Last Word

The newspapers and the steel industry had had their say on the controversial $5 to $6 a ton price boost in semi-finished steel. Last week, in reports by the Department of Commerce, the Department of Justice and the Council of Economic Advisers, the Administration summed up. Items:

P:Steel prices have risen less than prices of other commodities. Steel went up 25% in the 19 months ending Jan. 30, v. 47% for all commodity prices.

P:Despite fat profits, steel companies had not been able to set aside enough reserves to cover the $496 million spent on plant expansion last year.

P:There was no evidence of unlawful collusion between steel producers on the uniform boost. (But the FBI, after interviewing the heads of 16 leading steel companies, is still investigating.)

P:Though the industry had declared that the boost would not affect finished steel, Allegheny-Ludlum Steel Corp. had already found it necessary to boost the price of one finished product (carbon steel strip) by $10 a ton. "It would appear likely," observed the Justice Department, "that other purchasers of semi-finished steel products will find it necessary to do [the same], namely, to pass on these increases to the consumers."

In effect, the Administration found the steelmakers blameworthy chiefly for the timing of the rise. Said CEA: "Inflationary influences are still strong. If this inflationary trend is to be halted without broad use of public powers, all those who occupy strategic positions in the setting of prices . . . must recognize the public interest in their private economic decisions in a way the steel industry has not shown in this instance."

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