The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1935-02-14
Geneva FIASCO
OF 1927 TONIC
FOR SHIPYARDS
Agent of Big Three Given
Credit for WreCking
Naval Farley.
By soripps=Horqrd Newspaper Alliance

By SCrippS-h otcdFd y tHsp"Pe' -7'''N''NV
WASHINGTON, Feb. 1.-THE
collapse of the 1927 Geneva naval
limitation conference was just the
tonic needed by the Big Three
United States shipbuilderS, Senate
Munitions COMMITTEE records
showed today.
After the war. tpe shipbiulders'
revenues declined steadily until
1927 approached. when conditions in
the industry reached what Clinton
L. Bardo described as "a crisis"
1t was in 1927 that Mr.. Bardo and
executives of the two other big ship
corporations hired William B.
Shearer to observe" the Geneva
Conference. Mr.. Shearer is credited
by many with wrecking the con-
ference.
Mr.. Bardo gave the directors Of
New York Shipbuilding Corp. IAN
accounting Of his stewardship"
when he resigned as president last
year.
Six Millions Net Profit
His accounting" was put into the
record OF the munitions hearing. 1t
showed that ret current assets in
creased from one to five million dol
lars between 1926, when Mr.. Bardo
joined the company, and last Octo-
Der, when he resigned.
The amount of preferred stock
outstanding was cut to half. Sur
plus was increased from $1,600,000 to
sc, 100000, while net profit for the
period was $6,075,00O, representing
highest average in the company's
history.
On the books when Mr.. Bardo re-
signed, he said, were 40 million
dollars more in uncompleted con-
tracts than when he took Office.
Big Saving on Cost
The retiring president also point
ed out to his directors that on three
cruisers built for the Navy during
his service, a saving" of $3,620,000.
cor IS per cent" had been made on
decreased costs of labor and mate
rails while ION the balance of the
work a similar comparison shows
favorable results"
In the matter of taxes on the
company's properties at Camden.
N. j., Mr.. Bardo reported that
though the tax rate had risen 25 per
cent "the actual taxes paid on the
shipbuiIding plant have increased
less than 10 per cent"
Overhead plays very important
part in shipbuilding activities. &C
cording to Mr.. Bardo. The Vinson
naval construction bill, passed last
year, provided that shipbuilders'
profits be limited to 10 per cent.
Mr.. Bardo testified that many
meetings were held by the Big
Three" and such b-contractors as
General Electric, to decide how
much overhead would be charged
into cost under the 10 per cent rule.
Omitted Front" on Overhead
N. R. Parker, treasurer Of New
York Ship, testified that general
sentiment was that the 10 per cent
clause resulted in effect in cost-plus
contracts. 1t was therefore urged,
he disclosed, that the overhead be
set higher on work for the Navy
than on private construction.
Among items commonly charged
| into the induStry's overhead were
liquor and entertainment.
The shipbuilderS felt they should
be unanimous in adopting per-
centage for overhead, and one Of
them was quoted as saying: THE
thing will work until some one turns
back some money" The bill pro-
vides that everything in excess Of
10 per cent shall be conf1scated by
the Internal Revenue Bureau.
A memorandum of this meeting
recorded a statement that "the In
ternal Revenue Bureau will have a
hard time to resist us" if the in
dustry adopts a uniform overhead
rule.