Evening star., 1946-09-24
Son Of Kaiser
Defends Firm S
War JobFees
| Clash With Probers
| Occurs Over Kind
| OfQuestions Asked
By J. A. Oleory

by }. A. OLeory
Edgar F. Kaiser, son of Henry
J. Kaiser, clashed verbally with
counsel for the House Merchant
Marine Committee today as he
defended his fathers work in
building ships for the Govern
ment during the war.
The heated exchange occurred
when Marvin Coles, committee at
torney, wanted to know what the
fees paid to the Kaiser company
were for If the Government paid for
the material, the labor and part OF
the interest charge on borrowed
capital.
Mr.. Kaiser's son replied that the
fees were for organization, for man.
agement of the yards, for personnel
brought into the yards, for S32,00O,-
600 OF operating capital the COM
pany had to obtain, for speed of
performance and for building the
Liberty ships for $3.50, 900 900 less
than similar ships cost the Gov
ernment.
Pointing to his father, who sat
beside him at the witness table,
Edgar Kaiser told the committee he
knew more of what went on in the
shlpyards than any one else.
Argument on Questions Asked.
He hasn't shown it in these hear
ings," Mr.. Coles replied, presumably
referring to the fact that Mr.. Kaiser
earlier in the day had insisted his
STAN would need more time to
answer the numerous new questions
about details of contracts put to
him yesterday.
You haven't asked him questions
about how to build Ships" Mr.,
kaiser's son retorted. The son con-
tended Mr.. Coles was asking uues-
tlons which only the company ac-
countants could answer.
Mr.. Coles then asked that his re-
mark be withdrawn from the record.
which ended the colloquy.
1t started again a moment later.
however, when Edgar Kaiser re-
peated his fathers contention of
yesterday that the true measure of
profits was the percentage which
the company's fees bore to the total
volume OF work turned out for the
war effort.
On this basis, Mr.. Kaiser has as
serted that the profits of the ship
yards he managed amounted to less
than one-tenth of / per cent of
dollar volume.
What business do you know of
wheresyou can figure profit on the
dollar volume except betting through
parimutuel machines?" asked Mr..
Coles.
Edgar Kaiser retorted that it is
done every day, and read one Of
Moodyis industrial reports on cor
poration earnings to support his
contention.
Debate on Procedure.
The morning session also was
marked by colloquy between com.
mittee members during which
Chairman Bland said he wanted to
make it clear that there is no desire
to shield anybody, either in the
Government or in the shipbuilding
companies.
"We do not desire to exonerate
or to cruelty any one," said Repre-
sentative Bland.
His statement was prompted by
protests from Representative WEIGH
Ell, Republican, of Ohio, that the
committee was getting the cart be-
fore the horse" by cross-examining
Mr.. Kaiser on the details of his con.
tracts before bringing in the Mari
time Commission officials who made
the contracts.
Mr.. Coles had spent nearly an
hour asking Mr.. Kaiser and his son
about the amount of profit per ship
he was allowed on a group of 80
vessels and whether the contract
was changed during the progress Of
the construction.
Representative Weichel broke In
to object that the committee would
not get anywhere under its present
procedure. He argued that the men
in the Maritime Commission who
fixed the terms and made the pay
ments should be called in first to
say what they paid Mr.. Kaisers
companies and then let the ship
builder give his side of it.
Coles Is Sustained.
Chairman Bland assured his col.
league that the Government officials
would be heard, but that all of the
testimony could not be presented
at one time. The chairman sus-
tanned Committee Counsel Coles in
his method of procedure.
AS he resumed the stand this
morning. Henry Kaiser made public
statement, answering some Of the
questions put to him by Mr.. Coles
late yesterday, but complaining that
many Of them would have to be
answered later by his accountants
and other officials.
One question by Mr.. Coles yester-
day was whether Kaiser Co., Inc,
had applied some of its profit from
shipbuilding to Offset losses in the
production of steel. Replying to this
today, Henry Kaiser said:
Both were an integral part of
the operations of this one company.
AS matter of practical Common
sense, as well as law, both operations
were treated, as they were in fact,
as the operations Of one company.
Under the specific provisions of law
passed by Congress-the Renegotia-
ton Act-both operations of the one
company are lawfully considered as
one in the case of this company, as
(See SHIPBUILDING, Page AS.
Danes Won't Concede