fifteen per cent. The N. r. A.
has been subject to much criticism on
the ground that 1t permits price fixing
to the detriment of the general public
and of the small business man and in
the interest of greater and greater
monopolies. The Presidents executive
order seems to be designed to meet
these criticisms at least In part. 1t is
explained that bidders for Government
contracts, under the operation of the
codes, in many cases were turning In
identic bids, since they were compelled
to stick to the prices filed with the
code authorities. There was, In effect,
an end of competition. A mounting
of prices followed.
The Presidents order, of course, does
not entirely restore free competition.
No bidder may go more than fifteen
per cent below the prices which he has
filed with the code authority, and any
bidder whose prices have been under
cut by q competitor may appeal to the
National Recovery Administration for
an investigation, If he believes that he
has been underbid by unfair methods
Of competition.
1t looks very much as though the
Roosevelt administration has finally
awakened to q realization that the
N. r. A. is working to the detriment
Of the Government and the public
through the failure to permit proper
competition. The repeated charges by
Senator Borah of Idaho that the
N. r. A. was giving impetus to
monopoly, was destroying competition
and was a positive detriment to the
consuming public apparently have be-
gun to bear fruit. The criticisms
leveled by Clarence Darrow and his
board appointed by the President to
investigate and report on the opera
ton of the N. R. A. have added to the
weight of these charges. The criticism
of the identic bids for Government
contracts, however. has come from
members of the Presidents own official
family. Secretary Ickes. public works
administrator, has been particularly
aroused over such practices.
Can the price structure built up by
the N. r. A. codes for industry sur
vive the new order issued by the Presi-
dent? And If it can, will the PreSi-
dents new order be of real value? The
two things do not appear to be recon-
cilable. Senator Borah's contention
has been that the antitrust laws must
be permitted to operate again in full.
The new order seems still to withhold
entire freedom of action against
monopoly And price fixing under the
antitrust laws.
Whether the Presidents order will
placate the critics of the N. r. A.,
Borah included, remains to be seen.
There is one group In the country,
however, which it may seriously irri-
tate-the industrialists, the represent
atives Of big business.
Gradually there has begun a whit
ting away OF the N. r. A. as originally
conceived and set up. There have
been omissions from operation Of the
N. r. A. of small businesses in small
places, an abandonment of the codes
in part as applied to service industries.
Gen. johnson, N. r. A. director, has
Just issued an administrative order
virtually terminating code authorities
for service trades affected by the
Presidents modification order of May
26. including laundries, cleaning and
dyeing, barber shops and many others.
How much of the N. r. A. will remain
a year hence? AL Of which calls to
mind the fact that the next Congress,
which meets in January, must deter
mine whether to extend the life of
the N. r. A. Otherwise it dies next
June.