Formula for Rationing

When SPAB last week announced that it was preparing allocation (i. e., rationing) of "all critical materials throughout American industry," it sounded like big stuff, all-out, almost totalitarian. But Washington correspondents were not impressed, and they were right.

The announcement meant that the outlines of allocation (which is inevitable) were beginning to take shape. But the controls and knowledge to make allocation work were still lacking.

Said Don Nelson truly last week: "It is uncertainty that bothers everybody. It always bothers me." In SPAB, there is still no shortage of uncertainty--particularly in statistics. To start allocation, SPAB must have good figures on supplies, inventories and minimum need for scarce materials. Head Statistician Stacy-May had divided the inventories job into three pieces, reported progress as follows:

> Job No. 1 was in the hands of a Dutch mayonnaise executive (vice president and general manager of Hellmann's) named Maus R. Van Benschoten. He has been peering through his horn-rimmed spectacles for strategic materials tied up in railroad yards, warehouses, backyards. By last week he had almost finished. On his desk, hundreds of pink slips showed such "frozen" items as 20,000,000 lb. of copper sheets, ingots, wire, etc., 27,500,000 lb. of tin plate and 4,000,000 lb. of pig tin, "vast quantities" of rubber, silk, wool, hides, chemicals.

> Jobs 2 & 3, if successfully finished, would make these "vast quantities" look like peanuts. They were both under the supervision of Van Benschoten's boss, Ernest Tupper, OPM's tall, blond Coordinator of Industry & Commodity Research. Ernie Tupper is surveying 1) industry's inventories, and 2) those of the Army, Navy and Maritime Commission. By last week, his industry surveys (86,000 firms were questioned) were almost all in, but untabulated. They had already turned up some interesting preliminary unbalances: pulp and paper mills with ten months' supply of lead; 59 printing-machinery plants with nine months' supply of brass; an auto company with a whole year's store of copper.

The wonder was not the size of such excesses, but the fact that Tupper's questionnaires turned up any excesses at all. Among themselves, businessmen talk frankly of inventories they are hiding from the Government. They have also done a lot of inventory-ruining: processing their raw materials just enough (boring a few holes in steel sheets, etc.) to spoil them for allocations purposes, although they are not ready to use them themselves. Such stocks do not show up in Mr. Tupper's figures.

Mr. Tupper's second study--of Army, Navy, Maritime Commission, et al.--is still in the we-ought-to-have-one stage.

Figures or no figures, Don Nelson last week formulated his allocation technique: 1) OPM's "end-products" industry sections are to huddle with their industry representatives, develop a "requirements program" for each industry; 2) the "end-products" sections are then to discuss their needs with the OPM raw materials branches involved, scale them down if necessary, but arrive at some minimum figure; 3) OPM's Industrial Conservation Bureau is to advise on possible simplification, substitution etc.; 4) SPAB is to get the finished program, send it to Priorities for actual allocation of materials.

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