The potters herald. [volume] (East Liverpool, Ohio) 1899-1982, 1950-04-20
BY ALyAINE HAMILTON

| WdSHiUBIOll tII n ihC ocSt
Industry is as essential to the Am
erican economy as the steel rein
Forcing parts are to a large dan
and power house, Interior Secre'
tary Oscar Chapman told the House
Monopoly Investigating committee
April II. Every characteristic
American business depends upor
ample supplies of low cost steel
Beneath the surface of our con-
crete roads, under the paint of oui
automobiles, under the porcelain
finish of our refrigerators, steel
plays the basic role in our daily
lives"
An investigation of whether OF
not there is enough competition in
that industry-a probe which will
go "from stem to stern"-is. now
under way, under the direction OF
Chairman Emanuel Celler Cd, N.Y.,
1t is the first of series of in
quiries into specific industries
(later ones will include newsprint,
distilling, and Pan American Air
ways) to be studied by the commits
tee, which has power to propose
legislation.
High Grade Ores Running Out
Chapman disclosed that our sup
plies of high-grade, easily mine
able ores in the Mesabi range neaf
the Great Lakes are rapidly run
ming out. He was backed up by
facts and figures presented by Dir
ector James Boyd of the Bureau
of Mines, who warned that "the
time is already here when the DOM
estic steel industry will have serl
ious difficulties operating at full
capacity from the present ore
sources; in fact, at an operating
rate of 100 per cent of capacity, in
adequacy of iron ore supply is in
dicated for 1885,"
Steel production capacity will
necessarily be limited for the next
five years, until foreign sources
of supply, or domestic low-grade
ores, are found and utilized.
The Interior Secretary lashed
out at the steel industry for the lag
between the rate at which the steel
industry is expanding and the rate
at which the whole nations econ
omy is growing. President Tru-
mans economic proposals look
forward to a three per cent in
crease in capacity each year, while
the steel industry is boosting its
production only about one per cent
a year.
Nation Wide Problem
Maintenance of true competition
in the marketing of steel" is ma
tionwide problem, Chapman said.
"The five companies controlling
the bulk of the Lake Superior iron
ore reserves control three-fifths of
the steel producing capacity of the
nation. The decisions of these lead
ing firms have significant impact
on output and price of steel. There
is little opportunity at the present
time for offsetting influence by
or new firms"
Chapman proposed three actions:
of investment in
new steel industries, even though
this requires huge capital expendi-
lures; expanding plant capacity in
other parts of the country than
those adjacent to the Great Lakes
waterways; and that the govern
ment 'take all steps necessary to
protect the interests of labor, the
investor and the American people |
by maintaining and expanding this
vital core of our national economy"
Defends Trust Busting"
First concrete program of break
ng up the steel industry into
units was made by DrJ
George Stigler, economics profess
,r at Columbia University. Hell
made committee members sit up
md take notice with a vigorous de-
ense of trust busting"
"The steel industry displays i'm
ort ant monopolistic tendencies
hat call for corrective social
'olicy," Stigler told the Congress-
nen. For evidence, he pointed toll
he basing point system of settingl
rices, the "price rigidity" of the1
industry, the strange uniformity of
ealed bids on government steel +.
ontracts, the universal price dis
against foreigners. at
as long been difficult of imposs- L
ole to get rivals or customers of
ig steel companies to complain of
Stigler observed. He'll
allied this not sign Of sweet har-
lony, but something sinister"