Summer Strike?

Dave McDonald, the Steelworkers' handsome chief, put on his best scowl last week as he posed for a TV film, and essayed some rolling perorations in the inimitable manner of the master, John L. Lewis. McDonald cried that in the current negotiations the steel industry had made an "about-face" on 20 years of collective bargaining, and given his union an "ultimatum" to accept a "substandard contract." After four weeks of negotiating between McDonald and U.S. Steel's John Stephens, the industry's chief spokesman, the differences boiled down to i) a union demand for a 28.3-c- an hour "package" deal v. a management offer of 14-15-c-, 2) management's demand for a five-year contract instead of the usual two-year pact.

There were signs, however, that neither side had spoken the final word before this week's strike deadline: while letters from Bethlehem and Republic Steel to their employees emphasized that they stood firm on the five-year pact, the letter from U.S. Steel, the industry leader, failed noticeably to take such an adamant position. Union Leader McDonald indicated that he too would welcome a compromise "if it is a reasonable agreement we can live with." Some seasoned observers even discerned the possible shape of compromise: a three-year pact, a package increase of 20-c- an hour.

Both sides made the usual last-minute threatening gestures: the union dispatched strike rules to the locals ("There must not be any drinking on the picket lines; no elaborate meals shall be served"), and the steel companies announced that they would begin tapering off production and banking their furnaces by midweek if there was no sign of progress.

No one, however, seemed very worried. It was summer, and the prospect of a two or three week walkout from 'the mill heat during July held few terrors for most steel workers. The industry was also heading into the midsummer slack; steel production, currently scheduled at 95.7% of capacity, would probably drop to 80% before the expected snapback late in the third quarter.

Businessmen generally were concerned with the whole state of the economy rather than with the steel segment. Generally, the news was encouraging. The bottom of the Detroit slump seemed to have been reached and passed. Both Ford and G.M. were rehiring, and Ford announced it had found it necessary to increase production schedules for July.

The Commerce Department raised its estimate of total construction spending this year, forecast a new high of $44.5 billion, $1.5 billion higher than in '55. Paced by aircraft and motor issues, the stock market also continued to edge up; the Dow-Jones industrial average ended the week at 487.-c-95, nearly 20 points above the low of the ileitis break.

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