The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1936-03-07
RICHBERC HITS
FLYNN ARTICLE
ATTACKING NRA
Times C0IumniSt unable to
Write Sensibly,' Says
Former Chief.
By scripps-Ho,eard Newspaper Alliance

WASHINGTON, March Don
aid r. Richberg, former head of
NRA and of the National Emery
ency Council, today took issue with
statements made by John T. Flynn
in his column in The indianapolis
Times issue of Feb. 90. Mr.. Rich
berg's comments on the Flynn
article follow:
Mr.. Flynn is an able writer for
whose opinions on many subjects I
have great respect. Unfortunately,
he seems unable to write sensibly or
accurately about the MIRA.
MIR. Flynn writes: Under the
NRA producers were told by the
government to get together and
agree on production and prices and
other trade practices. The Sher-
man Antitrust Law was suspended
NRA Policy Held Consistent
''The fact is that producers were
not told to get together on prices,
but hiatt price fixing was forbidden
and every code explicitly required
conformity with the Sherman law
prohibitions against monopolistic
price fixing. The MIRA effort to pre-
vent discriminatory price cutting
and selling below cost, which is one
of the worst and most widely used
instruments of monopoly, was who'll
ly consistent with the anti-trust4aws
and afforded proection against mo-
nopoly to thousands of small manu-
facturers and merchants-as they
repeatedly testified.
MIR. Flynn says: Under the NRA
the steel makers were permitted TO
get together to revive the old Pitts
burgh-plus or basing point system
of charging for steel. This was an
old practice, but was stopped when
Harding was President
THE fact Is that when the single
basing poin system-called Pitts
burgh plus'-was outlawed by de-
cision of the Federal Trade Com
mission, the steel manufacturers
throughout the country adopted a
multiple basing point system, which
had been in operation for many
years before the NRA without any
governmental restraint.
Modification Recommended
'The steel code. as originally ap-
proved, permitted continuance of
the existing system for a 90-day
trial period. The operation of the
basing point system was then care
fully studied by MIRA officials with
the aid of economic and legal ad-
vice furnished by impartial and out
standing authorities in the univer-
sites.
"As a result, the MIRA recon-
mended drastic modification of the
basing point system to be gradually
made effective so as to prevent a
sudden disorganization of the en-
tire industry.
Ito any one who understands this
subject, the location of basing
points for price quotation in a pro-
ducing area is a sound and fair
business practice. On the other
hand, the maintenance of artificial
basing points is subject to many
criticisms and is tolerable tenn
porarily only to avoid the greater
evil of drastic change in existing
conditions, which would do as much
harm to labor and consumers as to
the producers.
Refuses to Face Facts"
'Mr. Flynn, like many other
critics of the NRA, holds the MIRA
responsible for secret price fixing
agreements, which were just as I'M
lawful under the MIRA as before
and since.
"On the other hand Mr.. Flynn
and his fellow critics stubbornly re-
fuse to face the fact that trade
agreements, to make possible the
maintenance Of minimum wage and
maximum hour standards, pro-
duced and can produce vast bene-
fits for labor and eliminate an in
defensible, unfair competition in
over working and under-paying
labor. If, however. such agree
ments are to be made and MAIN
tanned, the employers are also en-
titled to relief from unfair trade
practices which destroy their ability
to sell goods at prices which will
permit the maintenance of decent
labor conditions.
'T'he NRA can be criticized for
many mistakes of policy and ad-
ADMINISTRATION. But the claim that it
served as protector of monopoly
is utterly disproved by the record,
showing that, although many
monopolistic practices and evils of
long standing may have persisted
under the NRA, its major effect was
to give to small business and to
labor projections against monopolis-
tic practices which had never been
obtained under the antitrust
laws"