The Key West citizen. [volume] (Key West, Fla.) 1879-current, 1952-03-22
Todo'ly's
Business
Mirror
By SAM DAWSON


hike-and the companies say there
must be one If a strike is avoided
aud the unions gel what the Wage
Sterilization Board PROPOSES
would be a headache to many other
industries as well as 10 consumers.
The buying public. might find
prices going up CD a long iist of
products into which steel enters
autos, zippers, stoves, baling wire.
But a large part of the buying
public already finds the price of
many goods too rich for its bInod.
And that's where the manufacture
ers' headaches start.
A steel price hike might mean
an additional cost. squeeze on many
a manufacturer who already finds
costs risen so high they threaten
his break-even point. If he can't
pass on additional material costs
to his customers in higher prices,
he's stuck.
The long list of price-cut an.
nouncements, apd the sporadic
orice wars, show hc'4 hard that's
likely to be. And the declining
profits in many industries show
what they are up against.
There's an alternative, many in
industry point out. ThatsSanather
general round of wage and pf'ee
hikes, a rebirth Of inflat lou an
other boost in the cost ofaHtihg
for everyone.
Both the unions and the Wage
Sterilization Board chairman deny
that the steel wage hike the board
proposes and the union accepts
need start another round of infla-
ton. They point to the changed
industrial conditions generally
rising supplies. declining demand
as a natural economic brake on
initiation. And the union contends
that steel profits, though down
from 1850, are still high.
But steel management cites the
upcoming wage negotiations with
John L. Lewis coal men as certain
to follow the pattern the steel set
cement may set. And they note
that rubber workers can reopen
their contract at an early date.
So can electric workers. hr1SS mill
workers and aircraft unions. Thai
sets the initiation stage, manage
ment argues.
The question in the eyes of in
dustry narrows down 60 how much
of price hike is TO be part OF
the package deal, il steel strike
is &C. be held off after the latest
postponement expires. Steel man.
lgemcnt says that the So or So a
ton hike offered under the Cape
hart formula Is not enough. That
formula allows cost increases up
to last July rs to be added 10
prices.
The steel industry says demand
fcr steel is easing and that the
fast increasing mill capacity is
bringing the day near when steel
will no longer be scarce. Some
point out that, il this is true, the
steel companies won't be too arx-
Gus TO avert strike il IL means
wage boosts they consider too high.
But some smart cookies in Wall
Street think a deal has already
been made--that now that the
unions have been given the gov
ernment's blessing to wage hikes
they find acceptaI lie, the price sta
bilizers will announce formulas FOR
raising steel prices high enough
to- satisfy the companies demands.
Acting on this belief in q deal,
some traders In Wall Street bid
up the price of steel shares Thurs.
day by q dollar or more.
II there is to be no strike--still
quite an assumptions wage AIR.
price Increases are ineyif1 III
these traders argue. Price rises
have always followed Mage. hikes
n ire steel industry. although they
lave not always been simultahe-
-as. And these traders contend
hat a deal in steel will set the
oattern for other industries where
labor disputes are in the offinp.
Labor peace will be good for fhe
economy as a whole, they pointed
'ut And further initiation would
seem likely. they add-sending
stock prices up with ii.