Evening star., 1951-04-25
$4,000 Factories
Affected by New
Price Order
DiSoIIe Says Action
Will Cut Costs of
Consumer Goods
BY james Y. Newton


The Government today imposes
new controls at the manufactur
ers' level to bring generally lowe
prices for about one-fourth of tn,
goods people must buy.
Price Director Michael v. Di
Sale said he expected the pric'
ceilings clanped on $4,000 fac
tories to wip out a sizeable par
of the price spiral that FOLLOWED
the Korean invasion.
Economic Stabilizer Eric A
Johnston, meanwhile. approved {
wage boost of 6 cents an hour fol
/ million incorporating railroad
workers even though it exceeded
the Governments 10 per cent
ceiling on wage increases.
Cost of Living Clause Involved.
Mr.. Johnston said he agreed
with a three-man panel which in.
vestigated the case, that specia
consideration had to be given raj
workers because under the law il
takes them longer than employees
of other industries to win wage
boosts.
The 6 cents was due under the
coSt-of- living clause of a contract
signed at the White House March
/. In that agreement the raj
workers won a straight pay in
crease of 12E2 cents per hour
officials said the combined boosts
exceeded the 10 per cent ceiling
by about 312 cents an hour.
Mr.. Disable predicted the people
will find that the Office of Price
Sterilization has mot been play
ing pat-a-cake with prices" ano
that in the months ahead it will
become clear "tl1e whole program
is tougher than people have been
led to believe"
The OPS will follow up with
three other major orders within a
week placing new ceilings on ma
chinery, cotton textiles and wear
ing apparel, including shoes.
Some Increases Likely.
Mr.. Disable said the new order
will result in some price increases,
mainly for those few manufac-
turers who needed the Govern
ment's appeal for voluntary" re-
straint and then were caught in
the price freeze of last January
But these will be far outnumbered
by the price rollbackS.
Under the order. each factory's
new ceiling price will be: The
pre-Korean war price, plus added
wage costs and increased cost of
materials. On most materials, in
creases only up to last December
81 can be counted.
In the event a firm feels it is
entitled to a price boost on this
basis. it must give OPS Is days
notice before putting it into effect,
thus giving the Government a
chance to check it.
$40 Billion Output Involved.
Officials estimated the order
covers the price of goods having
an annual gross value of $40 bill
lion, or about % per cent of the
Nations total output of goods and
services.
The new ceiling prices must
be in force by May %. The effect
of the order will be felt by con-
sumers later since it takes some
time for goods to be passed along
from the factories to retail stores.
Among the products covered by
the order are:
Consumer hard goods" includ-
ing radios, television sets. re-
frigerators, washing machines,
ranges, :. furniture, hardware,
household appliances.
Many processed foods includ-
ing breakfast cereals, crackers,
cookies, macaroni, spaghetti
canned fish, potato chips, mustard
baked beans, pickles, peanut but
ter, sauces. seasoning, baking pow
der, candy. soup mixes, meat ex-
tracts, gelatin desserts. olives
yeast and dog foods.
Auto Tires Included.
A wide group of other items in
cluding auto tires and tubes, many
building materials Except lumber
or plywood, which are otherwise
controlled), paper and paper prod
ucts, rayon and some textiles.
Some of the products that are
exempt include raw farm and
forest products, fuels and power
and variety of items most OF
which already are under separate
ceilings - automobiles, chemicals
tobacco products. lumber and
metals.
The United States Chamber of
Commerce issued a statement say
ing that manufacturers were ex-
pected to make every effort to
adjust their operations" to the
new price order.
Truman Calls Conference.
In the meantime, President Tru-
man called late afternoon con-
ference of top economic advisers.
pointing out that proposed
changes in the Defense Produc-
ton Act would be thrashed out.
MIR, Truman will send a mes
sage to Congress this week ad-
vocating revtsions which expert
ence has demonstrated are needed
in the law.
Meeting with the President at
$3.50 this afternoon are:
Senator Maybank, Deomcrat, of
South Carolina and Representa-
tive Spence, Democrat, of Ken
lucky, chairmen, respectively. OF
the Senate and House Banking
Committees. and Charles E. Will
son. defense mobilizer: Herbert
A. Bergson. general counsel of
the Office of Defense Mobiliza-
tion; Eric Johnston, economic
stabilization administrator; Mi
chael v. Disable, price stabiliza-