Better

As second-quarter earnings reports began to clog the ticker tapes last week, one fact stood out: despite hell & high taxes U.S. corporations made more money than they had dared hope. The gloomily Republican New York Sun totted up 155 companies' earnings, came out with a 16.6% increase for this year's June quarter over last year's; a 14.1% gain for the first half.

Outside of the good overall earnings, there were few surprises and little to cheer about. Biggest surprise: a good many utilities, whose outlook for increased earnings was supposedly hopeless--their gross business is stable, their costs, on the rise--managed to squeak out a little more net income. Most notable were Wendell Willkie's ex-company. Commonwealth & Southern, with a six months' net of $7,331,000, its best showing in more than ten years; and New York's huge, over-bonded Consolidated Edison, whose $5,869,000 net for the second quarter was almost 25% above last year.

The Giants. The huge U.S. corporations did very nicely. General Motors, No. 1 war contractor, produced during the second quarter a whopping $832,275,000. Its net went up to $36,316,000, almost 50% over last year when G.M. was still struggling to convert to war. (This was still a far cry from the $53,580,000 G.M. made in bonanza 1941.) Bethlehem Steel, No. 2 war baby, gained nearly 10% to earn $6,600,000 on gross billings of $490,000,000. Du Pont, with an 18% increase in sales, turned in a 27% increase in net after paying a $31,291,000 tax bill, more than twice what was left over for stockholders.

U.S. Rubber, No. 1 rubber producer, got over the hump on synthetic-rubber production so completely that its six months' earnings of $6,912,000 were more than four times last year's doldrums figure. The one giant that really suffered was U.S. Steel: now falling behind Bethlehem in gross sales (because of Bethlehem's vastly greater shipbuilding operations), Big Steel's earnings for the second quarter nose-dived 16% to $15,680,000.

The Railroads. Compared with other U.S. industries, the railroads have had the Midas touch in the last two years. On the surface, the first half of 1943 was no exception: Chicago, Milwaukee, St. Paul & Pacific jumped its net from $2,378,000 in 1942 to $17,134,000; the Burlington went from $7,081,000 to $18,125,000; Lehigh Valley from $1,284,000 to $3,129,000. But there were a few nicks in the golden record: Erie, for example, made only $5,602,000 in the first half of this year, down nearly 10% from last year.

The Others. Elsewhere the record was mixed, but more up than down. Typical up & down story: Standard Brands, showing new muscle under volume-minded James S. Adams (TIME, July 26), pushed its net for the June quarter to $2,234,000, 60% above last year; its big competitor, General Foods, dropped 10% to $2,637,000. Among the most spectacular on the up side was Allis-Chalmers, whose net for the quarter was $2,056,000, almost two and a half times last year. Among the worst flops was ExCellO Corp. (machine tools): heavy taxes and provisions for renegotiation sliced its net for the three months ended May 31 to $332,000, less than a third of the same quarter last year.

Meanwhile, practically every U.S. corporation with even a trace of war business reissued a familiar warning: until the U.S. Government gets around to renegotiating his contracts, and the U.S. Congress gets around to fixing his 1943 taxes, no war contractor can be sure what his profits will finally be.

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