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FILE NAME: Newspaper & Magazine Articles (NMA) DATE: 1948 Nov 13 DOC#: NMA114 DOCUMENT DESCRIPTION: Business Week - Full Issue BOWER BEARINGS ARE m ile . . . the extra m iles of trouble-free perform ance you receive from Bow er bearings. There's no better explanation of this greater dependability than im proved Spher-O-honed design. For exam ple, roll-ends and flange surfaces are spherical before the bearing is installed. This greatly reduces initial w ear, and com pletely elim inates running-in and costly final adjustm ent. O n ly Bow er bearings offer you the m a n y important advantages of Spher-O-honed design. Consequently, only Bower bearings offer you precision, sm oothness, dependability and econom y in such high degree. That's w h y from every standpoint, they're yo ur best bearing buy. BOW ER R O LLER B E A R IN G CO M PAN Y D e tro it 14, M ich ig an B O W E R O L L E R BEARING 11%ht II il ! f'1 A growing river of Steel brings you this flood o f useful, durable products From steelm akers' furnaces pour the molten metals for thousands o f the things Americans enjoy today--from bridges to bicycles, from ships to scissors, from railfoads to razors, from tunnels to tin cans. For steel is not just one metal. There are 00 different kinds o f steel, supplied in 100,000 sizes, shapes, finishes and com positions. Because o f the vision and skill with which steelmakers have adapted their products to new uses, steel has truly become the backbo ne o f our civilization. One important phase of steel's multimillion dollar research program is the Use o f oxygen in blast and open-hearth furnaces, which promises material in creases in production. Steelmen are also Working to find ways o f using lowerEtade ores. N ew means o f casting steel direct from melt into semi-finished form--by-passing the ingot stage and blooming mills-- is another research development which, together with other improvements, may lead to still greater production efficiency in new and existing steel manufacturing facilities. From raw steel--made tougher, or more pliable, in new and old forms, with new properties and qualities--will come the products o f tomorrow. Research men in steel companies are working alone, work ing together, and working with manufac turers to develop the specialized metals which these new products require. Where else but in America are men as free to work out new ideas . . . to create new products... to participate in the ownership and management o f business? Where else are so many people so profit ably employed? Where else is the standard o f living for the average man so high? Vision is indispensable to progress -- and progress, in turn, demands freedom. Ba n k e r s T r u st C o m p a n y NEW YORK MEMBER FEDERAL DEPOSIT INSU RAN CE CO RPO RA TIO N V; f 'P i , ' f ' ! Iv' *-; ! I It: Hew ships for ocean highways ... powered by C-E The first Victory Ship came home the other day under a new flag -- carrying Egyptian cargo to the shores from which it had sailed a few short years ago with fighting men and supplies. Its return marked the peacetime fulfillment of a distinguished war record -- a record shared by much of the huge C-E pow ered armada of war days which now sails the water highways of the world in peaceful trade. That this record was impressive to shipowners and builders is attested by the importance and variety of new con struction that has gone down the ways equipped with C-E Marine Boilers -- new ships that range from luxury liners to sea-going dredges, from ore carriers -- with the highest pressure marine boilers ever applied commercially -- to various types of cargo vessels -- the latter including the largest order ever placed in an American shipyard by a foreign government. To service this vast C-E equipped fleet, Com bustion Engineering main tains experienced engineers and stocks of spare parts strategically located to serve the Atlantic and Pacific seaboards, the Gulf ports and the Great Lakes region. You, perhaps, associate Combustion Engineering m ainly with steam gener ation for industrial needs ashore, yet wherever ships ply the seas you will find C-E Boilers setting high standards of reliability and economy, standards sym bolized by the familiar C-E Flame. B-268 \ \ " 'C -E - CO M BU STIO N ENGINEERING 200 MADISON AVE. NEW YORK 16, N- Y. C-E Products include all types of Boilers furnaces Pulverized Fuel Systems Stokets Superheaters Economizers A ir Heaters Also, Pressure Vessels Chemica/ Recovery Equipment Sewage Incineration Flash Drying Systems D o m e s t i c Water Heaters HOW THE SPEEDS AND SIMPLIFIES FIGURING Almost all calculating consists of obtaining a series of intermediate answers (sums, products, results) that are added or sub tracted in succession until the final answer is reached. These exclusive ''remembering" dials of the new Burroughs store these intermediate answers automatically and show the accumulated results. Thus the intermediate answers and the final answer are arrived at directly--without the usual time-wasting rehandling of figures. See this Burroughs Calculator in action. Find out how it is saving 15% to 40% in calculating time for thousands of con cerns. Call your nearest Burroughs office for a demonstration. B U R R O U G H S A D D I N G M A C H I N E C O M P A N Y , D E T R O I T 3 2, M I C H I G A N These dials show the results of indi vidual computations (addition, sub traction, multiplication, division). As intermediate answers are obtained, they can be added to or subtracted from the amount in the rear dials instantly, by depressing a single key. The two sets of dials work together to simplify calculating to a new degree . . . to make it easier and faster and less costly. burroughs CA LCU LA TO R S BUSINESS WEEK F o o t b a l l is more than a sport. It is big business--and the accuracy, control and speed of a good halfback result in probts as well as touchdowns. In your business, photography can provide the accuracy, control and speed which result in profitable operations. It guarantees accuracy in creating and copying your business records. It gives you more exact control over your billing and accounting procedures. It provides a fast and simple way to help you build your sales. Only Remington Rand offers you all three methods of business photography -- photocopying, microfilming, and contact printing -- plus more than 70 years experience in business systems. Our repre sentative, therefore, can best help you select the photographic method which will do the most effective job for you. Call him for an unbiased survey of your records, without obligation. Or we will be glad to send you case histories showing how other companies stepped up their efficiency by using photo-records. Write to Room 195, Photo Records Division, 315 Fourth Avenue, New York 10, N. Y. EDITOR Ralph Smith EXICUTIVE EDITOR Kenneth Kiamer M ANAGING EDITOR Eegar A Giunwald ASST. M ANAGING EDITOR Harry Lee W addell ASSOCIATI: M AN A G IN G EDITOR l'beit B. Colburn Netcs Editois, Cora C aitci, Richard M. Machol Carl Rieser, Guy S tu p id . Ji. Illu via tio n , Jacquelyn Tudpp C. Peter D au s ' J ge> DEPARTMENT EDITORS Business Outlook, Ciaik R. Pace Bustness Poltcyr John L Cubbs 1 inane*, W illiam McKee Gillingham fo te ig n , How aid W hidden Labot, Merlyn S PiU tle Law, Josi ph A. G erardi M arketing Prank J. Cugan * P to d u tto n , John Sassu Aericultur> Aitimi L. M ooie EDITORIAL ASSISTANTS J. P. Cham beilain, Jane E Clark, Jean Drummond, Mary Flaheity, Frank J. 1ogarcy, John H artshorne, John Hofb man, N athaniel McKitterick, James C. N elson, Jr. (Asst. M arketing E d ito r), A ithui Riehcer, Edward T. Townsend (Asst. Labor E ditor), Doris J W hite * Statistician Gertrude Charloff Ltbtatian, M ildred L. Washburn * ECONOMICS STAFF D exter M Keezei, Sanford S Parker, W illiam F. Butler, Peter Fiench, Robert P. Uim D O M ESTIC NEW'S SERVICE C h ic a g o B a te a u , Jam es M . S u th e rla n d , M ary B. Stephenson C leieland Bateau, Robert E . Cochran * D etioit Bateau, Stinley H . Biams San Francisco Ba teau, Richaid lam b , M ardell Burns Washington Bateau, George Doving, Glen Bayless, Thomas A. Falco, Carter Field, Joseph Gambacese, Seabrook H ull, Louise Jacobson, Sam Justice, Paul Leach, Ji., Donald 0. Loomis, Gladys Montgomery, Seymour Nagan, Caroline Robertson, Vincent Smith, W illiam B. W hichard, Jr. * Corespondents Akron, Albuquerque, Atlanta, Balti more, Bangor, Birmingham, Boston, Buffalo, Charlotte, Cincinnati, D allas Denvei, Des Moines, Evansville, Houston, Indianapolis, Kansas City, Knoxville, Los An geles, Louisville. M adison, Memphis, Miami, Minneapo lis, New Orleans, Oklahoma City, O maha, Philadelphia, Pittsburgh, Providence, Richmond, Rochester, Salt Lake Cic>, Seattle, St Louis. Topeka, Tucson, Wichita, Wil mington, Fairbanks (A laska), San Juan, Honolulu FORI IG N NEW S SERVICE D uet tot, John F. Chapman _ London, Frederick Brewster, Randle Elliott Patis, Boyd France Betlni. John Christie Moscow, Andrew Steiger Tokyo, Alpheus Jessup Bombay, Joseph Van Denburg, Ji M elbourne, Herbert Leopold Rio de Janeiro, Henry Bagley Buenos A ttet. John W ilhelm Cor respondents Amsterdam, Bangkok, Batavia, Bogota, Cairo, Caracas, Copenhagen, Geneva, Johannesburg, L* Paz, Lima, M am li, Mexico City, M ilan, Montevideo, O ttaw a, Prague, Sr ntiago, Shanghai FO R G REA TER B U SIN ESS E F F IC IE N C Y -- USE PH O TO G R A PH Y - TZgHuj&n TZjuui ,9,'kHtllVtftSARt Morticians Supply Co,, Dallas, Tex. uses Portagraph photo prints for fast preparation of its own catalogs for use by its salesmen. BannerCaundry,Alexandria,Va uses Film -a - record microfilm to assure more exact control over its billing and accounting procedures. Marsh Steel Co., Kansas City, Mo. makes weekly Dexigraph photocop ies of Kardex stock record slides to keep salesmen up-to-date on inven tory and help them build sales. 4 PUBLISHER Paul Montgomery ADVERTISING MANAGER H. C Sturm SINESS WEEK NOVEMBER 13 * NUMBER 1 02 litli i\lnch a ie en nbmei The A n n a lis ta n d p A jif a p h in s . r u b i .lied eu-ekle In M o G ia -B " * 1 uKoimiliT jm p a m , Inc . J .J m s 11 M iU ra u U k t l l'U ` ll K , vJI MeGiaw, <D 1iene Puffleld' J'ulilieatiun Offne !l'i-12!i N oitli B io ad w as. Form Postmasxet : If tmdeliverable, notify pui n ^ st. . . Editooina. mut EX xneWcuUtiivme Offic--es, n t.: (C'Uulrltiis V' VH 1T"": ^\ Ke`-I'ie.-.u.c..lont and. T i e f t s u r e r _ puecior . m i m e Assistant loi P u b l i c a t i o n . Nelson D A d v c i ti s in g , J o'-epU A Goi ui di, Secretai!.^ _ . p. Addict-, correspondence rocaidinft subscription Week, OO- 9aeAkbmJn'..i(>Dad\vaJ>)i cAmllr.nmof 1C, nNnilati.on0,1fo0L L s 42nd St . u 'l o i k i s Allov ten d a \ s lo i change ot ad d . fr0i.i Subscriptions to Business Week a re S?*'C position anJ mage me r.t -me n in business a n d inousyx -.tion order., mpany connection must be in dic ate d ooinl 8 ^ ^ gstwattes a '11K-'' sSJCin'-g'SliHJllt'-o pf-iOc sO11: S ah sm p iio n rates -- I " " " Amenea.C a n a d a $7.00 a Vpa * 20 a m i n e s Mu a u a I All Oottlhiei countr;icees * ,t t he -1nred tcicd as Ml orci H a s , matte. i * ? - V 1S79 ine al A l i t a l:i.,..A.... v1.. .mutnudc>i,,, AMctf.of-firaw-li*m uj)hsbme L-' BUSINESS WEEK Nov. 13, 1948 I `s: j i:;' Hr 1I :R-i i-jl t -j--! ST-i1i : ,-S, '--A fe ,I li., i/;r`*i *1`5rr x --r r :. - .---r^'; - *-->> O ; - Good Service Depends on Good Earnings *-> - - 4' v_ - ; T here is still much to be done to make the Bell System big enough for th e nation's needs. It will take a lot of money. This money cannot come out of the rates you pay for service. It m ust come from investors. They are the hundreds of thousands of everyday people in all walks of life whose confidence in the integrity and earning-power of the Bell System encourages them to invest th eir savings in the business. Reasonable earnings will con tinue to attract the additional capital needed. And that in turn will provide the new and improved facilities th at will benefit every body who uses the telephone. Earnings th at are too low are not in the best interests of anybody and can only result in the long run in deterioration of a vital service. T he Bell System does not ask that it be allowed to earn one penny m ore than is required to do the job. It asks only w hat m ost people and most regulatory bodies agree is fair and j u s t . . . a reasonable re turn to the many men and women all over America whose savings have built the telephone business. BELL TELEPHONE SYSTEM it 1 i; -i i}'|t: - f: <s 3 m l ife % fftfe v TAKES A DEEP DRAW TO SAVE YOU MONEY W hen you need a tough, deep-drawing m aterial for lim ited quantities-- check M icarta. Deep, 24-inch draws, like the one illustrated below, are everyday jobs. M icarta, no ordinary " plastic" . . . is to d a y 's tough, versatile, industrial lam inate. I t has proved itself in thousands of industrial applications. Besides formability, M icarta has other character istics which m ake it the No. 1 industrial laminate: HIGH STRUCTURAL-COMPRESSIVE STRENGTH-- it is half the weight of aluminum for the some comprehensive strength. HIGH DIELECTRIC STRENGTH-- equivalent to mica, one of the best insulators. HIGH HEAT RESISTANCE-- easily withstands heat up to 230F. Below zero it gains in strength without brittleness. HIGH RESISTANCE TO ACIDS, ALKALIES-- to 10% solution. HIGH W ORKABILITY-- you can drill, tap, mill, die, punch, saw like a metal. M icarta is available molded, formed or com pletely fab ricated--in m a ss p ro d u c tio n q u a n titie s . Remem ber M icarta for a tough jo b ...c a ll your Westinghouse office for a M icarta Specialist. W estinghouse Electric C orporation, P . O. Box 868, P ittsburgh 30, Penna. J-06402-A pb 4v: BUSINESS o u t l o o k b u s in e s s WEEK NOVEMBER 13,1948 PAGE 9 Thot soft-goods recession everybody is talking about, just doesn't exist-- not on on over-oil basis, at least. To be sure, there are lines that are down from their postwar peak. But manufacturers of most nondurables are doing all right. Their sales hit a summer low of $9.9-billion in July. But even that was a billion dollars above the same 1947 month. They rose to $10.8-billion in August, only to be eclipsed by $ 1 1.3-billion in September. That September figure, by the way, tops all previous records. This is the more remarkable because the month has only 30 days with one holiday. _ ' Nobody is surprised, of course, when durable goods industries set new records. Sales of hard-goods manufacturers in September, despite the short month, topped the earlier peacetime high of $7,364,000,000 set in March. Dept, of Commerce preliminary figures put September at $7,400,000, 000. October is a cinch to beat that. Records are falling right and left in the steel industry. - ----- This week we will produce more steel than in any other week in our history-- war or postwar. Operations are at 99.4% of' capacity. That; means an estimated 1,791,700 tons. r : The highest previous tonnage was 1,791,300. It came the last week in April, 1944, the wartime peak. ' October, as expected (BW-Oct. 16'48,p9), set a peacetime mark. Its tonnage was 7,973,416 according to the American Irorr & Steel Institute. But it did more than exceed the postwar high of 7,571,652 tons: set last May; it beat the biggest wartime month by nearly 150,000 tons Electric power output now is moving up toward its seasonal peak which always comes just before Christmas. ^ Output now is more than 5Vi-billion kwh. weekly. This is a gain over year-ago totals of about 500-million kwh. Construction remains at a very high level. There's little indication of that drop so many people are predicting for home building next year. Value of all construction work put in place during October is estimated by the Bureau of Labor Statistics at $1,704,000,000. That's down from $1,790,000,000 in August, and $1,783,000,000 in September. Nevertheless, October ran a good $200-million ahead of last year. And the decline this year is hardly as great as the normal seasonal dip. For the 10 months ended Oct. 31, value of all construction adds up to $14.7-billion, against $ 1 1.2-billion last year. That's a 3 0 % gain. Employment continues to reflect the general vigor of the economy. Total employment declined only seasonally between September and October, remaining above 60-million. Nonagricultural jobs were 51 Vimillion. Unemployment shrank to less than 1,650,000. That is close to an irreducible minimum, about matching last November and December. M ore women have to be lured into the labor force if there is to be BUSINESS O U TLO O K (continued) BUSINESS W EEK NOVEMBER 13,1948 ony slock. Company after company is coming to this point of view and trying to do something about it. Yet the number of women employed in nonagricultural lines has hung right around ISV-million for a whole year. Apparently the need for multiple incomes, if families are to meet the rising cost of living, hasn't yet become a compelling force. PAGE 10 You hear about a lot of lines that are "slumping"; yet most look bad only by comparison with postwar peaks. Take jewelry, for example. Volume is down, to be sure. But whole sale dollar volume so far this year is about 7% ahead of last. Retail trade was running about even, with inventories 11 % higher. But note this: Dollar turnover still is about three times prewar. Seasonal expansion in cotton consumption hasn't been as robust as in 1946 and 1947. In fact, use of the fiber in August, September, and October was equivalent to an annual rate of only about BVi-million bales. Consumption in the cotton year ended last July was 9,350,000 bales. This week's estimate of the 1948 cotton harvest is 15,166,000 bales. The carryover of old cotton adds 3-million bales to the supply. Thus, the 1948-49 supply situation will be very comfortable, even if the rate of domestic use picks up to 9-million bales or so. Exports probably won't total more than 3-million to 3H-m illion bales for the season. " Lower operating rates and higher wages are squeezing those lush profits cotton mills were posting last year and early in 1948. The Cotton Textile Institute this week pointed out that direct wage payments in the first half of 1948 took 23.40 out of the sales dollar. That ; is up from 20.40 for the full year 1947, and highest since 1939. : .And, whether typical or not, here are quarterly earnings figures of one cotton textile company (before special reserves in all cases): M. Lowenstein & Sons, Inc., earned $6.02 a share for the first 1948 quarter; net was $4.36 a share in the second; for the third, $2,02. The third quarter, in fact, was down about 30% from a year earlier. Synthetic glycerin seems pretty sure to pull down the price of the natural product. Here, at least, is the experience of one company: It got its first shipment of Shell's new synthetic not- long ago. The price was substantially less than 300 a lb. in tank cars. At the same time, this company was paying in the neighborhood of 400 for natural. Warning to purchasing agents: Watch your glycerin inventories. An interesting fight still goes on over the domestic price of crude oil. But don't lose sight entirely of world petroleum economics. At home, the story still is this: Phillips Petroleum refuses to back down from its buying price of $3 a bbl. Other major companies quite as firmly refuse to move their posted price up from $2.65. Meanwhile, an authority on international phases of the oil industry declares crude from the Middle East can be laid down at New York for $1.75. Output in the Middle East, significantly, keeps on rising. National Petroleum News notes that Aramco produced 500,000 bbl. one day last month. Contents copyrighted under the genera! copyright on the Nov. 13, 1948, issue-- Business W eek, 330 W . 42nd St York, N. Y . urn VESSEL division t a. o. S mith C o a* p o a* a t i o 1 New York 17 Philadelphia 5 Pittsburgh 19 A llanla 3 Chicago 4; Tulsa 3 Houston 2 Seattle T Los Angeles 14 International Division: Milwaukee 1 A. O . SMITH TAKES THE GUESS W ORK OUT OF FIELD ASSEMBLY. Railroad shipping restrictions made it necessary to field-as semble this 11 Vi ft. dia. x 116 ft. long SMITHlined Fractionating Tower. To in sure ease of assembly in the field, it was first manufactured and completely assem bled in the A. O. Smith Milwaukee Plant, then hydrostatically tested, cut in two at the center girth seam, rescarfed for weld ing in the field, and shipped. Field-assem bly costs were cut to a minimum with only one girth seam to be welded. LEFT--the tower ready for the hydrostatic test. BELOW--one-half of the vessel ready for shipment. MANY TESTS BEYOND CODE REQUIREMENTS are a regular part of A. O. Smith vessel produc tion control procedures. Here Bill Poehlman, a 20-year veteran, in charge of spectroscopy and X-Ray research, checks the deposited weld metal composition in a vessel test plate, by means of an A. O. Smith-developed microspectrographic technique. IN STOCKHOLM, SWEDEN, they know about the famous SMITHway welded Multi-Layer vessel construction. Here is one of two SMITHway Inconel-lined Multi-Layer Autoclaves for fatty acid service, with a shell thickness of 5 inches and an operating pressure of over 5,000 psi. This vessel was shipped direct by ocean-going ship from Mil waukee to Stockholm. CHEMISTRY PUTS IN WHAT NATURE LEFT OUT N atural gas provides an abundance o f efficient, economic fuel to the nation b u t a synthetic gassy o d o r m akes its w idespread use safe for cooking, heating and processing. O ronite research, in cooperation with the N atural Gas industry, developed Calodorant* to supply this odor which gives the w arning o f escaping gas. W ith such protection, natural gas is safely used by m illions a f people. A typical example o f how O ronite research is helping industry solve difficult and im portant problems. ORONITE CHEMICAL COMPANY 38 Sansome St., Son Francisco 4, C alifornia 30 Rockefeller Plaza, New York 20, N .Y . Standard O il Bldg., lo s Ansefes 15, C a lifo rn ia 600 S. Michigan^Ave., Chicago 5, Illinois *REG.U.S.PA'-orr- fig u r es o f th e w e e k Business W eek Index (above) PRODUCTION Steel ingot operations ( % of capacity)....................................................................... Production of automobiles and trucks....................................................................... Engineering const, awards (Eng. News-Rec. 4-week daily av. in thousands). Electric power output (million kilowatt-hours)....................................................... Grade oil (daily average, 1,000 bbls.).................................................................. -- Bituminous coal (daily average, 1,000 tons)................................................ *198.7 1198.7 195.4 189.8 162.2 99.4 117,225 $24,136 5,564 - 5,627 2,042 98.9 1116,968 $25,546 5,555 5,604: t2,007 98.5 96.9 119,398 106,651 $23,701 $20,895 5,482 - 5,057 5,535 5,240 1,941 2,156 97.3 98,236 $19,433 3,130 3,842 1,685- TRADE Miscellaneous and L.C.L. carloadings (daily average, 1,000 cars)....................................... 90 All other carloadings (daily average, 1,000 cars)......................................................... . . 66 Money in circulation (millions)........................................................................................ Department store sales (change from same week of preceding year)......................... $28,254 +2% Business failures (Dun & Bradstreet, number)............................................................. 104 . 90 - 88 65 63 $28,091 $28,202 + 12% None 104 107 -92 65 $28,635 +13% - 72 86 52$9,613 +17% 228 PRICES (A verage for th e w eek) Cost of Living (U. S. Bureau of Labor Statistics, 1935-39 = 100), Sept.. . 174.5 Spot commodity index (Moody's, Dec. 31, 1 9 3 1 = 1 0 0 )........................................... .. Industrial raw materials (U. S. Bureau of Labor Statistics, Aug., 1 9 3 9 = 1 0 0 ) ... Domestic farm products (U. S. Bureau of Labor Statistics, Aug., 1 9 3 9 = 1 0 0 ).. . Finished steel composite (Steel, to n ).................................................................. ............. Scrap steel composite (Iron Age, to n )............................................................................. Copper (electrolytic, Connecticut Valley, lb .)................................................................ Wheat (Kansas City, b u.)........................................................................................... .. Sugar (raw, delivered New York, lb .)................................................................................ Cotton (middling, ten designated markets, lb .)................................................ .. Wool tops (New York, lb .)................................................................................................ Rubber (ribbed smoked sheets, N ew York, lb .)............................................................. 401.3 277.9 320.4 $95.05 $43.00 23.5000 $2.24 5.680' 31.230 $1,667 20.720 ...... 400.7 276.5 322.3 $95.05 $43.16 23.5000 $2.25 5.680 30.930 $1,609 21.350 . 174.5 406.1 275.0 323.9 $95.05 $43.16 23.5000 $2.20 5.610 31.250 $1,546 22.440 163.8 447.0 290.6 392.4 $76.09 $41.50 21.5000 S2.93 6.320 32.750 $1,863 23.880 105,2 198.1 138.5 146.6: $56.73 $19.48 12.0220 $0.99 3.380 13.940 $1,281 22.160 finance 90 stocks, price index (Standard & Poor's Corp.)......................................................... Medium grade corporate bond yield (30 Baa issues, Moody's).................................. High grade corporate bond yield (30 Aaa issues, Moody's )......................................... Call loans renewal rate, N . Y. Stock Exchange (daily average).................................. Prime commercial paper, 4-to-6 months, N . Y. City (prevailing rate)....................... 122.6 3.53% 2.86% 14--14% li-lf% 130.4 3.53% 2.87% 14-14% 14-14% 126.6 3.49% 2.83% 14-14% 14-14% 121.7 3.42% 2.74% li-l % 1-14% 78.0 4.33% 2.77% 1.00% 4-1% BANKING (M illions of dollars) Demand deposits adjusted, reporting member banks....................................... Total loans and investments, reporting member banks.................................... Commercial and agricultural loans, reporting member banks......................... Securities loans, reporting member banks........................................................... U. S. gov't and gov't guaranteed obligations held, reporting member banks Other securities held, reporting member banks.................................................. Excess reserves, all member banks........................................................................... Total federal reserve credit outstanding................................................................ Preliminary w eek ended Novem ber 6tb. t Revised. ftE siim a fe 46,607 62,229 15,415 1,357 33,268 4,234 880 23,729 147,422 (62,441 (15,410 1,346 (33,526 (4,280 880 23,797 46,441 62,174 15,311 1,393 33,235 4,408 510 23,707 %Date fo r " L a te stW e e k " on each ( B W -- Ju l.1 2 '4 7 ,p !6 ) . 47,452 64,910 13,971 1,821 37,982 4,234, 952 22,640 t (27,777 f t 32,309 ((6,963 ((1,038 ((15,999 ((4,303 5,290 2,265 series on request. BUSINESS WEEK Nov. 13, 1948 13 FA B R ICA TIO N In the picture to the right yon see one of the plate girder sections being fabricated (weight 30 tons) in the Clinton Bridge Works Division of Allied. Fabricating crews there are using the accumulated experience of years in bridge building. They build extra strength into critical areas, rivet or weld each member with precision. And . . . in true Allied fashion, ship the entire bridge to the erection site on the scheduled date. ERECTIO N In the lower picture, Allied erecting crews, the other half of the good team, are at the site to " carry the ball" when fabricated sections arrive. Theirs is no temporary con tribution to bridge growth. Training in modern techniques enables them to button up structurais quickly...and " for life." BRIDGES with a good "BRINGING UP" Now the great bridge in Pendleton County, Kentucky, is about to reach full growth. Allied fabricatin g an d erecting crews have brought up this handsom e structure with their usual patien t skill. Here, again, they have erected the struc tu re from the w ater level, u sin g floating equipm ent to place structu ral m em bers in position over the river. Loaded barges convey parts quickly from place to place, saving precious bridge-building hours. If you have a bridge o f any length to build, we'd like to estim ate on your plans and sp e cific a tio n s. STRUCTURAI FABRICATING PLANTS WORKING AS O N E H U G E O PER A TIO N IH 'S S 'FR D* CLINTON BRIDGE W ORKS L G A G E STRUCTURAL STEEL CO . Chicogo 8, Illinois M IDLAND STRUCTURAL STEEL CO . Cicero 50, ) W ASHINGTON O U TLO O K FIRST MEASURE of Truman's influ ence over the next Congress: What brand of Democrat is appointed to the House rules committee. This committee is the traffic cop for all House legislation. It determines what bills are voted on by the House, what bills are sidetracked. Five Democratic vacancies will be filled on this 12-man committee next January-- more than any time since 1931. Unless all five are g'ood Truman men, Tru man's new New Deal will be stymied before it gets started. You'll recall that Truman had his troubles when he had a Democratic Congress before; then the rules committee was run by unfriendly south ern Democrats with Republican help. The 77 new Democrats who came in with Truman will demand that the committee, next year, be a friendly traffic cop)-- that the new members be picked from the northern labor-liberal-farm bloc. But southern old guarders like Gene Cox and Howard Smith-- they ran the committee before and will still be members-- will be jockeying for at least one like-minded committeeman; then they : and the Republican members could check Truman when they wanted to. As speaker again, New Dealer Sam .Rayburn . will be the man who has most to say about who goes on the committee. He'll try, of course, to name five Democrats who see things Truman's way. Final decision rests with the Democratic House caucus. BUSINESS, rather than government, will become the target of congressional investigations next year. Particularly, the Ferguson Senate committee investigating government contracts will shift its sights. Under Democrat O'Conor, this descendant of the wartime Truman committee will again ride herd on defense contractors; heretofor Ferguson spent his time sniping at government bureaus. Also, Democrats won't be spying on Demo crats. That means that you won't be seeing any nore of the ''watchdog'' committees the Republi cans set up to check on Democratic administrators. The Taft-Hartley watchdog committee will die with the Taft-Hartley act. b u sin ess w e e k Nov. 13, 1948 Bridges' ECA committee, explicitly set up because of the White House-Hill party division, will fall to M cKellar, who will keep it going for the patronage it provides. Capehart's project for legalizing basing-point pricing will fail. His committee's hearings will run their course. Capehart will turn in a report to the new Democratic majority. And that will be the end of that. Democrats like O'Mahoney, of course, will be tempted to turn the committee into a big new inquiry into concentration of industry-- like the TN EC of the '30s. NEXT YEAR'S LABOR LAW will be the Wag ner act-- plus. The technique W ill be to add provisions onto the 1935 law, rather than subtract from Taft-Hart ley. It's easier that way-- besides, it fulfills the fetter of the Democratic" platform. Here is how you do it: Write a Hew law which (1) flatly repeals Taft-Hartley, but (2) re enacts those restrictions'in Taft-Hartley which Tru man himself thinks are all right. C.I.O. and A .F.L. are working up separate drafts of what they would be willing to take. They'll thrash out any differences with their friend. Labor Secretary Tobin. He will write the final draft of the bill for Truman. - You can depend on this: Truman isn't going to give up the president's right to enjoin national emergency strikes-- -in coal, transportation, utili ties. (That means Lewis, next July). So, Tobin's bill will contain something like the present Taft-Hartley injunction power for such cases. Other injunctions aimed at unions are out. But there will be some curbs on jurisdictional strikes and secondary boycotts. The new bill won't ban the closed shop; that will be back on the bargaining table. So will hir ing halls. (The printers win their fight.) Elections? The Wagner act has only one kind -- to choose a bargaining agent. And that's all there will be in the new law. On non-Communist affidavits there won't be anything at all-- or else management will have to sign up, too. (Odds are there won't be any affi- 15 HIGH-FLYING PLANES DEPEND ON G-E SILICONES &V:'. \ t \ ! > ' *4 * 5 mi r ... ;-l.. nes can Are you facing a production or product-improvement prob lem? Can it be solved by the use o f chem ically inert, highand low-temperature-resistant materials? T h en we suggest you discover how General Electric silicones can help you. N o t lon g ago G-E silicones began playing im portant parts in airplane m anufacturing. G-E silicone rubber is proving to be an excellent gasket material for new jet engines. These silicone rubber gaskets retain their resiliency and sealing pow er under the extrem es of heat and cold encountered in stratospheric flying. Silicone-insulated wiring furnishes ex cep tion al resistance to heat for U n cle Sam's fighting planes. A n d several prom ising new uses are being investigated for G-E silicones in the aircraft industry. W atch for G-E Silicone Resin Finishes H ave you heard about Genera'; Electric silicone resins? W hen available for synthetic enamels for application on kitchen ranges, refrigerators, automobiles, and other prod ucts, silicone resins w ill make possible a finish w ith characteristics of durability and suniastness never belore achieved. want to know more about c-F SILICONES? Sorry we haven't space for the com p lete G-E silicone story here. But w e'll be glad to go into greater detail if you 11 just contact us. Chemical Department, General Electric Company, P ittsfield , Massachusetts. Please address inquiries about G -E sd ic o v e s to C h e m m a ts D iv is io n , Chemical Department, General Electric C o m p a n y , S c henec tady 5, N. Y, GENERAL ELECTRIC C048-Q9 BUSINESS WEEK NUMBER 1002 NOVEMBER 13, 1948 Chapman Brannan Backed by Labor, New Dealers, Truman went to the people for his mandate. That, tells you . . . The Meaning of Truman s New Deal Businessmen can brace themselves for at least four years of a revived New Deal. W hat kind of New Deal will it be? Since 1933, there have been many kinds of New Deals to serve as patterns. After the NRA came the Wagner Act--Social Security New Deal and the trust-busting New Deal. The 1949 New Deal won't be a copy of any of these. But its underlying char acteristics are fairly clear: It assumes that government should keep its fingers in the running of the economy. It bases itself on the people's desire for security against economic hazards. It expects to give labor a bigger voice in its actions. This New Deal will develop slwly. The President isn't planning to start any dramatic " 100 Days" next January. So at first, his New Deal will sound like a warm-over of old Truman messages. That's because right now there isn't nch else to draw on. For months, no body in Washington has been doing much fresh thinking. This week Truman sent a memo to all branches of the Administration asking them to come up with their ideas for legislation. You can expect the answers to be showing up in bills all through the first session of Congress. It would be a mis take to assume that the new New Deal will look like Truman's past perform ance. It's a New President The U. S. is getting a new President Truman. No longer can the man in the W hite House be regarded as a nonentity put there by fate; this time the voters elected him. That means that for the first time Harry Truman has a go-ahead signal. Harry Truman is in a stronger position today, politically, than almost any Presi dent in history. Never has one Presi dent owed so little to so many. To almost everyone in the Democratic Party, Truman looked like a dead duck from the start of his campaign. Because what support they gave him was small and grudging, the political debts which Trum an' must pay can be counted al-' most on one hand. W hat does that mean in terms of the new Administration' It's a New Group of Advisers A lot of New Deal fices are sure to show up among Truman's advisers. Many N ew . Dealers have already got their heads under the tent--and more may crowd in later. For example: Roosevelt's longtime close friend, Jonathan Daniels, is at Key W est with Truman. This is significant because Key W est is not all vacation; important issues, like tax policy, may be settled there. Other New Dealers al most sure to buy one-way tickets for Washington include ex-Housing admin istrator Wilson W yatt, Ed Pritchard of Kentucky, ex-OPA Boss Paul Porter. Although Truman's Battery D boys are the only ones who really stuck close by the boss, the New Dealers aren't likely to bow to their wishes. In fact, key men in the New Deal--like Sam Rayburn and Alben Barkley--are in a 19 NEW CABINET Truman's New Deal will bring a reshuffle. Some cabinet members will leave because they wanted to retire; others because they did not campaign. Into the places of all will go strong New Dealers. Main jobs to be filled seem likely to be the posts of Defense Secretary, In terior Secretary, and Secretary of State. But a t this stage of the game only one man seems assured of a job. He is Mon W allgren, defeated governor of Washington. IN? Johnson W allg ren Harriman Douglas good spot to put the pressure on Truman. 1t's a New 'Cabinet Truman will also do some reshuffling in his official family. Three members of the old cabinet seem sure to go at the start: Secretary of State George Marshall, -Defense Secretary James Forrestal,. In terior Secretary Julius A. Krug. W ho will fill these posts? The list of potential Secretaries of State is long. Chief Justice Vinson and William A. Harriman are the best bets now, but the field is still wide open. For Defense Secretary, the leader right now is former Undersecretary of W ar Louis Johnson. Nearest to him in the race is the President's old crony, Gov. Mon C. Wallgren of Washington. Oscar Chapman seems pretty well on the way to succeeding his boss as In terior Secretary. Lurking in the back ground here, too, is Wallgren. He'll get Interior if no other job can be found. Otherwise, it goes to Chapman. Cabinet members sure to stay: Treasury Secretary John W . Snyder (but he may have less influence); Labor Secre tary Maurice J. Tobin; Commerce Sec retary Sawyer, Agricultural Secretary Brannan, Attorney General Tom Clark. It's a New Congress At the other end of Pennsylvania Ave. will be the most New Dealish Congress since 1936-38. Of the 435 20 members in the old 80th Congress, 130 won't be back. The net Democratic gain makes this division of the House: 263 Democrats,' 1 American Labor Party, 171 Republicans. Moreover, ever}' new Senator is New Dealish, replacing G.O.P. old guarders. ' Friendly people will be running the 81st Congress--Rayburn and MacCormack in the House, Barkley and Scott Lucas in the Senate. Yet the 81st won't be completely obedient; the President must be skillful if he is to get all he can out of it. He made a solid first step in inviting Sam Rayburn to join him and Barkley at Kev West. Rayburn, in a sense, is the key to the success of the new New Deal. For one thing, he can gain thumb-screw control over the House rules committee by out- flanking southerners like Gene Cox and Howard J. Smith (page 15). For an other, Rayburn can build a big solid Ad ministration following by developing the freshmen bloc of laborites and New Dealers elected by Truman. The Republicans can no longer count on much help from the southern Bour bons in Congress. Since they failed to beat Truman, they are now ready to scramble hack home to the party. Tru man is ready to clinch their loyalty by laying off his civil rights program for a while. (This and broader worker cover age under Wage-Hour are the only really important conflicts between North and South.) Truman's strategy will be to get things like aid to education, soil conser vation, power development through first. These are tilings that the South is New Dealish -about. For Business: Prosperity? FIow good can business be under this kind of government? In the perspective of this week, it looks as if it could be about this good: A continued high level of business activity. A lower level of profits. Business taxes can't go anywhere but up; and heavy industries particularly are likely to find their costs rising faster than their prices. Even so, profits under the New Deal may easily be at a level which would look good" any year but this one. T hat's about the conclusion the busi ness community has to come to. The Profits? stock market, though, sags under the ex pected blow to profits via taxes, controls, or both. Plenty of Business Just about every part of Trum ans domestic program is calculated t in' crease government spending or con sumer buying power. The social welfare programs alonesocial security, health insurance, educa tion, housing--can add several billions to the federal budget over the next vear or so. There's more uncertainty abou BUSINESS WEEK Nov. 13, I948 foreign and military,, spending--but it surely won't get smaller A pro-labor slant m the government uoints to ever rising wages, and fatter uocketbooks. It starts with a now-cer- tam fourth round of pay increases and will be back-stopped by higher mini mum wages. Add to that a guarantee that farm income will not be allowed to drop too far below its present high level. Biggest question: W hat will business men decide to do about buying more plant and equipment? There's been a psychological shock. But most expansion decisions have been enforced, despite high and rising costs, by imperative de mand. Despite this torrent o f money, busi- nessmen may not get to keep as much of it as they arc accustomed to. Rising wages mean rising costs. And one way or another, most welfare pro grams increase business costs. Prices, meanwhile, will get stickier. Basic industries like steel are likely to find their prices controlled directly. And all major businesses will have to bear in mind the reactions of a sus picious government when they fiddle with their prices. Even at the con sumer level, any upsurge of prices would bring the threat of price controls. Early post-election talk of an excess profits tax is dying away. But there's a good chance of an increase in corpo ration tax rates, and maybe in upperlevel personal income taxes. These A re the Great Issues Like any government coming to power today, the new Truman New Deal will have to be built around the central problems of foreign relations and in flation. To this, the Democratic admin istration adds another: government regulation and guidance of industry. A Freer Swing Abroad In'its formal objectives, the Truman foreign policy will be more of the same --strengthened bv riddance of many Congressional isolationists. It will still be based on maintenance of moderate military strength, containment of Rus sia, economic upbuilding of Europe. But you can expect a difference in tone, a more free-swinging, dramatic approach. Truman has chafed under the "professional" rigidity of U.S. for eign policy. Now he will, revive the am ateur touch--with both its virtues and defects. At the workaday level, these are the things Truman will be asking--and get ting--from Congress next year: Whatever money ECA feels it needs. Approval of a North Atlantic security pact joining U.S. and Canada with Britain, France, and the Benelux coun tries. Something like SI-billion for military lend-lease to Europe. ' . - More aid for China--but not much more. Add one big change resulting from the election: revival of the tariff-cutting approach-reciprocal trade, I. T. O.-- which was withering away. Caution on Inflation Truman was a hellraiser on inflation in the days when he uas, for all prac tical purposes, in the opposition. He wanted to throw the book at the high cost of living. Now he'll be more cau tious. The economic team in Washington still sees upward pressure in the economy --but less of it than in the past. So--initially at least--Truman will rely more on moderate fiscal measures than on the direct controls he liked to talk about earlier. As the Washington plan ners shaped their post-election ideas, this is what emerged: Extension of consumer credit controls beyond next July. Some sort of special reserve plan to sterilize bank holdings of government bonds and enable the Federal Reserve to keep.more control over bank credit... Another 6% increase in. regular bank reserves. . . ; _ - . No excess profits tax looks likely: Until recently, this was a darling of the Washington inflation-fighters. Now they doubt that thev- really want it. It might- prove too deflationary. And anyway, what would you use for a base.year? Higher taxes--just to. put a, little NEW CONGRESS The 81st Congress will be solidly h the hands of the New Dealers, t e key figures are Lucas in the Senate and Rayburn in the House -- both strong Truman men. Sen iority will keep New Dealers out of some committee chairmanships. But on nearly every committee they wilf have enough members to offset the shenanigans of Republicans ond conservative Democrats. Thus, the new Congress is essentially a New Deal Congress. Lucas Rayburn Sabath George bu sin ess w e e k Nov. 13, m s Doughton Thomas Lesinski 21 NEW FACES-- Men like these freshman Senators will be pulled together into a strong bloc to support New Deal legislation proposed by Truman squeeze on the boom--would be wel comed by many Democratic economists. But they realize a tax boost would be politically impossible unless needed to prevent an actual budget deficit. And the way tax collections are going now, it looks as if even a budget beefed up a couple billions by the Truman welfare program would balance out at present tax_ rates. Any real set-up in military spending next year could upset this balance. Tru man won't boost war spending far unless relations with Russia get a lot worse.' If he does, you will see: first, an increase in corporate income tax rates. Then, if that's not enough, an increase' in per sonal income tax rates; this will be coupled with an increase in exemptions to throw the extra load into the upper .brackets! A military set-up would also bring direct price controls. They would come in th e basic heavy industries. The Hand of Government No price controls- doesn't mean no controls. The biggest change that the businessman-at-the-desk will notice, liv ing under the new New Deal, is this: W hen the government sees an eco nomic choke-point shaping up, it won't hesitate to do something about it. For early next year this approach to the situation means: Allocations of scarce industrial com modities--steel certainly, some other metals very likely, perhaps some indus trial and utility equipment. Housing controls. Priorities on build ing materials will be aimed, as in the W yatt days, at encouraging cheap houses, discouraging expensive construc tion. A possibility: Some form of subsidy or rapid amortization for expanded ca pacity in critical industries like steel. Add to these special measures, the effects of a revival of confidence and en thusiasm among the old-line regulatory commissions and agencies. The Federal Trade Commission, which has been shivering at shadows ever since it saw Congress' reaction to the basing-point decision, is now raring ` back for a vigorous policing job on business. The Civil Aeronautics Board can move ahead freely wuth its plans to re vamp the route and corporate structure of the airlines. It's in this sort of spirit, seeping down into every bureau and office, that you will really feel the effects of Truman's election victory. The N ew Deals Special Interests It is already clear what groups will get the most out of the New Deal. The two most outstanding are labor and the farmers. Both take credit for putting Truman and the Democrats in power. A Strong Labor Voice The 1949 New Deal will mean the end of the Taft-Hartley act. That will be labor's payoff for playing a leading role in the Democratic victory. The new Congress is the first which labor can claim to have given a mighty heave into office (page 102). A few of the Taft-Hartley provisions will stay, but only as changes in the Wagner act. There will be no more in junctions--except perhaps for "grave na tional emergencies" (particularly John L. Lewis). The closed shop will come back. Unfair labor practice rules for unions will be wiped out or drastically softened. Other changes will be made NEW POWER-- Men like these, who have been running some of the important agencies under Tru man in the past, will have their authority increased-- instead of losing their jobs Lilienthal (AEC) Coy (FCC) McCabe (FRB) Smith (FPC) O'Connell l BUSINESS W EEK Nov. 13, 1948 coiccf: unions when strikes do occur. tC>however, labor won't get off scot , The new law will probably have a tj against jurisdictional disputes and "unjustifiable" secondary boycotts. A Strong Farm Voice Tire switch of the Midwest states to tbe Democrats means a boost to the farmer's influence in the government. That's especially true of the meat, wbeat, and dairy farmers. By the same token, the fact that the southern Democrats sat' on their hands means a drop in their influence for cotton and tobacco. Biggest plum that will fall to the farmers as a result of their vote will be : continued support prices. But the battle 1 that's been going on within the farm bloc will continue in this Congress. What kind of price supports shall they ; be: (1) mandatory supports at 90% or j more of parity, plus mandatory acreage i and marketing controls, or (2) flexible ] price supports? j Two other plums will fall to the farmj ers.: First, Congress is sure to give the j Commodity Credit Corp. the power to build more government storage facilities for grain under loan. Second, there's no j chance that Congress will end the tax j exemption on farmers' cooperatives. More Social Welfare A; third special interest of the new New Deal has also been a pet of all previous New Deals: social welfare. Upcler this Truman Administration, social security will be broadened and ex panded. You can count on some kind of e hfaeiralylthu.nisncsautrhaendc.e bill going through atn The Unfinished Business e The election pulled the rug from o r l under a lot of unfinished business in Qy* del Congress. Much of it seemed solid enough to roll on forever unchallenged. But now all of it is either on the way : ufl or rerouted. The most important i changes: j The Capehart Committee, investi- igating basing points, will submit its re p ort in 'January. But it won't mean miudi because the Democrats will be | ack in control. With* O'Mahoney as ^chairman, the committee will soon into investigation of monopoly. I Fhe Ferguson Committee will turn f b uns to aim them at war contractors of at the government. , * "e Hoover Commission, aimed at eamlining the government, is as good ls dead. It will write and file its report originally planned. But the Demo- l> t Cf yictory has taken all the punch fra' l*-: ^ le victors won't go for a proJ that loses them jobs and prestige. 5, H ess w e e k . Nov. 13, 1948 Peace Treaty for Alcoa? Aluminum company buys W A A plant at Massena, N. Y., frees its patents to the industry. Question: Is Justice Dept, relenting in its antitrust campaign. Aluminum Co. of America last week buried the hatchet with one govern ment agency. But whether it was to get the ax or the olive branch from another wasn't quite so clear. Two Deals--W hat Alcoa did was: (1) Sign an agreement with W ar As sets Administrator Jess Larson. This will make many of its patents available -royalty-free--to the rest of the alu minum industry. (2) Arrange to buy the governmentowned aluminum-reduction plant at Massena, N. Y. Price: $ 5-million. The Aluminum Co. of America is also get ting carbon-production equipment from the government's Burlington (N. J.) plant, for $175,000. Before this, Alcoa got the brush-off when it came to buying any of the sur plus plants WAA was peddling. Alcoa did buy the surplus fabricating plant at Cressona, Pa., in February, 1947. But the Massena plant is, a pig pro ducer. That makes all the difference, and that makes the sale to Alcoa sig nificant. Background--It all goes back to Jus tice Dept.'s 11-year feud with Alcoa. The courts ruled in 1945 that prewar Alcoa was a monopoly. But the govern ment didn't make any further move against the aluminum giant at- that time: It was waiting to see whether it was still a monopoly when the war sur plus plants were distributed. About a month ago, Justice finally asked for a court order to break Alcoa up (BW-- O c t.2 '48,p28). Crux of Justice's charges was that Alcoa controlled the aluminum indus try by controlling pig production. Now WAA has relented and sold Alcoa a pig plant. Larson was glad to get rid of it. To him, Massena was a white elephant. The plant had been standing idle, and was going downhill. No one else would have it. Change of Heart?--Justice Dept, op posed the sale of the Massena plant to Alcoa, but not very hard. So the indus try is asking: W hat does this deal--and the release of the patents--do to the antimonopoly suit? Some sources say, not much. These dopesters think that there'll probably be a break in the antitrust suit in the next couple of months. Justice has filed its findings in the monopoly case; Alcoa's answer is due in January. That answer should either result in a settlement or bring the case to trial. Feeling in Pittsburgh is that the Mas sena sale might foreshadow a softening toward Alcoa on Justice's part. It's rumored that the W hite House put its O.K. on the deal. If that is so, Justice probably knew about it. W hether or not the release of patents will mollify Justice, what Alcoa gets-- and gives--in the two transactions is fairly clear. Massena Deal--Under the Massena agreement, Alcoa will: c l o s e d o w n two-thirds of its old plant at Massena and operate two-thirds of the WAA plant. increase its over-all pig output by about - i of 1%. Production at Massena will be upped 4% to 5%. keep up unused part of the old and new plants, as standbys in' ease of war-- ' or threat of'war. Patent Deal--Under the patent agree ment, Alcoa will: : . ... . ; - give waa a royalty-free' license to use Alcoa's fluoride patent at the govern ment's alumina plant at Hurricane Creek, Ark. WAA will have the right . to sub-license any: operator of the , plant. m a k e a v a il a b l e , also royalty-free, all its patents, governing the process of . extracting alumina from bauxite ore at 'government-owned alumina plants; again WAA will have rights to sub license. g r a n t t o w a a , for $115,000, a license under all Alcoa's machine patents; the license would apply to all the alu minum-producing and fabricating fa cilities that Alcoa built for the gov ernment during W orld-W ar II. Results--As a result of these commit ments, both Reynolds Metals Co. and Permanente Metals Corp. will have access to all of Alcoa's alloy patents; they will also be able to use its basic patent on the so-called "direct-chill" process of casting aluminum, plus a variety of other patents in the fabricating field. From now on, the aluminum indus try will operate on a royalty-free basis. The only exception will be in the fabri cating field, where moderate industry royalties have been established. In winding up its issues with Alcoa, WAA points out that aluminum-smelt ing facilities will now be divided in about a 50-30-20 ratio among three companies, Alcoa, Reynolds, and Per manente, respectively. 23 What Ford and Nash Held Estate filings show that both auto men kept large sums in cash. Their heirs can use these liquid assets to pay inheritance taxes to government. A few people in the United States have a problem that doesn't bother the rank and file: where their money should be, when they are alive and when they are dead. In a wav, it's many a man's worry. But it looms bigger when there are millions of dollars involved. T hat's the problem that faced two massive figures in the auto industry: Ford Motor Co.'s Henry Ford and Nash-Kelvinator Corp.'s Charles W . Nash. Two recent items in the financial news throw some light on how they handled it. Thrifty--The estate of Nash has just come up for appraisal in probate court. Nash died last June, at the age of 84. Preliminary figures put his estate at $43,183,624. The two biggest items in the 15-page listing of his assets h it financial dopesters with a bang. Nearly $13-million of the estate was in savings accounts. Farmers & Merchants National Bank of Los Angeles had over $7.7-million. Security-First National Bank, also Los Angeles, had a cool $ 5-million. By any standards, those are fat figures for the savmgs-account book. The next largest asset item was 62,900 shares of NashKelvinator Corp. The value of these was estimated at over $1.1-million. Other investments included public-utility and traction bonds. Among other matters still to be han dled in winding up the Nash estate is the payment of taxes. This is usually a problem calling for much negotiation with tax authorities to get agreement on estate asset values. Ford's Tax--W hen the Ford will was filed a vear and a half ago (BW --Apr. 26'47,p92), one big question was how much money the government could col lect on it in taxes. The estate and the government didn't agree on the value of the taxable Ford shares. The argument went back to the time of Edsel Ford's death in 1943--and even earlier. Now that Mrs. Henry Ford has filed the first annual accounting for the estate, there is an answer to the ques tion of the government's take. The ac_ counting showed payment of $21.6-mil lion m federal taxes, $1.5-million f0r Michigan inheritance tax--on account The $21.6-million wipes the federal liability off the books--provided the estimate of the stock's value isn't chal lenged. The E state-O n Apr. 8, 1947, the estate had a cash balance of over $26 4million. There were also property and real estate holdings of $1.9-million in Michigan, $963,695 in Georgia. Then there were holdings in British and French Ford. Add to that roughly $3g_ million in Class A and Class B Ford stock, worth SI00 a share. You get a total of some 566-milhon, not counting the foreign holdings. The Ford foundation gets 286,099 shares in "A" nonvoting, tax-free stock The Ford family gets 95,321 shares of "B" (voting) s:ock. Dividends of $5 a share have swelled the cash account by some $1.9-milhon between April, 1947, and April, 1948. 'Taxes almost swallowed up the cash balance. By July of this year, after claims and taxes had been paid, the estate's cash had shrunk to a little over $ 5-million. A Clew?--That is a big bite to take from any estate. Its size may help ex plain what Charles Nash may have had on his mind when he salted away 513million in savings accounts. That big splash of liquid assets may be just the thing when the Nash estate has to settle up taxes. Mavbe the heirs won't have to sell stocks--at a time when stock values are declining. Maybe all they'll have to do will be to draw on those sav ings accounts. Berliners Had Two Winners to Pick From Newspaper readers in Berlin had a slight Case of confusion for a short time after last week's election. I,ike Col. McCormick's Chicago Tribune, the Soviet-licensed Na tional Zeitung (left) went to bed a bit prematurely with the wrong man on top. On the other hand, the British-licensed Telegraf (right) had the word correct; but until later returns came in, Berliners had to wonder who won. 24 NATURAL GAS; WHEN? W hen will natural gas reach the metropolitan New York area? You could get some idea this week. Six util ities in and around New York and one in Philadelphia signed contracts to buy 295-million cu ft. of gas a da)'--when Trans-Continental Gas Pipeline Co. can deliver it. But that hardly means tomorrow Trans-Continental hopes to start de livery by late 1950 or in 1951- It lS building an 1,840-mile pipeline from Texas and Louisiana to New York City. And there's still a shortage of steel pipe- Another pipeline company is m a position to reach the New York^area. Texas Eastern Transmission Corp. s Big Inch hncs (B W -N ov.6'48,p22) now terminate at Linden, N. ]., not far from New York. Texas Eastern is delivering some natural gas to Philadelphia, hopes to expand its capacity enoug deliver gas in the New York metropo i tan area bv 10 51 or 1952. BUSINESS WEEK Nov. 13, 19-** WRONG GUESSES like this on California a n d ..................U N EX PEC TED , right guesses like this one mean that pollsters . . . GEORGE GALLUP, and . . . ARCHIBALD CROSSLEY, and . . . ELMO ROPER are trying to explain . . . How the Election Polls Went Wrong The pollsters couldn't read their own figures, and their sampling method may have been wrong. You could have knocked them over with a punch card last week--the public opinion pollers and most editors and politicians. For the first time, the "sci ence" of pulse-feeling had really gone haywire. W h y? Crowded Limb--First off, the disaster stemmed from a basic human error: The researchers didn't read their own figures hke mathematicians. Once one of the rnajor pollers had himself out on a limb with a prediction, the other two got on Behind him. Sure that poll-takers are the type who wear a belt and suspenders, too, the editors and politicians crawled out with them. The limb broke. Strictly speaking, neither Crossley nor Gallup nor Roper had proved that either of the major candidates was a winner. Crossley gave Truman 44.8% of the vote; Gallup, 44.5%; Roper, 37.1%. (Truman actually got 49.9%.) But these figures had miles of stretch in them. That 4% Error--For one thing, all samples are subject to possible error. The pollers say this stretch was about 4% for each candidate. In other words: W ith completely bad luck, the margin of victory could have been sour by 8 percentage points, one way or another. Next, the "don't know" vote ran as high as 15% (in Roper's case). The pollers assumed the "don't knows" would split about even between the ma jor candidates on election day. W hether they did is still anybody's guess. All in all, Roper's own figures--taken at face value--had such a stretch that Truman could have had as low as 28% of the vote, or as high as 51 %. No Hedge--W hy didn't the pollers frankly say that? The New York Herald Tribune's Ralph Chapman probably put BUSINESS WEEK Nov. 13, 1948 25 his finger on it. After an interview with money. You know - in advance that pense of calling back again and again Gallup, he wrote: people's opinions are affected by various can be enormous. "Asked whether he had warned that things--age, race, creed, income, occu Here again the "quota" system takes his prognostication of the presidential pation. You also have certain basic data a shortcut. You can substitute Mr. election could be in error because of on these factors from Census and else Smith for Mr. Green. You can--if you the anticipated small vote, he (Gallup) where. are sloppy about it--interview only replied that he had not because the So you try' to set up a sample with ground-floor families, save your wind by newspapers would have accused him enough factors m the right proportions. not climbing to garrets. of hedging." Basically, that's sound. The interviewer has spine leeway for For businessmen, the first big lesson But suppose your data is shaky? Or human judgment under the "quota" from the debacle of the polls thus is evi suppose that y'our definitions of the system--just as the sample-maker did. dent: Beware how you read figures. In various factors are vague? For example: And that " judgment" can introduce a research as in contracts, it's often the Just where is the dividing line between systematic error m the results. footnotes--the hedging--that makes all different income groups? At first glance it looks as if the elec the difference in the world. T hat's where serious trouble can tion gave "probability" polling a big W rong Methods--Aside from plain creep in. Human judgment weakens the boost, "quota" polling a black eve. human errors m judgment, the pollers mathematical guides. But for many jobs, the "probability" may have committed some errors in Interviewing--Further, the difference system is fancier than you need, too method. If nothing else, it's obvious between the "probability" and "quota" expensive for what it shows. Suppose that a poll which has a stretch of 23 or methods is especially w'ide in the inter you want to find out if any adults in even more percentage points in it leaves viewing work. New York's Hell's Kitchen "drink whis something to be desired. Let's say you are using the "proba ky. You could get every' last adult's And therein lies a second big lesson bility" method and have grabbed 5,000 name and address, put it in a bowl, draw- for businessmen: If you want tighter names from the one big bowl. Now out a sample, then interview each and research, you will have to push for it. your interviewers must buttonhole ex every name m the sample, with no lee The techniques are there. But they actly those people. They can't substi way for substitution. haven't been used to their fullest. One tute. They have to play Dick Tracy on But you could probably get an an reason: Businessmen won't spend the that 5,000 until they have nailed every swer cheaper, sooner, and good enough money. last one. (In actual practice, you could for practical purposes by a crude "quo From its. beginnings, research has never reach all 5,000; but y'ou would ta" sample. been bedeviled by this penny-pinching have to come mighty dose.) The ex- Right Questions-Aside from sam on the part of its customers. That led pling and interviewing methods, the to the widespread use of the "quota" election has put the spotlight on the sample. The public opinion pollers, in questions that are asked of the guinea cidentally, all used "quota" samples. pigs. Probability vs. Quota--Critics for Are they searching enough? Did the\ some time now have been touting an allow the subject to lie or fake? What other method--the original "probabil about . the "don't knows?" Would ity" sample. (Variations on it are called deeper probing of them have revealed "precision" or "area" methods.-) something? The Census Bureau is a strong plug- No definite schools revolve around ger for this type; so is the Advertising this point, as they do around sampling. Research Foundation. But there's common agreement that Suppose you want to find put some more psychology would produce more thing about the 140-million citizens valid answers, of the U. S. You put everybody's name The research fraternity hopefully says on a slip of paper, throw the slips into this soul-seai ching is all to the good. a big bowl, spin it, then draw' out a And indeed it is--providing it teaches handful of slips. You now have an ab businessmen thev have to pay an hon solutely random 'sample; every name est price to get honest goods. When a in the bowl had a fair, impersonal competent research firm advises an ex chance to get into the game, to regis pensive sample, the client would do ter a vote or opinion. You have a true well to take it, or drop the job. "probability" sample. End of Polling?--Does all this mean W hat's more, you can use a mathe that commercial research is crippled or matical yardstick to find out how much O n e Correct Poll stretch (range of error) there is in your doomed? Probably not. The election polls dealt with future findings. Suppose you have a big hand Staley Milling Co., Kansas City (no con intentions. That's trickv stuff. Most and grab up 1,000 names on the first nection with A. E. Staley Mfg. Co., page 6) commercial surveys deal with facts and try. You interview' these. But your is blushing this one off--not because its poll actions-did the subject actually use mathematical yardstick shows there is was wrong, but because it was right. Lifcbuov or Camay, did he actual!' still a lot of room for error. So you grab Just before the election the company held listen to "Stop the Music" or Fred another handful of names--and another. W ith each handful, the possible error an informal poll in which fanners cast their votes by calling for a chicken-feed sack with Allen7 , Noi docs the average commercia gets smaller. a donkey or an elephant on it. After three work need tire absolute certainty of an All " probability" samples are based w e e k s, th e r e su lt s t o o d : 54% fo r Truman, election poll You may find out via on this grab-'cm-out-of-the-one-big-bowl- 46% for Dewev. Unable to believe what it research that sav, 55% of the system. The attraction is the completely saw, Staley called the thing off. Quipped favor your product. Actually only 0 random selection. Every "name has a one executive at the time (with more fore buv it. But \ou probably w ont go 1111 mathematical chance of coming up. sight than he realized): "If pullets were bal der because of the difference. iI ';' Quota Samples--The "quota" sample lots, President Truman would be a shoo-in W ith Truman and Dewey it's some I is a shortcut method to save time and for re-election." thing else again 13 1948 26 BUSINESS WEEK Nov  Howard Alien on Order Desk Howard Alien, Sales Representative Howard Alien, Machine Operafor Outside Man with an Inside Story Do you know the inside story behind your ' Ryerson sales representative? It's a story of years spent within a Ryerson plant. A story of the steel inspection department, the operating department, the service department and others --inside jobs through which a Ryerson sales man builds up the experience he applies--out side--to your steel problems. T hat's why you can be sure you're dealmg w ith an experienced steel man when a Ryerson representative calls. He offers a com plete steel service--carbon, alloy and stainless, sheared, sawed or slit, burned or bent, punched or threaded. And he can put to best use all the smoothly coordinated functions th at make up this steel service, because he knows about them first hand. Of course, he can't work miracles. Right now there simply isn't enough steel to meet current demand. But you can depend on your Ryerson salesman to cooperate closely and intelligently with you. From long experience he can often suggest practical alternates when the steel you need is not available. So, to make the most of available steel, talk it over with your Ryerson representative or phone our nearest plant. Joseph T. R yerson & Son, Inc. Plants at: N ew York, Boston, P h ilad elp h ia, Detroit, Cin cin nati, C levela n d , Pittsburgh, Buffalo, C h ic a g o , M ilw a u k e e , St. Lo u is, Los A n g e le s, San Fra n cisco . i RYERSON STEEL |i r- '- r*' )i- `y i * - tt '-! j; \."i n -. - Here is General Mills' latest achieve ment in cost-cutting packaging machinery. The Tray-Lock Machine produces lock-type trays and cartons from flat, unglued blanks. Operation of the machine is entirely automatic; the expensive glueing operation is eliminated completely. The m achine delivers a wide variety of tray and carton sizes and styles to the filling station at speeds to synchronize with the filling opera tion, up to 90 units per minute. All are turned out with sturdy, straight sides that have no diagonal scores to weaken them. Carton sizes range from 1" to l f i " in height, 2" to 6" in width and 4" to 13" in length. Change-over from one carton size to another is a simple 10minute job. Cut your packaging costs--turn out stronger cartons at a faster rate with the General Mills Tray-Lock Machine. Further information on this or other General M ills packaging m achines (finished-edge carton formers, ice cream carton set-up and closing machines, Vacuflow powder fillers) is yours for the asking. Address Dept. B118. General Mills T ray -Lock Machine Madebyone oftheworlds largestusers of packaging machinery 28 BUSINESS BRIEFS t h e ru bb er p ic t u r e continues bright September output of natural hit a new high (145,000 tons), while consumption hung up a postwar record (122,300 tons). on th e block are North American R ay. on and American Bcmbcrg (B W --Apr 3'48,p28). The Office of Alien Property will open bids on Dec. 13. Last barriers to the sale went down with stockhold ers' approval of a new series of stocks. Successful bidders must get an O. K. from the Justice Dept.'s antitrusters. B R IT IS H A U T O M A K E R S expect to export $280-million worth of 1949 models. U. S. buyeis will account for a big chunk: The; bought 16,000 British cars (worth $14 8-million) during the first nine months of 1948, are now secondbest overseas automotive customers. an titru st hearings against the Giannini's Transamerica Corp. are slated to begin Dec, 7 (BW--O ct.l6'48,p92) The Federal Reserve Board is speeding things up now that a Federal district court has refused Transamerica's de mand that the board "clarify" its com plaint. t o p posts have been filled in the gov ernment's $ 1-billion program to develop electronic all-weather airways (BW-- May6'48,p47). American Airlines' pres ident Ralph S. Damon will be chairman of the Air Navigation Development Board; R.C A.'s Dr. Douglas H. Ewing will head up development. e m p ir e tractor is in bankruptcy. Two weeks ago a federal district court ap pointed receivers for the companyknown mainly for its sales to Argentina (BW--Aug.' 6'47,p21). Now creditors have joined in a new petition to with draw the oiginal one for bankruptcy. T H E H U D S O N R I V E R DAY L I N E h a S followccl the famed Night Line into senti mental limbo. It has taken its four steamboats off the New York-Albany run, put them--and other property-up for sale. H a w a i i a n p i n e a p p l e co. is inching ever closer to its market: First it acquired a California cannery (BW -Apr.2T48, p i 03); now it has bought a piece of the new cannery going up in Cerro Colo rado, Mexico, p o r is m o o t h , va., has oversubscribed the 5250,000 fund being raised b v e Industrial Foundation (BW --M avlo > p48). Money will go to house new 1 . dustrics, end Portsmouth's boom- u dependence on naval shipyards. , .. 1 3 1948 BUSINESS WEEK Nov. Time, Gentlemen, Time! . . . high time to end this Uncivil War T h e r e 's a legend that in one part of the South, a pack of Johnny Rebs and a bunch of the Boys in are still shooting at each other -- be cause no one has been able to get close enough to tell them it's all over. And that makes just as much sense as the actual feuding and lighting that goes on among some "grown-ups" in the world of business today. One side defending an outworn set of principles, prejudices and pompous protocol. The other side assaulting bitterly (with plenty of lavender and old lace m its own knapsacks). Who could guess that this is a buyer-seller rela tionship? W ell, it is . . < and how often you see it: "You can buy my Blueproduct . . . but you'll have tofight, to get it!" Now, these Brass mills were oper ating at the time of the Civil War. But even then, Bristol never operated in the stifling stuffiness that consti tuted "the code" . Almost ioo years old, Bristol has always been a young man's outfit, in which shirtsleeves are no crime and a laugh during business hours doesn't dock a week's pay. You'll find we serve up our service plain, without red-tape bows tied in hard knots. And if that's the way you like it, then here's the place you can get it . . . good Brass sheet, rod and wire made exactly as you want it. Glad to see you, or to come to see you, any time you say. Write. THE B r is t o l B ra ss CORPORATION Makers o f Brass since 1850, Bristol, Conn, 15 Park R ow , N ew Y ork City 418 Prick Building, Pittsburgh, Pennsylvania 1607 South Broadway, D ayton, O hio 616 Temple Building, Rochester, New York 827 Hospital T rust Bldg., Providence, Rhode Island YOUR LISTENING POSTS IN the New York State market Without leaving your desk, you can get an accurate picture of local conditions in the "World's Richest Market." Marine Mid land bank officers in 47 New York State communities can serve as on-the-spot reporters. Tell us in New York City what you want to know . . . and we'll have reliable first-hand infor mation for you . . . quickly! Marine Midland Banks serve. Buffalo New York City - - - Adams Albion Alexandria Bay Antwerp Attica -Avon Batavia Binghamton Copenhagen Corinth Cortland Depew East Aurora East Rochester Elmira Elmira Heights Endicott Evans Mills Fulton Holley Horseheads Jamestown Johnson City Lckawanna Lockport Malone Medina Middleport Niagara Falls North Tonawanda Nyack Oswego Palmyra Phoenix Rochester Snyder Sodus Tonawanda Troy W atertown Watkins Glen Webster W estfield Williams ville j Wilson The MARINE MIDLAND TRUST COMPANY o f New York M em ber Federo {Oepost Insuronce Corporation 30 Energy: Key to the Future Oil researcher sees present fuels and atom power ex hausted in a few centuries. Answer: direct utilization of sunlight, water power, vegetation. Industry is energy. Put it another way: Energy is the one thing industry simply could not do without, for energy means heat; energy means power; en ergy means transportation. Changing Energy Picture--These days more and more people are thinking and talking about the problems of energy supply. It's being forced on people's attention by: (1) The changes that are taking place in our energy sources. For instance, the rapid emergence of petroleum m the last few decades, only to drop back to a minor place m a comparatively short time as world development is measured. (2) The probability of a big increase soon in our energy needs. Supplies of easy-to-get-at, high-quality raw materials are rapidly being used up. In their place, we are being forced to turn to lower- quality resources, or to substitute mate rials. As our supplies of high-grade iron ore" give out, steel men are experiment ing with beneficiation of low-grade ores. T h at takes energy. Aluminum and mag nesium are being used more and more in place of other metals; titanium is coming'up (BW--Nov.6'48,p66). These new metals use more energy in the re fining process; aluminum is practically stockpiled electricity. Key question: Where will we be get ting our energy m the future--50 or 100 or 200 years m the future? Report--This week a session of the 28th annual meeting of the American Petroleum Institute, m Chicago, heard a carefully thought-out paper on the long-range aspects of this problem. The author: Eugene Ayres of Gulf Research & Development Co., a Gulf Oil Corp. subsidiary. His conclusion: W e will eventually ha\e to shift away from sources of energy that get used up, turn to "continuous," inexhaustible sources --and we had better start following this policy soon. In his report Ayres predicts that "the direct use of solar energy is likelv to displace an appreciable portion of our fuel consumption within the next few decades." Ayres estimates that total annual en ergy consumption in the United States today is a bit more than 12-trillion horse power-hours. (12-trillion is 12-thousandbillion; a horsepower-hour is about three-quarters of a kilowatt-hour.) Big Users--The largest single use of energy is for space-heating; it takes up 28.4% of that 12-trilhon hph. Second largest use is for transportation, with 27.7%; third comes manufacturing and Punctured Tread for Winter Driving Goodyear dealers are being provided with a new winter line of business--"tractionizing" tires. Goodyear Tire & Rubber Co. is now furnishing its dealers with a device (above, left) which punches thousands of tiny holes into tire tread to a depth of i to A in. Goodyear says the treatment nt creases traction on snow and ice, eliminates need for chains, lasts all winter. Stan at charge for the service is $2.50 per tire. BUSINESS WEEK Nov. 13, 1948 PRODUCTION TRIPLED! with TOCCO* Induction Heating Even if your products are entirely different in size and shape TOCCO can probably provide similar cost reductions and production increases for you. Nash Motors, Kenosha, Wisconsin reports the following benefits from TOCCO Induction braz ing of drain flanges to automobile oil pans: 1. PRODUCTION TRIPLED-- Using a hand torch, production was only 21 brazed assemblies per hour. TOCCO brazes 75 per hour--357% of former output! 2. COSTS CUT--At the same time TOCCO Induc tion brazing cuts labor and material costs from $12.75 to $4.90 per hundred--a reduction of 60%, representing a saving of $6.00 every hour. 3. OTHER ADVANTAGES--include a neater, bet ter looking brazed joint, and a complete elimina tion of leakers and subsequent repair costs. TOCCO Engineers are glad to help you find appli cations in your plant where TOCCO Induction Heating would increase your production, cut your costs and improve your products. THE JUST OHIO CRANKSHAFT COMPANY FRIE Mail Coupon T o d a y -------------- --| BULLETIN T THE OHIO CRAN KSHAFT CO . Dept. W-8, Cleveland 1, Ohio TOCCO Please send free copy of 60 page book. --"Induction H eating" Name P o s i t i o n __________________________ Company A ddress City Zone State Lowest Prised. . . Most Productive Fastest Moving Self-Propelled 5 Ton Mobile Crane on the Market iHYSTER You Won't believe it until you see a Karry Krane performing your loading and unloading jobs under your own conditions. That's why we welcome an opportunity, to demonstrate this selfpropelled mobile crane with adjustable boom, pneumatic tires, and the ability to hoist and move heavy or bulky loads up to 10,000 pounds quickly, efficiently. See your Hyster distributor for a Karry Krane demonstration. Write us for literature. HYSTER COMPANY THREE FACTORIES 2907 N. E. Clackamas S L , Portland 8, Oregon 1807 North Adams Stree t. . Peoria 1, Illinois 1010-07 Meyers Street ....D a n v ille , Illinois 32 mining, with 25.7%. The rest is mostly wasted. Practically all energy is of atomic origin. Most of it comes--or came--from atomic processes in the sun. Some of the solar energy that reached the earth many millenniums ago still exists today, in the form of "stored sunlight"--coal, petroleum, natural gas, shale oil. These underg:ound resources make up most of the `unrenewable" sources that Ayres talked about. From these unrenewable sources we obtain more than 90% of our energy requirements today. The other important unrenewabie source of energy is fissionable material, uranium and thorium. How Long--Estimates of ultimate re serves of these sources vary' tremen dously. Avres tock the highest and low est estimates for each fuel, stated them in terms of the number of years they alone would satisfy the present annual energy requirement (12-trillion hph.). Coal--maximum 1,700 years, mini mum, 170 years: petroleum--maximum 16 years, minimum 5 years; natural gas --maximum 12 vears, minimum 5 years; shale oil--maximum and minimum both 13 years; total--maximum 1,741 years, minimum 193 years. Rising Demand--These figures, of course, are based on a constant energy requirement at the present level. Ayres estimates that demand will increase about 50% every 50 vears. On that basis, demand would be 27-trillion hph. 100 years from now, instead of the pres ent 12-trillion. But there's another big factor: A lot of energy is lost when one form of energy is converted into another. Over the long term, this will make itself felt in two chief ways: (1) Electricity From Coal--A big part of the increase in demand for energy will consist of electric power. Most of this, in the future, will be made from coal (leaving hydropower out of consid eration, for the moment). And there is a big loss of energy in this process. Ayres estimates that, at present, the efficiency' is onlv 14.4%. This efficiency figure will be im proved; some of our production today runs around 20%. But Ayres estimates the conversion loss 100 y'ears from now as 7-million hph. a year. (2) Liquid Fuel From Coal-Many uses of fuel are much better adapted to liquid than to solid tuel. Automobiles and airplanes are only two examples. But oil is a short-term resource. The long-term answer is conversion of coal into liquid fuel. T he present effi ciency of such processes today is only about 40%. Even assuming technolog ical advances, \yres estimates the an nual conversion loss 100 years from now at 9-trillion hph In 2048--So the total IJ. S. energy re quirement in 2048 is 27-tnllion hph- 1 BUSINESS WEEK Nov. 13, l? 48 S ee w h a t it can do for you r business. For mechanization is the one sound answer to today's high cost of hand figure-work of every kind. Businesses large and small all over the country report savings ranging up to 50% after mechanizing their accounting with Nationals. Savings which often pay for the whole National installation in the first year! Today's high costs of delays and overtime make mechanization as essential in the office as it has long been in the plant. Ask your local National representative to study your setup, and report the savings you may expect from the use of correct modern accounting tools. T H E N A TIO N A L CASH R E G IST E R COM PANY. D A Y T O N 9. OHIO fill Q /ffitw nal cashusants -avows matwis ; Accewmm MAcmms ` Y k r ' %? . ' ' Low-Cost ELMES HYDROLAIRS Now Deliver a Continuous Power Stroke " -.i V:, -n ' T 4? * H e r e 's th e biggest im p rovem en t in sm a ll hyd rau lic presses sin ce Elm es H ydrolairs w ere in tro d u ced -- continuous pow er stroke that m ain tain s the pressure you select . . . even on com pressible m aterials. BIGGEST SMALL PRESSES, EVER A dd to this the many other H ydrolair advantages --sm all size; lig h t w eight; effortless, quiet op era tio n , w ith y o u r re g u la r shop a ir lin e fu r n ish in g the pow er. T hese little m arvels are the biggest sm all presses you ever saw. NO OTHER PRESS LIKE HYDROLAIR H ydrolairs have neither pumps nor m otors. T he am azing new Elmes Pow er-petuator autom ati cally transform s air lin e pressure in to positive hydraulic force. Packless construction assures freedom from m aintenance. Service ap p lication s are v irtu a lly lim itless. H u n d red s a lrea d y in use. CUT YOUR PRESSING COSTS THIS EASY WAY. B uilt to E lm es big-press standards in sizes to 50 tons. Bench- and floor-types. Furnished w ith or w ithout hot plates and other accessories. If you w ant to cut your pressing costs, w rite for new B ulletin N o . 1036A . D istributors from coast to coast. Elm es Engineering Works of A m erican Steel F o u n d rie s, 214 N . M o rg a n St., Chicago 7, III. 30-TON, BENCH-TYPE O p e n in g , O'7 to 1 3 * . P la te n , 10* x 10* S tro ke, 6". Dimensions, 3 0 * x 2 9 * x 4 7 " high. 30-T0N, FLOOR-TYPE O pening 0 * to 13*. Platen, 10* x 10*. Stroke, 6 * . Dimensions, 3 6 V2 " x 19* x 6 5 * high. 50-T0N, FLOOR-TYPE O pening, 14*. Platen, 18* x 18*. S tro ke, 6 * Dimensions, 4 0 " x 2 7 " x 6 5 " high. Push button control o ptional. ENGINEERED BY ELMES Good H yd rau lic Production Equipment Since 1851 34 rect, plus 16-trillion hph. in conversion losses-a total of 43-trillion hph. For the years beyond this, Ayres assumes a con stant increase of 50% every 50 years On this basis, our total reserves of fossil fuel would last 92 years at the minimum, something under 300 years at the maximum. Other sources of energy must be de veloped. Atomic power is not the an swer, Ayres says: the world's reserves of uranium and thorium are too small They will probably be exhausted be fore the fossil fuels; this is even more certain if consumption of uranium for bomb manufacture continues at the present rate. The only answer, then, is to turn to sources of energy that can't be ex hausted. Ayres thinks three are poten tially important. [hey are: Direct Solar Energy. This could be used in two ways: for heating, and for power. The maximum potentially avail able is somewhere around 17-quintillion hph. per year. In practice, of course, only a very tiny fraction of this could be realized. Ayres' estimate for 100 years from now: 20-trillion hph. for power; 4.5-trillion hph. for heating--more than half his assumed power load. Several ways of converting solar en ergy into usable power are theoretically possible. Experiments on direct conver sion of sunlight to electrical energy are now going on at Massachusetts Institute of Technology. Concentration of sun light by lenses to produce heat is an old dream that may yet prove practical; heat can be changed to electricity. Once electricity is obtained, it would be pos sible to synthesize fuel from nothing but air and water. W ater Power. A tremendous amount of solar energy is used to evaporate water from the water-surface of the earth, and to lift it to form clouds, whence it returns as rain. About 99.67% of the total is used for evaporation, and is in no way recoverable; the other 0.33% is used to raise the water vapor above the earth, and part of that is recover able in the form jf the water power of our streams. Avres estimated the maximum avail able from this source at about 360trillion hph. a year; some 700-billion hph. are being recovered today; the maximum likelv to be recovered 100 years from now is 6-trillion hph. Vegetation. Sunlight is used by plants in their growth. And some f Jbe energy thus stored is recoverable. M e use it today, when we burn wood. But i could be realized m other ways'- con version of vegetation into alcohol, tor instance, or even into gasoline. Ayres' estimates of energy from etation: maximum potentially aval a ^ 60-trillion hph ; now used, I'M hph.: possible within 100 years, I lion hph. BUSINESS WEEK Nov. 13, D 48 Even if you have no more hair than a grapefruit, you probably know something about "home per manent waves" . . . particularly if your wife, daughter, sister, or mother-in-law goes in for them. Millions of women do. In 1947, they bought 50,000,000 kits. This year, the figure's still higher. What turned this clever idea into a booming industry almost overnight? Paper helped, tremendously. Often the hair curl er itself is made of paper . . . twisted, and some times reinforced, to give the exact stiffness and pliability needed. And in packaging, labeling, in struction sheets, advertising and merchandising, paper continues to aid this fabulous industry as its sales graph curls steadily upward and upward. To meet the growing demand from industries new and old, "Paper Makers to America" is rapidly increasing production. Each m onth sees more Mead Papers, of consistently finer quality. In the Mead, Dill & Collins, and Wheelwright lines, industries as well as individuals find "the best buy in paper today." Mead offers a completely diversified line of papers in colors, substances, and surfaces for every printed use, in cluding such famous grades as Mead Bond; Moistrile Bond and Offset; Process Plate; Wheelwright Bristols and Indexes} D & C Black & White; and Printflex Coated Papers. MORE TIM c HUNDRED YEARS OF PAPER MAKING THE M E A D C OR P OT W T I O N " PAPER M A K E R S TO A M E R I C A ' ss. , machines `V ic to r m u c h a aS M`~ 'b u s iu e s f as rn ro d u D o n-rn e y e f the h o e ^ is ruifei V i e t e r ^ wifh to d a y - VI o r o b len as ,, ur sd an Blueprint for Defense . . . Mode! 7-83-54 Also fu)J-keyboard Add, subtract, multiply, or com pute credit balance---th e re 's a versatile Victor for every busi ness . . . large or small. Choice of ten-key or full-keyboard; hand or electric models. W orkers like efficiency, speed and accuracy. Anyone can oper ate. Com pact . . . easily carried. Fully guaranteed. Nationwide service points. Call your Victor dealer for a dem onstration. C onsult your classified phone directory, or w rite for address.- VICTOR A D D IN G MACHINE CO. World's Largest Exclusive Manufacturer of Adding Machines Victor Adding Machine Co. Dept.BW-11-13, Chicago 18, 1. (~1 Send free "Secret of Speed" booklet. I 1I would like a demonstration. N a m e ____________________________________ Address___ .____________________________ _______ C ity _______________________ State___________ ___ 36 . . . Puts Firestone in Kickless Artillery Business At Firestone Tire & Rubber Co., where designers grapple with "bounce" in motoring, production lines are hum ming with orders for rifles designed to take the "bounce" out of firing. These recoilless weapons, developed by ordnance late in'Ij-the war, give the infantryman the fi'srng cower of an artillery battery. T ht'y're patterned, in general, after the bs;Zooka.B ut they have rifled barrels, u<e .bigger''charges> thus get far greater dii;tance accu racy. Recoil is cut out ty'"allowing a controlled amount of the gases that propel the shell to escape through open ings in the breech of the rifle. These escaping gases exactly counterbalance the force that drives the shell out of the muzzle. Thus, a kickless 57-mm. rifle, which weighs 45 lb., can be fired from the shoulder; a 110-lb. 75-mm. piece can be manned from a machine-gun tripod. The 57-mm. job fires a 3-lb. high explosive shell for two miles; the 75mm. piece fires over four miles with a 14-lb. shell. Firestone is not new in the game; during the war it redesigned the Bofors antiaircraft gun, turned out thou sands of the weapons. BUSINESS WEEK Nov. 13, 1948 |>True conservation of our forests is proper growth, crop is grown, a crop is taken. But the easA***- ' I I M ____ ...'->*?$ i 5 s t>.' ''V!, * ?.' n is a te **? -<?<3*r sv i' t h L e t smokestacks tell the story! Every factory in America makes some product or has some moving part or some piece of working equipm ent chat can be made better, or cheaper, o r both -- w ith Industrial Panelyte. This resin-im pregnated hot-pressed laminated plastic goes, down to the ^ 'i sea in ships . . . travels the highways in over a score of automotive parts . .. soars through the skies in airplanes . . . is in all sizes of transform ers --from Boulder Dam to a toy electric train. Every one o f more than 50 grades of Industrial Panelyte is a special com bination of properties w ith varying characteristics. And there are also decorative grades. Panelyte Division o f St. Regis Paper Company manufactures m ost o f its ow n resins and draws heavily on the parent company for the papers used as base. Like all St. Regis papers they are made in St. Regis mills, from pulp which in large measure is m anufactured in St. Regis plants and supplied by St. Regis woodlands. *Q ua ?uc 1,800,000 acres of twserukd ea A M IS* PUNTS IN 30 LOCATIONS ABOUT ASSETS OVER 145 MILLION DOLLARS ST. REGIS. im13,200 & OVER 17,000 EMPLOYEES STOCKHOLDERS ST. REGIS PARER 2 3 0 PA RK A V EN U E , NEW YORK 17, N Y. 2 PRINTING pIBtlCATlOK m INVERTING PAPERS 'C o ,,M end uwoo-ed for offset, te" ' "; lfcro l0 S p . c - I " nd `f ' ;<onverf'"V Pop*,s PAPER FOR HIltTIWAh; _ BAGS paper for panelyte t| !jm!one^Chafi, ' "f\s *<&*****' ,, TMdu.l lominWi ,l.% , a.teaDti1, CErCfrcf, W Q O D p U U --fo r s o le to co n v e rtin g m ilts i PACKAfiM K s y s t e m s --Bo as an d B a a Filling M achines, M A SS PR O D U C TIO N O F SH EETS, RO D S, TU BES, M O LD ED FO R M S, F A B R IC A T E D P A R T S Hit? t it. 1 r?:\ Well planned... for well-fed acres Like other FMC division-built products, Peerless Pumps are described in an interesting booklet "Know Your FMC's,'' available on request. ; ,1 ^ 'i'i ` ' CTL 4? Water, with its essential life giving qualities, is the essence of all human existence. Its cool draughts refresh the thirsty earth, turning arid acres into fertile fields. But nature does not always provide ample moisture, when and where it is most needed. Thus, man must tap nature's vast underground reservoirs, lifting and moving a tapful or a torrent by highly efficient mechanical pumps. In serving these needs of farmers, growers, food processors, homeowners, industrial plants and even entire cities-Peerless Pump Division of Food Machinery and Chemical Corporation supplies the right unit for every pumping job. Like other FMC divisionbuilt products, Peerless Pumps are described in a booklet "Know Your FMC's," available on request. FMC AGRICULTURAL EQUIPMENT DIVERSIFIED INDUSTRIAL & AGRICULTURAL CHEMICALS PEERLESS PUMPS & WATER SYSTEMS FMC CANNIN G, FREEZING & PA C KA G IN G EQUIPMENT FMC PACKING HOUSE & PROCESSING EQUIPMENT JOHN BEAN AUTOMOTIVE MAINTENANCE EQUIPMENT AGRICULTURAL EQUIPMENT J ohn Bean Division Lansing, Michigan J ohn Bean (western) D ivision San Jose, California Bolens P roducts D ivision Port Washington, Wisconsin AUTOMOTIVE SERVICE EQUIPMENT J ohn Bean D ivision Lansing, Michigan fm c FOOD M A C H IN ER Y AND CHEM ICAL CORPORATION E X E C U T IV E O F F IC E S : S A N J O S E 5, C A L IF O R N IA AGRICULTURAL INSECTICIDES & FUNGICIDES N iagara Chemical D iv .Middleport.N Y. Jacksonville, Fla ; Richmond, Calif INDUSTRIAL CHEMICALS West vaco C hemical Division N ew York, New York CANNING & FREEZING EQUIPMENT Anderson-Barngrover D ivision San Jose, California Sfragul-Sells D ivision, Hooposlon, Illinois PUMPS & W ATER SYSTEMS, P eerless P ump D ivision Los Angeles, California, Indianapolis, Indiana PACKA GING EQUIPM ENT, Stokes and Smith Compani (wholly owned subsidiary) Philadelphia, Pa PACKING HOUSE & PROCESSING EQUiPMENl P acking Equipment Division Riverside, California Harlingen, Texas F lorida D ivision Lakeland, Florida FIR E FIG H TIN G EQU^ sS T J ohn Bean (western) Divis San lose, California J ohn Bean D ivision Lansing, Michigan RESEARCH S U R V E Y IN G th e field: D r. L eonard G reenburg, N ew Y ork S tate D ep t, of L abor, and D r. M ay R . M ayers, chairm an, O ccupational C ancer C om m ittee, join up w ith , . . . Industry Against Cancer New group, representing industry and medical and govern ment authorities, maps fight on country's No. 2 killer. First step; a survey that will help determine industrial danger spots. Science and industry are joining forces to take on a powerful antagonist: occupational cancer. The size of the ]ob can be gaged by the fact that cancer now rates as the second biggest killer in this country. This week, the growing hazards of oc cupational cancer were the theme of a paper by cancer authority Dr. W . C. Hueper, of the National Cancer Insti tute. The occasion was a meeting of the American Public Plealth Assn, m Bos ton. Dr. Hueper's point: The more mod ern industry develops, the more vital is a study of potential industrial danger spots. Starter--Just such a study is the goal of New York State's brand-new Occu pational Cancer Committee, an unoffi cial agency. Members have been work ing on a two-vear program. They have a special fund from National Cancer Institute of the U. S. Public Health Service of S32,694 a year to go on. Ohio and New Jersey are getting similar grants. Industry has representatives on the committee--Dt. G. H. Gehrmann, for Manufacturing Chemists Assn.; and Dr. Arthur E. Hoag, for American Petro leum Institute. Other members include filirm representatives from the U ;S. Public. Health Service, from New York State Depts. of Labor and Plealth,. as well as from the medical and scientific centers. Chairman of the new group is Dr. May R. Mayers, chief, Medical Unit, D.iv. of Industrial Hygiene, N. Y. State Dept, of Health. The committee knows very well that its job will be tough. For one thing, no body really knows how big the problem is. As Dr. John R. Heller, Jr., director of the National Cancer Institute, reported last week to the American Cancer So ciety, there are no figures to show how many people are dying today from en vironmental or industrial cancer. No one knows, even, how many people are exposed to it, or where the precise danger lies. Program--But with this nebulous start, the committee has lined up its im mediate plans: (1) A pilot study at the Roswell Park Memorial Hospital, Buffalo. This, the first large-scale survey of its kind, will cover 5,000 male cancer patients; 1,000 male non-cancer patients will serve as a control. (2) The distribution of a leaflet on "Occupational Cancer" to hospitals, "DAYS-SOONER" D ELIV ER Y AT LOW COST by routing all your eastbound freight via "Save tim e a n d m oney the depen dable P ' l ' E w a y !" Fastest-by-land betw een San Fran cisco or Los Angeles and Chicago or St. Louis., .with com parable speed to all interm ediate a n d points beyond P 'l-E. We handle a ll details w ith th e shipper in any and every California p o in t. . . pick up the freight, and, where destination is beyond P ' l ' E, interline with the carrier of your choice at the P I E Mid-West Ter minal most practical to you ! Shippers agree... it's P 'l 'E ! y", PACIFIC (HTE MOUNTAIN EXPRESS,; J Chicago * St. Louis K ansas C ity - Denver Ogden Elko Ely Pocatello Reno * Salt Lake City San Francisco Los Angeles Sacramento O a klan d General Offices: Salt Lake City, Utah 3Q clinics, and all physicians in the state who are interested in cancer. The pilot survey is out to track down what chemicals or other occupational factors may be considered among the possible causes of cancer. Dr. Mayers re ports that industrial chemicals can, m general, be used with perfect safety if adequate control measures are instituted. But m order to get the best control measures, you first ha\e to know what chemicals offer the threat. Specially trained personnel will take detailed occupational histones of all cancer patients who enter the Roswell Park Memorial Hospital. The mteiviewer will try to pm down just what the patient's occupational exposure was; what chemical substances he came in contact with, what othei environmental factors were present m the workroom. Since cancer will usually develop only after a great many years of exposure-- and even mans- years after exposure-- PORTLAND CEMENT now helps the Iron Horse run smoother / I VRAIN PASSENGERS are enjoying new standards o f comfort -* because o f portland cem ent " grout," a m ixture of portland cement, sand and water, which, when pumped into soft spots and water pockets under tracks, hardens and stabilizes the roadbed. M ore than 45 m ajor railroads are now pressure grouting with portland cement to obtain a smoother riding track and to reduce maintenance and operating costs. This is another example of the thousand ways th a t portland cement and ,concrete serve and save. Concrete is the favored m aterial for streets and highways because i t is sm ooth-riding and lasts longer--at lower cost to taxpayers. Concrete also provides strength, beauty, firesafety and lowannual-cost service for school buildings, hospitals, apartm ents, factories and municipal structures. Concrete is a wise investm ent for homes and farm buildings because it is firesafe, storm proof, ratproof, decay-proof, term iteproof, easy to heat, inexpensive to maintain. Yes, you can depend on concrete for better service and better living-- and be money ahead in the long run too. PORTLAND CEMENT ASSOCIATION 33 W. G rand A v e ., Ch icag o 10, HI. A national organization to im prove and extend the uses o f portland cement and concrete . . . through scientific research and engineering fie ld w ork C A N C E R A U T H O R IT Y : D i. W . C. H ueper has ideas on how to tackle the prob lem of occupational cancer this means tracing the patient's history all the war back to his first job. Sleuthing--If a clue--however elusiveturns up at an) point, a chemist wall be called in. ITis job will be to unearth any positive proofs that a chemical suspect may have been the source of the disease. The data will be entered on punch cards. These v .11 be used as the base for a complete statistical stud) to be carrier out by the Division of Cancer Contro of the N. Y. State Dept, of Health, urn der the direction of Dr. Paul Gerhard The committee is ready to follow any suspected case right into the workroom Its investigations will include chennea 1 Q/lR The Idea that became a Christmas tradition We don't mean hanging up m istletoe . . . ( although that can he a very reioarding idea). We don't mean a holly w reath ...(although it wouldn't he Christ- - mas ivithout one). We don't even mean sending C hristm as cards . . .-(-although that's a good way to let friends know you wish them well). We DO mean THIS: If you're wondering w h a t's the best way to say "M erry C hristm as!" to your busi ness associates, customers, potential cus tomers, and friends nam ed Bill and E d and Jim . . . . . . say it with a bottle or so of Four Roses! So many people give F our Roses for C hristm as nowadays th a t i t 's become sort of a holiday custom --and well it m ight be. For you could search high and low w ith out finding a gift th a t's half so welcome and sure to please --and one th a t offers such a simple solution of your gift prob lems! F our Roses--so softly mellow and dis tinctive in flavor --is a gift th a t not only reflects your thoughtfulness b u t is also a compliment to the good taste of the man who gets it. Your favorite retailer will be glad to make special arrangem ents for gift pur chases. FINE BLENDED WHISKEY- 9 0 . 5 p ro o f. 40% straigh t w hiskies; 60 %grain n eu tral sp irits. Frankfort D istillers Corporation, N ew York. For the holiday season --in a special, attractive gift carton FOUR ROSES G IV E W HAT YOU'D LIKE TO G E T -A M E R IC A 'S FAVORITE GIFT W HISKEY % Q M u i m d d I m i m A ... " I Iv analysis of materials, radiation measure ments, chemical analysis of air contam inants--dusts, gases, fumes, and the like. That way, it is hoped that occupational factors that a; c not now suspected of causing cancer may be hi ought to light. Investigation Points--Dr. IIuepcTs pa per broke down the known and sus pected cancer causing agents into. Physical Agents: These include ultra violet rays, X-iays, and other radioactive substances. Chemical Agents: Inoigamc chem icals, such as arsenicals, chromates, nickel carbons 1, asbestos; organic chem icals such as aromatic compounds and amines, benzol, and the undefined com pounds responsible for the cancer-caus ing action of tar, pitch, asphalt, soot, carbon black, paraffin oil, creosote, and various crude and processed mineral oils, shale oils, and some products de rived from them W ith this *ist of suspects, the med ical authorities are particularly in te r ested an industries using these materials. As Dr. Heller put it "As far as we know, the most dangerous areas are m the field of radioactive substances, the areas of hydrocarbon icsearch and development, such as the high-temperature distillation and fractional ion of petroleum; and the wide field of organic chemistry which is developing new synthetic chemicals." wM Iplnnm tJr^] \ o n t e ^ ! Assure your letterheads distinctive a p p e a ra n ce -- durability -- and the added prestige of a famous water mark. Specify Nekoosa Bond, one of the largest selling papers in the world. NEKOOSA-EDW ARDS PAPER CO., PORT EDWARDS, WISCONSIN 42 Neufron Counter T h is tiny n e u tr o n c o u n te r is ex p e c te d to ease one of the toughest jobs of th e atom ic researcher. It was recently developed by D r. K uan-H an Sun, C hinese-born physicist a t the W estinghouse Researcli Laboratories. N eutrons are difficult to d etect because they carry n o electrical charge. B u t n eu tro n s will split uranium atom s. So the detector in cludes a film of uranium -235. A pho to sensitive plate responds to th e radiation from th e ato m ic fission by em ittin g electrons w hich are m ultiplied, collected, and counte BUSINESS WEEK Nov. 13 1948 It really rains business in America's Biggest Market Are you following thH eaders--into the half of the nation's m arket where it literally rains sales? There are no dull days for your b etter retailers in towns of under 25,000--M ain Street towns-- across America. When it rains, the farmers come in to spend their record-high income. When it shines, town families, enriched by seven straight years of farm prosperity and new town enterprise, do their buying. Saturday night, everybody buys. And th at means over half t our population--80 million people. Full shopping weeks make these better dealers your best dealers. Are you sure you are distributing your selling messages among their customers--farm and Main Street families both-- in proportion to their number and buying power? Join the hundreds of leading advertisers who are making sure through the pages of F arm J ournal and P athfinder. 3,750,000 Families Who Buy On Main Street IN SEVEN Y EA R S , the farm plant has increased in value from 54 to H I billion dollars. Farmers now have 22 billion in banks, bonds and cash. FARM JOURNAL, b ig g e s t in the country with 2,700,000 subscriber families, has increased annual advertising revenue from 2 to 8 millions during the same period. For full effects, look in the towns like this where farmers spend their money. BIGOEST b u s in e s s of Main Street, America, is retailing. Your Main Street dealers today serve more than half the families in the country, who live, or shop, on Main Street. Can you tell the prosperous town customers from the prosperous farm customers in this modern store? Both are important to you -- and both can be reached through our two magazines: FARM JOURNAL and PATHFINDER, together Influencing the b u y in g h a lf of today's America. MAIN STREET IN ITIA TIVE, stimulated by seven years of farm prosperity, is creating new and bigger payrolls, new businesses and factories in Main Street towns. There's more community spirit, more individual enterprise in this economy. Is it behind you? Yes-- if you're one of the foresighted adver tisers who has realized the selective significance of America's 2nd Largest news magazine. P A TH FIN D ER ' S 1,050,000 families make it 1st on Main Street. Farm Jo u rn a l, Biggest-- in the C o u n try P a th fin d e r, First on M a in Street Graham Patterson, President Phenolic Resins by I N T E R L A K E Security Study what supply sources would we have to knock out to unset an enemy's produc tion? CH EM ICA L offer many industrial uses Rand Corp., once an Air Force baby, is now independent. It tries to find ways to use new scientific advances militarily. Rand's success as a research experi ment was one of the big reasons for set ting it up as a completelv independent organization. Functioning that wav, it will be assured of the cooperation of in dustry without upsetting competitive relationships. Out of the back room last week came Setup--Working capital for the cor- Here are typical examples where an Air Force project that the boys in poiation has come entirely from private the bar have been whispering about for sources. It will be run by an 11-man resins "tailo red" to individual two years. Project Rand (the name board of trustees. Heading the organiza needs by Interlake's Technical Staff have produced a better product at lower cost: stands for Research And Development) shed some of its mystery, officially be came Rand Corp., an independent, non profit research organization. tion as "director" wall be F. R. Collbohm, for many years one of Douglas' top-rankmg engineers. Rand will be paid for its research un- W hat It Is--In the broadest terms, dei a contract with USAF. Bulk of the PLYWOOD Rand's job has been the scientific study work will be handled bv civilian scien of ways to improve national security. tists of the staff; but plenty of projects Top quality p ly Fostered by General Flap Arnold, it was will be farmed out to consultants from wood is bonded with In te rla k e set up in March, 1946, as a separate de partment at Douglas Aircraft Co. Its work since then has been done under a the universities and private research or ganizations. \ \ here government agen cies other than the Air Force are con contract with the Air Force. Top execu cerned with the research, the results will tives of .Douglas and of three other air be made available to them. Nonclassi- craft companies--Boeing, Northrop, and fied material will go out to the univer MINERAL WOOL North American--worked with USAF m sities and research centers for further setting policy and lending support to development. - ; This type of insu lation is bonded into batts with Interlake resins. the project. Rand does not develop new weapons or instruments, as such. Its job is to dig into the potentials created by mod ern science, to try to shorten the gap between scientific theory and military LAMINATES reality. As such, it paves the way for new engineering work. Rand braintrusters Paper base lami nates such as table will look at a new scientific principle, decide whether it has any military pos sibilities, then figure how much it will tops and paneling cost to develop the possibility and how re produced with Interlake good an end product can be expected. They also try to decide what avenues of research will be the most economical. Secret--The biggest part of Rand's work, of course, has been kept well BASIC APPLICATIONS OF blanketed behind a security fog. The INTERLAKE RESINS: few glimpses that observers have caught, however, indicate that many of the proj Bonding Surfacing Laminating Impregnating ects make Buck Rogers look like a 19th century octogenarian. Here's an example of the kind of stuff Rand might be called on to tackleOnce we get a rocket to the moon, of such materials as cloth, paper, wood, cellulose waste and fibrous materials. what will be the chances of our setting up a lunar military base? If- it can be done, what kind of equipment will we have to develop? Video Van I f y o u 've ev er witched televisors try to m ove their cameras from one location to another I N Q U I R I E S I N V I T E D -- Our Technical Economists, Sociologists--Rand's staff in a h u rry , you k now w h a t k in d of problem -fi tSotafyfowuirll eanpdpeliacvaotirotno.adInatpetriIankteerlaCkheeRmeiscinasl aislnon'te. cMonafniyneodf thtoe repsheyasricchaelrs sacrieengtriaspts mthoevye'realul pthaegahineasvt.y, Ocnuem bmearsno'smseo leuqtiuoinp mise ntot Corporation, Union Commerce Building, C lev elan d 14, O hio. pling with projects that fall entirely in the fields of economics and sociology. on a single dolly. Paul A. R aible of W A V E -T V , L ouisville, Ky., d re a m e d u p th e For instance: Suppose New York device, designed it to carry all th e e q u ip m en t IM IK Ilk L C H EM IC A L were hit by an atom bomb. How would you get Detroit workers to stay on their jobs when they know' the auto city looms as No. 2 on the target list? Or, if our needed for a telecast. A portable transm itter in a truck goes along w ith th e u n it to sen th e program to th e station for rebroadcast. T h e dolly is d esigned to carry tw o cam eras, C o rp o ra tio n raw'-material sources were suddenly crip a sw itc h er co n tro l, tw o synchronizing P R O D U C T S FROM COAL. pled, what steps would we have to take to rebuild diem? On the other hand, units, three power units, and com p e e power hookup equipm ent. 44 BUSINESS WEEK Nov. 13, l ? 48 How sw eet music m iqht help , W;' you solve problem s in ste e l 3# THE p ictu re ab o v e s h o w s th e m ech an ism o f an antique m u sic, b o x -- a c o l l e c t o r 's ite m w o r th th o u s a n d s o f d o lla r s . T h e finest o f such m usic boxes w ere handm ade by Sw iss, German and Austrian craftsm en about 100 years ago. T his box is one o f many ow ned by G eorge A. B idden o f Barrington, R. I., w ho like many p eop le today m akes a hobby o f collectin g these beautiful instru m ents. H e has becom e expert in restoring them , in recapturing their virtually perfect tone. But Mr. Bidden encountered a problem . H e could no longer g et from Sw itzerland th e out-of-the-ordinary flat steel needed to dam pen the tones in the com b teeth. In desperation he turned to our Athenia Steel D ivision, described his requirem ents, and in short order got specially-processed steel, perfect for his needs. ; iy, T his is a story o f unusual application, but is typical o f Athenia serv ice in the d e v elo p m en t and p ro d u ctio n o f steel. So if you are a. user o f special-purpose steel . . . if the solution to a problem in quality, behavior, uniform ity, control or application w ould be "m usic to your ears", it m ight pay you to see w hat A thenia special ists can do about it. divisions of NATIONAL-STANDARDCO. ATH EN IA STEEL, Clifton, N. JL . . . . Flat, High Carbon, Cold Rolled Spring Steel NATIONAL-STANDARD, Niles, Mich. . . . Tire Wire, Fabricated Braids and Tape W AGNER LITHO M A CH IN ERY, JerseyC ify, N. J., Lithographing and Special Machinery W ORCESTER WIRE WORKS, Worcester, M ass. . . Round Steel Wire, Small Sizes Ir =4f -i ' - in FIGHT Office Worker Fatigue Air in offices, air conditioned or not, often gets stuffy and lifeless. This taxes efficiency, brings on fatigue and causes 4 o'clock sag among workers. Moore McCormack Lines use Airkem Chlorophyll Air Freshener to solve this problem. They say: "The folks in our Freight Department complained .of stale, stuffy air. Since using Airkem w e have noticed a decided improvement." Try Airkem Air Freshening Service at our expense. Look for Airkem in your ' phone book or write us at 7 East 47th Street, Wew York-17 , ,N . Y . Q irkem - 1 I FOR AIR OF QUALITY That you may have light The wires carry the light and power for homes and industries and the seldom-fail ing service is a modern miracle. In the great power houses where steam, water and air are held under exactly controlled pres sures, Ashcroft Gauges indicate these with enduring accuracy. Quality comes from almost a century of fine gauge-making. If you need pressure gauges, specify Ashcroft. Stocked a nd sold by leading D istributors everywhere MrM A S H C R O E f t Gauges M A N N IN G , M A X W ELL & M O O RE, IN C. STR A TFO RD , CO N N ECTIC U T Makers of Ashcroft Gauges, Hancock Valves, Consolidated Safety and Relief Voives ond 'American' Industrial Instruments. Buiiders of '5haw*Box' Cranes, 'Budgit' ond 'Load Lifter' Hoists and other lifting specialties. 46 READERS REPORT: French Problems Sirs: I was very much interested in Mr. McGiaw's article, France's Problems Today and Tomorrow, [BW--Jul.24 '48,pl05i- I know many Frenchmen who would have been proud to sign this study, and I think it is remarkable that after a short visit a foreigner has been able to give such an exact synthesis of a situation which, particularly in France, is full of rather delicate shades of difference in public opinion. W ith reference to your justified insist ence on the political instability of France, I think it is important to re member that the major cause lies in the unreconciled difference between the three major political parties in France on the subject of "dirigisme" (govern ment planning and interference). - The recent numerous French coali tion governments have been made up of three main parties: (1) The Socialists on the left of the coalition, to 'whom "dirigisme" is the essential basis 'of their governmental concepts; (2) The Central party (Radicals and affiliates)'--pri'sffively anti-"dirigisme"; and :: (3) -The popular Republican party-- less stable in its doctrines, but supported by an electorate which fiercely dislikes "dirigisme." In anv precariously balanced coalition it is often the minority that swings the lead. T he. several recent elections have shown the Socialists as increasingly los ing support from the electorate. Seeing their anti-dirigist partners in the coali tion gaining in strength, but knowing the coalition to be still in need of Social ist support, the Socialists have provoked one ministerial crisis after another in a kind of losing rearguard battle. The French individualism, the fact that detailed government interference and planning had never been applied in France until the occupation by Ger many, and thirdly, the fact that any di rected economy in France is badly di rected, have made the French electorate as a whole detest government interfer ence and bureaucratic red tape to a more violent extent than I have seen it anywhere else in Europe. F r e n c h I n d u st r ia l ist PARIS, FRANCE. Animals in Industry Sirs: Until he saw your article, "Animals Find Jobs in Industry" [BW--Sep.4'48, p23], the writer thought he was the only one using animals for the purpose shown. However, he is rather proud of the fact that he has been using sheep to keep down the grass around lumber piles. The ground is rather stony, so that the grass cannot be cut easily by power. Moreover, the sheep reach grass around the lumber piles that would otherwise have to be cut with a scythe. The fire insurance companies have given us credit for good housekeeping around our lumber piles; the use of sheep eliminates the Ere hazard of dead grass around the lumber in the spring. T h e o . A. S p a r k s P R E S ID E N T , N A T 'l . T IM B E R & F E N C E C O ., L T D ., W IN N IP E G , CANADA. Law on Mergers Sirs: In the article "W hy The Urge to Merge" [BW--Sep.4'48,p25] is the following statement. "So noticeable is the trend that Con gress has been asked to prohibit mergers by the acquisition of assets (mergers by acquisition of slock already are barred)." Do you mean by this that controlling stockholders cannot sell or merge their companies with another, if the minority stockholders are given an opportunity to do likewise and ~On the same basis? L e o n a r d A. W a l e s W ASH IN G TO N , D. C. Section 7 of the Clayton act makes illegal the acquisition by company A of the stock of company B if the effect of the merger thus consummated is (1) to lessen competition between the two companies, (2) to restrain commerce, or (3) to tend to create a monopoly on any line of commerce. Federal Trade Commission has been after Congress almost since this law was passed to amend the law so that l would also bar mergers where company A just buys up the physical assets o company B. So far as we know, any merger, BUSINESS WEEK . Nov. 13, 1948 whether by stock acquisition or other wise, is perfectly legal, as far as the anti trust laws are concerned, as long as it doesn't have tire specified effects as to competition, commerce, or monopoly. Transportation Pattern Sirs-' ,, Your story regarding transportation pattern changes [B W --O ct.30'98,pi 9] is very interesting. It is true that this is a major problem; unless the basmg-pomt decision is modihed or changed, it will become an increasingly serious problem for railroads. Railroads are now getting no more freight revenue per ton mile than they did in 1921. Unfortunately, the public is of the opinion there have been many increases, because the Interstate Com merce Commission made three bites of their last decision. This has had an ef fect on the shipping public, possibly, similar to cutting off the dog's tail an inch at a time so it won't hurt so much. It is true that traffic is being lost to the trucks. It is also true that much of the shorthaul traffic really should go to the trucks because they can handle it cheaper and better than can a railroad. But it is also true that steel companies and others have diverted considerable traffic to trucks, not because they wanted to but because there are insuf ficient cars to meet the demands. The total available car supply has been pretty busy this year and every car has been utilized; it was out of necessity to move their products that trucks were used. Every car that it has been possible to build in the past two vears has been built. . . . 'The whole situation has been made worse by the fact that industry in gen eral, now working on a 5-day week, only unloads 40% of a normal day's unload ing on Saturday and unloads practically nothing at all on Sunday. This has made worse the countrywide shortage of equipment. To some extent it gets down to this: Good service depends on good earnings. The railroads must be permitted to earn sufficient money now to enable them to modernize, to buy modern machinery, locomotives and cars to cheapen the cost of service which will keep rates down. It is impossible now for railroads to acquire capital through the issuance of stock; earnings must be sufficient gradually to interest investors in buvmg railroad securities. It is necessary to bor row part of the money for these im provements; they cannot all be paid out of earnings. In either case, however, good earnings are necessary in the in terest of holding down freight rates. . . . R. E. W oodruff p r e s id e n t , E r ie r a il r o a d c o ., Cl e v e l a n d , o h i o BUSINESS WEEK Nov. 13, 1948 S' SAFETY FEATURE ' -- T h e h a z a r d ,o f f a llin g lamps is virtually eliminated when, fix tures are equipped with Gnral? Electric Turret lampholders. Each spring-backed plate contains two holders into which the fluorescent lamp pins are .inserted. Snug fit and uniform spring tension hold the lamps securely in place. , ' ECONOMY - -- Turret lampholders have the ability to withstand rough handling with out being damaged, which .means that there is no costly replacement problem. Elimination of safety gadgets means an other saving. In addition, the availability of three sizes of Turrets simplifies fixture design, and permits a- wide selection of lamp arrangements. C O N V EN IEN C E --Lamps can-be installed from either end of the Turret, Either face of the Turret is depressed,,by one end of the lamp, and the other end is then slipped into place. The .lamps are automatically held in firm contact. Re moval of dead lamps is equally easy. The starter socket is built-in,- and "is readily accessible. SERVICE --The sturdy metal construction of General Electric Turret lampholdersis designed to stnd hard usage. All working parts are made to give long ser vice--as long as the fixture itself lasts. This durability helps to provide topnotch fixture performance . . . maximum lighting efficiency T o sim p lify your lighting m aintenance, and to get the u tm ost in fluorescent ligh tin g efficiency, it pays to in sist on G eneral E lectric T urret lam pholders in every industrial and com m ercial fixture you buy. L am ps are n ot sta g gered, b u t are m ounted in a straigh t line, thus givin g m axim u m efficient, shadow less lighting. Just check the advantages of having these durable lam pholders. C om pare G eneral E lectric T urret lam pholders w ith an y other typ e o f la m p h o ld e r o n th e m a r k e t. Y o u 'll fin d t h a t th e y o ffer e c o n o m y in u p k e e p , great safety, and long service. G eneral E lectric Turret lam pholders have m ade an outstanding record of d ependable operation in th ou san ds of fixtures now in use. T h ey can co n tribute a great deal to your "better ligh tin g," too. A n ew G e n e ra l E le c tric T u rre t la m p h o ld e r w ill a c c o m m o d a te th re e la m p s. T w o -la m p lam p h old ers are a lso availab le, w ith recep tacles sp aced on 3%" inch or 5 -inch centers. F or inform ation on G -E T urret lam pholders, w rite to Section Q9 -1110, G eneral E lectric C om pany, B ridgeport 2 , C onnecticut. TRADE-M ARK REG. U .S. PAT. O FF. G EN ERA L 47 P R O D U C T IO N Selecting a Chemical Plant S ite ... Operating Factors Location Factors Labor Type Supply Rates Strike history Fuels O il Producer gas Natural gas Coal Coke Living Conditions Housing Cost of living Sanitation and health C lim ate Average temperature Average snowfall Average rainfall Service Cost Quality BUSINESS WEEK State Local .W Row M aterials N earness to supply Available transportation Jg r Site Conditions 5- f&p s Construction Costs' Rail connections Ground for foundations Drainage Facilities for slag disposal Expandability Labor Materials Supplies c \ 4/ V u ln e ra b ility Nearness to other Important facilities ` CHEMISTS Lave to consider 'everything from taw materials supplies to the security problem of vulnerability to atomic attacks in . . . Finding Safe, Economical Plant Sites Plant-location symposium hears that dispersal for safety in warfare can also-be cheaper, more efficient than centralization. You don't have to sacrifice economic advantages of plant location m order to get security against wartime bombing attacks. That's what experts from the National Security Resources Board this week told the American Institute of Chemical Engineers, holding a plantlocation symposium in New York. Al though aimed specifically at the chem ical boys, the idea applies pretty well to most basic industries. Simple Idea--And the idea is simple enough. According to R. F. Dimmitt, speaking for NSRB, it boils clown to proper application of the old adage: "Don't put all your eggs in one basket." Here's how it works: Draw a three-mile radius" around the proposed site. That is the area which NSRB figures an improved atomic bomb would damage. List every facility within the area which might be of interest to an enemy planner. Such facilities might range from plants making highly stra tegic materials to canals, rail yards, dams, or air bases. After this, assess the probable role your own plant would play m war production. Dimmitt points out that the known amounts of fissionable material are small. Thus, it is certain that onh- tar gets of the highest strategic importance will be subject to atomic attack Areas of less than five sq. mi. or under 50,000 population would be in danger of such an attack only if they contained highly strategic war plants. Four Factors--NSRB experts are happy about four major factors in plant-loca tion trends today: (1) "Recent surveys show that more plants arc being located in smaller com munities. Only one-third of the plants built since 1940 have been located in cities of over 100,000 population. On the other hand, about 30% of all plants established are m towns of 10,000 or less. This compares with only 20% of the plants built before 1940." (2) "Management today realizes that often greater efficiency can be obtained by dispersing operations, rather than by expanding indefinitely existing facil ities " (3) "The increase in mechanization of processes leads to simplification of op erations. This decreases the dependency of manufactuieis on local supplies of highly skilled labor." (4) "Another factor farming disper sion, which is just beginning to be no ticed, is the interest which lending in stitutions are taking in the strategic safety of plants." Other Factors--There arc other, more prosaic plant-location factors which have to be taken into account (chart, above). One of these is labor. Any industry locating a plant must have a good sup ply of labor at hand To the chenrica 48 BUSINESS WEEK . Nov 13, 1948 '"1 * 0 M OVE th e e n tir e o u tp u t o f o n e o f th e w o rld 's largest electric cleaner factories 6 m iles to a railhead m ight seem like a difficult problem -- but not to T he H oover Company. W ith a fleet o f 9 Fruehaufs and 3 M ack trucktractors to pull them , the factory at N orth Canton, Ohio, has literally been moved onto the main line. " Shuttle System"--The Answer! Each truck does triple duty. W hile som e o f the nine Trailers are being loaded at the factory, others are unloading at the railhead, w hile the three trucks and rem aining Trailers are in transit. A further saving results from the fact that each Trailer returning from the railhead is loaded with raw materials for the p roduction lines. T h e r e 's no w aste m o tio n in either direction. The savings in initial equipment and operat in g cost are really w orthw hile. T h e first Fruehauf bought in 1 9 2 9 --still in service-- dem onstrated it so w ell that m ore and more units were added as the com pany grew . Trailers Save Money for Industry! Trailers are d oin g a splendid job for industry^ They link plants, put stockpiles on wheels and handle direct deliveries m ore econom ically than by any other method. Surely, it's w orth investigating in your case, so why not let a Fruehauf man show you how much m ore productive yov^r trucks can be by coupling them to Trailers? W o rld 's La rg e st Builders o f T ruck-Trailers FRUEHAUF TRAILER COMPANY DETROIT 32 LOS ANGELES I I In Canada: Weston, Ontario 7 9 Factory Service Branches 4 ,t rt? P le r e is 1 versatile corrugated luggage-type boy that can be Used in the packaging of a wide variety of products. It is a triple use package. First, it adequately protects its contents in shipment. Second, it acts as a powerful sales tool in mass display. Third, it creates impulse sales and suggests "take-with" purchases and requires no additional packing for retail delivery Such packaging is sound merchandising, it `helps make a good product better, it stimulates sales. Consult the i , , H & D Package Labora'ory on ALL packaging problems. `'.I It' HINDE & DAUCH ECUI7VF b trm s *60 ECi J> i r r t i T * * \ r i ' h r o t o C ftr - ip . .k..a.-.n..s..a..i.1..- .L **q#3Nv ti. w o trs a .^ c .^ - W i f t f C " M G W G N D .l l , Y A . ' SAMIWJWY O'1'O 7 0 pC)N7f1 ONTA mdustre, however, the supply must not only be adequate in num ber It must also be highly intelligent because men will base to be turned to opeiatc com plicated technical equipment. W ater--Ll\cry n dustrv lias to take the availability of fuel and power into con sideration m lota mg a plant. But the clieinisfs !ia\t to 'limL ot another \it. I fac tor- - the watci upph. fo r example. the Southwest nun look like a natiual foi a plant It Inn timan fuel, available uiw matciiah fiom p-, tio- Icum, limestone, alt, and sulphur But then comes the c itch toi the c h o n w l plant Its opciati n ma\ need fanl.wtio amounts of tooling watci And the water table tn me iv parts of the Si nil - west is ahcach dmgerouslv low 1'li.it means that e\ cn if lie dug wells, the chemical maiiufa etui ei imght cut w deeply into the natural water icslivc that he endangers domestic supplies Thus, lack of water could tide o it much ot the Southwest for certain kinds of chemical plants The most practical alternative, which more and mow chem ical concerns ate taking, n to mine to the coasts, use sea watci foi cooling Its, an expensive alternative It means tint the chemical nnmulactiirci must i.ake his coolers out ot costlv me tab and alios s that will insist tie conoswe effects of salt water Pollution--Anotliei pioblcm of watci supple is disposal ot wastu aiartn-i|- Chenncal plants have one ol mcir toughest ]obs in mrdmg methods winch are adequate to present polhino i It takes onlv small a mounts ot such chem icals as phenol to make ama/ung quan tities of water ta; e foul then the an auund a plant present) a pollution pioblcm Chemical wastes m the an can be acidic enough to rum nvlon stockings ot turn load based house paint black But what people d n- l. - s c most is the smell \ \ L faith, of menu Products Refining, warned the a - s c - w - hled cnginccis th it the public often mas be apathetic to 'tic cite cN oi cor.asiv. gjsew fiom a pen ci plant, or ewes to gases shghtlv to\i to vegetation But u mnv become so mghw uKwmeel m 1 tensive odois as tcT induce legal net.on 'faxes and Cli nate --I oc.e kmc -' ` hound to be an important tem sl- leetmg a plant site Bid pv.hapv n, w nnpoitant is f l i c local p :>1 t,eal a ' m 1- phew 'laves aic an nuke it on ot tl . t atmoqilieic \hmv an irrhi'-tcv > ' found haven bee me the town w a'k l have monte making hkIw Iiv \ sicond giouo ot pkmt kwokc i n i h cl I ( ' i o n i c o p l i e m e ' cl] PI k K. ! C11 - t i n `A s like m a t i 1 IlCW hen ()]'<k. t - VI l t d N ll.'e \ C el , u i c t i i plan ( s e t s a n d ]) i o f i ! s, ] ) P ! i k c h k haul if ; m c c M u c I lk(., c l i m a t e . f o i e v e n pic A eInn c k t e n d s t o l o l c l C O l r t : u l t , C i l c l o w 1i i n c .i . k s 11 me ' l i k l . 1 c 1 m SO BUSINESS W EEK Nov 13, 1948 RESEARCH men in ^ work with natural universities and in all industries w ho and synthetic substances will welcom e this n ew t o o l-- the C M S 5. It provides the low est thermal hazard for the distillation o f h eat-sen sitive materials w h ich are fluid ab o v e 100 C and w h ose m olecular w eig h ts are greater than 200. D P I makes this fine precision unit available at low cost ex pressly to enable the student and research worker to use the process o f m olecular distillation in his study o f oils, resins, plasticizers, drugs, perfum es, vitam ins, sterols, fatty acids, etc. D istillation P roducts, I nc. Send for free Leaflet . . . which gives fu ll description o f this com p lete, com pact (3 sq. ft. by 32w high) unit, and show s how this still can be a useful addition to your present laboratory facilities. I--------------------------------------------------------------1 I Distillation Products, Inc. j 739 Ridge Road West, Rochester 13, N.Y. j | Please send the CMS 5 Bulletin to | | I j Name________________ Title_______ _ . ] Company------------------------------- ----- . 7 3 9 Ridge R oad W est Rochester 13, N. Y. ^Q n u fa ctu rers o f M olecular S tills a n d H igh-V acuum E quipm ent; D istillers o f O il-S o lu b le V itam ins and O ther C oncentrates for Science a n d In d u stry Address------------------------------------- -- j City------------------- Zone------ State------ j I_________________________________________ 1 THE MOST USABLE O n e -W YO U CAN BU Y cw ,-lo N >ft T N O ne Man Can C arry It . . . Hang It . . . O perate It These one-man hoists are known in factories, foundries, shops, and shipping rooms as "lightweight hoists for heavyduty jobs." They weigh only 30 pounds in the Vi-ton, 14-ton, and 300-lb capacities, and 75 pounds in the 1-ton capacity. Speed is variable. With the one-hand control bar you can `lift or lower loads without effort . . . at any speed you re quire, up to 17 feet per minute. Send for illustrated bulletin. ^ - . KELLER O n tfo m . . . . . . . . 3 ' . '!' KELLER TOOL COMPANY * 4811 H ARBOR STREET GRAND H A V EN , M ICH IGAN A SELF-CONTAINED PNEUMATIC FORGING HAMMER Self-contained motor compressor and hammer in one unit. Anti friction bearings, clean, low-center-of-gravity construction, im proved long ram guides are valuable features. Its greater forging output is due to heavier anvil construction, higher impacl speeds and greater rapidity of blows. F u r t h e r d e t a ils in B u l le t in N o . I6-L-7 CHAMBERSBURG ENGINEERING CO., CHAMBERSBURG, PA. 52 stalled outdoors. But if the climate is too hot, labor efficiency drops. Final Question--One final big ques tion: Should plants locate near thensources of raw materials or near their markets? The answer depends on the particular segment of the chemical in dustry involved. Here's how individual chemical indus tries hare answered this particular ques tion, according to the experts at the meeting. Tough Shipping--The petrochemicals (chemical products derived from natural gas or petroleum) have probably grown faster than any other part of the U. S. chemical industry. The pattern of re cent installations highlights the fact that such plants go to the raw materials rather than to the markets The reason is that it is haid to ship such raw mate rials as natural gas any great distance and have a reliable supply. Too often natural gas that has been shipped into an area is cut off from industrial users during cold snaps to satisfy household demands. Because of this, petrochemical plants have been mushrooming m the South west. That area has a big enough supply of gas to meet demand. Easy Shipping--One form of petro leum raw material for chemicals can be shipped readily. That is LPG, the socalled liquefied petroleum gas which consists mostly of propane and butane. It is familiar to most people as a fuel used for years bv farmers and other in habitants in isolated areas. Produced mainly in the Southwest, LPG is shipped all over the country for use as a raw material One of the chemicals that can come from LPG is ethylene glycol. The con sumer knows this as the "permanent" antifreeze he uses in his car. As an il lustration of the use of LPG in various areas, the experts made estimates of manufacturing costs for three locations --Philadelphia, Houston, and Kansas City. The result indicates that plants could economically supph their own areas, but that Houston was best if a national coverage was wanted. Drawback--T hCe is one disadvantage to locating petrochemical plants m the Southest Thai is the recent outlawing of basmg-point pricing ss stems which has raised the cost of building plants far from the steel mills that start the con struction process. That change mav increase constiuc- tion costs in the Southwest by as much as 15 % . Hence, it mav be more econom ical to build a -riant nearer the market and ship the raw materials. Unique Problems--Chemurgv (chem ical processes which use agricultura products as a basis for their raw mate rials) faces unique problems in plant lo cation. Mainlv, these aie (1) the seasons nature of agriculture and (2) the lac BUSINESS WEEK . Nov. 13, D 48 i I ; WM48-7 ,,^y7o n s u p o n to n s o f c o tt o n s e e d fly th r o u g h th e air, fo r . distances up to 700 feet, in a unique b eltless conveyor used in cotton seed oil m ills-- air does a ll th e w ork! T he seed is m oved by a high pressure fan w hich is gravity fed from a hopper. The p ow erfu l fan is d riven by a 40-h p . W agner M otor . . . chosen for th is application because of its ab ility to d eliver p len ty of dependable, low -cost pow er. In industry, in stores, in hom es, w h e re v e r an electric m otor is used, a W agner M otor offers m axim um service at m inim um cost. W agner M otors have been know n for efficiency and d e p en d a b ility for over 55 years. Should you need m otors for any of thousands of applications . . . or should you need any of the other products m ade by W agner . . . consult the nearest of our 29 branch offices or w r ite to W agner E lectric C orporation, 6460 P ly m o u th A ve., St. L ou is 14, M o., U. S. A. ELECTRIC MOTORS TRANSFORMERS INDUSTRIAL BRAKES AUTOMOTIVE PRODUCTS .y hr it' ,1, ?ii A sturdy Anchor Chain Link Fence is the only language most trespassers understand. It's the surest way to keep your plant safe from all snoopers, agitators and trouble makers. In addition, it enables you to use outdoor space for storage--and controls traffic in and out of your plant. For in formation on exclusive features like D eepDriven Anchors, which hold the fence erect and in line, write today for our illus. trated catalog to:.ANCHOR POST FENCE D IV ., Anchor Post Products, Inc., 6670 Eastern Aye., Baltimore 24, Maryland. J^nchor pence Nation-wide Sales and Erecting Service that such materials are often perishable. Other problems include the high ratio of weight of raw material to weight of finished product, and the fact that agri cultural products are bulky, expensive to ship, have large amounts of waste ma terial to dispose of. These problems have all pointed in one direction: Chemurgy plants should be near the raw material rather than near the market. Solution?--Meanwhile, the Dept, of Agriculture is working hard to overcome the problems themselves. It is aiming to cut down the perishability of the agri cultural raw materials by either (I) im proving the storage life; or (2) cheaply converting the commodity into a stable form for subsequent year-round process ing. Either of these methods may give enough weight to other factors so that plant locations could spread out of the farm belt. One thing might prevent it. Said Faith: "If everything else were equal, whether or not a plant would be lo cated near the -raw material source or near the product market would depend on the ratio of pounds of raw material per pound of product. If the ratio were greater than unity, the plant would be located -near'the sources of raw material, and-vice versa . . . Practically all ratios in the agricultural process industries are greater than EO, and the great majority are over 3.0. It is to be expected, then, that location of a plant near the source of raw material is usually a must in this industry." Plastics Near Markets--Plastics plants will follow the moldcr, according to C. O, Hoycr of Monsanto Chemical Co. The reasons: to keep inventories of fin ished products low, to give better cus tomer sen ice, to avoid high transporta tion costs, which arc increasing because of rising freight rates. All this is not without its pains Raw materials costs aie 60% to 90% of the finished cost of plastics molding powders and other resin forms Since the raw materials arc seldom m the same location as the molding powder consumer, there is a high freight bill either way. Perhaps the biggest reason for locat ing near the consumer is the range of products that a plastics resin manufac turer has to pu+ out. For instance, pol\styrene is available today in more than 1,000 colors. Monsanto's color labora tory can match 8-quintilIion (yes, that's quintillion) colors, shades, and hues. That means small individual orders, small lot manufacturing, and it requires small inventories. According to Hover, plastics custom ers are usually small organizations--thou sands of them. Most of them live on a relatively small inventory basis and de pend on the large manufacturer to make quick delivery in limited amounts. Therefore, nearness to the market and good transportation facilities are vitally important. P A R K o w e C A R O fZ P A P ER TU RM S O U T S W E L L C O P /E S / \ O P C O U P S E - /T S M A D E B Y xo rryp e! N. 1 Non-curl !Non-slip! Non-smudge !T h a t's P a r k L a n e , th e c a r b o n p a p e r th a t is specially treated to give b etter copies, cleaner copies. G et in a supply to d ay ! See the differ ence in the quality o f the w ork turned o u t in y o u r office! M ade by Roytype, division o f R oyal T y p e w r ite r C o m p a n y , I n c .-- w o r ld 's largest m anufacturer o f typew riters! THERE'S A ROYTYPE PRODUCT FOR EVERY BUSINESS MACHINE NEED! 54 Picture-in-a-Minute Camera Set for Market Last week, conventioneers at tlie P hoto graphic Society of A m erica g o t their first g o o d lo o k a t p r o d u c tio n m o d e ls o f P o la ro id 's n e w L a n d C a m e ra (B W --M a r . l '4 7 ,p 4 0 ). P ric e d a t u n d e r $ 1 0 0 , i t 's e x p e c te d to b e in d e a le r's h a n d s w ith in a c o u p le o f w eeks. T h e cam era takes only a m in u te after th e sh u tter clicks to deliver a finished print. I t uses a special double-roll film; one part of th e film looks like an ordinaiy negative; th e o ther, like a roll of plain paper. Tiny pods of chem icals arc concealed in the paper ro ll--o n e fo r each of th e e ig h t pictures. W h en jo u pull a tab out of th e camera, the film a n d p a p e r pass b e tw e e n tw o sm all ro l ers w hich squash the pods. T he chem ical je 1 sp read s to fo rm a p ictu re-lay er 1 /1 0 ,0 1!'thick . T h is jell v develops th e negative an^ m ak es th e p ositive. T h e fin ish ed p rin t rs se p ia -to n e th a t m easures 31 by 31 in> BUSINESS WEEK Nov 13, D 48 YOU CAN BE S U R E ... that Westinghouse Lamps are of the highest quality YOU CAN BE S U R E ... that you can buy Westinghouse Lamps everywhere, and get them promptly AND YOU'LL NEVER DO BUSINESS WITH N ICER PEO PLE That's our distributors we're talking about, not ourselves. Yessir, it'd ? V be hard to find a finer group of businessmen. In our book they're A-l for the kind of personal service they give customers. And, remember, they handle a complete line of the best lamps money can buy. If you don't know who your distributor is, write the nearest iV Westinghouse Lamp District Office. O r Lamp Division, Westinghouse Electric Corp., Bloomfield, N. J. '.. $ II "Si you c a n b e SURE T V s tin h o v is e THE NAME YOU KNOW IN C U A i Hi P O R T A B L E T A N K S drain w aste oil from big Air F o rce craft- I t goes to a . . . I H AVE A "U . S ." ELECTRIC P L A N T ... W in my home 1500 to 7500 WATTS Storm s can' t shut o ff your o il b u rn er, fr o z e n food w o n '# thow, and you need n ever b e in d arkness w ith a " U .5 ." stand-by Elec tric Plant. It's cheap in surance! ON MY FARM 1500 to 15,000 WATTS In cose of h ig h-line fa il ure a unit can keep your farm "g o in g " It o p e ra te s pumps, fu r n ace , locker, refrig e rato r, "m ilker, se p ara to r,' radio, etc. A T M Y FACTORY 1500 to 140,000 WATTS In m a n y in d u s t r ie s the d a m a g e caused b y just one power fa ilu re would ju s tify and p ay for a " unit. These units p reven t sp o ilo g e -- lost production -- lost profits. You'll find "U.S." units in vital spots throughout the world. For over 30 years United States Motors has been building the World's most complete line of engine-generator units. They're noted for their dependability. Write or wire, stating type of plant in which interested. UNITED STATES MOTORS CORP. 575 Nebraska St. Oshkosh, Wis. 56 R E -R E F IN IN G P L A N T , like this one of W o rth in g to n Oil R enners, which produces . . . low-Cost Laundered Lubricants Re-refining of oil is a big business now. Air Force points to savings in stocks and operating costs as young industry zooms. An old petroleum-industry cliche, "oil ne\er wears out," has become the stock m trade of a fast-growing business --rc-rcfining of used oil Tried and proved as early as World W ar I, pro cessing of crankcase drainings has by now blossomed into a multimilhon-dollar industry. Estimates put this year's production at almost l-million bbl. of high-grade lubricating oil. Saving Measure--Last week at Oklahoma City, Air Force engineers from nearbv Tinker Field staged their first oil reclamation conference. One of its principal aims to talk up conservation and cost advantages of "retreaded" oil. The Air Force explained how use of the re-refined product had shaved its op erating costs. Cost of the laundcied lu bricants runs around 20^ a gal.--com pared with 750" a gal. for new oil Through re-refining, USAF has saved about 23,800 bbl. of aviation oil a month; 2 5% of its monthly oil issues m the U. S. are from re-refined stock. Rc-rcfimng means cheaper oil for on- lubc users The catch is to convince them that retreaded oil is as good as the original Pros and Cons--It's a well-known fact that oil doesn't deteriorate; it just gets contaminated with carbon, acids, metal particles, water, and dirt A lot of people maintain that if the oil can be cleaned of all foreign-matter, the residue is as good as new. , Or Better?--7 'here are even plents ot users who go all out to say that the BUSINESS WEEK Nov. 13, 1948 laundered lubricants are better than new oil. They argue that oil in an en gine gets a secondary refining that is more rigorous than anything commer cially Practica^ c' W earapd engine heat, they think, break down injurious chem icals that won't come out m normal refining: Products of tins breakdown are readily separated m the re-rcfining. To make sure of quality, many fleet operators have their drainings processed on a custom basis. Then their oils are treated by the re-refiner as a separate batch. Yields from controlled waste like this often run as high as 90 %. From mis cellaneous pickups, the average is closer to 70%. Some fleet operators have been able to cut the amount of new oil pur chased by 80% And_the retreaded oil has cost them about a quarter of what they would have planked down for new lubricants. Many petroleum industry spokesmen doubt that reclaimed oil is as good as new. They point out that most highgrade oils today are additive oils. They say that a mixture of crankcase drain ings is a chemical pot-pourri, that the re-refiner doesn't know what is in the waste he collects; thus, he can't clean it thoroughly. New Industry--While experts have been arguing the question, a whole new industry has been built up around the re-refining process. It wasn't until the depression that commercial re-refiners appeared to sup ply the demand for cheap oil. In the last three years, the industry has really come into its own. Capacity has doubled, and new manufacturers are springing up all over the country. Installations range from small $750 "pot" stills, which process five gallons in three hours, to milhon-dollar plants complete with fractionating towers to handle hundreds of barrels a day. Re-refiners get their oil mainly from filling stations. They pay anywhere from 7 to 74 a gal.--depending on quality and quantity, and whether they make their own pickups. These waste oils are a mixture of kerosene, gasoline, and dirt. Even so, they are less contaminated than the crude oil from which new oil is made. T hat's because the used oil has already been dewaxed in the initial refining process The Process--Most re-refining today is done m atmospheric-pressure stills-- either "pots" or fractionating towers Once the oil has been collected, the process breaks down into six basic steps: (1) Removal of solid particles by set tling, whirling, filtering, or all three: (2) Neutralization of acid compounds by treatment with alkahnes: (3) Washing the oil with water to remove soaps formed in neutralizing, (4) Distillation. The oil is processed under heat and pressure m a fractiona ting tower or "pot" still. This drives Bu s i n e s s w e e k Nov. 13 , m s .17 O / V fy o s fe g e / n e fe r; For every kind of m ail. . . first class, airmail, special delivery, registered, postcards . .. booklets, publications, catalogs.. ..parcel post, insurance and special handling charges . .. the exact postage is provided, as needed, by the same postage meter! The postage meter prints postage, plus dated postmark, and' your own advertisement, if you like... directly on the envelope, seals the flap at the same time 1.. prints on gummed tape for parcel post. The meter displaces the adhesive stamp and stamp sticking . . . makes postage always available injury .. value needed.. .protects postage-frorn Toss, theft misuse . . . records postage available and used on visible registers . .. speeds mailing, saves time, effort, and usually postage. Today virtually every office, large or small, can afford a postage meter. If yours doesn't have one, call or write for illustrated booklet,"So You Have No Mailing Problems. . . " i; ' 'i 7 , i:l; 7 iV? p iT N cy -e o w e s PITNEY-BOWES, Inc. H70 Pacific Street, Stamford, Conn. Fpjjj Originators o f (he postage meter largest makers o f mailing machines. *0? Offices in 93 cities in U .S and Canada, 'w 57 4 i- % o f the B ulk o f card index m etal address plates % o o f the W e ig h t o f card index m etal address plates Vz o f th e C o s t o f ca rd in d e x m e ta l a d d re ss p la te s 9/io o f th e N o is e in y o u r A d d r e s s in g M a c h in e D e p a r t m e n t A n d we will d ouble o r triple y o u r addressing speed and in crease, even m ore than that, y^ur" speed o f'p rep arin g address plates. . A n d we can b ring m any o th er advantages to y o u r addressing d ep artm en t, w hich advantages are described in a little b o oklet we w ould like to send to you. v. B e c a u se w e a re --d e liv e r in g th e s e a m a z in g re su lts, six E ll io t t F a c to rie s are very, busy,.. f ' ,. . Elliott F a c t o r y a t Cambridge, Mass. . Elliott Factory at Atlanta, Ga. THE ELLIOTT A D D RESSIN G MACHINE COM PANY 151 Albany Street, Dept. 11-B, Cambridge 39, Mass. 47 Branch Offices in the largo cities 2000 Agents in the smaller cities 58 off water and produces gasoline, fuel oil, and lube oils of \arious weights. (5) Decolorizing with bleaching clay (usually fuller's earth), which is immedi ately removed bv filtering. (6) Blending the oils to get specified viscosity. New Method--Recently another proc ess came into the picture. It employs a new low-temperature vacuum fraction ating tower (picture, page 56). One of the first re-refiners to go over to this method was Worthington Oil Refiners, Inc., Roslyn, Va. Worthoil starts off with a dehydration and settling step. Then it treats the oil with sulphuric acid to precipitate gums, grease, and other foreign matter. After this, the acid com pounds are neutralized and fuller's earth is mixed in. The mixture next goes through a number of passes in the frac tionating tower. Then the temperature is raised in stages. Gasoline, kerosene, No. 2 fuel oil, No. 10 and No. 20 lubri cating oil (and up) are driven off as vapor, free of particles. The residue, a mixture of clay and No. 40 or No. 50 oil, is then pressurized through heavy filters to remove clay and other par ticles. This final step accounts for the primary yield--pure No. 40- or No. 50grade oil. W ho Uses It?--Biggest source of cus tomers for re-refined oil are the jobbers who peddle it through retailers to the motorist and farmers. W hen it is marked as reclaimed oil, it retails at be tween 10<f and 15(i a gal. Pan American Airways and American Airlines re-refine a major part of their aircraft crankcase drainings. They both use Refinoil units, of the "pot" still tvpe. The Air Force has no re-refining equipment of its own. Their work is done on a conti act basis by specified relcfiners. The Air Force has put re-refin ing on a nationwide basis. The Army is getting set to test collection methods over an entire army area. Eves Open--Meanwhile, re-refiners are "keeping one eye open for new mar kets--even to checking the export pic ture The other eve they've got glued on the 11 9-million bbl of used oil that annually go down the drain. Esso Distills Fuel From "Fluidized" Shale W hen the U. S. oil supply finally dries up, there wall be three major sources o synthetic liquid fuels to tap natural gas, coal, oil shale. For some time both pri vate industry and the government have been taking a very close look at all three iB W -M ar 27'4B,p73) Less-Publicized--Most of the public- itv, however, lias played up conv^ ^ i f of coal and natural gas (BW--Jan -- BUSINESS WEEK Nov. 1 3 , 1 9 4 8 PIPI r : .1 C h ic k e n a n d ric e , rice pudding, s h a s h lik ... ``just plain rice" --which is the basic food for most of the world's people-- every rice dish will be improved because of Malekizing. M a le k izin g sc ie n tific a lly modifies rice so that it retains most of its natural nutrients. Malekized rice has more than twice the vitamin content of ordinary white rice. M a le k izin g e n h a n c e s the delicate flavor of rice--it's great to eat all by itself and it's wonderful in place of bread or potatoes. B e st o f a ll, for housewives--Malekized rice is easy to cook--each kernel is firm and separate. It never becomes sticky or gummy like ordinary rice. Cream-colored in the package, Malekized rice turns snowy white and fluffy during cooking. Th e M a le k izin g P ro ce ss was perfected by General American scientists and food tech nologists. Malekizing equipment fits into standard milling operations and can be installed in rice mills anywhere. It sub stantially increases the whole grain mill yield. The first cost of the plant is sur prisingly low; its operation is economical. Inquiries are invited. 1 .1 ?<1 r lit ftp 'h c . W a lto n 's Now Available M alekized W ondeRice produced under license by W alton Rice M ill, Inc. S tuttgart, Ark. M A LEK IZ ED RICE P R O C ESS GENERAL AMERICAN TRANSPORTATION CORPORATION 133 South L a S a lle Street . C h icag o 90 tckles Aerytask p21). Despite the work done by the Bu reau of Mines in its new laboratories and pilot plants, distillation of gasoline, fuel oil, and lubricants from oil shale has gone almost unnoticed. Last week Standard Oil Co. (New Jersey) was--hteially--building a fire un der oil-shale research. It began applying to shale the "fluidized solid" technique that it used to get the most out of cat alysts in oil-cracking. Work got under way at Esso Laboratories' Baton Rouge pilot plant, where the process was ongmally developed for cat-cracking; oil shale was furnished by the Bureau of Mines' deposit at Rifle, Col. Experimental Stage--Esso first of all pulverizes the shale, blows steam or gas through it. In this "fluidized" state, shale particles cnculate easily. The proc ess lequires two vessels. In No. 1, the shale is heated to 900 F, which knocks out oil molecules in the form of sapors, these can be distilled into gasoline, fuel oil, lubricants. Some of the decomposed shale is transferred by air stream to No 2 vessel, where the carbon is burned out This supplies the heat needed for break ing down the shale in No. 1. But don't get your hopes up too high, cautions Standard Oil Development Corp., which has charge of the research There's a long way to go before oil from shale can compete economically with crude oil. PRODUCTION BRIEFS CA T S U P ...v in e g a r .. . soft drinks -- bottles by the m il lion are made in cast, iron molds. But handling these m olds w hile they are 1000 degrees hot is a major foundry problem. After pouring, they must be moved quickly because "cooling off" ties up floor space. In the past, two men maneuvered tongs around red-hot castings to load them into wheelbarrows -- slow , costly work. Today, an Ohio lifting magnet does the entire job faster in one operation. Suspended from a small overhead crane, the magnet travels above the line of castings. Its pow erful m agnetic field pulls red-hot castings out of the sand . . . quickly grips and transports them to "cool ing off" areas. 60 A n o th er job com pleted in m agnetm inutes in stea d of costly m an-hours! And another example of why you should investigate O hio lifting and separation magnets today. W rite to O hio -- 25 years a lea d er in m agnet ic m a teria ls h a n d lin g a n d separation. The O hio Electric M fg. Co., 5920 Maurice Avenue, Cleveland, Ohio. Ohio s also a lead ing nam e in the sm all motor industry a wo f e r r o x c u b e magnetic ferrite ma terials (mixed cnstals of metallic oxides and iron oxide) have been patented b) Phillips Laboratories. Will mean a re duction m the size of inductors, trans formers, and other electrical equipment, says Phillips. g e r m a n o x y g e n p r o d u c t i o n is sur veyed in a new Commerce Dept, report (PB 88840). Covers equipment and processes. w a r t i m e r e s e a r c h has had a peace time payoff foi International Nickel International can now turn seamless tubes and pipes which are more than twice as large as prewar sizes g . e . r e s e a r c h g r a n t s : College giaduates who want to go on with scientific and industrial studies can apply now foi 1949-50 awards (up to $1,500 a year) Money comes from G.E.'s Sl-million education fund. m e c h a n i c a l e n g i n e e r s will pitch camp m New York,, Nov. 28 to Dec. 5, foi their 69th annual conclave The Amciican Society of Mechanical Engineers has scheduled 72 technical sessions. BUSINESS WEEK Nov. 13, 1948 Sitting Pretty Your factory would be, too, if it were located in the Southland. For if there was ever a place formed and fashioned for sound industrial growth, it is the South. Wherever you go . .. wherever you look . . . your im agination w ill be stirred by evidences of great natural resources, of pro gressiveness, of confidence in the future. No wonder new factories are arriving alm ost daily, and old ones are expanding, all along the 8,000-mile Southern Railway System. And they're all " sitting pretty" in th is am azing industrial opportunity-land. "Look A h e a d -- Look S o u th !'* P re sid e n t 'So9' T | SOUTHERN RAILWAY SYSTEM T he S outh ern Serves the South The Facts Douglas Fir How much plywood is being manufactured today? In 1948, output o f the Douglas fir plywood industry w ill exceed 2,000,000,000 square feet --an all-time record. Here's a comparison with recent years: 1938 . . . . . . . 650,000,000 sq. ft. 1945 . ... ... 1,175,000,000 ' " 1946 , . . 1,390,000,000 ' ' 1947 . . , . . . . 1,620,000,000 " " 1948 . . . . .. . 2,000,000,000 * * W here is plywood going? T o every state in the nation. Alm ost all fir ply- ."wood is used in th United States.' >-v - W hat is the distribution pattern? 1 j~~ Plyw ood M anufacturers 100% j ______i r - - I -- " - - - |Arm y-N avy.D irect 5.0%[| [W holesale Distributors 68.8% 1 " ------------1-------------- -------- 1--------- [Cabinet Shops | [Home Ow ners] [Hobbyists, Craftsm en] | Remodeling ] I Builders | |fo rm e rsj | Stores, Signs, D isplays | Cut-up Uses) | M iscellaneous Why whoiesaie distributors? Fir plywood is manufactured in one corner of the nation, marketed throughout the 48 states. Distributors perform many functions--main tain stocks, assume credit risks, supply the nation's 25,000 lumber dealers and thousands o f industrial users who find this "modern miracle w ood" vital in the manufacture o f their products. Why lumber dealers? Lumber dealers supply contractors, carpenters, cabinet shops, home-owners, home-builders, farmers, sign and display shops, amateur crafts men and many other users. In 1948 lumber dealers are handling 1,062,000,000 ft. o f ply wood, with a large percentage o f this going into new and remodeled homes. What about industrial users? Historically important plywood customers-- largely using grades, thicknesses and sizes not ordinarily handled by retail dealers--industrials get about 15% o f firplywood production direct from manufacturers, and additional quantities from distributors and dealers. Included in this group o f users are railroad car shops, truck builders, door factories, furniture manufac turers, prefabricators, boat builders, etc. W hy is plywood demand so great? Plywood is literally "TheW ood o f 1000 Uses". It is used in houses, garages, industrial build ings . . . in barns, silos, rowboats, yachts, tuna clippers . . . for signs, tables, concrete forms, track shims. The list is lo n g ... and constantly growing. For Plywood's many unique advantages make it one o f the most versatile o f all building ma terials. Plywood is "engineered" w ood--real w ood in large, rigid, cross-laminated panels . . . light, strong, puncture-proof, split-proof . . . durable, easily worked either with hand or power tools. The complete allocation o f plywood for war-- for use in PT boats, aircraft engine crates, barracks, pontons, and thousands o f other items - created a tremendous back-log. Today's high economic tempo, plus that back-log, puts total demand at an unprecedented level. Is productive capacity being expanded? Yes. Here's the picture: 1938 . . 21 factories 1941 . . 31 1945 . . 31 1947 . . 35 1948 . . 42 . . 11 factories being built about Plywood DOUGLAS FIR PLYWOOD Large, Light, Strong Real Wood Panels Is plywood as good today as prew ar? I t is better. Performance requirements sqf forth in the new U . S. Commercial Standard CS45-48 -(effective N ov. 1) are the most rigid ever specified. This applies both to Exterior-type (waterproof bond) and Interior-type. Are plywood grades the same as prewar? Y es.. .and eiferinmanyrespects. Further,addi tional appearance grades o f both Exterior and Interior types have, been developed to meet specific needs and for highest utilization o f raw material. For efficient production and use, several sizes are offered; new, sim plified A -B-C grade identification has been adopted. The most versatile o f all plywood grades is the "one side" material--having one face suitable for fine finishing. Manufacturers are turning out 66% o f production in this -material. ' W hy are prices higher than prew ar? -Prices for plywood at the factory are set by the individual manufacturer, reflecting individual operations and determined by his costs. Raw material (logs) and labor account for v some 80% of. production costs. W age rates have more than doubled since 1941. Log costs have about tripled. Did the war disrupt distribution? Greatly. Through 100% W PB allocation for many years . . . through changes in population ratios, business activity ratios, plywood use ratios. What has happened postwar? After wartime allocation, plywood was allocat ed to veterans housing in 1946 and 1947. A llo cation, in many instances, upset historical pat terns o f plywood distribution. The results of abrupt changes under allocation are not immediately neutralized. During the war, too, many individuals and firms became fully acquainted with plywood's outstanding advantages, and are now using plywood in greater and greater quantities. This created new customers--new uses--new demands. What's ahead in fir plywood? 1-- Continued increased production, with a higher proportion o f Exterior-type (water proof bond)--the all-purpose material for siding, farm uses, marine uses and count less other outdoor applications. 2-- Continued conservation o f the natural re source--timber--through higher raw ma terial utilization, the production o f grades for specific uses, the manufacture o f several standard panel sizes tailored to economical use and production. Further development o f new products such as overlaid plywood, extra-sizepanels, and the manufacture o f ply wood from woods other than Douglas fir. 3-- Continued sale o f a high proportion o f production through distributors and deal ers--an d co n tin u ed su p p ly in g o f industrials, long-time, important plywood users. 4-- Constant betterment o f product, through research and testing--with higher perform ance standards for both Exterior-type and Interior-type--p o in tin g to ever-greater plywood usefulness. above. ___ 2. THE W OOD F TOO ^ Pictorial review of 3 . u . s. C O * \ M E f adeS( Covering types, y versa,m*y Q CS45-48 5.zes aod perform- 'T , ? . '. " M I0 W K S0 1TM W .iie to NEW PRODUCTS M ercury"TrackIess Train" Speeds MORE Tonnage at LOWER Cost! Hauls every ton for less . . . . travels wherever material movement dictates. Works as a cost reduction team with ,, your fork trucks -- relieving them of , LONG HAUL transporting-- freeing them to handle and stack. Ask a Mercury Sales Engineer to call. Or, request Catalog No. 7-11. THE MERCURY MANUFACTURING COMPANY TRACTORS TRAILERS LIFT TRUCKS 64 Construction Cannon Powder-Power Tool Corp. has put some light .artillery into a device to drive studs into concrete or steel. By using a .38-caliber cartridge m the tool, the com:pany says itlcam pack a 25-ton wallop into the driving'action. That means you can blast the studs through 3 in. of concrete or through f in. of steel. . '.When you want to anchor conduits to W'alls or to attach metal roofing and siding, here's what you do: (1) Insert the stud and powder cartridge in the barrel of the -tool; (2) screw the barrel into place; (3) set the tool against the surface. where you want the stud; and (4)' turn a safety ring. The tool fires when it's forced against the face of the work. Powder-Power has designed special studs to go along with the tool. They have a thin flange at the top of the head which: (1) holds the stud in the barrel; (2) confines the explosion until enough pressure is built up to shear the flange off the head. This gives added driving power. The tool can't fire accidentally; when it does go off, it has almost no recoil. The .38-caliber model weighs around 8 lb ; a junior edition, a .22-caliber job, 3 lb. The manufacturer's address: S. W . Wood St., Portland, Ore. Availability: immediate. Foam Rubber Piecer A special cutter--a tool for the foamand sponge-rubber industries--has come off the lines at Stanley Electric Tools, New Britain, Conn. The portable, electric cutter oper ates on either a.c or d.c. You can use it to cut rubber that's up to 4 in. thick, following either a curved pattern or a straight line. Depending on thickness, you can slice the stuff at speeds up to 30 ft. a min. Motor housing of the tool is a light weight, aluminum-alloy casting. The notched blades that do the cutting are made of alloy steel. Availability: immediate. Lead Detective In the manufacture of lead com pounds, production men have to keep a constant check on the amount of the stuff that escapes into the air. If too much gets loose, it's bound to have a toxic effect on workers. Engineers at E. I. du Pont de Nemmours & Co. have been working on the problem. Now' they say they have found a device that wi 1 detect lead m the air in amounts as low as one part m 20 mil lion. T hat's about as much as you'd get if you ground up a BB shot and dis persed it m about 500,000 eu. ft. of air. The instrument is a mobile job that can be w'heeled around the plant to make regular sir inspections. Air is drawm into it through a tube, passes over an electrical spark m such a wav that it gives off light. This light is then broken up in a quartz spectrograph. Each of the metals that are present m the air produces a different color of light. Lead gives off an ultra-violet light; it show's up as a narrow' band in one particular spot.,on the spectrum. Light from this part of the spectrum is then passed through a photoelectric Geiger counter, where it produces a pulsating BUSINESS WEEK Nov. 13, 1948 R e g a r d l e s s o f size, your plant equip m e n t is a n im p o r ta n t in v e s tm e n t. It's a n in v e s tm e n t t h a t d e se r v e s sp e c ia l "care a n d fe e d in g ." F o r e x a m p le , it 's n o t u n u su a l for o p era to rs o f t h e "b ig b a b ie s" lik e th is m am m oth diesel above to put them on spe c ia l "fo r m u la " d ie ts for p r o te c tio n . W h e n th is happens, the services o f a seasoned lubrica tion engineer are helpful. C ities Service lubrication en gin eers are thorou gh ly grounded in up-to-the-m in ute lubrication techniques on diesel engines. T hey know w hat proper types and grades o f oils, greases and fuels w ill best m eet your individual requirem ents. A t absolutely no obligation to you, a C ities Service lubrication engineer w ill m ake a thorough, on-the-spot analysis o f your lu brication requirem ents. H is recom m enda tions m ay su b stan tially reduce y our opera tio n an d m ain ten an c e costs. W rite C ities S e rv ic e O il C o m p a n y , R o o m 256, S ix ty W a ll Tow er, N ew Y o rk 5, N . Y . We have a new 66 page book let entitled "Diesel Engine Lubrication." This complete lubrication manual is yours for the asking. CITIES SERVICE QUALITY PETROLEUM PRODUCTS T " jjjgjllppgp 'il- r'rii' "* ' agjfrSgk W V i* ' *rr*9 >- current of electricity. By measuring the strength of this current, you're able to find the intensity of the hght, and, in turn, the amount of lead m the air. Although the device has been tried only for lead, du Pont expects it can be adapted to detect orher toxic metals. North American Phillips Co., Inc., 100 E. 42nd St., New York, is handling the manufacture. Availability: on order from P h illip s . 8 A 50% cotton fiber paper, R esolu te Ledger is rugged. It w ithstands heavy use, has good writing and erasing qualities and is an excellent m oderately priced paper for m achine bookkeeping and other sem i-perm anent records of m oderate im portance . . . such as inventory, payroll, production and social security. These famous names identify the papers manufactured by the Neenah Paper Com pany. The name N e e n a h . ap p ears in each watermark to identify the genuine for your protection. OLD COUNCIL TREE BOND SUCCESS BOND CHIEFTAIN BO N D NEENAH BOND N EEN AH THIN PAPERS TUDOR LEDGER STONEW ALL LEDGER RESOLUTE LEDGER NEENAH LEDGER NEENAH INDEX BRISTOL NEENAH PAPER CO M PAN Y NEENAH, WIS. 66 Auto Operating Table The bigger and broader models that carmakers are putting out these days, haven't made the handling problem m body-repair shops any easier. Everytime a body section is removed for roughing or finishing, workers get set for at least a mild wrestling act. Blackhawk Mfg. Co., Milwaukee 1, thinks it's found a device that may be of some help. The Reck-Rack will take any body section up to about 6 ft. wide and 9 ft. long, hold it tightly in place while the roughing or finishing is done. Four adjustable bars with clamps are designed to grip parts of anv shape. Height of the rack can be varied (from 30 in. to 41 in.) to suit the particular job vou have to do. A v a i l a b i l i t y : i m m e d i a t e t o 3 0 davs. Round-the-Clock Dictator If you're bothered by having to change records m the middle of a dicta tion session, Miles Reproducer Co., Inc., can sell you a couple of recorders that should keep pace with your longest talkfest. One model, the liM -L, will run continuously for an heur; the other, the CMT, goes on for 24 hours without a rewind. Botlvmaclnnes cut heir sound tracks on film. The sound of your voice con trols their stopping and starting. Auto matic volume control on the speaker pickup makes it possible for you to move around the room while you're die- BUSINESS WEEK Nov. 13, 1948 That's my traveling secretary-- the new Electronic TIME-MASTER You c a n f l i p o p e n the traveling case--and tu rn a hotel room into an office, ^-11 you have to do is take out the trim, com pact, sturdy TIME-JVIASTER--.the revolutionary, new office dictating machine. W ith this versatile machine by your side and the small electronic m ikejm your hand you can dictate "as usual" wherever you go. And you can mail your recordings back to the office at once! T hat's because the electronic TIME-MASTER records on a small, flexible plastic belt--just the right size for your busi ness envelope. Five of these handy Memobelts--an hour and a quarter recording-- can be mailed in a standard small-size envelope under a 3^ stamp! TIME-MASTER gives better recordings, uniform tonal quality and uniform backspacing--from first word to last! Your secretary will agree -- for all-around convenience plus perfect voice fidelity--there's no dictating machine to compare with the Dictaphone TIME-MASTER. I t's completely new, completely different, completely satisfying! FO R A D EM O N STRATIO N of the new TtM E-M ASTER M odel, simply call your local Dictaphone representative or fill in the coupon below. D ictation d o n e ? Twelve of these small Memobelts will nest into your billfold. Five of them will luck into your regular business envelope. And these superior Memobelt recordings can be mailed in a regulation mail chute. V I T A P H O N E Electronic Dictation r ------------------------------------------------------------------------1 I Dictaphone Corporation I I Department F-12, 420 LexingtonAve., Y. C, I EH Please show me the new TIME-MASTER. . I Please send TIME-MASTERliterature. * I Your Nome---------------------------------------------------------- I I C o m p a n y ___________________________________________________ I Street Address--------------------------------:----------------------------------- j C i t y & Z o n e ------------------------ ------------------------------- S t a t e ------------------ | fating; it picks up your voice even when you're 25 ft. away. On the PIM-L model you can rewind to any part of the film m a matter of a few seconds. The CY1T, the 24dir. job, works on a continuous loop, twisted so that recording is done on both sides of the film. Depending on the width of your film (8 mm. o. 16 nun.), you can record 35 or 100 tracks on each side. Miles also has a group system that lets several men use the same machine The desk unit for this network hookup looks like a name sign. It holds a micro phone, an on-off switch, and an induc tion telephone pickup. It's connected to recorders in a central battery. Miles is at 812 Broadway, New York 3. Availability: immediate. Gets o u t:o f order along about three or fo u r o 'clock every afternoon. Doesn't stop running en tirely. . . ju st slows down. .Fatigue, they call i t . . .fa tig u e brought on by eyestrain brought bn by bad lighting. Wakefield Over-ALL Lighting is the one essential business tool you can't afford to be'without if you want top efficiency from all your other business tools. Wakefield Over-ALL Lighting is a basic business tool that cuts errors, speeds production, reduces absenteeism, lowers employee turnover, raises employee morale. Wakefield Over-ALL Lighting is engineered to fit the task, no matter what that task is, in office, drafting room, store and school. Bad lighting is bad business. For enlightenment on what good lighting will do for you, write to The F. W. Wakefield Brass Company, Vermilion, Ohio. Over-ALL Lighting Fo r O ffice. * D rafting Room S to re a n d S ch o o l A BASIC BUSINESS TOOL Piece Goods Handler Maybe you've watched someone try to get a particular roll of piece goods out of a bin. Then you know how much pulling, lifting, and fugging it takes to get the roll out when it's in the middle oi on the bottom of the stack. Cutting Room Appliances Corp., 45 W . 25th S t, New York 10, thinks it has found a device that will take most of the grunt and groan out of the job. Its Eas-Out is a lightweight handling tool that can be slipped into the end of the tube of the roll of goods. W hen you start pulling with the springequipped handle, notched chrome-steel grippers bite into the inside of the tube. Thus, you have a solid grip that makes the job of sliding 'ihe roll out of the stack a fairly simple one. C. R. A. feels the device will be a 68 BUSINESS WEEK ?- I ! j / T h e reason for W orthington air conditioning in many of the build ings of Firestone Tire and Rubber Company is for employee effi ciency . . . in your case, it may be the sam e--or more sales--or low er-cost maintenance. I n a n y c a s e , W o r th in g to n 's complete line--including all the vital components o f an air condi tioning system*-- gives you your best opportunity for an applica tion exactly suiting your needs. Each machine is built to the same standard of quality and to oper ate in balance w ith interrelated m achines. R esult: sm oother, quieter, lower-cost operation and longer life. Further: W orthington's over50-year experience in manufac turing air conditioning equipment is balanced by the engineering ex perience of selected distributors. Locate the one nearest you in Classified Telephone Book and find out why there's more worth in Worthington. W orthington Pump and M achinery Corporation, Air Conditioning and Refrigeration Division, Harrison, N . J. * 'Worthington makes more of the vital innards -- compressors, condensers, engines, turbines, pum ps-- than any other one manufacturer. W ORTHINGTON AIR CONDITIONIN G AND REFRIGERATION tI A8~29  O IL W IC K m ASSURES UNIFORM "CIRCULAR-FLOW' LUBRICATION B-L'ine SLEEVE BEARINGS A white wool rope oil wick A, is wrapped around the spool-type bearing hub several times. The oil is held in suspension and fed to the shaft through the oil pick-up window B,,in the heavy bronze bushing. Oil in the oversize reservoir C, thoroughly saturates the circular wick surrounding the bearing and reduces the amount of free inactive oil. No more failures due to the wick not making shaft contact. B-LINE's "Wrap-around" wick is always in contact with the rotating shaft. A liquid-tight steel cover D, allows greater capacity in less space and keeps the bearing free from dust and abrasives. Operating efficiency of B-LINE sleeve bearing motors is greatly increased by this new design. B-LINE is far in front with many such motor improvements. When selecting a motor for your application . . . don't just buy a motor. . . buy B-LINE and get the very best! a !--r.- 1 70 makes a complete I,no and ball:-bearing motors for every application in>^Bustry . . . on the farm . . . and in the home. Write for Descriptive Bulletin 5000A, on Repulsion-Induction, Capacitor, Squirrel Cage, D. C. and Gearmotors. Call your local B-LINE representative for further in formation. big timesaver for mills, converters, job bers, and retail and department stores. Availability: immediate. Radiant Glass Drier Glass heatmg panels have cropped up in a new appliance at Continental Ra diant Glass Heating Corp. The panels, which have been getting a promotional iide as house heaters, have been built into a plug-in electric clothes drier. The drier has two 16-in. x 24-in. glass panels mounted on its bottom. The ra diant heat is generated m aluminumalloy ribbons which are fused into the glass. There are no moving parts. The wash hangs on stainless steel rods in the top of the unit; you has e about as much drying space as you get on a 60-ft. clothes line. The drier works on 110-220 v., a.c. or d.c. It draws about 11 amp. at the start, cuts this to 7 or 8 amp. after it reaches correct drying temperature. Continen tal says it dries a 10-lb. wash m roughly the time it would take you to iron it. The manufacturer's address: 521 5th Ave., New York 17. Availability: 30 days. p. s. A folding glass for convertible auto mobile tops is being turned out at Pitts burgh Plate Glass Co. The glass, used in the rear window', sandwiches like an accordion when you put the top down Bookkeeping system marketed b\ Thomas Pearce Co. does awa; with the ledger, substitutes a combined ledger statement. You post from an all-purpose cash and general journal sheet. The ledger statement gives you: (1) a per manent ledger record, (2) a trial balance, (3) a statement of profit and loss and a balance sheet, both 'monthly and cu mulative. Pearce's address: 833 Tatnall St., Wilmington 43, Del BUSINESS WEEK Nov. 13, 1948 TO THE SIX MEN INTERESTED IN CUTTING COSTS AND IN CREASIN G PROFITS You can meet the challenge of a "Buyers' Market" with AMERICAN AIRLINES Ship by air Travel by air Mail by air From the speed and dependability of American's Airfreight stem specific ad vantages: faster turnover and increased volume . .. wider distribution with lower distribution costs... smaller inventories --with less loss through spoilage and with a minimum of warehousing re quirements. Get merchandise to market when it's wanted--with Airfreight. The speed of air travel permits you? salesmen and other traveling personnel to go more places more often,--cover more ground in less time--make more calls, more sales--with tremendous sav ings in man hours. American's lowestfare policy makes air travel costs re markably low. Time saved in travel means money savings, too. The speed of air mail will increase the tempo of your entire business operation.' The complete routine of receiving orders, expediting deliveries, sending out bill ings and receiving payments is speeded up. All bookkeeping is kept up-to-theminule. And you can get out detailed field instructions more quickly and com pletely than ever before. YOU CAN'T AFFORD AN EARTHBOUND BUSINESS! Check what American's Airconomy Plan does: Quickens turnover--with smaller inventories Averts disastrous mark-downs--reduces seasonal risks Makes re-orders easy--keeps field stocks fresh Helps open new markets, expand old ones Cuts warehouse costs--reduces losses in transit O Speeds up distribution, frees more capital Permits productive personnel to cover more ground Increases personal contacts Saves precious man-hours Shortens order-to-deiivery-to-payment period Gets field instructions out faster Streamlines end-of-morith bookkeeping A M E R IC A N A IR L IN E S ' AIR MAIL THIS REQUEST TODAY Ame-ican Airlines, Inc., Department M, 100 East 42nd Street, New York 17, N. Y. ! gentlem en: W e are interested in your I airconom y plan a n d w ould like to find I | o u t how it applies lo our bu sin ess. r I NAME OF FIRM_______ i I I I NAME OF INDIVIDUAL i I ADDRESS_____________ I I TYPE OF BUSINESS----- i L J PORTS 1 Freight sorting depot Authority's important in Manhattan is traffic-expediting one of New York Port projects. In it . . . 2 Shippers have a central distribution point for incoming and outgoing shipments. Here parcels are weighed, sorted, then . . . Tractor trains haul parcels to outgoing shipping platforms, m Railroader's trucks. All platforms are recessed into building to where they are picked up by . . . "T avoid blocking street traffic Semi-Public Authority Guides New York Traffic A government agency that pays its own w ay, Authority rates high as a private business. It's pushing public works, private trade. Last week some Cleveland business men were puzzled. The Port of New York Authority had just set up a trade promotion office there. Clevelanders wondered why a govern ment body like the Port Authority, which builds and operates tunnels, bridges, and freight terminals, should be interested in promoting New York's commerce as well. Half-and-Half--The fact is that the Port Authority is more than a govern ment institution. It is partly a private business corporation, too. It gets no government money, can't tax anybody. Instead, it charges tolls for the use of its facilities like any private business. Through its union railroad terminal (pictures, above) last year passed some 112,000 tons of rail freight, all in lessthan-carload lots. That's not a very large figure. But it's just one part of the sprawling job that the Port Authority, as a part-public, part-private corpora tion, does. So the more business the Authority can bring to New York, the more money it makes. Of course, this money doesn't go into private hands; it helps to strengthen the Port's other projects, like the huge International Airport on Long Island. This blend of the private and public stamps everything the Port Authority does. It is a sort of super-Chamber of Commerce for the port region, acting as a moderator in local disputes and serving as the New' York area's outside representative. This week, for instance, it was lobbying at the federal Budget Bureau for more federal money to deep en New York's waterways. How It Grew--W hen the A uthority was established in 1921, it was the first such institution in the U. S. The fed eral Tennessee Valiev Authority and many local port and housing authorities all owe much to this one. This does not mean all authorities are identical, or 72 BUSINESS WEEK Nov. 13, 1948 even similar. Problems and objectives differ widely. The Port of New York Authority was started because the communities served by New York harbor finally realized that it was better business to work together than try to cut each other's throat. W hat convinced them was the geog raphy of the case. The states of New York and New Jersey meet along a huge harbor area. Along eight bays, four rivers, and four straits are 650 mi. of waterfront. New York City and the cities on the New Jersey shore had been having trouble with each other for a century. Dissension--Most railroad freight for New York City was unloaded in New Jersey rail terminals on the New Jersey shore; then it was carried across the harbor by lighter to railroad piers in New York City. This service was in cluded in the freight rates from western points to New York. And these rates were the same for northern New Jersey cities as they were for New York City. New Jersey businessmen felt that this gave their New York competitors an unfair advantage. So they tried to get their own freight rates lowered. Their attempt finally led to the New York Harbor case of 1917. This proved an expensive lawsuit that put both parties in the mood to compromise on a "port treaty of peace." Peace--The states of New York and New Jersey made such a treaty. They promised each other that they would act in harbor matters through a joint agency. In future, this agency would handle planning and development of public terminal and transportation facil ities. The agency that developed out of the "Port Treaty of 1921" is nonpolitical. For that reason, it is able to take a regional approach. Its commissioners are appointed by the two state governors; they serve without pay. Salaries of its permanent staff are higher than for most public agencies. The Authority soon worked out a comprehensive plan for unifying the railfreight facilities of the port. But that plan has never progressed very far. Rea son: It concerns interstate commerce, and the Authority has never been able to get the Interstate Commerce Com mission and the railroads to see things its way. Nor has New York City ac cepted a much more recent proposal to operate and modernize its aging munic ipal docks (BW --May29'48,p40). Setup--Just the same, the Authority has become essential to the economic health of the world's largest metro politan area. Besides that, its bonds en joy a Moody's "A" rating. The reasons: (1) The high caliber of the businessmen who have served as Authority commis sioners; and (2) the automobile. Most of the Authority commissioners BUSINESS WEEK Nov. 13, 1948 CREATES Q U A LITY For each shipper's product, a corrugated container that's exactly right. This goal Fort Wayne Corrugated Paper Company has ever had in sight for its customers through 40 years of container making. It's a goal attained through experienced, heads-up teamwork --consistent teamwork that co-ordinates the specialized skills of Fort Wayne experts and integrates the operations of four modern fabricating, plants and two productive paperboard mills. This teamwork creates quality. Through every manufacturing step from rawmaterial selection to final container fabrication, Fort Wayne controls quality and uniformity of production... for individualized service to the shippers of America. CORRUGATED FIBRE BOXES CORRUGATED PAPER PRODUCTS Corrugated Pa p e r C ompany (fa u n a l 0(ce4: Fort Wayne 1, Indiana 7^laa(a.: Rochester, New York Chicago, Illinois Pittsburgh, Pennsylvania Hartford City, Indiana 'm a .Vincennes, Indiana s ib ilia te : Southern Paperboard Corporation Port Wentworth, Georgia S a le O fie& i: Chicago, 111. Detroit, Mich. Buffalo, N. Y. 'Jamestown, N. Y. New York, N. Y , Rochester, N. Y. Syracuse, N. Y. Cincinnati, Ohio Cleveland, Ohio Dayton, Ohio * Lima, Ohio Newark, Ohio Indianapolis, Ind. Muncie, Ind. * Pittsburgh, Penna. York, Penna. 73 H E R E ... the industrial weather vane always points in a favorable direction! Industrial trade -winds blow steadily toward Connecticut. Here is a strategic location for a manuiactuiet.-Here is a vast transportation web which reaches but to huge nearby markets and sources of semi-finished materials. Here are skilled workmen who assure high productivity and get along well with management. In compact, versatile Connecticut is to be found 75% of all types of American industry. W rite to Connecticut Development Commission, Depart ment WB6,State Office Building, Hartford 15, Connecticut, for information on the special advantages Connecticut offers your type of industry. This service is free! Put your business in a "State of Success" have been businessmen. They have taken a broad view of the needs of the port. The fact that commissioners don't get any money for their work has done a lot to keep the Authority out of poli tics. Present Port Authority chairman is Howard S. Cullman, a tobacco man who has served as commissioner for more than twenty years Other com missioners: S. Sloan Colt, president. Bankers Trust Co. of New York, Bay ard F. Pope, chairman Marine Midland Corp. Land Traffic--The bridges and tun nels built and run by the Authority have done a good deal to join the states of New York and New Jersey into one huge business area. The Authority began by building bridges between Staten Island and New Jerscv; it vent on to build George Washington Bridge and the Lincoln Tunnel, took over operation of the Hol land Tunnel. It has built a grain ter minal in Brooklyn, and the union rail road terminal. It is operating thru large airports in the New York area. Problems--All this activity lias brought with it a hefty traffic problem. The Authority is now on the way to solving this one. It is putting up two motortruck term nals--one in Newark and one in Manhattan. Their setup will be much like that of the Manhattan union rail-freight terminal These will act as "post offices" for over-the-road freight. Daily capacity of the two ter minals will be 4,500 tons. In addition, the Authority has a union bus terminal under way on the west side of midtown Manhattan. This terminal will keep intercity buses off New York streets All three terminals are expected to cut traffic congestion, save time and freight costs. Airports--The Authority has also launched a long-range program of air port development. It is operating La Guardia Field and New York Inter national Airport on Long Island, on 50vear leases from New York Citv. Inter national Airport will be nine times as big as La Guaidia when completed. The Authority operates Newark Airport on a similar arrangement with the city of Newark. It has contracted to buy the privately owned Teterboro Air Ter minal in New Jersey. Outlay--Since its start, the Port Auth ority has built or has started about $300million worth o! self-supporting public works. In the early days, it bad a little trouble explaining to investors just what it was, and why they should loan it money. Since then, it has sold about $ 568-million m revenue bonds on its own credit, including refunding of its original issues. Besides all this, the Authority spent about $43 5,000 last year in port plan ning and development. This included: (1) Studies of airports, waterways, dock BUSINESS WEEK Nov. 13, 1948 How Battery Maker Cut Lumber Handling Costs 65% Acm e Steelstrap and Unit-Load Band en ab le Exide firm to sa v e $7*40 p er 1,000 b o ard -feet. The Electric Storage Battery Com pany o f Philadelphia, makers of the famous Exide Battery, decided that the process of unloading lumber from boxcars board by board Was too slow and too costly. After a survey by an Acme Ship ping Specialist, they asked their sup pliers to ship them crating lumber strapped in bundles "Bound to get there" with Acme Steelstrap. Then the bundles were loaded onto flat cars and held firmly together with Acme Unit-Load Band. The result was a reduction in costs of fully 65% ! Two men and a fork truck took only 8 man-minutes per 1,000 boardfeet to unload the lumber and move it to storage. Moving bundles out of storage proved to be just as fast. T he savin g am ounted to $7.40 fo r every 1,000 board- Bnc.Skititiafi A fork truck op erator at the Exide p lan t stacks bundles of lumber firmly held together with bands of Acme Steelstrap. Bundies can be e a s i l y and q u ick ly moved from h ere to 'production lines. Securely bound with Acme Unit- L.0d`d ;:Bands/ a car of lumber arrives at the Exide plant. The load consists of 27 easy-tohandle bundles. feet handled, and was achieved de spite additional loading charges at the m ills. Company now specifies shipment by Unit-Load methods on every purchase order. _Why, not find out what Acme Steel strap and Unit-Load methods can do for your business. An Acme Shipping Specialist w ill gladly make an analy sis for you without cost or obliga tion. For further information, mail the coupon below. STRAPPING D IV ISIO N ACME STEEL CUMP4 NY Acme Steel Company, D ept. BW-118 2838 A rcher A venue, C hicago 8, Illinois Please send me a free copy of your booklet "SAVINGS IN S H IP P IN G /' NEW YORK 17 76 ATLANTA CHICAGO 8 LOS ANGELES 11 conditions, and problems of mass trans portation; (2) appearances on behalf of the New York region before ICC Mari time Commission, and other federal agencies; (3) establishment of an office in Chicago for promoting business in the port of New York. Now it has offices in Cleveland and Washington. Port Payoff New Orleans stays under business management as voters beat amendment giving gover nor complete control of port. In the past few years, the Port of New Orleans has built up its business faster than almost any other port m the country (BVv--Jun.28'47,p38). Re sponsible for it was a hard-hitting sales campaign put on by the area's business men. They felt that this record proved it was better to have businessmen do the job than politicians. Threat--Then Gov. Earl K. Long came to power in Louisiana. He spon sored a constitutional amendment which would have put complete control of the bustling port into his hands. Businessmen were horrified; to them, this was a "power grab" which would ruin the port by making it a political football. The port now produces 70$ of every income dollar in New Orleans. W ith politicians in control, they fig ured, it could never keep up such a performance. So the businessmen put on another campaign to convince the people they shouldn't vote for the amendment in the November election. Long Defeated--The campaign paid off. Last week the amendment was beaten by just under 20,000 votes. New Orleans itself rolled up a big 40,000 plurality against it. Baton Rouge and the other big cities added up a majority too big for the rural vote to overcome. The spadework for this victory was done by a Committee to Save the Port of New Orleans. It was organized last summer, largely through the efforts of Charles Nutter, managing director of International House. Its roster included thirty business and civic organizations. Among them: International House, the Louisiana Junior Chamber of Com merce Assn., New Orleans Steamship Assn., New Orleans Clearing House, Young M en's Business Club, New Or leans Assn, of Commerce. Difference--Under a 1940 constitu tional amendment, the Board of Com missioners of the Port of New Orleans has five members, serving five-year terms. They are picked from nominations submitted by each of nve business groups in the city. The. hoar pulls these down to three, sends tieir BUSINESS WEEK Nov. 13, 1948 names to the governor. He picks one of them to fill a vacancy. Amendment No. 3 which was de feated last week, would have wound up the terms of the present board and set up a new board of seven. Three of these seven would have been picked he-the old way; the other four--a majority--by the governor. Campaign--Immediately after the leg islature put this measure on the ballot last July, Nutter began forming his Committee to Save the Port of New Orleans. Its work was thorough and effective. It ran advertisements in every Louisiana paper, including the weeklies. The ads pointed out that much of the state's income comes from the Port of New Orleans. They showed relative ton nage and dollar figures'under a political setup prevailing before 1940, and under business-management since. Speaking engagements for committee members were lined up before groups m every town m the state. The com mittee followed through with radio time, when speakers drummed home the ad vantages of business management of one of the state's prime assets. Leader--Heading the committee was Lloyd Cobb, New Orleans attorney and head of an upstate sweet-potato packing firm. He was picked to lead the fight because, having no direct tie with the Port, he was recognized statewide as' a disinterested citizen. IoHon The non-reciprocating principle of the PALMER GENERAL PURPOSE Continuous Motion CAR TON FORMER insures delivery of stronger, squarer cartons sealed with nine times the sealing time, with greater efficiency and higher speeds, smoothly and continuously to your packaging lines -- profitably reducing waste and change-over time. As an executive in the manufacture of cartoncontained merchandise who is responsible for a profitable sale s volume in today's tight competitive market, you can no longer afford to ignore the sales advantage that this revo lutionary PALMER-equipmenTmakes economi cally available to you in higher quality pack ages and low cost production. Our engineers welcome your requests to discuss the cost reducing ability of PALM ER Continuous Motion non-recip rocating Carton Forming Ma chines as applied to your own specific requirements. W rite, wire or call us. , -rii ft" ssf-fl mM * J Lamplighter's Dream This streetlamp, a new product of General Electric, practically thinks for itself. Its brain is an electronic eye, the cover of which is being removed by Art Bjontegaard, G.E. engineer. The eye flicks the circuit switch at the first touch of dusk, snaps it off at the first break of dawn. The units are mounted on individual lights, which can come on one at a time as needed. BUSINESS WEEK Nov. 13, 1948 FRANK D. PALMER, Inc. 528 N. WESTERN AVE., CHICAGO 12 60 E. 42ND ST., NEW YORK 17 CH 3-3344 ' Western Representatives VA 6 -4 1 8 5 ,6 PETER D. BOWLEY & ASSOCIATES 210 MISSISSIPPI STREET''' ME mlock 1--8162 SAN FRANCISCO 10 PACKAGING MACHINERY MANUFACTURERS 77 MARKETING OF INDUSTRIAL OPPORTUNITY Along the Mississippi Gulf Coast's 80 miles of shoreline exist unusual indus trial opportunities. Your plant can be "ship-side" -- with direct transportation facilities to anywhere in the nation or the world. Labor is intelligent, trained and friendly. Present industries include shipbuilding, seafood processing, small boat construction, tung oil processing, chemicals and a wide variety of other types of manufacturing. Investigate th industrial dispersion advantages of the Mississippi Gulf Coast. Write the Chambers of Commerce in . . . MISSISSIPPI GULF COAST Cash Discounts Edging Back There's still some w ay to go before this w ar casualty returns to full operation, but the fabric market is loosening enough to permit agitation. Outraged converters call it "chiseling." I t's axiomatic that a war brings cas ualties. During W orld W ar II--and its sellers' market--one casualty was the cash discount. Sometimes it was only maimed. Sometimes it was killed out right. But the seller's market didn't end with the war. Cash discounts often re mained only a faint memory. In a few lines, indeed, the discount became a postwar casualty when price control and rationing ended. Last week the fabric market began to show signs of the agitation that could come to markets where discounts are . Still crippled or dead. Prewar--Here's the situation: Before the war, rayon converters (who dye and finish gray goods bought from the mills) sold their merchandise "6/10/E O M ." This meant that the buyer got 6% off if he paid his bill on or before the 10th day of the month following billing. These discounts disappeared with the rest during the war. But the extra mar gin which it represented found its way into the converter's pocket. The dress cutters and department stores could do nothing about ir---.if they wanted to keep on getting merchandise. There was no letup at war's end: The fabric market stayed tight. So rayon con verters continued to offer the same shortened (or invisible) discounts to the buyers. Loosening Up--Now, however, the situation is loosening up. Although highly styled raj on fabrics must still be bought on order, the more basic, staple rayons are in better supply. Silks are m the picture again--to compete with rayon. Cottons, which are selling at lower prices now than they were a year ago, have been styled up considerably, adding another competitive factor. To the cutters and department stores, the slight easing m the market means more than just a better supply of the Business Week is read by men who make buying decisions . . . m anagem ent-Ynen. That is why advertising in Business W eek achieves maximum effectiveness for companies whose products and services are sold to business and industry 78 Television Service Takes Passengers on Capital Airlines' ChicagoWashington nonstop flights are getting an extra thrill for their money. I t's televisionairborne. W ith the cooperation of TV setmaker, Philco Corp., Capital has installed to the Air sets in two of its airliners: "The President and "The Constitution." Airline officials say that passengers like the "teleflights." Capital plans to broaden video service later to all its air travel. BUSINESS WEEK Nov. 13, l ? 48 ooods they want. It also means a chance to plump for a return of the prewar cash discounts. Therefore, dress cutters be^an to press informally for higher dis counts several weeks ago!.. Department stores followed suit. " C hiseling"--The converters were outraged and adamant. The move, said Herman Chopak, president of Textile Distributors Institute, Inc., is ``just an other way of chiseling on prices." He advised members of the institute to maintain voluntarily the terms they had been using--mostly 2% off if you pay within 70 days after the date of the bill. The converters maintained a united front on the discount question--but on the flanks, the cutters'began to make inroads. They bought in smaller quan tities, made up fewer dresses at a time. And they continued to agitate. Here and there, the converters' ranks wavered; they decided it would be better to shade prices a little than to let the fabric house next door do the shading and make the sale. The discounts haven't come back into the picture--yet. But the stores and cutters figure they'll get them back when the ravon market eases up a lot more. Basic Questions--The cash discount problem, which many manufacturers will have to face sooner or later, raises a lot of basic marketing questions. From the seller's point of view, cash dis counts don't always have too close a re lationship to cash. Manufacturers have found that the big merchants will pay up promptly anyway. And the smaller ones often don't take advantage of the discount. But the importance of the cash dis count to the big retailer and wholesaler is evident. For example: Background--In 1947, according to Harvard University's annual study of department store operating results, cash discounts accounted for anywhere from 2.4% to 2.9% of net sales. Store heads see this item as a big part of the cushion that kept profits for that year at levels between 4.3% and 5.3% of sales. Furthermore, the cash discount has become an integral factor in book keeping. A department store buys an item for $50; the store adds its standard margin for that item--say, 50%. That makes it cost the consumer $75. If the store gets a 6% cash discount on the merchandise, it chalks up $3 as a cash discount received. W hen the store sells the item, its books show a $25 margin, plus the $3 cushion provided by the discount. No Cushion--But suppose the manu facturer, instead of giving a cash dis count, sells the merchandise at a flat $47. T hat is the price of the goods after deducting $3--not as a discount, but as a price concession. The department BUSINESS WEEK Nov. 13, 1948 Beware of the unseen dangers in your water supply . . . corrosion . . boiler scale . . . dirty water that will ruin the quality of your product, slow down production, and push up. costs. Permutit W ater Conditioning Equipment will protect you against these harmful effects. You can rely on Permutit's long experience and equipment to provide chemically-correct water for your plants. For full information, write to The Permutit Company, Dept. BW-11, 330 W est 42nd Street, New York 18, N. Y., or to the Permutit Company of Canada, Ltd., Montreal. 79 Table Edging 'flasiicy store adds its 50% markup, and the item sells for $70.50. W hen the sale is completed, the retailer has markup money of only $23.50 m his pocket, and no $3 cushion. The store could, of course, through its bookkeeping, enter the $47 item on its books at $50 and give itself a 6% discount. But the cash discount system is so deeply intrenched m retailing that it would require making special cases out of certain 'types of merchandise wwohuiclhd bcearrycosntloy cfraoshm dainscoaucncto.unTtihnigs I point of view. Other Ramifications--And there are other ramifications which will make the sub|ect of discounts--quantity as well as cash--a sore one in the coming months. For example: Bus and Motor Coach Moldings Some economists--mainly in the government--claim that discounts have no relation to fact (BW--May25'46, p76). They say the discount has grown into a manufacturers' bribe for big mer chants. But the cost of the bribery tends to keep prices high and "sticky." Some manufacturers agree, in part, with this point of view. But few can withstand the pressure of the bigger dis tributors when competition gets tough. Other manufacturers just don't pay much attention to the subject, handle it by guess and by gob--or tradition. .Iresstite E xtruded Plastics from cellulose acetate, cellulose," acetate butyrate, r ethyl `cellulose,- -poly:Styrene,--vinyl, -and .polyethylene, -, m eet.rigid, functional protective a n d decorative specifications in ' wide variety of industries. - .Our Engineers will work with you in developing spcal extruded p lastic-sh a p es to m eet your requirem ents. Write for prices and recommenda tions today. 3936 80 R.K.O. Consents Antitrust suit ends in agree- j ment to split company. Move may crack defense of other motion picture firms. Since 1938, when the Dept, of Jus tice sued eight major motion picture companies, the defendants have had a united front. Last week, the defense broke. Radio-Keith-Orpheum Corp. i reached an agreement on a consent de- l cree. I The charges against the companies 2: were: (1) monopoly of the three i branches of the industry--production. i distribution, and exhibition; and (2) ! restrictive trade practices. Pattern--The pattern of R.K.O.'s set- 1 tlement is one that Justice has sketched f as a goal for all five theater-owning com- I panies named in the 1938 suit. Besides R.K.O., these include Paramount Pic tures, Inc.; Twentieth Century-Fox Film Corp.; Warner Bros. Pictures, Inc.; and Loew's, Inc. The three other companies (Universal Pictures Co., Inc.; United Artists Theatre Circuit, Inc.; ( Columbia Pictures Corp.) didn't oper- j ate both production and exhibition; | hence Justice tackled them separately- ^ Split--Under the consent decree, I R.K.O. will divorce its theater holdings I BUSINESS WEEK Nov. 13, 1948 | // // TO FIT THE JOB Trucks that fit your job . . . save you money. They save in many ways. They save on gas, oil, and tires. They save on upkeep and repairs. They stay on the job. They last longer. For such a truck, see your Dodge dealer. Tell him what you haul . . . the weight of your load . . . and your operating conditions. He will then recommend a Dodge "Job-Rated" truck that has been engineered and built to fit your job. Your new truck will have "Job-Rated" power, for per formance with economy. Every other unit . . . clutch, transmission, brakes, rear axle, springs and tires will be "Job-Rated," for long life and dependable operation. these im p o rtant NEW features SHORTER TURNING DIAMETERS N ew Dodge "Job-Rated" tru ck s provide an entirely new ease of steering and handling. You can tu rn in much smaller circles, right and left, because of a new type of "cross-steering," plus shorter wheelbases and wider tread front axles. MORE COMFORT AND SAFETY 1. Plenty of headroom. 2. Steering wheel, right where you w ant it! 3. N atural back sup port, adjustable for maximum com fort. 4. Proper leg support. 5. Chair-height seats. 6. 7-inch seat adjustm ent, with con v en ien t h an d control. 7 . " AirO-Ride" cushions, adjustable to weight of driver and road conditions. BETTER WEIGHT DISTRIBUTION N ew D odge "Job-R ated" tru ck s have much better weight dis tribution. You can haul more payload. T his has been achieved by moving the front axle back, under the frame, and moving the engine forward. More of th e load is carried on th e fro n t axle. Wheelbases are shorter . . . but cab-to.-rear-axle dimen sions are unchanged. For the location o f the Dodge dealer in your commu n ity , consult the yellow pages o f your telephone book. DODGE ^ TRUCKS FIT THE JO B LAST LONCER I Get the Right Answer the First Time In these days of high production costs; most manufacturers can't afford n ot to so lv e their m aterials-handling problems right the firs t time. Trial and error m ethods are costly in time arid m oney. W hatever the equipm ent might be -- gravity or power conveyers, or special conveying machinery -- it should be designed specifically to meet yo u r requirements. It is real econom y to get sound engineering help w ith your materials-handling problems -- help from people w hose busi ness is the development of efficient handling methods, and the manufacture of fine conveying machinery. The Mathews organization makes such service available to American and Canadian industries -- service which is com plete from preliminary planning to erection in the field, and which is backed up by the facilities of three very modern plants. MATHEWS CONVEYER COMPANY ELLWOOD CITY, PE NNSYLVANI A MATHEWS CONVEYER COMPANY WEST COAST SAN CARLOS, C A L I F O R N I A MATHEWS CONVEYER COMPANY, LTD. PORT HOPE, ONTARIO Engineering Offices or Sales Agencies in Primipal American and Canadian Cities 82 from its production-distribution setup. To do this, R.K.O. will split into two separate companies Present stockhold ers will get stock in both companies on a pro rata basis. Exception: Howard Hughes, who owns a controlling interest (24%) in R.K.O. Hughes will have to get out of one or the other unit within a year--by selling his stock. There is no question that he will unload his hold ings in the theater company, stay in the producing end of the business. The exhibition company must liqui date its interests in the 241 theaters that R.K.O. now owns in partnership with other exhibitors. The exhibition company may dissolve >0 of these part nerships bv buying out its partners. These theaters, plus the 80 wholly owned houses R.K.O. now has (and, with minor exceptions, may keep), will make a chain of 110 theaters. Exhibition Company--The future of the exhibition company, once the split has been made, seems assured finan cially. The company will have big theaters in 20 cities, as well as a profita ble neighborhood theater circuit m New York. In 1947, the theater chain brought in profits of $7-million, while the produc tion-distribution unit went into the red for $3.5-million. This year, R.K.O.'s theater wing has been off some 15%20% from last year's showing. But it is still expected to come up with a sub stantial net at the end of the year. Production-Distribution Setup--The production-distribution company will not be allowed to keep any theaters. Its outlook is more uncertain than that of the exhibition unit. Mostly it depends on how Hughes operates the concern. Although the company was consistently in the red last year, it posted a $500,000 profit during the first quarter of 1948. But last year it had to write off several millions in unprofitable films. Weakened Defense--R.K.O.'s settle ment is regarded as weakening the de fense of the other companies under Justice's fire. These companies have maintained all along that a producerdistributor must-have theaters m order to merchandise and test its pictures properly. _ According to trade rumors, some of the other defendants, notably Para mount, are tning for separate consent decrees to fit their own problems. But no agreement has come out of negotia tions vet. Rchcarings before the threejudge Federal Statutory Court are still slated to take place this month. Hughes' reason for beating the rest in reaching a settlement is generally be lieved to be his anxiety to get rid o the costly suit. Also, the sale of his in terest in the theaters is a way of recoup ing at least part of the S9-million he is said to hare paid for his block o R K.O. stock. BUSINESS WEEK Nov. D , D i 8 FI BERG LAS* m akes a better "dust tra p " ... for air that m ust be clean! Today, in automobile refinishing booths, men make old cars look like new--quickly, inexpensively, thanks to new quick-drying finishes, efficient spraying, modern ventilating and air filtration equipment. Adequate ventilation plays an important role, carrying off undesirable mist and paint fumes. But air drawn into the booth must be clean, for air-borne dust and dirt can ruin a slick, wet surface. That's why DUST-STOP Air Filters are used. Wherever high standards are set for clean air and where economy, too, is important, DUST-STOP Replacement-Type Air Filters are widely used. The pack of Fiberglas fibers forms an exceptionally efficient filter medium. Being glass, and inorganic, they will- not rot, nor will they absorb the non-evap orating adhesive with which they are coated. As a result, each trapped particle of dust is quickly satu rated, maintaining high dust-catching effectiveness. When the filters become loaded with dust, have done their job, they are easily and economically replaced. For your heating, ventilating or air-conditioning equipment, get the facts about'DUST-STOP Filters . . . their ease and economy of maintenance. Standard DUST-STOP metal frames are adaptable to build filter panels for any air volume requirement. OwensCorning Fiberglas Corp., Dept. 803, Toledo 1, Ohio. In C anada: F ib erg la s C anada L td ., T o ro n to , O ntario. Paint shop at Bob Reese M otors, Toledo, Ohio. Spray booth by The DeVilbiss Company, Toledo, Ohio. M aintenance of jliters for this type of booth is sim plified be cause of the ready availability of D U ST-STO P Air Filters, coast to coast. O W E N S-C O R N 1N C F ib e r g . -- las ------------------------------------------- *F!BERGLAS is the trade-mark (Reg. U. S. Pat. Off.) of Owens-Corning Fiberglas Corporation for a variety of products made of or with glass fibers. DUST-STOP is the trade-mark of Owens-Corning Fiberglas Corporation for impingement-type air filters made of glass fibers. electrical s h o t T r ic k increases THINSTEEL perform ance It's done with an electric cur-rent and it deposits a uniform satin-like zinc coating on cold rolled strip steel. This electro zinc coat on CM P Thinsteel makes a corrosion resistant itrip steel product that can take the punishment of severe fabrication without. fl^kipg or injury to the . coating, even under deep drawing or sharp bending' operations. If the fabricated item is to be . painted, the zinc-coated strip receives _a phosphate treatment to provide the base on which paint will best adhere. So, where the characteristics of uniformity and- accuracy to gauge, common to all CMP Thinsteel strip products, are de sired in combination with the protective edges of an electro zinc coat, check with us for recommendations for application to your particular production problems. (^HJNSTEEl LOW CARBON SPRING STEEL ALLOY GRADES STAINLESS th e C o ld M e ta l products co. YOUNGSTOWN, O. NEW YORK CH ICAG O DETROIT ST. LOUIS BUFFALO INDIANAPOLIS LOS ANGELES SAN FRANCISCO 84 54 Daily Upsets Evening newspapers in Los Angeles fight back as the new Mirror eats into their circulation and advertising. 7 4 Rivals An old-fashioned newspaper war is making Los Angeles a lively town. Serious Threat--This week the brandnew evening Mirror, after skyrocketing to almost half-a-million circulation for its first few issues, seems to have settled down at about 150,000. Even at that level, it poses a serious threat to the cir culation, advertising, and profits of its evening competitors: Hearst's HeraldExpress and Manchester Boddy's aiound-the-clock Daily News. The Mirror is the offspring of the well-heeled morning Times. It is a tabloid in size--but not in character. Its conservative, owners have kept it clear of the sensationalism and earthy editorial touch that made the New York Daily News so fabulously successful. In stead, the Mirror's initial gains have been due mainly to these three potent factors:. . . :L.. t i m i n g .. .The nickel Mirror hit the ...streets pus.t after the opposition dailies hiked their prices to l}. format- Though it may as yet be weak on syndicated features, particularly comics, the- Mirror has a lavish, pic; tun?rsplas.hedcmake-up. p r o m o t i o n . The Mirror was ushered in with a diard-hitting, $150,000 adver tising campaign. This implies; of course, that plenty' of money -has'been sunk into the new venture. B u t1just how much, no one knows except 'the Otis-Chandler fam ily (which owns the Times-Mirror Co.). Estimates hover between $ 12-million and $20-million. The paper is housed in five stories of its own ten-story building (BW--Sep. 4'48,p20). It also has eight color presses, a $500,000 photo laboratory--and the privilege, it is said, of losing up to $1.5million its first year. Pinkley--The Mirror was conceived during the war years when Norman Chandler (president of the TimesMirror) and his brothers decided that Los Angeles could use another after noon newspaper. So when the time came they built an $8-million home for their project, and tapped Virgil Pinkley, former European vice-president of United Press, as publisher and editor. Pinkley had just nine weeks to pro duce a paper from scratch. To do it, he built his staff mainly with aides from the U.P. overseas staff. And he also hired away a few men from other local dailies--a practice frowned upon by the PUBLISHER Pinkley's unorthodox tactics have started an old-time newspaper war Los Angeles Newspaper Publishers Assn. Maverick--This characterizes the Mir ror's maverick behavior. Another ex ample: For 10 years Los Angeles papers have ignored radio as a source of news; now Pinkley has decreed two pages daflv of radio gossip and logs. W ith a circulation guarantee of 100,000, the Mirror has lured all but two of the city's largest retailers--plus a con siderable number of national advertisers --into contracts. Retaliation--O f course, the competi tion hasn't taken the Mirror's inroads lying down. The Herald-Express hit back first. Across page one it splashed a candid picture story' of a Mirror re porter (1) sneaking damp copies of the Herald-Express out of the latter's mail ing room; (2) phoning the headlines to his own city' desk. Last week the Daily News also struck with bus carcards. Another Threat--In their preoccupa tion with the JVIirror, Los Angeles' other dailies momentarily took their eyes off another potential threat: the W est Los Angeles Independent. This is one of a string of seven weekly, free-distribution papers pur chased early this year. It's the caliber of the buyers--some Time-Life executives, movie people, Los Angeles departmentstore men--which is the chief cause for worry. Publisher James Parton, who headed Tim e's overseas editions, has explained that his backers are intent on learning the weekly newspaper field before branching out. But he admits that no one will believe me." The grain of salt results from- (l ! the high-powered staff, (2) the list ot wealthy stockholders; BUSINESS WEEK Nov. 13, l ? 48 (3) expansion of Pacific Press, the West's largest printing plant, owned partly by Time-Life. Oleo Truce Offer Dairymen would agree to end of taxes on margarine if sale of colored oleo were banned. But oleo men won't compromise. Warv margarine makers warned each other this week to beware of butter mak ers bearing gifts. The "gift" ', a sudden compromise proposal by the American Butter Insti tute and other dairy interests that all taxes on margarine be dropped. The catch: that Congress enact a law ban ning the sale of colored margarine. Reasons and Reasons--Butter men's announced reason for wanting colored margarine barred is to prevent decep tion. They say restaurants serve colored margarine to the public as butter. But margarine makers figured that there were a couple of other reasons, not announced: (1) Housewives dislike col oring their own oleo, so a good deal more of the product would sell if it were colored; (2) restaurants would curb their use of margarine if they had to serve it white. N o Compromise--But the oleo group will accept no compromises from the butter interests that it has fought since back in the 1880's. Oleo men had an aroused public be hind them last spring when they were able to force through the House a bill to repeal margarine control (BW --May l '48,p20). The repeal bill died m the Senate Finance Committee in the lastminute legislative rush at the close of the 80th Congress. But a similar bill will be offered next year. And margarine men feel that the new Congress will be even more sympathetic to their appeal than was the 80th. Butter interests, of course, will press their compromise solution, too. And both sides are wondering how much public interest can be whipped up m the coming battle. The answer will de pend, at least in part, on the altitude of butter prices. C olored Butter--"W e are glad that the butter interests publicly admit that they have been wrong on margarine," twitted Paul T. Truitt, president of the National Assn, of Margarine Manufac turers. He and other margarine people asked an embarrassing question, too: Why do butter men want to ban the sale of colored margarine and not of colored butter?" Margarine men know that large quantities of colored butter are sold, particularly in the winter months. BUSINESS w e e k Nov. 13. 1948 a s s u re s y o u a a i^ jj^ 1 6 m m p r o je c tio n a n d so u n d Yes, 16mm sound-on-film projection reaches perfection with the R C A " 400" '. Your films--black-and-white or full color--are reproduced with crisp, sharply detailed screen images and life like, full-range sound. Your showings have professional quality performance when you use the RCA "400" . S 'u tjltte s i P icia si& i! From the first frame right through to the " end" you'll realize th a t here is rock-steady, brighter, flicker-free screening. 750-watt illumination. Pic tures are at their best in brilliance, contrast and definition. <7U eabie.-llhe. S o u n d ! Voices, music and sound effects are re produced with the dramatic realism, and superb tone qualityof natural sound. You change from " sound" to " silent" by merely turning a knob. S&UeH O pe/icU ioit! The R C A " 400" is the easiest of all projectors to thread. It is exceptionally simple to operate. Theatrical framing. Finger-tip tilt control. Smartly de signed projector is compact and easily carried. Ideal for use in business, in dustrial training, churches, schools and colleges, homes. S E E I T . . . H E A R I T . Before de ciding to buy any projector--see and hear the RCA "400" . Your RCA Visual Equipment dealer will gladly arrange for a demonstration. For illus trated brochure and name of nearest dealer, write: Dept. 16K-V. first in sound . . . finest in projection SO U N D AND V IS U A L P R O D U C T S R A D IO C O R P O R A T IO N o f A M E R IC A ENO/NEERINO PRODUCTS DEPARTMENT. CAMDEN. N.J. In Canada: RCA VICTOR Company Limited, Montreal , i 0 6ways i "jse; e le c tr o n ic s * THE MARKETING PATTERN T H E N IG H T after the election * movie-producer W alter Wanger appeared on a panel broadcast over attitudes toward yourself or your product? W hy pay the pollsters to get opinions or indexes of buying New York City's radio station expectations? It's all phony, any Down-to-earth course W QXR. The subject under dis how. Cet yoursc If a public relations cussion was: " Is the movie audi expert who will mould public opin trains your personnel ence getting what it wants?" The ion for you--not measure it wrong." interlocutor asked Wanger: "Can to apply them in you tell us if the film industry has W H I L E THE PUBLIC as a any guide to popular favor other T~ whole mav cast a sardonic eye your plant than box office receipts?" at polls for awhile, the really im "Until last night," Wanger re portant buyers of research probably To get the most out of electronic fe equipment, your personnel must thoroughly understand its funda mentals, advantages, and lim ita rii tions. To help you w ith this tra in ing problem, General Electric has prepared a complete, easy- to-take visual course in indus trial electronics. H ere's w h at the G-E electronics training course o ffers-- 1. A 146-page instructor's m anual, designed to give your employees a practical understanding of- the fun damentals ,of electronics...tell them flow 'they're applied in modern in dustry: It'enables a member'of your organization to conduct the 12-les*son course. 2. Twelve Slidefilm' Lessons each With IP "its'ow n record. The lessons' are phrased in non-technical language ...devoted to specific applications. 3. Twelve Review Booklets, illustrated, for^reference-and home study. plied, "we always had the advan tage of Dr. Gallup's Audience Re search Institute . . . I don't know what the substitute will be." Of course, the answer was good for a laugh. But it's no laughing matter for the political pollsters who came a cropper (page 25). Their main business is the market research they conduct between elec tions. The most ironic point about the pollsters' unfortunate calculations 'is the fact that they conduct the political polls more or less as ad vertisements for their services. In previous elections, the payoff has been the comparison of election results with ;the pollsters' predic-tions. -Until :this year's elections, won't change their programs much. They have been working closely with the vox poppers for some time; therefore, they have been aware of the error possibilities inherent m any sampling method. But some of the smaller "fringe" buyers of research services may decide that research is still too inexact a sci ence for them to risk an invest ment in. And some top manage ment men, better acquainted with the results of research than with the techniques, may keep their own research departments under the gun for awhile. Most consumer market research, however, shouldn't suffer too much. The job of consumer quizzing is usually to find out what people F re e in s p e c tio n o ffe r -- the comparisons have been very have, how much they make, what Once you've seen the scope of this' fact-packed course, we knoW'you'll be -convinced i t will pay off f-or you. *So,- examine the instructor's manual witliout obligation. After you've seen it, you will want to order'the complete course; which is-offered at- costv. ; only $i20.00. favorable1. - T H E RESEARCH TRADE is * wondering what effect the elec tion fiasco will have on its busi ness. At least one small researcher magazines they read. This is quite a different thing from asking people what they expect to buy, earn, or read in the future. And this, m effect, is what the election polls attempted--to find out how has greeted the pollsters' down people expected to vote at some fall with glee. He says that pre time hence. vious election polls by the big out Management men have never fits won customers for the pollsters. put too much faith m the prospec But this time he expects the polls' tive-purchase surveys anyhow, say miscalculations to drive customers the researchers. But refrigerator into the little fellows' offices not makers have relied heavily on publicized by election polls. studies which tell them how many Among executives of other re refrigerators there are m Des search firms not involved in the Moines, or how many farm homes Attach to your business letterhead election blowup there is some feel ing that, in the long run, market research will learn some lessons from the experience. Researchers, wired for electricity have quickfreeze units. W H A T IT ALL may add up to G en e ral Electric Co. j they say, will have to tighten up " is this: Most intelligent mar Section A 684-5 I Schenectady 5, N. Y. | P le ase send m e a sa m p le copy o f the G -E j /n d u stn a / ElectronicsT ra in in g C o urse M an- . their procedures. They will have to choose their samples more care fully. And they'll have to be plenty keting executives will continue to channel dollars into research studies that tell them what people are uol (G ES-3 3 3 0 ) w ith o u t co storo b lig a tio n . . N a m e -----Com pany. I T it le ------------- t II ; j S t r e e t ______ ------------- II cautious in interpreting the results of their question-asking. Meantime, the research fraternity can expect a competitive barrage from the public relations people. doing, or what they have done. And they will want to be surer than ever that the techniques used are the best that can be devised. But they will keep on being skeptics This group is sure to approach man when it comes to determining what j C ity _ agement something like this. "Why people are going to do tomorrow, GENERAL ELECTRIC put your money into research on next week, or next year. 13. 1948 Removing molds (stripping) from hot Open Hearth ingots at the Lowellville, Ohio, Works of the Sharon Steel Corporation. There is no finer STEEL than SHARON For alm ost 50 years the Sharon Steel C orpora tion h as produced America's finest steels for America's finest customers. One reason why Sharon is today one of the nation's ten largest steel makers. SIIAllON STEEL COHIM) ItATI ON lptARIES QP SHARON STEEL CORPORATION: The Niles Rolling Mill Company, Niles, Ohio; Detroit Tube oany, Detroit, Michigan; Brainard Steel Cor/toony, Warren, Ohio; Sharonsteel Products Company, an, and Farrell, Pennsylvania; Carpentertown Coal & Coke Co., Mt. Pleasant, Penna.; Fairmont Coke s, Fairmont, W Va Morgantown Cake Works, Morgantown, W Va Chicago III, Cincinnati, O Clcve'and, O , Dayton O , Dc` roit^Mich ^ Indianapolis, . Brainard Steel Com* _ pany, a Sharon Steel subsidiary, is one of the nation's three largest pro Home Was Never LikeThis.. $ The S ta diu m T h a t Comes To Your H o m e . . . pioneered with the aid \ of the Mallory Inducfuner* tuning device and electronic parts. until Electrical "Brains" Helped Make It so T h e American home is the w orld's best home today for two im portant reasons-- the hom em aker's devo tion and the electrical "brains" that are her ever present accessories. These work for h er--saving her time and effort--providing new relaxation--and permitting her to do a better homemaking job than ever before. Electric refrigerators, completely automatic washers, self-controlled dryers, television receivers, and now a new device that automatically selects, plays and replaces records for hours on end. These and many like them quickly become commonplace, largely because they are so completely trouble-free. M any of these contributions to better living have been developed by the use of Mallory parts and materials. Mallory components ^Hf'flistcr e<l T r a d e m a r k o f P . K . M i l i t a r y ( (T o ., I n c ., for inductance tu n in g devices coveted by M alloty -W u r e patents. often provide the electrical "brain-power" respon sible for their completely automatic operation .. . and in every case Mallory precision has played an impor tant part in their record of dependable performance. B ehind this precision stand the skill acquired in thirty years of pioneering development and manu facturing in the fields of electronics, electrochemistry and metallurgy. If your problem of design or pro duction falls within this area, let Mallory assist you in reaching a higher degree of perfection ior your product. Gearing for Christmas HELP FOR SANTA of expert type will come from New Orleans salespeople. Reason: 30 of them graduated last week from a course on how to wrap gifts for stores FAR-AIR F IL T E R S SCHOOL FOR SANTA is held in Albion, N. Y. It teaches the department-store variety how the North Pole variety acts. Tuition is $50. "Xmas expert" is Charles W . Howard People buy more and work better in cool, clean, air conditioned buildings. That is why progressive commercial institutions are interested m clean air and are stand ardizing on Far-Air Filters. The herring bone-crimp design assures dependable higher performance, larger dirt holding capacity, lower pressure loss, easier cleanability, reduced maintenance costs. A m o n g the users o f F a r-A ir Filters are: Bank o f America F. W . W oo lw o rth Co. Fred Harvey Restaurants I. M agnin Co. N ational Broadcasting Company Rexall D rug Company Savoy Plaza H otel U. S. A rm ed Forces A well-equipped testing and development laboratory is m aintained lo r research in all types of filtration problem s Farr engineers are available in your territory to serve you. W rite Farr Company, Los Angeles 43, Calif. FAR-AIR FILTERS "Trade Mark Reg. PSYCHOLOGY FOR SANTA was discussed at Parents Magazine's one-day training school, ^anta, said psychologists, should be mild-mannered, soft-spoken, not scare childen BUSINESS WEEK Nov. 13, 1948 FARR COM PANY 'WlatufrzcturUtup Los Angeles Chicago New York 89 (Adveitisement) BUSINESS IN M OTIO N 22, The part shown here certainly does not seem complicated in either design or manufacture. Yet actually it proved to be_ difficult to make as economically as was desired The piece is called a "poten tial tap," and is a small stamped channel section used in certain types of electric meters Since it has to carry, current, nat urally it is made of copper. Originally this was made of electro lytic copper, with sufficient hardness to provide the strength required to with stand the operation of tightening the wires-on it by means of a nut and washer. The metal, however, proved 'troublesome, because cracks devel oped at the bends dur ing the forming opera tion. As a result,"100'% inspection was re quired, and rejections were numerous.' Even though the rejects had a .high salvage value, as .is.the case .with anything made of copper,.still the cost of the part was much higher than had been expected. At this point, a Revere Technical Ad viser entered the picture. He studied both the requirements of the metal and the fab rication methods, and made two sugges tions. One was that a somewhat harder temper be used. The other was that the metal be OFHC Copper, Oxygen-Free, High Conductivity. Test runs on this Revere Metal proved so satisfactory that a large production order was placed. OFHC Copper carries a premium over regular electrolytic, due to the extra processing necessary to produce it. Most of its applications-are rather special, such as in electron tubes, and in electrical equipment operated at high temperatures in the presence of reducing gases In the case of this potential tap such chemical characteristics were unimportant. The reason the Revere Technical Adviser recommended the metal was that it has excellent forming characteristics, even at a Rockwell hardness of B50. For that reason it can be deep-drawn, and the 90degree bend required in this part is easy to produce without fracture. The General Man ager of the company ' expressed it this way: "We paid a premium for OFHC Copper. ` But that premium is much more than offset . by our saving in scrap . , and the all-around re duction in costs. Our potential taps now have no more cracks in the bends, there are no rejections whatever, and expensive inspection has been eliminated." Thus another manufacturer has learned that it is .not the price per pound that de termines the economy of a material, but the cost of the finished part made of it. In this instance Revere collaborated with the company in the investigation. However, there are other informed sup pliers of materials, whether they be metals or chemicals, plastics, glass or wood. Revere suggests that you take them into your confidence, and work closely with them. After all, every order en titles you to their knowledge as well as to their shipments. Why not get both? REVERE COPPER and BRASS INCORPORATED F o u n d e d b y P a u l R e v e r e in 18 01 Executive O ffice s: 230 Park Avenue, New York 1 7 , N. Y . 90 MARKETING BRIEFS l i o u o r s a l e s this August beat August, 19-17, by 1.8%. Even so, the eightmonth total for 1948 still lags 2.4% behind last year e x c l u s i v e - d e a l i n g c o n t r a c t s between National Pressure Cooker and whole sale distributors got the ax from FTC last week. The company will not appeal. c a n d y m a k e r s also felt F T C 's hot breath last week. Charges against 24 companies: discrimination m price, allowances, services, and facilities. c i g a r s m o k e r s bought 13% more stogies during September, 1948, than they did during that month last year. But tax figures show cigarette sales foi the same period gained only 2%. w e s t w a r d is the name of Kaiser Co.'s new pocket-srzc magazine for cus tomers. Photographs, art, and coloi point up Pacific Coast industrial ex pansion. a m a t e u r p h o t o g r a p h e r s buy $ 3 3 million worth of equipment yearly, ac cording to an Eastman Kodak study. Commercial photography accounts for an additional S67-million s e a r s , r o e b u c k had the best October ever. Sales hit S221-million, 7.8% higher than last October. Sales from February through October are 20% ahead of last vear c o a x i a l c a b l e linking A.T.&T.'s Boston-Richmond and St. Louis-Milwaukee television hookups will open Januarv 12. The presidential inauguration will probablv be the first major event telecast over the entire network. l u g g a g e r e t a i l i n g by catalog has been adopted by U. S. Luggage & Leather Products. Hopes to sell through 50,000 stores, ship directly to customers. c. b . s. relaxed its ban on recorded pro grams last week io permit rebroadcast of live programs Gives sponsors a chance to keep big-name programs going in summer. d e p a r t m e n t - s t o r e s a l e s a r e 1% a h e a d of 1947 for the vear up to Oct 30 Big gest regional gain, 12% (Dallas dis tric t); sm allest, 3% (Boston, San Francisco). h a l v i n g w a r e h o u s e r a t e s : " Unitized loads could do it in many cases, says matenals-handling expert Albert B. Drake. Readying loads for mechanica handling will cut time and pilferage. BUSINESS WEEK . Nov. 13, 1948 finance Put Good Management on your desk! Just Talk for Action with ELECTRON T9 4 6 1947 1948 N E W ISSUES have stayed high, but they have been yielding . . . Less Profit for Underwriters Industry may have more trouble raising new money in the-' future. Underwriters' income has been hit by private placements, overbidding, and corporations' tendency to sell bonds. : " Results of the election throw a cloud over business plans for capital expan sion and the demand for new money. Hopes--Up to election day, Wall Street thought it had a fairly good idea of what lay ahead m the capital markets. On the demand side, it anticipated a steady stream of new issues to raise money for capital-expansion programs. On the supply side, it looked for a pair of contradictory trends: (1) a gradual tightening of credit under a moderately conservative Republican administration; (2) a series of measures designed to of fer more incentives to investors (for in stance, corporate tax reform). This combination, the Street con cluded, spelled slowly raising money cates, a high volume of activity, more public" participation, and something better than the "profitless prosperity" that the securities business has experi enced for the past couple of years. Now, nobody knows what's ahead. Less Expansion?--First, there's the cprestion of what the Truman victory will cj0 to the capital-expansion plans of business in general. The immediate im pulse of many businessmen has been to pull m their horns. They fear that- an. excess-profits tax or a government-sup-ported fourth round of wage increases . will take the profit out of new facilities. They are afraid that allocations of ma terials will cut their production, an d . that price controls will narrow their margins. But this mood may pass. If Truman takes a fairly easy-going attitude toward business, the chances are that few ex pansion plans will be shelved. And while business is waiting to see which way the Democratic cat will jump, the tremen dous volume of expansion pro]ects al ready under way will keep total corpo rate spending at a high level. Supply Problem--But if business still wants new money for expansion, will Wall Street be able to supply it? The Democrats probably will be more in clined to easy money than the Repub licans would have been. But there is no use hoping for any special incentives for investors. And the stock market's frantic dive for the cellar (page 100) is a bad omen for finance in general. At this point, nobody m Wall Street can tell how these problems will work Intercommunication T H I S IS IT ! For fast action ^everywhere in your .bush, ness, use A M PL IC A L L --the Electronic Communication System that simplifies man-! agement problems. Speedy, -dependable A M P L IC A L L , keeps all key men within split-second speaking' reach 'of yourdesk and of each other--relieves switchboard. congestion--eliminates costly "wandering" and wasteful waiting. Whether your business occupies a two-room office or a 10-acre plant, there is an AM PLICALL System avail able to fit your needs. Learn how AM PLICALL helps put Good Management on your desk --get the details today! n Systems (tonfd)_ JH1CAT10N SYSTEMS rotile me** A mPUCALL* . SYS- general business. i daily use. Engi* See Your Phone Book For your nearest AMPLI CALL specialist, look in the "Intercommunication'! section of your classified directory, or write direct to the Rauland Corp., Chicago, Illinois. fi u l n d THE RAULAND CORPORATION 4249 N. Knox Ave., Chicago 41, Illinois Gl-Send complete details on the New AM W C A tt; '' Q Sendyour representative. No obligation. Name........................................ ........................ Company....................... ................. Address........................................... City*.,............. *.......................State business week No. 13, 1948 91 ...b a c k in 1911, when Benjamin .Gertz opened his tiny stationery store in Ja- maiea, Long Island. .......... Here he cheerfully sold newspapers, magazines and w riting matenal^-.-to abustling, fast-growing community. His business grew and he added toys, sport ing goods and musical instruments.- Jam aica kept on growing. And so did an idea in the minds o Benjamin Gertz and his two sons, who had joined the bus iness. "Why not," they asked themselves, "establish Long Island's first completely stocked `th rift' departm ent store?" T h is w ould r e q u ire fin a n c in g --for larger quarters, for store equipment, for a line of m en's and women's clothing. Could the Bank of the M anhattan Com pany help? It could--and did. In 1925, the Gertz family came to the Bank with a still longer-range merchan dising program : to offer a wider and wider variety of the finest merchandise with a "T riple'G uaiantee" of satisfaction, service, and prices as low as any in New York City. In this undertaking, the Bank 'again lent a-hand. Expansion was rapid as the Gertz bus iness went ahead--with the assistance of the Bank. Even during the depression, thrifty-m inded customers thronged to the Gertz store in such numbers that still more space was added, as well as a 1200car parking lot. Today Gertz is the fifth largest depart ment store in New York City; expects to do a $30,000,000 business this year. The G ertz business, in its m odern 7-story air-conditioned building, is a far cry ftom the tiny shop of 37 years ago. And it is built on a firm foundation of vision, haid work and creative finance. Bank o //ie Manhattan Company NEW YORK M E M B E R FED ER A I D t P O S I T INSURANCE CORPORATION 92 themselves out. For the present all a securities man can do is keep his fingers crossed and wait for more news on T ru man's plans and industry's appraisal of them. Gloom--It isn't as though the corpo- rate-new-issues market had been bloom ing even before the election. In recent weeks, when their hopes were highest, underwriting houses still were having their troubles. It wasn't the amount of business that was bothering them. Offerings of new corporate securities in the first nine months of 1948 added up to almost $4i-bilhon. That's 11% higher than the same period last year, and only 8.7% less than the first nine months of 1946 --biggest new-issue year since 1929. But despite this high level of business, Wall Street's underwriters have rarely been so glooms as they are today. Rea son: For all the volume, they haven't been able to earn respectable profits. Several factors are responsible for this state of affairs. Most important among them: private placements; more bonds and fewer stocks; overbidding. Private Placements--Most of the new issues that are sold privately to insurance companies or other institutional inves tors never pass through underwriters' hands at all. So, from the standpoint of underwriters' pi ofits, they might just as well never have been sold at all. In the first nine months of 1948, some $1.7billion of new corporate securities by passed Wall St-eet this way. T hat's almost 40% of the total of new-issues flotations. Only once before (in 1942, when the war was restricting new-issues marketing) has this percent age ever been surpassed. And dollarwise, private placements m 1948's first nine months have already topped the total for all of 1947. Occasionally, of course, an under writer wall midwife a private-placement deal. A case m point: the recent sale of $250-million of bonds by Shell Carib bean Petroleum Co. to a group of insti tutional investors; the details were han dled by Morgan Stanley & Co. (B W - Oct.30'48,p21),J3ut such examples are comparatively rare, by and large, the trend to private placements has defi nitely hurt the earning potential of the underwriters and distributors of new issues. Fewer Stock Issues--Commissions re ceived bv underwriters for h a n d l i n g new stock issues are almost always higher than those on bonds. Reason: The risk is greater. And, with the supply of risk capital drying up in recent years (BW -- Jan.24'48,p70), corporations have been relying more and more on bonds ror their new' money. , Last year, ' for example, new stoc issues amounted to only about -M- billion. That was a chop of some $ ' million from 1946. And it representen BUSINESS WEEK Nov. 13. 1948 *> * , the human ingredient te . * * in the unbeatable combination On the Norfolk and Western Railway's Roanoke, Va., shop assembly line, men like these build a 70-ton steel coal car "in 48 minutes. " . The building of these sturdy cars is only one of thousands otjobs which go on ceaselessly behind the scenes. The workers who build them are only, a few of many thousands of Norfolk and Western employees.. Bui these men typify the hum an ingredient which helps to make Norfolk and Western Precision Transportation. Good railroad transportation requires modern and efficient facilities from the roadbed up. It requires sound, progressive operating methods . . . and the teamwork of the thousands of Norfolk and Western employees with trained minds and skilled hands . . . with the sense of responsibility which creates the human desire to see the job well done . . . and with the experience that assures the railway's shippers that the job of providing dependable rail service will be well done. This is the vital human ingredient in the unbeatable combination. *T he N. & W . has m o re th a n 52,000 coal c a rs of v a rio u s capacities to serve th e coal m ines along its lines, dealers and consum ers. The car are designed an d b u ilt to fit th e needs of th e coal operators and coal users. The N orfolk and W estern R ailw ay recently was aw arded the H arrim an M em orial G old M edal fo r m a kin g th e o u tsta n d in g sa fety record am o n g th e large Class I railroads o f th e n a tio n i n 1947. T h is m a r k s t h e f o u r t h t i m e t h e N . S? W . a n d its R A ILW A Y !.. em ployees have w on th e h ig h est honor in railroad sa fety , PRECISION TRANSPORTATION ,'j l .{: Leach Silo Unloaders, manufactured by the Leach Company o f Oshkosh, Wisconsinareaboon to farmers in eliminating an unpleasant chore and conserving ensi lage. But packing the 1200 pound, oddly shaped units in such a way that they could be handled and installed conveniently presented a difficult problem. Some m eth od for shipping the m achine as a group o f sub-assem blies that would pass through small silo doors was essential. Wirebounds solved the problem. Wirebound engineers "tailored" eleven differ ent boxes and crates to package and pro tect the various parts of the unloader for safe, convenient shipping and handling. At the receiving end, re-assembly was easier because contents could be seen and identified through the sides of the Wirebounds for unpackingin proper sequence, Light weight Wirebounds meant real shipping economy for Leach too. Less than seven man-minutes -were required for packaging any one of the unloader sub-units and packed crates could be stacked 10 high to Conserve valuable floor space! Wirebounds can provide an efficient,. economical solution to your shipping problems. Mail the coupon below! 161 pound motor fo r the L e a ch Silo U n lo a d e r is mountftd on a c ra te b a s e which is e n g a g e d b y the bottom c le a t ! of the W ire b o u n d . The d o o r-lik e fourth sid e is fo ld e d shut a n d the w ire s a r e tw isted closed with an electric tog g le tw ister. another "O D D S H A P E " shipping problem solved by only 26% of the year's total new-issues business. This year the showing has been even worse: According to the Federal Reserve Bank of New York, stock is sues made up only 20% of the total in the first six months, only about 9% in the July-October period. Overbidding-Back in 1946, under writers took a lot of heavy losses because they bid too high on new issues. For quite awhile after that unpleasant ex perience, they were careful to keep their bids below going prices. Today, how ever, there are signs that they are forget ting that costly lesson. Back in September, an underwriting syndicate bid 100.14% of par for $75niillion of Pacific Telephone & Tele graph Co. 39? bonds. It promptly re offered them to the public at 100.53. The issue received a lukewarm recep tion from the start. That might almost have been expected, because of the big volume of Bell System paper that has been absorbed by investors in the past year or two: Bell obligations accounted for over 50% of all utility flotations m 1947; for 32% so far this vear, A month later, a large portion of the Pacific Tel. & Tel. bonds still remained unsold. Nevertheless, another big syn dicate bid 101.77% of par for $7 5-mil lion of new Michigan Bell Telephone 31% bonds. These bonds were reoffered at 102.4. And they didn't sell either. Coup de Grace--Crowning blow to the hopes of both syndicates was the an nouncement by American Tel. & Tel. itself that it planned to sell SI 50-million The unusual shipping problem encountered b y the Leach C o m p a n y is r e a d ily a p p a r e n t in the a b o v e v ie w o f the assem bled Silo U nloader. MAIL THIS COUPON TO D AY WIREBOUND BOX MFG. ASS'N. Room 1837, Borland Building, Chicago, Illinois SEND COMPLETE LITERATURE SEND A SALES ENGINEER " AME FIRM NAM E ADDRESS CITY PRODUCT 'PO SITIO N ' ZONE STATE SIXTY WIREBOUND PLANTS THROUGHOUT THE UNITED STATES 94 o m c fu /m BOXES & CRATES Lesson in Finance Basil B. Chesley, Lansing (Mich.) druggist believes in teaching them the ABC S o finance while they are young. He has in stalled this self-service cash register in 1S store where young (and old, too) can ring up their own purchases--all on the honor system. So far, Chesley reports that hntty^ has been holding its own; and the regr is a big drawing card. BUSINESS WEEK Nov. 13, 1948 { new bonds soon. W hen that news jas received, the two syndicates gave hope of selling their bonds at the 0gering pnce, and decided to let the issues seek their own levels -in the open market. The Pacific Tel. & Tel. bonds promptly dropped to 98% of par; the Michigan issue, almost to par. Wall Street hears that the syndicate handling the Michigan bonds took a loss of about 51-million. Another Example--Overbidding has by no means been confined to telephone bonds. Just a couple of weeks ago an underwriter bought $10-million of New Orleans Public Service Corp. 31% bonds at 101.565% of par, reoffered them at 102%. Before if could get out from under, it had to drop the selling price to 100.95. That represents a net loss of about $6.15 on each $1,000 bond sold. And instead of earning the ex pected $56,000 on the deal, the under writer took an out-of-pocket loss that's estimated at $61,000. Obviously, not all recent new offer ings have gone sour. On most issues, particularly earlier in the year, under writers held their bids down to a point where they could reoffer the securities to yield more than comparable outstand ing issues--and still make a profit. But even in most of these cases, underwrit ers were forced to slice profit margins pretty thin. Impact on Business--It would be the worst sort of shortsightedness for busi nessmen to kiss this whole situation off as merely "W all Street's worry." Under writers are like anybody else: They can't and won't continue to take losses lying down. To relieve their present plight, they are likely either to hold down their bids on new issues, or to insist on higher coupons. Either way, it will cost busi ness more to raise money. dearborn says no Boston's John Hancock Mutual Life Insurance Co. planned to build a $10million rental housing pro]ect at Dear born, Mich. (BW --Oct.9'48,p2 5). But now it's not going to do it. The reason: Dearborn residents have indicated they don't want it. On election day, the voters turned thumbs down on the project by a thumping margin--15,948 to 10,562. Only 8 of Dearborn's 55 voting precmcts, m fact, voted in favor of it. The vote was on an advisory referendum for the guidance of the Dearborn city coun cil. The outcome was a victory for Mayor Orville Hubbard. He had long fought erection of the proposed 500-rental-unit project, on the grounds that it would bring mto his residential community an undesirable element." The insurance company has made no BUSINESS WEEK Nov. 13, 1948 000 . . . but loaded with Fm t A little fire can ruin a big business. If your records go up, you're in trouble--4 out of 10 firms never reopen after losing their records by fire! Keep your, records, i n .a.safe--B u t -- CAN you DEPEND ON YOUR SAFE? N O .. . if it is a refinished used safe that may have been in a previous fire or burglary. NO . . . if it was built before 1917. N O . . . if it. does not carry the, label-of the inde pendent Underwriters' Laboratories, Inc. Y E S . . if it is a new Mosier. Mosler safes carry the Underwriters' la b e l--they can he trusted. WHY TAKE CHANCES? You'd be surprised at how little it costs to. trade your old safe in on the world's finest safe protection --a new Mosler. Near you there's a Mosler office or dealer--write for his address, see him--and see safe equipment exactly suited to your needs! EsfaHished 1648 320 Fifth Ave., New York I, N. Y. Factories: Hamilton, O. Largest Builders of Safes and Vaults in the World Co. Builders of the ti. S. Gold Storage Vault Doors at Fort Knox, Ky. T h e M osler Safe Co., D e p t. 211 . 320 F if th A ve., N ew Y ork 1, N . Y . i Please send me: Q The new free booklet " W hat You ! Should Know A bout Safes. 0 The N am e of my nearest M osler Dealer. N a m e . ...................... .............................................. F i r m ........................ ............................................ A d d re ss ............................................................................ C ity ....................................... .S tate. official statement since the election re turns were announced. Earlier, how ever, John Hancock spokesmen hinted that the proposed project would be taken to some other community if the vote showed that Dearborn wasn't in terested. AKRON TO DIVERSIFY Put Akron on the growing list of oneindustry cities that want to diversify. Sparkplug behind the drive for new industry is the rubber capital's biggest bank, First National. It has turned its officials into a sales force that will carry the Akron story in person to corpora tions that are considering expansion. The roving ambassadors will carry along with them a "personalized" bro chure that stresses these Akron advan tages: (1) a freight run of 24 hours oi less to 70% of the U. S. market; (2) an area served by 64 common and contract trucking companies; (3) a favorable tax rate of $34.64 per thousand. To clinch the deals, the salesmen have another strong argument: First National will put up the capital to erect any type of building for the new industry or business. The only condition is a long term lease. T H IS is su re protection , for your funds everyw here you travel! On a trip, or even'at home, a thief or' a. moment qf- fqrgetfulness . . . and" TRAGEDY . . . your cash is GONE! If, however, you follow the practice of 'experienced travelers and carry your money in National City Bank Travelers Checks, ,yopr .travel funds will be safe -and spendable everywhere.. Ypur signature* and countersigna ture** on each check is your unique protection. If your checks are lost or stolen, The Rational City Bank of New York gives you a prompt refund. Good untH used. You buy them in convenient denominations of $10, $20, $50 and $100. Cost 75$ per $100. Ask for them at your bank. NCB TRAVELERS CHECKS iis THE BACKED NATIONAL OF NEW BY CITY YORK BANK M em b er F e d e ra l D ep o sit In su ra n ce C o rp o ratio n 96 Working Capital Hits Another New High Corporate working capital is still climbing. That's the word from the Securities & Exchange Commission this week. At midyear, SEC reported, cur rent assets of all U. S. corporations (excluding banks and insurance companies) topped current debts by $63,-9-billion. T hat's a spread (2.1% larger than the earlier recordbreaking total of last March; and it's 5.4% greater than at the start of 1948. Cash and government bond hold ings continued their postwar down trend. Inventories, meantime, were at a new higH in June. But current liabilities took a drop, too. So, all in all, you get this picture: The current iatio (current assets divided by current debts), for ex ample, worked out to 2.17 vs. 2.14 at the 1947 year-end. Quick assets (current assets excluding invento ries) also covered current debts 1.35 times, compared with only 1.33 times six months earlier. Normally, 2-for-l current and 1-for-l quickasset ratios are considered good by fiscal authorities. Here is SEC's latest working cap ital report (m billions of dollars) m detail: CURRENT ASSETS Government Other Current Cash Securities Receivables Inventories Assets Total 1939 . . . . $10 8 $2 2 $22 1 $18 0 $1 4 $54 5 ; 1940 , . - 13 1 2.0 24 0 19.8 1 5 60 3 i 1941 . . . . . .. .. 13,9 4 0 28 0 25.6 1 4 72.9 1942 . . , ........... 17.6 10 1 27 3 27.3 1 3 83 6 1943 . . . . ........... 21.6 16 4 26 9 27 6 1 3 93.8 j 1944 . . ........... 21 6 20 9 26 5 26 8 1 4 97 2 1 1945 . ..... 21 7 21.1 26 3 26 3 2.4 97 8 > 1946___ . . . ___ 21 4 14.9 32 3 34 8 1 7 105.1 1947 22 6 13.4 38 2 40 6 1 6 116.6 1948- M arch 31 .. 22 1 13 2 38 8 42 3 1.5 117 9 June 30 22 4 12 6 38 7 43 0 1 6 118.4 il CURRENT LIABILITIES j Other Current 1939 1940 1941 1942 1943 1944 1945 1946 1947 . .. .... .. . ... . Payables T axes Liabilities Total $21 9 $1 2 * $6 9 $30 0 ! 23.2 2 5 7 1 32 8 26 4 7.1 7 2 40 7 26 0 12 6 8 7 47.3 26 3 16 6 8 7 51 6 26 8 15 5 9 4 51.7 26 1 10.4 9 7 46.2 31 3 7 9 9 7 48 9 j 35 3 10 0 10 S 56 0 M arch 31 June 30 1948- i 34 0 10 0 11 3 55 3 j 33 8 10 2 10 5 54.5 j 1939 1940 1941 1942 1943 1944 ___ . . . ___ ......... NET W ORKING CAPITAL 24 5 1945 27 5 1946 32 3 1947 36 3 1948 42.1 M arch 31. 45.6 June 30 . 'j 51. 1 56 2 60.6 1 1 62.6 i 63.9 BUSINESS WEEK * Nov. 13, 19** Airport Income Up M unicipal fields show operating profit for the first tim e-thanks to rentals from non-flying concessions. For the first time in history, cityowned airports as a group have been able to show an operating piofit. A Record--T hat's the report of the 1948 Municipal Yearbook, which In ternational City Managers Assn, has just put out. In 1947, says the Yearbook, gross revenues of 173 municipal airports added up to over $8.9-million. This set a new high. Operating costs for the same period came to $8.2-million. That $700,000 in the black repre sents quite a jump from the 1946 show ing. In that year, substantially the same group of airports were in the red with a total operating deficit of over $1-mil lion. To the Rescue--It wasn't the flying business itself that pulled the rabbit out of the hat. The association gives credit for last year's record-breaking revenues to banks, beauty shops, and other busi nesses renting space at air terminals. Those rentals gave the airports a sub stantial increase in income in 1947. Topping the list as an income pro ducer was Miami's International Air port. Its revenues of $764,000 came dose to doubling running expenses of $384,000. Dallas' Love Field and St. Louis' Lambert Airport can make the same claim. The Newark (N. J.) airport wasn't far behind. Its 1947 income was some $500,000; its running expenses only $300,000. Tops in Revenue--For sheer size of revenues, New York's La Guardia Field takes the national blue ribbon. That field, now operated by the Port of New York Authority, took in $832,000 in 1947; in the six months ended Nov. 30, 1947, its take counted up to over $636,000. In "non-aviation concessions," the Yearbook points out, "La Guardia Field has reached the highest development" so far. To travelers using its facilities, it offers a score of non-flying services. These include an automobile park, newsstands, barber and photography shops, taxi and bus services, an observa tion deck, a postoffice, drug stores, even clothing stores. La Guardia gets two-thirds of its total income now from fees from such concessions, the association reports; in come from actual flying activities sup plies only a third. But not in Profits--Even so, La Guar dia Field has yet to show a profit, al though its revenues have risen sharply since Port Authority took over from BUSINESS WEEK Nov. 13, 1948 )u s t b u b b lin g over with. lxxsrs It's really a dream. I go for its rugged, streamlined beauty. I'm mad for the quick and easy way it helps me get things done. If I were a kitten, I'd be purring right now, because that wonderful Smith-Corona typewriter has made my job happier, ever since I got it. Typewriter of the experts Th e real "professionals" -- co u rt stenographers and letter shops, for instance--long ago recognized the outstanding speed and stamina o f Smith-Corona. It does a w orld o f work w ith a m inim um o f effort . . . it stands up . . . it has every -typing feature you need Particularly, you'll enjoy its different to u ch , so easy and free from jar an d shock. W h e n you "g rad u ate" to Sm ith-C orona, you'll use " th e typew riter o f th e experts" -- an d y o u 'll love it! - - Smith-Corona Office Typewriters L C SMITH & CORONA TYPEWRITERS INC SYRACUSE 1 N Y Canadian factory a n d offices, Toronto, Ontario. Makers o f famous Smith-Corona Portable Typewriters, A dding Machines, V iv id Duplicators Ribbons and Carbons 97 Who In su re s America's Great Cigarette Manufacturers? C OSTLY stocks of warehouses, giant leaf in manu facturing plants w ith their equipm ent and a challenging diversity of fire, casualty, m a rine and other risks make the tobacco industry a large and exacting buyer of insurance rotection. ome of America's foremost tobacco com panies -- and many leading organizations in other fields of industry as well -- retain Schiff, Terhune & Co. to handle all their insurance requirements. Consult us with out obligation for an insurance program designed to give you greater im m unity against loss at lower cost. the city. The sideline businesses brought in the cash. But building them up was what put the Field m the red last year; **- receipts were poured into further ex pansion of "extracurricular activities." In the case of 83 separate airports, fees from terminal concessions ac counted for over $1.1-million of reve nues in 1947. Seveial airports, the asso ciation notes, actually "were saved from going in the red" by the added income they derived from such sources. * Money-Makers--Thus, the automatic insurance-vending machines installed at their airports proved particularly profit able to the cities of Baltimore and Knox T. ville. Hatbox Field, owned by the city of Muskogee, Okla., is similarly re ported to have done well with an air port hotel. Cliff Manus Field, the prop erty of Corpus Chnsti, Texas, is also said to have picked up satisfactory extra income with an airport hotel and an i airport theater. T h ird o f a series o f advertisem ents show ing how S ch i . T erhune & C om pany serves A m erican industry. Schiff, Terhune & Com pany INCORPORATED ' ' 99 J o h n S tre e t, New Y o rk 7, N. Y . NEW YORK CHICAGO SAN FRANCISCO LOS ANGELES * MILWAUKEE FINANCE BRIEFS l i f e c o m p a n i e s h a v e recently bought new securities from Fibreboard Prod ucts ($25-million), Minneapolis Gas ($11-million), St. Regis Paper ($10million), Russell-Miller Milling ($ 5-mil lion), Portland General Electric ($4-milhon), Gerber Products ($3.5-million). STOP ERRORS Christm as clubs of mutual savings banks will disburse $166.8-million to ( members, $17-million more than in 1947. l a r g e s t b a n k in Mississippi will come in your business, before They happen! out of merger now planned by Jack son's Capital National and Jackson Errors in copying records, figures, agreem ents'-- other important papers, can cause embarrassment, and cost you money! Now, make error-proof photocopies -- at less cost than typing! 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PHOTOEXACT U O fiC e/l e d g e w a t e r b e a c h h o t e l in Chicago went for some $6-million to a Boston group that operates eight residential and resort hotels in the East. t r a n s f e r o f s u r p l u s will increase capi tal of New York City's National City Bank from $77.5-miihon to $ 124-mil A M E R IC A N PH O TO C O PY EQ U IPM EN T CO . 2649 N. Clark $t., Dept.B-118, Chicago 14, Ili. Please send me your free illustrated booklet, "Short Cuts," that tells how I can elim inate errors w ith APECO Photo-exact copying in my business. lion, if stockholders approve. Bank would up par value of present stock from $12.50 to $20, issue no new shares. *6 7 5 STANDARD ACCESSORIES ADDITIONAL Name and T itle ................................. ................................... .. C om pany... ................... .. ............................. .. ......................................... Company Address......................................................... ..................... City and Zone..........................................................................State. k a i s e r -f r a z e r 's earnings have s l i p p e d : They were $4.1-million (before taxes) in the third quarter of 1948--about half what they were m the same 1947 months. Probable cause: K-F- had -5 98 BUSINESS WEEK Nov. 13, 194? I 'i higher costs but didn't jack prices as high as some other car makers. emil scHiuM has signed another threevear contract as president 'of the New York Stock Exchange. Salary is sup posedly the same--$100,000 a year. xo f in a n c e a proposed 1949 outlay of some $40-million for new construction, Cleveland Electric Illuminating will try to sell $20-million to $30-milhon of new securities. d a y t o n . may soon slap on a municipal income tax, following the lead of sistercities Toledo, Columbus. Springfield. Or e g o n v o t e r s f o r g o t all about financ ing last week when they approved $50a-month pensions, allowances for med ical and dental care. Bill had no pro visions for raising requisite sums--so bond houses are ignoring offering of Oregon's $2-million veterans-bonus bonds. m i s s in g s h a r e h o l d e r s will prevent the Pennsy from buying all outstanding stock of the Detroit, Toledo & Ironton, even if ICC OK's the deal (B W -O ct. 23'48,pl02). For over 20 years no one has tracked down owners of seven shares. W IL L W ALDORF-ASTORIA GO t o H i l t O l l Hotels? Unconfirmed rumor says the chain is negotiating for purchase of the famed New York City hotel. How much will Embezzlements cost Employers in 1949? V T H E Y E A R 1948 is not over, but thus far it has revealed a rising trend in spectacular embezzlements, not only in banks but in other businesses. Some of these have exceeded half a million dollars. D uring th e p a st tw o y e a r s , among banks alone there were 37 losses of over $25,000 which averaged $144,000 each, according to an article in "Business Week." These bank short ages were concealed for periods ranging from less than a year to 20 years. "The concealment factor is the reason that the losses don't show up in a hurry," says the same magazine. "If he (the embezzler) is particularly adept, he can keep all this well-hidden for years." And our experience shows that in most cases it is easier to conceal a shortage in other businesses than it is in banks. N o e m p lo y e r n e ed f e a r long-concealed shortages if he has the protection of our modern D is c o v e r y B o n d , which; reimburses for losses discovered while the bond is in force, regardless of when the bonded employee began to embezzle! The tre n d con stitu tes a w a rn in g to you as an em ployer. Ask our nearest agent or your broker to have our specialists review your Dishonesty Insurance Program Now. And, you w ill find that our Loss Prevention Service, based on more than 60 years' experience, can be a powerful aid in preventing shortages. Fund Director Andrew N. Overby, 39, Iras been appointed to the newly created post of deputy man aging director of the International Monetary Fund. Formerly a special assistant to Treas ury secretary John Snyder, Overby will act as chairman of the Fund's executive board in the absence of Camille Guff, Belgian-born chairman. BUSINESS W EEK Nov. 13, 1948 AM ERICAN SURETY G RO U P AMERICAN SURETY COMPANY NEW YORK CASUALTY COMPANY SURETY FIRE INSURANCE COMPANY "D ep en d a b le as A m erica" 100 Broadway, New York 5, N. Y. THE MARKETS IIK E n W W M w IN A CAN A M ER IC A 'S PLAN FOR IN D U STRIA L SAFETY SISSIPPI O f f e r s In d u s t ry Room f o r ___ PROFITABLE PEACETIME PRODUCTION MAXIMUM WARTIME PROTECTION America's future safety lies in the security oT its industrial machinery. For this and other reasons more and more indus tries are seeking plant sites away from congested "area targets." .'Mississippi is the ideal state for dispersion, because it offers industry pro tection... plus two major re sources vital to peacetime industrial prosperity and war time production: * Access to the world's largest fuel and energy reserves. A reservoir of intelligent rural labor willing and able to work. For s p e c ific in fo rm a tio n co n cern ing y o u r requirements w r it e : M ISSISSIPPI AGRICULTURAL & INDUSTRIAL BOARD N ew C apitol Bldg . -- Ja ckso n , M ississippi N ew Yo rk O ffice : 1001 Tw o Rector Street Stocks Down, Commodities Firm Implications of Truman victory, especially prospect of : Higher taxes,-affects industrial and rail stocks. Farm commodities ..strengthened by Democratic policy of vigorous price supports. The , stock -market seems to have :made -.up. its. mind this week about the significance of -the election: For stock traders, Truman's victory is pure poison (chart above). . Commodities,, Bonds--Other markets don't.tak e, the same dismal view of what's ahead for them. Commodities have firmed up sig nificantly since election day. Most of their strength has been in the farm group. Industrial commodities have been steady, imported commodities have turned a little shaky. The government bond market also Security Price Averages Stocks This Week Industrial 148.0 R ailroad, 43.3 U tility 67.3 Bonds Industrial R ailroad U tility . . 94.5 85 1 93.5 Week Month Ago Ago 164.8 49.8 73.0 156.6 48.0 70 3 94 6 85 6 93 7 95.7 85 8 94.6 Y cat Ago 151.6 40.7 71.4 100 9 85.1 99.5 Data Standard & Poor's Corp. has perked up considerably m the past week. The Democrats are traditionally an easy money party. And with Tru man in the W hite House and John Snyder m the Tieasury, the market as sumes that support of government bond prices at par will go on indefinitely. In stitutional buyers, who had been hold ing back on the chance that the peg would be pulled, started picking up long-terms immediately after election day. Stocks Depressed--Wall Street isn't taking much comfort from the bullish signs in commodities and government bonds, though. The stock market is what most financial men watch. And the stock market has been having a rotten time. The first wave of panic selling spent itself quickly on the morning after election day. But it was followed by a steady flow of large-scale liquidation. This isn't freight selling m the ordi nary sense. It is carefully considered, de termined liquidation by big and little investors alike.- It is hitting the top quality, investment-grade issues--chem icals, motors, steels, oils--as well as the cats and dogs. In general, heavy indus try is suffering more from it than the ; I 100 BUSINESS WEEK Nov. 13, 1948 onsunier goods lines. And that's a bad si^n It was the heavy goods that put life into the market before the election. Bearish Signs--It's still a little early to sound taps for the bull market that was supposed to have started moving last spring. But the pattern shaping up looks more and more bearish every clay. In the rally just before election day, the averages refused to go through their June tops (193.16 for the Dow-Jones industrials). In the post-election slump, they slid quickly through one resistance point after another. And on Tuesday of this week, the industrials dropped under their summer low point (175.99). There isn't another resistance point worth mentioning on the downside short of the old bear market lows around 163-165. The rails, on the whole, have turned in an even worse performance than the industrials. On a strict reading of the Dow Theory, you would have to say that a new bear market is already under way. That would mean that the 1948 bull market ended last June. Tax Spectre--But the Dow Theory hasn't exactly distinguished itself lately. And there's also at least one hopeful possibility: Probably the biggest single thing that frightens the market now is the prospect of an excess profits tax. The latest word from Washington is that Truman will go slow about asking for a levy on excess profits (page 19). If that's true--and traders begin to be lieve it--the market may be able to pull itself together in coming weeks. Election Returns: Early Effect on Stock Prices Industrial C om m on Stocks Dow-Jones A verages. . . A m erican C a n ......................... American C ar & F o u n d ry ... Amer. Sm elting & Refining American T obacco.. A n aco n d a C o p p e r...................... A rm strong Cork. B e th le h e m S teel ..................... C h ry sler C o r p ............................ Du P ont. . . ....... G en eral E le c tric .......................... General Foods .. ... . . G en eral M o to r s ........................... 1948 H igh 193 16 $92.75 49 12 68 00 69 75 41.25 56 75 39 75 65.75 188 87 43.00 41 00 66 00 G im bel B ro th e rs ................ B. F. Goodrich G u lf O i l ............................................................. I n t 'l H a rv e s te r ( 1) ................ I n te r n a tio n a l T el. & T e l......... J o h n s -M a n v ille ............................ K e n n e c o tt C o p p e r..................... N a tio n a l S t e e l .......................... .. 25.00 64 50 81.00 34.25 16.50 42.25 60 87 114 50 S ears R o e b u c k ............................ E . R . S q u ib b ................................ S ta n d a rd O il (N . J . ) ................. S tu d e b a k e r C o r p ........................ Swift & Co ........................ U nion C a rb id e ( 1) . U nited F ru it . . . U. S, R u b b er ................ U. S. Steel ................ W estinghouse Electric. .. 42 87 29 25 92 87 29 25 36 87 43 25 58 50 49 62 87.62 33 25 Railruad C om m on Stocks D o w -Jo n es A v e r a g e ................ A tch., T opeka & S anta Fe A tlantic C oast Line C hesapeake & Ohio Great N orthern (P fd .). Illin o is C e n t r a l....................... Louisville & N ashville. . . N. Y ., Chic & St. Louis . N orfolk & W estern. . P e n n s y lv a n ia ........................... S o u th e rn P a c ific ................... S o u th e rn R y ............................ U n io n Pacific ( 1) 68 31 $120 62 62 00 45 25 50 87 42 37 50 00 92 00 62 87 22 12 62 37 50 25 96 25 E le ctio n Eve 189 76 $81 75 37 37 61 87 64.75 38 12 53 00 39 25 61 00 181 75 42 50 40.25 66 00 21.37 64 00 75 12 30.25 12.50 41.00 60.87 111.00 42.87 25 87 81.00 27 25 32.00 43.25 54 50 46 75 85.12 28 50 61 97 S i l i 75 59 00 39.00 49 00 38 00 44 75 86 00 62 87 19 75 59 87 48 75 92 50 N o v. P, 1948 173 94 $79 25 31 50 52.75 59 00 33 50 45 50 33 62 54 00 170 00 37 62 38 62 59.87 19.12 56 37 65.87 27 25 10 00 35.75 53.00 97.75 37 87 23 00 72.62 22.00 30 00 38 12 50 50 40 00 73.75 24 62 Post Election Loss 8. 4% 3.1 ' 15.7 14. 7, 8.8 12.1 14 1 14.3 11.4 6. 4' 11.5 4.0 9.3 Loss From 1 9 4 8 H%gh 9 9% . 14.6 35 9 22.4 15. 4' - 18.S - ' - 19,8 15 5-" ~ ' 17.9 ' lOiOr 12-.5 5.8 - 9.3 -T - 10. 5' 23'-. 5 > * 11 9 12.6 12.3 18.7 9. 9' 20.6 20. 39.4 12.8 15.4 12.1 12.1 11 9 14 6 11.7 11.7 11 1 21 4 10 3 21 7 19 3 24.8 [6.2 18.6 11 9 11.9 7.3 13.7 14.4 19.4 13 4 15 8 113.6 25 9 53.83 $99 37 51 00 35 50 40 25 29 50 39 75 76 50 58.37 17 25 50 25 42 25 82.50 13. 1% 1 2 .7 13 6 8.9 17 9 22 4 11 2 11.0 7 1 12.7 16.1 13.3 10.8 21 2% 1 7 .6 17.7 21.6 20 8 30 4 20.5 16.8 7 1 22.0 19.4 15.9 14.3 (1) A d ju ste d fo r stock sp lit-u p s. BUSINESS W E E K Nov. 13, 1948 It's t i n y . . . / / x iu t It's RUGGED! x for STROKE and ROTARY APPLICATION This new M odel " Y " Productim eter Is e a s ily ad aptab le as an integral part of office m achines, lab orato ry equipm ent, meters, voting m achines, electronic devices and various types of production machinery. It's tin y . . . but i t 's rugged -- a sm all, compact reset counter. Designed particu la rly for ap p licatio n w here high speed co unting is in vo lve d . . . and p recisio n built to give you' years of service. Sencf for Cafa/og Section No. 37. DURANT M ANUFACTURING COMPANY 1906 N. Buffum Street' 106 Orange Street M ilw aukee.!, Wisconsin Providence 3, R. I. R ep rese n ta tives in P rin cip a l C itie s ' PRODIICTI METERS SINCE 1879 . '/ Prove profits yourself Install one `B udgit' electric hoist in your production, assembly or inspection line or on your loading platform. See how m any valuable minutes an hour you save --how many dollars!Note how the worker likes his `Budgit' for it makes the job so much easier. Gone are his fears of rupture and sprains from lifting. T here are no installation costs. Insignificant current consumption! T h e hoist pays for itself over and over again for indefinite years. Sendfor Bulletin No. `B U D G I T ' H o is ts MANNING, MAXWELL & MOORE, INC, M U S K E G O N , M IC H IG A N Builders of `Shaw-Box' Cranes, 'Budgit' and `Load Lifter' Hoisfs and other lifting specialties. Makers of Ashcroft Gauges, Hancock Valves, Consolidated Safety and Relief Valves and `American' Industrial Instruments. 101 LABOR How Labor Campaigned Unions spent nearly $4-million, find they can work best inside the Democratic organization. Labor party is now a dead issue; its advocates were too successful in electing Democrats. Was the Democratic victory last week a first short step toward a labor govern ment in this country? This- question came up, inevitably, when labor's role in winning the elec READ THIS! American industry - is using 3-dimensiona! Layouts for every type of industrial planning . . cutting costs-- reducing prices-- increasing profits. tion became evident. Union leaders claimed--and got--a lot of the credit for the greatest political upset in three dec ades. Labor manpower and money had pulled the Democratic Party out of po THINK HOW IS YOUR PLANNING litical bankruptcy. As a result, labor may be in a position-to have a commanding position for atdeast two years. BEING DONE? - Payoff--Political rewards for labor are Is the perhaps excessive cost of ` layouts a hidden certain: Complete overhauling of the one? . V isual Planning models cost fa r less than paper tempfets-^-require no translation^ ' ' " Taft-PIartley law may be only a small part of-what labor ultimately will get For brochure, catalog & price list, write or wire: , (page 19). -Broad social controls and reforms, economic planning, and gov- V IS U A L P LA N N IN G EQ U IPM EN T CO ., IN C. OAKM O NT PENNA. ' er-nment;regtdah'on of the economy are part of labor's program. Test Case--Last week's election was a OBcruciaToiieTor the right-wing labor bod ies. It was a test of (1) whether labor - could rally housewives, farmers, liberals, and other forces-behind a common pro gram, and (2) whether labor could carry GAS FIRED UNIT HEATERS on its political efforts within the frame work of-the Democratic Party. W HERE SPACE W orking'with one of the major par I S V A L U A B L E _____._____ ties--and perhaps taking it over--has been C.I.O .'s objective ever since it got into political action. A.F.L. has a similar goal But both C.I.O. and A.F.L. have strong advocates for a new party. Third Party?--Walter Reuther, presi dent of C.I.O.'s United Auto Workers, has been the most outspoken. Reuther proposed, three months ago, that unions get together "after the 1948 elections [to form] a genuine progressive political party." The proposal has been discussed quietly in union conferences since that time. It got unexpected support when A.F.L. president William Green was quoted as favoring a new labor party; Green subsequent!) denied that he had come out so flatly for a new party. The labor part)' advocates worked hard this fall, campaigning for laborendorsed Democrats. They didn't ex pect a sweeping victory. Their own goal was election of "as many good congress men and senators as possible in the 1948 elections [as] a base from which to work." Their big fight, which might lead to an actual government by labor, was on the schedule for 1950 and 1952. Dead Issue--The labor third party is now a dead issue. The election results Why burden working space with m onstrous heating equipment? Keep floor areas open for work space by installing an attractive Re z nor sus pended "automatic" unit heating system. Without fuss or muss, the Reznor unit-heat ing system can be quickly installed. Features such as the "special heat exchanger" and the "big. quiet fan" efficiently maintain even temperature where you want it. Write for catalog. SU SPEN D ED OR FLO OR MODEL NO BOILERS NO STEAM LINES NO FUEL STORAGE N O FIRE TENDING REZNOR MANUFACTURING COMPANY MERCER 3, PENNA. Gas Heaters S in ce 1888 C.I.O. CAMPAIGN HEADS Jack Kroll (left) and Philip Murray got out votes BUSINESS WEEK . Nov. 13. 1948 A.F.L. POLITICAL GUIDE George Meany was just as effective in labor victory strengthened the hand of those who have argued all along that a new party would be too risky. As long as the Dem ocrats let labor have an influential role in the government--even though not a controlling one--unions will be satisfied. Labor's gains are emphasized by com parison with accomplishments in earlier elections. In 1946, for instance, unions tested their political strength in 14 elec tion contests. They lost 13, and the other was only a partial victory; labor was divided on the winning candidate. This year, unions endorsed 19 candi dates for the Senate alone. All were Democrats, including four incumbents. Sixteen of the candidates won. The only setbacks were in Kansas, Michigan, and New Jersey. Unions also endorsed 217 candidates for the House of Representatives. Fa vored candidates won in 167 of the con tests--or almost 80%. No Coat-Tails--Unions gave belated and comparatively lukewarm support to President Truman. He wasn't the man they wanted as a candidate (labor has always suspected that Truman is inher ently conservative). W hat they accom plished in his behalf, therefore, is far more significant, politically, than votes garnered by laborites while riding the late President R.oosevelt's coat-tails. This time, the showmanship and hoopla of Political Action Committee campaigning was missing. This undoubt edly led vote experts to underestimate labor's activities--and its potential bal lot strength. Instead, unions used triedand-true political campaign techniques. C.I.O. worked with farm groups, par ticularly in Iowa. It got together with A.F.L., Railroad Brotherhood and other union political committees for unified BUSINESS W E E K Nov. 13, 1948 Hogs are important'to Ohio farmers--but they're not everything! No, sir, in the Buckeye State, farmers believe in a variety of 'products. Thus, they avoid the ups and downs of a single product. . . and have money coming in the year around. Now, that's one reason for, Ohio's STABILITY . . . a stability inciden tally that's rarely found in other "upper third" farm states. Another reason for this stability is the proximity of Ohio farmers to their markets. Because they're only minutes away:--they spend less money in selling-- save money for buying1' ' ' Then, there's age--a mighty important indication of stability. And Ohio's been a great farming market for more than one hundred years. Indeed, THE OHIO FARMER has been bringing the latest farm news to farm families for all those many decades. Today, THE OHIO FARMER is still the favorite with two out of every three Ohio farm families. Crescent S ta b ility "your best profit hedge the farm market" No fa rm area of equal size and wealth can match the stability of The Golden Crescent. I t has greater age . . , more market cen ters . . . a larger variety o f products. Served by M IC H IG A N F ARM ER, TH E O H IO P A R M E R , and P E N N S Y L V A N IA F A R M E R , TheGoldenCrescent safeguards your profits through the ups and downs o f the farm, market. For further informa tion, write 101S-A Rockwell Avenue, Cleveland H, Ohio. THE O H IO FA R M ER C le v e la n d M ICH IG A N FA R M ER East Lansing PEN N SYLV A N IA FARM ER Harrisburg 103 Chemical laboratories depend on Printw eighaccuracy. '. 1 Costly errors in m aterials elim inated by Printweigh. Control your costs with Toledo PRINTWEIGH Scales--the modern answer for weighing-bookkeeping problems of industry! N o human mistakes in reading, remembering and recording can slip in. Get set now with PRINTWEIGH speed and accuracy . . . keep weight S e n d p v t tfad- records right in receiving, shipping, N ew illustrated bulletin batching. Write . . . Toledo Scale N o. 2021 shows Better Company, Toledo 12, Ohio. Ways to control costs. T O L E D O H E A D Q U A R T E R S F O R S C A L E S 104 house-to-house campaigning. Duplica tion of effort was cut way down. And C.I.O. and the other labor politicians followed through from registration, to "political education" of the voter, to the poll itself. They rented automobiles on election day to get voters to the polls. They fur nished baby-sitters for families on labor's vote list (including idle bartenders who agreed to handle different kinds of bot tles, just for the day). They used the telephone to remind the right people to vote, or rang doorbells in doubtful pre cincts. The effort paid off. In Illinois, A.F.L. and C.I.O. had 17,000 members pushing doorbells; 13,000 of them worked m Chicago. Result: In Cook County, 82% of all registered voters went to the polls, compared with 72% in downstate Illinois. It's political tradition that a small vote is a Republican vote. This time, b u s in e s s w e e k co:respondents in most of the country made the same comment about the election in their territory: The voters who showed up were Dem ocratic voters, drummed up by labor; the Republicans stayed away. Money, Too--'The unions also kicked in heavily when the bankrupt Demo cratic National committee needed funds. Typically, P.A.C. turned down an ad vertising firm proposal for a C.I.O. pub licity program to cost $650,000. It was the sort of thing the old P.A.C. would have bought. The new version, directed by Jack Kroll and Philip Murray, de cided the money could be used to a better advantage m precinct work. The expenditure didn't show up spectacu larly, but it was more effective. In all, C.I.O.-P.A.C. spent about $500,000 nationally plus $1,200,000 in the field. A .F .L 's newly organized Labor's League fo~ Political Education, headed by George Meany, spent about $1,000,000. These weren't the only union political expenditures. A.F.L. and C.I.O. affiliates, and other major unions, also spent liberally--where it would be of real help to the Democrats. In addition, C.I.O. took about 4,800 of its field employees off regular jobs and put them to work in the campaign. They worked in Democratic offices in many places, took over important com mittee jobs m some spots. W here they did, they are hanging on to them. A .FL. and C I.O. are firmly en- tienched m the Cleveland Democratic organization, for example. The Wayne County (Mich.) Democratic com m it tee is strongly influenced by Reuther and U .A W . and in Minnesota the Democratic-Farmer Labor Party is in the hands of union men and pro-labor representatives of Americans for Demo cratic Action. Key Issue--Importance of the Tam Hartley law m labor's election fight can't be minimized. It was a niade-to- BUSINESS WEEK Nov. 13, 1948 order issue for getting P.A.C. dollars, precinct workers, and the labor vote. In many instances, the T-H law was the only important issue at stake. The basis for indorsements in .Illinois, for instance, was: "Do you favor repeal of the T-H act?" The election might have been another story'if T-H hadn't been on the statute books. So the test of how strongly labor will remain in politics may come in 950--when T-H probably will be an cient history. --on cutting fuel bills in Half labor briefs c a se s p e n d in g before NLRB dropped 9% in September, to 9,348. The Board disposed of 4,034 cases, got only 3,082 new ones: 2,521 petitions for elections, 453 unfair labor practice charges against bosses and 108 against unions. n o n -c o m m u n i s t a f f id a v it s have been filed by 98,256 union leaders, a 9,234 increase since Sept. 30. T-H require ments now have been met by all but 11 of A.F.L.'s 105 unions, six of C.I.O.'s 37. r e m i n g t o n r a n d employees in Syra cuse voted to let U.A.W. represent them. They turned down (1) Interna tional Assn, of Machinists, and (2) a plea for "no union" votes by U.E., the former bargaining agent. e ig h t b r e w e r i e s in New York City seek $8,275,000 m damages from C.I.O. Brewery Workers and five locals. Grounds: a wildcat strike (BW --Nov. 6'48,pl06). International union is a defendant although it repudiated strike. s u g g e s t io n s have netted Remington Rand employees $100,000 since 1945. More than 5,000 ideas have been adopted. Top awards: $1,500. a n e m p l o y e r can urge his employees, in private talks, to vote against a union in an NLRB election--if he doesn't make any threats. The hoard said so in the Mallinckrodt Chemical Works case. w a g e i n c r e a s e s : (1) American Potash & Chemical gave 11 4 an hour to C.I.O. employees; (2) a Newark (N. J.) arbi tration award raised Public Service Co ordinated Transport employees (A.F.L.) 13y an hour now, 1 after next Apr. 1. So l o m o n b a r k i n , C.I.O. textile union research director, is latest union official borrowed to help make ECA work. He will study the British textile industry, serve as consultant to ECA administra tor in Great Britain. BUSINESS W E E K Nov. 13. 1948 D uring N ew England's severe w inter of 1947-8, the J. C. Corrigan Com pany, Inc., of Dorchester, Mass., cut its fu el bill nearly 50% by installing a DRAVO Counterflo Heater. Coal for the previous winter season had cost this company between $1100.00 and $1200.00, whereas only $652.00 was spent for oil to fuel the DRAVO Heater during a similar period. Besides fuel savings! the mainte nance expense for the ld hearing system was practically eliminated be cause the DRAVO Heater operates automatically by thermostatic control. "Even m ore im portant'' , says Jv C. Corrigan, President, ". , . part of our substantial increase in production this winter was due to th improved heating system." Employees in the Corrigan plant manufacture custom-built conveying systems and need adequate warmth for efficient fitting and assembling. Previously, the plant was-heated by a coal burning furnace using blowers and ductwork to distribute the warm air. Excessive ro o f heat losses in. this I 6 5 'x 7 0 'x 2 7 ' building prevented.it from being com fortable. To heat "cold spots" that developed, eight pot-bellied stoves w ere installed. Maintenance of this old hearing meth od required three hours labor every day. Coal and ashes had to be hauled through the heart of the busy plant. Even w ith the eight stoves to supple ment the coal-fired furnace, heat was Ar inadequate and employees spent valu able production time huddling around the stoves. In November 1947, one DRAVO Counterflo H eater w ith an output ca pacity of 2,000,000 Btu was installed. N o ductw ork was needed. Only fuel and pow er lines had to be connected and a vent stack installed. N ow the entire factory area is maintained at the proper degree of warmth for w orkers' comfort and .efficient production. D uring sub-zero weather last winter, the single DRAVO H eater delivered ,, enough heat within 20 minutes after it was turned on to satisfy the ther' m o S ta t's s e ttin g . M o r e o v e r, th e. DRAVO Heater is shut down to co n -. serve fuel during non-w orking hours, whereas the coal furnace had to be fed over week-ends while the plant was s not in operation to m aintain1' some warmth for the Monday m orning shift. ' ' DRAVO Counterflo Heaters, .burn . oil, gas o r coal. Units burning non- , solid fuels can be converted from one fuel to another very readily. Coal- . fired heaters can be converted, f o r .. burning gas or oil. DRAVO CORPORATION, Heat, ing Section, Dravo Bldg., Fifth and Liberty Avenues, Pittsburgh 22, Pa. DRAVO CORPORATION Pittsburgh Cleveland Philadelphia New York Chicago Atlanta Safes Representatives in Principaf Cities Detroit Boston Function Heating with just ONE U N IT D R A V O C O R P O R A T IO N , H eatin g Section, R oom 812-11 D ravo B ldg., F ifth and L iberty A venues, P ittsburgh 22, Pa. W e w ould like to consider D R A V O C o u n te r flo H eaters for: N a m e ........................................................................ C o m f o r t H e a t in g T i t l e . ....................................................................Q Y e a r 'ro u n d V e n t ila t in g C o m p a n y ......................................................... , . P r o c e s s D r y in g A d d r e s s ......................................................... , . T e m p e r in g M a k e -u p A ir C i t y a n d S t a t e . .................................................. H e a t C u rin g P -6374 105 f o n M a x im u m P fi T c rto H PITTSBURGH 1 CHAIN LINK FENCE Y Your property, your equip' ment, are protected against thieves, meddlers, and the curious when Pittsburgh Chain Link Fence is on the job. Also the coming and going of your own employes is regulated which in itself can save you money both in time and ma terial. We have been planning and erecting good fence for many years--our experts will be glad to give you advice and a cost estimate. Write to Pittsburgh Steel Co., 3249 Grant Building, Pittsburgh 30, Pa. The FIRE calls the firem en-A n au to m atic F IR E A L A R M is a fe atu re of th e G lobe Sprinkler System . It operates while the sprinklers are extinguishing the F IR E . Safeguard your property w ith this device. Why depend on a passerby for a m idnight F IR E alarm? G L O B E A U T O M A T IC S P R IN K L E R C O . New York Chicago. Philadelphia . Dfflcts In nooriv ail Brlnetail cities They Pay for them selves W hen You H ave . . . . Industrial or commercial real estate for sale or lease you c a n a d v e rtis e it lo r n a tio n a l o r local attention in the REAL ESTATE SECTION of BUSINESS W EEK 106 W ageG apShrinks Skilled workers7 percent gains haven't kept pace with those for unskilled. Semi-skilled do better too. Before the war a skilled employee in a manufacturing plant pulled down 65% more pay than an unskilled worker. Now he only gets 55% more, which means that he has made a smaller per centage gain in wages than his unskilled co-worker. This m turn creates a new problem for employers. It accounts for much of the discontent and lagging morale of highly skilled workers--upon whom em ployers rely the most for steady, highlevel production. Narrowing Gap--The narrowing of . the wage spread isn't anything new. Before World W ar I, the gap between unskilled and skilled pay was 105%. It narrowed to 80% in the 1931-1932 depression years. And it has been be coming less almost every year since then. "T his doesn't mean, of course, that differentials have shrunk on a cents-per'hour basis. Top-skill pay has gone up "about "100% since prewar days; un skilled rates, 115%. But these percent age raises added more actual cash to the skilled worker's pay envelope than to ,the unskilled worker's--85^ as compared with 60^.t.in hourly increases. Buying Power Off--Here's what really bothers" the high-skilled worker today: T he unskilled worker's pay has risen one-third faster' than the cost of living, while his own rate of increase has barely kept abreast of the c.-of-l. And he is being 'tapped more for federal taxes than before. 'As a result, many skilled workers have suffered real losses in living stand ards since prewar days. Some blame it on their unions. Most blame it on the employer. No matter which they do, their discontent shows up in morale and productivity. W hy the Trend?--The narrowing wage gap is due to a combination of factors: Unions have pressed for--and w onsizable increases in minimum wage rates Competition by employers for un skilled labor in a tight labor market al ways narrows the wage spread. The gap widens again when the labor pinch ends, but it is never as great as before. Mechanization of factory work has cut into the demand for highly skilled workers. It usually requires less skill to run a machine than to do the same job by hand. And workers can be trained more easily and quickly to run the ma chine than to do a crattsmanlike hand operation. More education--both general and technical--means that there are fewer untutored laborers. And the starting worker is worth more to the boss. Regional Differences--You can see these factors at work in the labor maiket by looking at regional variations. The biggest average spread between skilled and unskilled wage rates is found m the South--70% as compared with the national average of 55%. The rea son: There is a large poo] of unskilled labor, while highly skilled workers are hard to get. The smallest spread (45%) is in the bar West. It is harder there to find un skilled workeis. Industry can attract them only with a higher starting wage rate. Semi-Skilled Workers-Figures on the narrowing maigin between skilled and unskilled workers leave out the largest occupational group--the semi-skilled. Their wages have gone up almost as much as those of unskilled labor in most industries. Statistics for only 34 years are available (October, 1943, to April, 1947), but they tell the story. Increases during the period amounted to 35% for semi-skilled workers, as compared with 28% for skilled and 36% for un skilled labor. Semi-skilled workers gained more than any other group in the textile and ap parel industries--mainly because there are so many incentive plans which cover only semi-skilled operations. The Future--The Bureau of Labor Statistics has estimated that the long term trend has been a shrinkage of 1% a year in occupational differentials. The short-term trend is determined m large part by the pattern followed in annual wage settlements. A flat percentage increase--such as th at given this r ear in the steel industry --maintains the percentage differential in rates. Highly skilled workers favor this kind of settlement: It pays oft best for them. Unions generally prefer a uniform cents-per-hour raise for all job classifica tions. Such a settlement (agreed on this year by almost all industries except steel) appeals most to the large number of union members who are paid less than top rates. It means a bigger gain for them. It also squeezes the differ ential between pav extremes still fur ther. The Pictures----Acme, Harris & Ewing, Int. News. W ide World -19-22; Acme--24, 25, 84; British Information Services--118 (mid., bot); European -- 117; Fabian Bachrach--99, Harris & Ew ing102, 103; Int. News--26, 89 (mid,), 94,- 108; Keystone--118, 120; N Y. State Dept. L abor39; W ide W orld-89 (bot.). BUSINESS W EEK Nov. 13, 1948 G. N. ALEXANDER will be the . . . Fifth G. M. Umpire in Eight Years Gabriel N. Alexander--a newcomer to the big league of labor arbitrationwill step into one of arbitration's tough est jobs next week. He will succeed Saul Wallen as impartial umpire for Gen eral Motors and the United Auto W ork ers (C.I.O.). Wallen was ousted recently after a decision against the union (BW -Sep.25'48,pl 11). Alexander will be the fifth man in the job in eight years. Alexander is a Detroit attorney; he has done occasional labor-arbitration ivork since his graduation from the Uni versity of Michigan law school in 1933. He handled a number of special unionshop cases for G.M. and U.A.W. while Ralph Seward, Wallen's predecessor, was umpire. He has also arbitrated cases involving a number of other C.I.O. unions, A.F.L.'s Teamsters, and the In ternational Assn, of Machinists. TO RULE O N ANTI-RED OATH The Supreme Court this week agreed to rule on the legality of the non-Comnrunist affidavit clause m the Taft-Hartley law--one provision which may sur vive congressional overhauling. The affidavit clause bars unions from using the National Labor Relations Board unless officers swear they aren't Communists. The leftist American Communications Assn. (C.I.O.) has challenged this requirement. Earlier Biis }ear, in a hearing before a special three-judge federal district court, the union alleged that it was barred illegally from an NLRB election. NLRB said A.C.A. wasn't eligible for the ballot at Press Wireless, Inc. because union offi cers hadn't signed affidavits. The lower court upheld NLRB--and the T-H law. AC.A. appealed. BUSINESS W E E K Nov. 13, 1948 A LL scales with postage computed at present rates become obsolete i i January 1,' 1949! That's when numerous changes made by the Government become effective. New Commercial Controls Scales embody ing the necessary changes'are designed'to handle your requirements for all types of mailing. Get your order in NOW for delivery in December! The same accuracy, precision and convenience is built into these new scales that has characterized Commercial Controls Scales for many years. You can depend on these distinctive features to save yon time and money. The new Model 970 Parcel Post Scale 70 lb. (illustrated above), in addi tion to showing changes in parcel post rates, includes third class, book rate and the new air parcel post computations. The new All Purpose Postal Scale, 30 lb. capacity (same model design as illustration), includes com putations on first class, air mail, thud class, surface and air parcel post. N E W 1949 LETTER SCALES M odel lpO -- 20 o zs. or 3 lb s. Capacities Shows new postage computations on first class, air mail, third class; also air and surface parcel post. For further information, call Commercial Controls . . . listed in your local telephone directory. For NEW POSTAL RATE WALL CHART, send 25c in coin to Commercial Controls, D ept. BW-118, Rochester 2, New York. , .M etered (M ail System s Letter an d Parcel Post S cale s , Letter, O p eners Envelope S ealers M ultipost Stam p A ffixers M a ilro o m Equipment Eriddrsographs * Tick e to g ra p h Systems Autom atic Stam p Vending, M achines M ail Bag s * P a k - T y e rs ri . v ! , y A uto m atic T y p e w rite rs S a le s a n d S e r v ic e O ffic e s in P rin c ip a l C itie s , . . , Rochester 2, New York C o m m e rcia l Co ntrols C a n a d a L td ., To ro n to T, O n ta rio 107 PLYMOUTH DODGE DE SOTO CHRYSLER rou GET TH GOOD THINGS BST O M CHRYSLER COBPOATION DIVIDEND ON CO M M O N STOCK The Directors o f Chrysler Corporation have d eclared a q u arterly dividend o f one d o lla r ($ 1 .0 0 ) p er sh are on the oustanding common stock, p a y a b le Decem ber 14, 1 9 4 8 , to stock holders o f record a t the close of business N ovem ber 1 5 , 1 9 4 8 . B. E. HUTCHIN SO N Chairm an, Finance Committee Do Heavy Lifting Easily with a H Y D R O - L IF T * Truck and Shop Crane A fast lifting 2000# hydraulic crane for in dustrial plants, shops, - garages, delivery trucks, etc. Boom fo ld s o u t -of w ay when oot in use. > t -Assures 4ulck,Ni` 'easy lifting of heavy loads with complete safety. Mo danger gf strains, or her- J,a ia . ! ^ '! ' '-May be-used-as truck or shop crane. Provides utility of two-6fanes'for , .nriQe,of xme. Lpwvpriced. Immediate delivery From Truck to Shop Crane in 30 SEC O N D S! Writetfor F R E E Bulletin! CARDINAL CORPORATION 1835-L U niversity A ve. ST P A U L, M IN N . Turning the ."Searchlight'/ on Opportunities Published as 'space'Zis available-- approximately oxee a month. Bate-- 00 per line, minimum 3 lines-- 2 icords for box numbei. Address replies c/o Business VTetTr South A fric a INDUSTRIAL OPPORTUNITIES Encuaeer, Imsiness background, good organizer, intim ate knowledge S A., desires .loin company plamuntr overseas expansion there , to conduct grouudwork from conception thru planning, construction, operation. Bov 7017. Buropean Ed ito ria l Position YOUNG AVOMAN w ith engineering-public rclations-joiirnalistic education and experience is seeking a responsible editorial position with an American organization in W estern Europe. Box7019. Truck Fleet Executive TRUCK FLEET Operalors. An executive with over 20 yea is experience in tru c k fleet operation desires to change positions. Knows procedures fiom shop through o/hee. Experienced in single shop or scattered fleet Ex< optionally good on organizing and setting up ion tines to reduce costs. Box 6956. A V A ILA B LE EX EC U TIV E V IC E-PRESID EN T W ORKS M ANAGER OR COM PTRO LLER Soundly balanced management sk ill as top co-ordinator Able to add "know-how" strength and execution where needed for in creasing profits Now on P a c ific Coast P . W . 7027 B u sin e ss W e e k 621 S H o p e S t ., L o s A n g e le s , C a lif. 108 Easy on Overtime i Auto Workers don't want to stir up Congress on overtime when the Capitol is in a mood to forget about it. The United Auto Workers (C.I.O.) won't push suits against employers for pyramided overtime. U.A.W. has told regional and local union officers to "pre serve contract arrangements where they have proved fair and equitable." Thus, its formal position on overtime-on-overtime (BW --O ct.l6'48,pl08) . is to go easy. Reason--This attitude is highly sig nificant. Management wants Congress to amend the Fair Labor Standards (Wage-Hour) Act early next year. That would wipe out management liability for back overtime, under recent Su preme Court decisions, by redefining "overtime." Now, Congress may not act on the issue at all. U.A.W .'s legal staff has made a broad study of the Supreme Court decision. As a result, the union executive board says that U.A.W. "does not intend to stretch the Supreme Court decision in an effort to pyramid overtime rates, or to repudiate legal contractual provisions for computing overtime pay. At the same tinie it does not intend to permit any employer to use the Supreme Court decisions- as an excuse for doing away with'premium pay for work on holidays, Saturdays, .Sundays, and shift differen tials.' It .is entirely possible within the law to preserve contract arrangements where they hate proved fair and equit able." - -1' " -Holiday Pay--U.A.W .'s legal staff has, at the same time, a new opinion on holiday p a y .'It's a friendly interpreta tion of contracts, says in effect: (1) Regular pay for holidays not worked is not payment for hours worked. It can't be included in figuring the regular rate of pay for the weekon which overtime is paid for moie than 40 hours' work a week. (2) If work is done on a holiday, the extra pay--and only the extra payshould be included in figuring the reg ular rate of pay. Straight time pav for the day would be "idle" pav--the worker would get it even if he didn't work. So if he worked and got double-time pay, only the second half of it would be figured into the base rate. Since it would be the same as straight time for one day, it wouldn't change the base rate. C) Some contracts specify straight time for holidays not worked, and pro vide an additional double-time pre mium if work is done. In such a case, the double time would be used in com puting the base rate. A.F.L. LONGSHOREM EN check bosses' "final offer" prior to NLRB vote Longshoremen Strike Hits East Coast Docks A.F.L. longshoremen on East Coast docks quit jobs this week as an 80-day anti-strike injunction expired. "National emergency '' provisions m the Taft-Hartley act had failed, for the second time, to avert a potentially serious tieup. The first failure involved C.I.O. longshore men on the Pacific Coast. Members of the International Long shoremen's Assn. (A.F.L.) formally voted to re]ect employers' "final offer" of contract terms (picture, above). They later turned down an even better set tlement which Joseph Ryan, I.L.A. president, described as "satisfactory." Opposition was led by a left-wing minority in New York City, but rankancl-filcrs all along the coast joined in. The East Coast flarcup came at a time when there were signs of possible labor peace on Pacific Coast docks. Negotiations were resumed this week between the International Longshore men's & Warehousemen's Union (C.I.O.) and employer bargaining rep resentatives Bosses agreed to resume talks when assured C.I O. would guar antee that I.L.W U. will live up to terms of any contract it signs. BUSINESS W EEK Nov. 13, 1948 Rail Pay Puzzle Should employees of a mine road get mine scale or railroad scale? That's the basic issue in the Kennecott Copper strike. Sometimes railroad men on mine-tomill railroads belong to the same union as the mill workers. This is particularly true in the steel industry. In other industries, employees on mine or mineto-mill roads often belong' to the big railroad brotherhoods. Problem--In such cases, should wages follow railroad pay rates or industrial pay rates? This question has caused trouble for a good many companies m recent years. And it's the key issue to day m a labor dispute at Kennecott Copper Corp.'s mine m Bingham Can yon, Utah (BW --Oct.30'48,p36). Kennecott operates two rail lines at the mine. One goes down into Bing ham Canyon to haul ore. The other carries ore from the terminus of the mine road to mills and crushing plants in Magna and Arthur, Utah. Employees on both lines are mem bers of the Brotherhood .of Locomotive Firemen & Enginemen. The company agrees that the second line is a bona fide short-haul railroad, and pays its engine crews prevailing railroad wages. But it insists that employees of the mine road are actually production work ers, so it pays them the mine scale-- considerably less than their fellow unionists on the other line. Demand--Last month the Brother hood demanded that Kennecott pay the same scale on both lines. The union first asked a $4.08-a-day increase for the mine railroaders. Later the demand was cut to $2.71. The com pany offered 964 a day--the same 124 hourly increase accepted by Kennecott mine and mill employees. Strike--Rail workers struck three weeks ago when wage talks collapsed. The companv protested that the stop page was an attempt to force "a new round of increases." It warned it would not contribute to a "new inflationary spiral" by raising its offer. The strike tied up the nation's big gest supplier of copper; about 30% of the country's output--more than 18,000 tons a month--has been coming out of Bingham Canyon. Federal mediators sought a settlement as the walkout, en tering its third week threatened to halt the government's stockpile purchases of 10,000 tons a month. But by midweek, mediation hadn't dented the firm position of either party. The rail union was willing to let the dispute go to a federal fact-finding board. Kennecott refused the proposal. BUSINESS W E E K Nov. 13, 1948 -1-- li'L TS; "De guard wouldn't believe it wuz lunch fer me brudder!" W h e n these criminals sighted: a' Fence stays taut and true under the Cyclone Fence, they had to re stress and strain of long service,. sort to subterfuge. Unfortunately, forW- hy not send for our. free book-- them, they've just discovered that "the "Your Fence." I t's fulh of interesting best laid schemes o' mice, and men gang, aft a-gley." Burns 'em up, too! Thugs and trespassers don't like a Cyclone Fence--but property owners do. facts about the world's' most widelyused property protection fence. It con tains specifications and illustrations. If you want help in planning.your fence, Plant executives have long known--and depended upon--the "entrance and exit control" a Cyclone Chain Link Fence have a Cyclone sales engineer assist you. There's no obligation incurred. And don't forget: No job is too large- provides. And Cyclone's popularity no job is too small }or Cyclone. didn't just happen. Its special features of design, construction and installation CYCLONE FENCE DI VI SI ON (AMERICAN STEEL i #1 RE COMPANY) stem from over SO years' experience in WAUKEGAN, ILLINOIS BRANCHES IN PRINCIPAL CITIES I?- making fence. No wonder a Cyclone UNITE0 STATES STEEL EXPORT C OM PANY, NEW YORK US S CYCLONE FENCE rli % C y c l o n e F e n c e , W a u k e g a n , 111., D e p t . 41 18 W e 'll s e n d you o u r fre e, 3 2 - p a g e b o o k on fen ce. I t 's full of facts, specifications, illustra tions. Shows 14 types of fence. Before vou choose any fence for your pro p erty , get the facts about Cyclone. if N a m e .............................................................................................................. T 109 FR A N C H IS E AVAILA BLE For Territorial Distributors Oui engineers ha\e mst developed the ino&t b u llian t store-window Electric sign ever produced1 Yes, mine b u llian t than neon by light metei te->t. Jt > new . different and sells at a puce that assures quick sales . . . an outstanding \alue and big earnings tor you' Endless list ot prospects. Prefer firms and men who have an organi zation 01 staff of salesmen m the neld and w ill be responsible lor certain territories, sectional 01 state. Quotas will be required but no financial investing 01 stocking ot merchandise. W rite or wire for fu ll particu lars. OHIO A D V E R TIS IN G D IS P L A Y CO. Bldg., B OADCO PLANT, CINCINNATI 2, OHIO COMPANY STORE in Jacksonville, Fla., offsets high food cost--and wage demands Company Store Keeps Wage Demands Low ! No one would be likely to guess that men. He found that their biggest worry a company store might prevent labor was high food costs. from asking for a big wage raise. No The company put up a $12,000 store one, that is,'but the Jacksonville (Fla.) building in the'Jacksonville Coach yards. IT'S no trick with the l Ho'nsen Tacker, Coach Co. cc It put in $6,000 worth of modern equip with its B alan ced D rive, to do oil those 1 Food Expetise--Last spring the com ment, spent $10,000 at the start for a tacking, fastening and assembling jobs-- pany-figured that the biggest single ex wide stock of name-brand groceries and _ faster, easier, better. Learn why ! Specify your tacking needs.. Request details. pense itenrthatit-s 549 employees faced top-grade meats. To operate it, the com was-foodaSo itdecided to set up a com pany hired an experienced store man pany store which would sell them gro ager and four clerks. ceries and'meat on a nonprofit basis. Name tags entitle employees to make ' The food savings were so big that the purchases at the "trading post" for employees loved this company store either cash or credit. The tag also may INVITATION to BUSINESS GROUPS from-the .day. it .opened. W hat the com be used by members of the family, and During the quieter months o f December, January and February, THE HOMESTEAD at Hot Springs, Virginia invites small business groups (up to 100) wishing to meet in surroundings of dig nity, comfort, and restful beauty. Ideal pany hoped was that they would love it well enough to keep their third-round wage- demands 'down. They did: The union asked for--and got--a hike that could be granted with out a fare increase. Problem Solved--For Jacksonville is a "pass" for a free ride on company buses to and from the store. Good Business--The store got big business from the start. Employees found that they could save up to onethird. The markup on items costing up to 12<i at wholesale is 4; on items cost for concentrating on the work at hand, Coach, this outcome solved a problem ing more than 12^ wholesale, the away from urban distractions. Every facil ity for making your meeting successful. that loomed last spring. Bus passenger markup is 1^. The markup is intended r N o lost rime--overnight from all Eastern traffic was down sharply; costs were at to cover day-to-da\ operating costs; the J and Midwestern cities. For information, a record high and still trying to push company meets the--overhead. write Harold P. Bock, General Manager, The Homestead, Hot Springs, Virginia. higher. The company was m a nip-and- Savings on food are roughly equal to tuck fight to break even. a 15% to 20% raise. Possibly as a re The A.F.L. Street Electric Railway sult of it, union demands weren't heavy. employees local at Jacksonville was ready Negotiations brought a quick and to come up with third-round wage de friendly contract agreement. The com mands. Other companies already were pany store wasn't biought into the dis negotiating on 30?! to 40?! demands. cussions, or made a part of the contract. The Jacksonville company couldn't give Thus, it remains wholly a voluntary more than Si an hour without asking offering by the company for employees. is sold only by subscription to for a fare increase. It didn't want to Sales Soar--Currently, the store's sales I1 management-men who are iden tified by their titles and business do that. Biggest Worry--The company and union have always been on friendly arc well over $18,000 a month--and the trend is upward. Revenue from the markup so far has been enough to meet connection.,. the m en w h o m ake terms. The company's labor record is running costs, and to have a little left considered a good one by A.F.L., and over. The companv recently built an o r influence buying decisions. employee morale is high. So Jackson addition to the original building so that ville Coach's general manager, J. M. it can buy in carload lots at cheaper Ss? " ' no Moore, could talk informally to union prices. A BUSINESS W EEK Nov. H , l48 What Is a Strike? Mass quitting can be, NLRB finds, in n ailin g ddw n T-H definition. But unions aren't necessarily responsible. If a lot of your men quit at once, is that a strike? It is-or at least it's "per suasive evidence of one. Concerted Stoppage-Of course, may be your workers can give a sound reason for quitting their jobs. Then it's a different story. But if they can't, their action is to be construed as a concerted move for a common cause. And con certed stoppage of work is a strike, by Taft-Hartley law definition. But the union isn't responsible, un less you can prove that it "initiated, pro moted, or sponsored" the walkout. First Time--This is the meat of a de cision just handed down by a National Labor Relations Board trial examiner. For the first time, NLRB has had to interpret the Taft-Hartley definition of a strike. The decision conforms with the view expressed recently by the Federal District Court at Knoxville, Tenn. (BW--Sep.25'48,pl07). But it looks as though the full five-man NLRB would review it at the request of the union--the International Brotherhood of Electrical Workers (A.F.L.). The Case--The company in the case is Roane-Anderson Co., which main tains and operates the electrical distri bution system at Oak Ridge, Tenn. All but one of the company's 115 mainte nance electricians and linemen quit their jobs on July 29 and 30. About the same time, the Kaiser Electric Co., Knoxville nonunion subcontractor, be gan installing fluorescent light fixtures in a school. Roane-Anderson's union men had demanded that a company using union electricians get the job. Most of the I.B.E.W . workers stayed away until Sept. 2, when an injunction was issued against the stoppage. On Their Own--Last week, NLRB Examiner Arthur Left turned down the statements of 13 employees, who said they had quit their jobs on their own. The workers made their statements to support a union claim that there was no strike. The T-H law provides that nothing in it shall be construed "to make the quitting of his labor by an in dividual employee an illegal act." Leff said none of the employees could give a specific reason for quitting. Most f them left after reporting for work, 0r in mid-shift. But thev couldn't cite anything that had happened at the mo ment to make them quit as individuals. Responsibility--The trial examiner said that I.B.E.W . did not formally call a strike, or hold a strike vote. He said, 6US1NHSS W E E K Nov. 13, 1948 DISAPPEARING-MOTOR TRICK We love the sight: o f modern motors. We should, because we build them. But nothing pleases us more than does the trend to built-in drives. There's a real trick to devising compact designs which work dependably though bidden fro m view . That's w hy out-of-sight means out-of-m ind to manufacturers using R & M power. . . . MOT M A G IC -JU S T G O O D D ES IG N IN G --These are not jobs for regular motors,,but for.Robbins & Myers Matched Motor Parts---rotors, sta,tor& aqd other, elements that meet size and shape limitations. H om e appliances and portable tools are typical produqt.examples, yet the uses of R & M motor parts are surprisingly many and varied. BUILT-IN POWER PAYS OFF-- In the Maginniss Electric Con crete Vibrator," below , R & M motor parts are so skillfu lly concealed you'd scarcely believe them there. A vibrator head only .2%" outside diameter contains the rotor, stator, bear ings, and' an eccentric weight that turns 10,000 r.p.m. You can see h ow sim ple if is--how convenient and easy to use. FOR Y O U , T O O --If you are interested in electric pow ering that means smaller, lighter products, w e'll be glad to mail you our timely 32-page-booklet, "Matched Motor Parts." Long-experienced and truly cooperative engineering aid also is yours for the asking. Please address Robbins Sa Myers, Inc., Motor D ivision, Department A l 18. See te "TfCatofi? "r^en-ef R O B B I N S & M Y E R S , INC. SPRINGFIELD 99, OHIO . BRANTFORD, ONTARIO MOT OR S HOI S T S C R A N E S FANS MOYNO PUMPS 111 T however, that the union's responsibility l & l-- -- ' was proved: In ten instances, the evi dence showed that union officials had T- induced, directed, or encouraged the walkout. Dying Issue--The strike-definition is sue will almost certainly be a dead duck / te a m soon after the new Congress meets. It grew out of section 501 (2) of the T-H law. T hat's where one definition of a s? B ju iy w strike as "any strike or other concerted stoppage of work by employees" occurs. 'Fhe earlier Wagner act did not define a strike. Unions considered "concerted stoppage of work" a dangerous wording: It makes unions liable for a walkout by any group of its members, whether the r" union was forewarned or not. Congress is sure to rub out the strike-definition or 77 years, M. & St. L. has been the nicknam e of the M inneapolis & St. Louis Railway, an im portant road which networks rich agricultural and industrial areas of the Great Midwest. clause when it overhauls the present federal labor law Today, M. & St. L. symbolizes also the M odern and Stream-Lined trans portation which that railroad provides in M innesota, South Dakota, Iowa and Illinois-- Textile Workers For Agriculture and Industry For Shippers and Receivers of Freight For Connecting Lines, via Major Traffic G atew a y s Ask 1(V Boost in 1949 W ith fleets of Diesel locomotives, new est-of w hich is the No. 348 in the picture, and of new freight cars, the M. & St. L. is truly a road of M odern and Stream-Lined Service. W hat will your workers be shooting for as a 1949 wage goal--now that the election has gone their way? The C.I.O. textile workers may have given a clew to 7 4 e Minneapolis&St Louis TRAFFIC OFFICES IN 36 KEY CITIES the answer. In New England and the mid-Atlantic states they are trying for a 10(f-an-hour increase. It would take ef fect early m 1949 for more than 200,~ 000 workers. SC IE NC R e a d h o w Is m odernizing A m erican In d u stry! Post-Election-This is the first im portant union goal announced since the election. And it's the smallest figure that the Textile Workers Union of To K eep Pace with the Latest Advances of Science -- read Science Illu strated! America (C.I.O } has asked since the war. T hat's rathei curious. Other un ions may be tougher m their fourth- No one group of men are quickening the pulse of industry more than the scientists. 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This special rate saves you $4 over the one year price. We'll start your subscription with the big new issue now on the press --IF YOU MAIL YOUR ORDER WITHIN 10 DAYS. Science Illustrated 3 3 0 W est 42n d Street, N. Y. 18, N. Y. YES! I accept your special offer. Start my subscription to Science Illustrated with the new issue now on press. I prefer 2 yrs. at $4 (Saves me $2 compared with the 1-yr. rate) I prefer 3 yrs. at ?5 (Saves me $4) I prefer 1 yr. at $3 Bill me later Payment enclosed round wage demands. The union will ask the 10<f raise for 90.000 woolen and worsted workers and 120.000 employees m cotton and rayon, mills. Here's what the 10? would mean: Woolen and Worsted Mills: The increase would raise the minimum to SI 15 in 160 mills under contract with T.W .U.A. It would raise average straight-time hourly earnings to $1.41. Cotton and Rayon Mills: A 10if in crease would bring the average straighttime hourly earnings to about $1.28. The minimum wage would go up to $1.07 an hour. Resistance Seen--New demands are expected to meet some employer resist ance Employers aren't as optimistic as the union about continuing high profits for the industry. But if negotia tions should deadlock there would be no strike; wage-setting would be sent to arbitration proceedings under terms of textile contracts Textile raises so far have not been Address. tangled up in multi-industry "pattern settlements Hence, what T.W.U.A. Ci ty ____ _Zone_ A L SO O N SALE AT ALL N E W S S T A N D S ..................... 2 5 < _State_ B .W 1-13-48 gets won't necessarily influence other union-management decisions. 112 BUSINESS W EEK Nov. 13, 1948 Behind the magic of Recordak microfilming ...y o u have all the advantages of iifM photographic experience i I t means a lot, you'll agree, to have Eastman Kodak Company behind every phase of Recordak microfilming . . . It means that Recordak equipment and film are right photograph ically. For they're made by Kodak. And as the foremost manufac turer in the photographic field, Kodak knows cameras, lenses, film . . . knows how they must be integrated for their exacting job: -- The job o f recording documents as only photography can-- witE accuracy and completeness . . . at tremendous reduction, high speed, and low tost. It also means that the film processing is right, for Kodak-perfected technics and equipment control every step. Uniformly sharp images' assure maximum reading comfort when viewing original-size en largements on the screen of the Recordak Film Reader. Significant backing, this--and Kodak has been behind R ecordak' throughout its 20 years of specialization in microfilming. To see what this specialization can mean to your business, write fo r "50 Billion ' Records Can't Be Wrong." It'sfree. Recordak Corporation (Subsid iary of Eastman Kodak Co.), 350 Madison A ve., New York 17, N. Y. in' fi&i I ,:tl M (Subsidiary of Eastman Kodak Company) originator of modern microfilming-- and its application to business systems "Recordak" is a trade-walk m T im e a n d co st s tu d ie s p r o v e this.mm To find' out ex a c tly w h at this fast pay-off time on A ir Pow er equipm ent m eans to you, ask your Ingersoll-Rand en gin eer to m ake a job study in your plant. He will help you m ake actu al Air Tool perform ance tests right on your own operations . . . then help you determine how much money you can save, and how quickly Air Power equipm ent w ill p ay for itself. no enroll-Rand "a030 329-8 11 B road w ay, N ew York 4 , N. Y. INTERNATIONAL OUTLOOK iUSlNESS W EEK NOVEMBER 13,1948 ge ns You can just about write off the Nationalist government in.China. Chiang Kai-shek's military forces are crumbling fast-- as much from mutinies and desertions as from Communist victories. His new gold Yuan currency has been reduced to just about nothing. Rice riots have thrown Shanghai, Nanking, and other Yangtze valley cities into turmoil. Unpaid soldiers, hungry students, angry workers-- not Communists-- are bringing Chiang down. Chiang's one hope seems to be this: Turn over rule in the Yangtze area to Vice-President Li Tsung-jen; let T. V. Soong control South China; go into the field himself to pep things up. Don't expect the U. S. to prevent further disasters in China. True, U. S. Marines may be flown into Shanghai and Nanking to protect American personnel and property. But this won't make a new China policy. The fact is Washington doesn't know what to do. The Chinese experts are divided. One group argues that $ 1-billion worth of military equipment could still save Chiang. The idea thus is to get a military solution to the problem first. Economic problems would be tackled later! - The other group says that Chiang's forces need more than military sup plies. They need the will to fight. And they won't have this unless Chiangcleans up his corrupt bureaucracy and checks inflation.---- Don't read too much into de Gaulle's success in this weekfs. elections,. The voting was for the Council of the Republic (French-senate). "The General won the same sort of victory in last year's municipal elections. But since the electorate for France's upper house consists mainly of representcrtives from the municipal councils, Sunday's vote is no new yardstick. The licking the Communists took probably means more. They are just about isolated politically. ' m General elections in Britain may not come until 1950. But Labor has: started to prepare for the fight already. Last week the government dropped controls on a lot of home-produced goods, plus some raw material imports. (British industry will be spared filling out about 200,000 licenses a year.) Next week the reins on steel will be loosened. Dozens of other controls could easily go any time now. But they will be abolished piecemeal. Reason: to give the impression that the government is making steady progress despite its vast problems. : " In 1949 the housewife will get a hot wooing. Rationing on food and clothes will ease off. Tactics such as these will make it tough for the opposition. You can be sure, though, that the Conservatives will make hay with the steel nation^ alization issue (page 117). _ Work has started in London on an international control authority for the Ruhr. ' - "" This is the body that's supposed to take over the job of allocating Ruhr coal, coke, and steel from the U. S.-British military governments. The prob lem is how to divide these products between western Germany and the other Marshall Plan countries. The U. S., Britain, France, Belgium, Holland, and Luxembourg are IN TERN A TIO N A L O U T L O O K (Continued) BUSINESS WEEK NOVEMBER 13,1948 taking part in the London talks. The delegates expect to reach an agreement by the end of this month. President Peron is getting set to ditch his Argentine Trade Promotion Institute (IAPI). This is the outfit that has squandered Argentina's gold and dollar reserves. Peron just about junked it in September. At that time Foreign Minister Bramuglia convinced him that IAPI was ruining the country. But IAPI is the pet of Miguel Miranda, the economic boss. When he heard about Peron's plan, he decided to get Bramuglia out of the way for a while. So the .foreign minister was sent off to the United Nations meeting in Paris. But Miranda's move may have boomeranged. Bramuglia has gained . world prestige as-chairman of the Security Council. He has been the prime mover in the attempt of the "neutrals" to settle the Berlin blockade. It shouldn't take Bramuglia long to topple Miranda when he gets back to Buenos Aires. Brazilian officials now talk of spending $1-bi Ilion on railway improve ments. . ..cThiSotS.iarb.ig bike on the $300-million President Dutra recommended in his-five-year "Salte" plan. And Brazilians say they will have to borrow in the U. S. to finance the difference. ; .Here's^what the money would be spent on: locomotives and rolling stock, $295-mjllLon; roadbeds and rails, $243-million; electrification, shops, etc,, $272-million; overall construction plans, $191-million. - The-BrazHian-U, S. Technical Commission is taking a look at this new plan. -You can be sure the U. S. group (BW-Jul. 17'48,pl 07) will turn thumbs dowmon-ione of the Brazilian proposals: to sell special bonds in the U. S. rr These, w.oujdn't. pay interest in an orthodox way-- they would offer freight - s discounts to the American holders. The-U.. S. group will also want an explanation of things such as this: The government-owned Central do Brasil Railway has the same mileage and carries the same number of ton miles a year as the privately Leopoldina Railway. But the Central has about 42,000 employees and the Leopoldina about 7,000. PAGE 116 The Itabira iron mine in Brazil is getting out of the red. U. S. steel men are paying $9.00 a ton for Itabira's 68.41% ore laid down at the port of Victoria. The price six months ago was only $4.80. (Company officials figure they can more than break even at $6.00.) Despite transport problems, Itabira expects to ship at least 300,000 tons of ore this year, as against 174,000 in 1947. The goal for 1950 is 1.5-million tons. Washington looks for an early end to the Arab-lsraeli war. The hard facts of the military situation make this almost certain. The Arabs are beaten, and they know it. The Israelis want-to quit, too. The fighting has been a heavy drain on their infant economy. The big job is to devise a way of saving face for the Arabs. That is really what the United Nations is trying to do now. Contents copyrighted under the general copyright on the Nov. 13, 1948, issue-- Business Week, 330 W . 42nd S t ,, New York N. Y . busin ess a b r o a d British steel industry's record output doesn't check Labor's plans for . . Steel: Political Nationalization Would remove a political foe, give planners control over 5 0 % of Britain' s capital investment. Also would increase capacity. LONDON--Britain's steel industry has never been a model of efficiency-- at least not since the 19th century. And there's little chance that it will become one under the steel-nationalization leg islation introduced two weeks ago by the Labor government. * Iron & Steel Corp.--The Iron & Steel Bill does no more than turn a privately owned monopoly into a publicly owned monopoly. Ownership of some 107 companies passes from private hands to a public holding company--the Iron & Steel Corp. of Great Britain. Over-all direction of the industry passes from the British Iron & Steel Federation to the new corporation. The bill calls for no reorganization of steel production as such, or of the industry's "uniform delivered price system." The fact is that m nationalizing the steel industry now the Labor govern ment isn't thinking primarily about making the industry more efficient, as it was m the case of coal nationalization. Political Objective--The government's immediate objective is political. It claims that public ownership of steel is essential in'building a socialist democ racy. Private monopolies, such as the BUSINESS W E E K Nov. 13, 1948 present steel industry, wield too much power. Moreover, the government says it has a mandate to carry out steel nationalization, since it was a big plank in Laboi's 1945 election platform. The government also has a broad eco nomic objectn e into which steel fits very nicely--to stabilize the whole econ omy through control of the flow of in vestment. When steel is added to the other nationalized industries (plus hous ing, roads, etc.), the government will control bettei than 50% of the invest ment potential of the country. More Capacity--The one "thing the country mav gam from steel nationaliza tion--in terms of steel alone--is more capacity. The government has set its target for steel a lot higher than the British Iron & Steel Federation has. It wants at least 22-million net tons of capacity before 1960. The industry has refused to set its sights higher than about 19-milhon tons capacity. W hen it comes to these objectives, the government can probably get what it wants by- means of its steel b illassuming Labor wins the next general election. W hat the Bill Does--The bill sets up the Iron & Steel Corp. of Great Britain as the sole shareholder of the 107 larg est British iron and steel firms and their subsidiaries. The private companies re main intact. Thev keep their names, management, directors, and trade-marks. Individual accounts will still be pub lished. But instead of paving dividends to their present shareholders, they will pay them to the new corporation. (Nation alization of steel differs radically from coal, transport, and clectncitv: In these industries private companies were dis solved and welded into an entirely new organization.) The Iron & Steel Corp. has vast pow ers and will undoubtedly supervise the units of the industry much more closely than the British Iron & Steel Federa tion ever has. Tire corporation is sub ject to general direction from the Minister of Supply and is responsible through him to Parliament. But in prac tice it will determine the quantities, prices, and tvpes of virtually all ironand steel produced. It can acquire or form additional companies. Its five to 11 members will be in effect controlling shareholders in all of the nationalized concerns. Big Slice--The government takes over firms that produce: 97 5% of Brit ain's iron ore production; 97.6% of pig iron capacity; 99.5% of steel ingot out put; and 95.6% of rerolling, sheet, plate, and tinplate output. From the subsidiaries of the 107 ear marked companies the government also gets: 45.5% of Britain's total output of heavy forgings; 15-8% of drop forgings; 23% of steel castings; 94.3% of steel 117 LABOR'S STRAUSS will spearhead the steel bill in Commons. On the other side . . . wheels and axles; 67.2% of wrought iron and steel tubes, pipes, and fittings; 60% of hard and mild steel wire; 72.4% of cold-rolled strip; and 40.7% of bright steel bars. Competition--The ' government,' in taking over about 160 subsidiaries of the big firms, will compete with private- en terprise in a wide variety of goods. They range from hand tools, nuts and bolts, ballbearings, and fertilizers to;um brellas, tennis rackets, and safety pins-. The new corporation will also build bridges, quarry limestone, make con crete, and produce sulphuric acid. ' - It is impossible to calculate exactly what percentage of national output-of such goods the corporation wall con trol. But on the basis of the number of workers involved' in each, the cor poration will be producing: 32% of Britain's nuts and 'bolts; 11% of bridges; only 1% of hand tools and cutlery, chemicals, and cement. New Stock--Compensation for the private owners will be paid with British Iron and Steel "stock," guaranteed by the treasury as to both principal and dividends. Each existing shareholder will receive stock equal m value to the stock exchange quotation for the securi ties he is giving up. This will be either the Oct. 1-25, 1948, average or that of the six months just before the 1945 election--whichever is higher. (This op tion is intended to wash out the depress ing effect on stock values) Total issued capital of the 107 pri vate companies is about $780-million. But on tie basis of stock-exchange val ues, some $ 1.2-billion of the new stock will have to be issued. Complaints--These terms for compen sation follow' the pattern used in nation alizing electricity and railways. But steel men complain that they are be ing even more unfairly dealt w'ith than private railway and electricity share holders. On the London .stock exchange it is estimated that the total assets of the 107 companies are worth at least $2-bilhon. And steel shareholders argue that stock exchange quotations do not yet reflect the capital investment by pri vate steel owners during the past three years (since June, 1945, almost $400million has gone into new' steel plant and re-equipment). Investors w'ho hold on to their new' British Iron & Steel stock (which is ne gotiable) will certainly take a heavy cut m income. The ordinary shares of most British iron and steel companies are yielding about 5%. The comparable government stock will pay about 3%. - Opposition--Three forces are getting set for a finish fight against the steel CONSERVATIVE LYTTELTON will fight nationalization on the floor, while . . . bill--the Conservative Party, the Brit ish Iron & Steel Federation, and Aims of Industry, Ltd. (largest British publicrelations outfit). Since Labor has a big majority in Parliament, these groups can't keep the measure from being passed. So they will stake their whole effort on keeping it from being put into effect. This means they w'ill carry steel to the British people as a main election issue in 1950, when they hope to put the Conservative party back into power and repeal the steel bill. The Conservatives begin their battle in Parliament m another ten days or so. W inston Churchill will undoubtedly relish this opportunity to blast Social ism. How'ever, Oliver Lyttelton (a war time Minister of Production) will prob ably carry the burden of the opposition case in the House of Commons. It will be the job of George R. Strauss, Minis ter of Supply, to defend the bill. Delaying Tactics--Delaying tactics will be used by the Tories m the House of Lords to hold up passage as long as possible. Aims of Industry will launch a $400,000 "steel defense campaign" (BW --Oct.2'45,pl08). Apart from the private investors, the British Iron & Steel Federation has the biggest stake m the fight. The B.I.S.F. has run Britain's steel industry with a pretty tight rein since the mid-1930's and is responsible for: (1) a moderniza tion program which got under way about 1935; (2) the monopolistic char acter of the industry. Under the leader ship of Sir Andrew' Duncan, the B.I.S.F. blocked a Labor attempt at nationaliza tion in May, 1946. Retarding Investment--But there is no basis for the charge that has been made by some Labor spokesmen that steel men w'ould sabotage production. It is probable, however, that some of the newer capital investment pro grams w'ill be retarded. Any new invest ment next year would be just so much more private money poured down the drain, unless the government makes special provision for such investment. Today British steel production is run ning at record levels--about 15-million tons a year. But between now and the 1950 elections, some slight fall in pro duction effort and output may result from uncertainties about the future. But the big impact will be felt after the general election if Labor is re turned to power and the act is put into effect. No sure-fire way has been sug gested for training new' top manage ment men, technically competent to run the complex steel industry if the present management refuses to play along. STEEL CH IEF DUNCAN carries the British steel industry's case to the nation 118 BUSINESS WEEK Nov. 13, 1948  '1 the toifi-to1 tal buf . ,P( overseas niessatje $ e t / / f Via R C A (SEND TO) FAST--500,000 TIMES FASTER THAN SOUND-- RADIO WAVES CAN GIRDLE7THE GLOBE IN LESS THAN A SECOND. COMBINE THAT WITH RCa 's DIRECT CIRCUITS TO OVER SIXTY POINTS ABROAD, PLUS RCA's AUTOMATIC TAPE SYSTEM AND YOU HAVE THE MEANS OF SENDING YOUR MESSAGE TO THE FAR CORNERS OF THE earth quickly, accurately, reliably-- i t 's EASY TO SEND AN RCA RADIOGRAM. IN NEW YORK, SAN FRANCISCO AND WASHINGTON, D. C., SIMPLY CALL FOR AN RCA MESSENGER. ELSEWHERE, MESSAGES MAY BE SENT FROM ANY TELEGRAPH OFFICE BUT YOU MUST INDICATE THE ROUTING "VIA RCA". JUST BE SURE TO WRITE IN "VIA RCA" ON THE BLANK- BE MODERN-- RADIO YOUR MESSAGE! ItfiCl R C A r r 1 PRACTICAL BUSINESS MANUALS fo r today's executive V_____ _______ Examine them TO days free 1-- Business Executive's Guide. By J. K. Lasser. 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Tells how to be the meeting chairman and how to get out the attendance; general conduct of a meeting, how to arrange the loom, how to handle usual aids, how to take notes, etc $2.25 M AIL COUPON TODAY McGraw-Hill Book Co., Inc., 330 W. 42nd S t, N.Y.C. 18 Send me books conesponding to numbeis encircled below for ten da vs' examination on approval. In ten days I will lemit cost of the books I keep, plus a few cents postage, and leturn unwanted books postpaid * 123 4 5 67 8 Name Address City Zone........... State. Company Position BW-f M 3-48 * S A V E1 We pay mailing costs if you send cash with Order. Same return privilege. PROMISED LAND? This Italian hopes for a better life in the New World, now th a t . . . Argentina Seeks Immigrants President Peron is trying to attract both new industry and new w o rk e rs, p rin cip a lly from Europe. Purpose: to build Argentina's production; to lessen its dependence on dollar imports. BUENOS AIRES--Last week a 20thcentury 'Mayflower disgorged its pas sengers and cargo on the barren shores of . Tierra del Euego--at the extreme southern tip of Argentina. The passen gers were 600-odd Italian immigrants, .they were fleeing overcrowded Italy in search of a place to work and enough to eat. They were far better equipped than most pioneers. They brought with them prefabricated houses, brick kilns, and the machinery for a paper factory--all made in Italy. They brought their own managers and technicians; their own doctor, dentist, and teachers. They had all the basic needs to build a fairly mod ern community m their bleak new land. Invited--The Europeans came at the express invitation of the Argentine gov ernment. It has hung out "help wanted" signs all over Europe in an effort to bring whole industries as well as skilled and semiskilled labor to the country. Purpose- to put Argentina on the road to self-sufficiency m industry; to elimi nate as much as possible the need for dollar imports. President Peron doesn't think he can make much of a show of power with only 16-million-odd Argentinians. And he can't wait for the normal increase in population to fill the gap. Industry, Too--Argentina has offered European businesses duty-free entry for all machinery and material. It has of fered land grants on which to build new factories. It has deluged the European businessman with publicity--telling him how profits or 100% m Argentina are more common than not; how his wage problems would pale into insignificance in a land where there is plenty to eat. So far, 109 small manufacturing and construction firms have taken the bait. They have brought m about $40-million worth of capital goods and some 25,000 technicians and other skilled workers. Mostly Small--Very few of the immi grant industries are any great shakes. Most are marginal organizations. In cluded are. 27 construction firms, 31 metal-working plants, 12 textile mills, 11 sawmills and woodworking plants, ? paper mills, 5%hemical manufacturing plants. More than half of the concerns are Italian. But, over-all almost every west ern European country and some South American countries are represented. Examples--One Italian firm, Cotosan of Milan, is shipping its factory for washing and processing wool. Another, Luis Mendez y Alberto Riccioti, is ship ping heavy machinery for the m a n u K lC turc of nails and wire. A shipbuilding outfit, Cantieie Navale A. Costagna o Genoa, is sending its entire yard to e set up on th Parana River near Buenos Aires A Belgian firm, SILCA, is niovmg to the Argentine city of Mar del n > 120 BUSINESS W EEK . Nov. 13, 1948 will manufacture fire bricks. ^Brazilian outfit is setting up a com] te silk business--from worm culture fhrou^h the spinning process. A Swedish aperconcern is already building a mill Pj[ich promises to cut Argentina's 1mports of kraft paper. Some critics say that many of these industries are not only small, but also equipped with out-of-date machinery. B u t Argentinians answer that, in the situation they find themselves, any machinery is better than none. immigrants--President Peron's drive to bring individual skilled and semi skilled workers to Argentina has also been paying off. In the first eight months of 1948 more than 83,000 immigrant workers entered the country almost all of them were Italians. Next year the government hopes to bring in close to 20 0 ,0 0 0 . A new immigration treaty was recently signed with Spain; so many Spaniards will be included m this 200,- 000 figure. Most of the Italians were lured with mouth-watering tales of cheap beef steaks (304 a lb. for T-bone) and plenti ful supplies of the indispensable Italian macaroni and wines. But there are more concrete lures: The Argentine govern ment promises to supply shipping space for the immigrants, and shelter on their arrival. And when a worker has settled down he is allowed to send back for his relatives. Productivity Problem--If President Peron thinks these immigrant workers are going to solve all his economic head aches, he may be m for a disappoint ment. In addition to Argentina's labor shortage, there's the problem that Ar gentine workers don't seem particularly interested in working. Peron has showed great solicitude for the Argentine work ers, but his attitude has not paid off in more production. The Argentine worker is making just about twice as much in wages as he did in 1943. But man-hours worked have actually decreased. Reasons: (1) an un believable amount of absenteeism; (2) a ridiculous number of political and re ligious holidays. Workers Loaf--One of Argentina's leading business magazines points with regret to the fact that the workers don't seem to have any great desire to improve their standard of living- President Peron has doubled their wages; so they only Work half time, and get the same in come. Pressure--There is some indication, however, that the government realizes that its policy of protectionism for the workers isn't all it might be. It may not be long before Peron takes official steps :0 bring an end to absenteeism and gen eral malingering. In that case, the new workers and the new industries will be real boon to Argentina. bUSINESS W E E K Nov. 13, 1948 And it will save you mo n e y . . . by releasing men and machines for productive w ork! Workers like the new Whiting Electric Hoist because it makes the handling of back-breaking loads a simple job. You'll like it because it cuts materials-handling; coiits .way down . .. . by min imizing the time highly paid, skilled workers must spend in unproductive lifting . . . by re ducing the amount of time expenSive machines must stand idle. Plant managers report that the Whiting Hoist -- which: handles loads up' t d two tons, 13 times as fast as a hand hoist-- pays for itself in a very few months. It can be. installed by one man, yet is- so rugged it will , stand up under heavy duty. Find out how the_ Whiting Electric Hoist can save money for you. O N E-TO N SIZE COSTS O N LY I f it Saves One M an Only 12 Minutes a Day IT PAYS A PRO FIT/ ELECTRIC HOISTS V*f Vi, 1/ and 2 -Ton Sizes Write for Bulletin H-100A W H IT IN G C O R P O R A T IO N 15661 Lathrop Avenue, Harvey, Illinois Send m e a copy o f your Bulletin H-IOOA describing the new W h itin g Electric Hoist Q Please send me the n am eo f the W hiting distributor in my terri tory w ho can give me immediate delivery on a W hitiag Hoist. N A M E ______________________________________________________________________________________________ STREET ADDRESS _ C IT Y __________________ 121 Product "customer-value" built up with flame hardening THE THEW SHOVEL COMPA m , Lorain, Ohio, wanted to improve the wearability of the sheave throats on Lorain power shovels and cranes, which are located at the upper end of the boom. By so doing, the company felt it would reach the acme of "owner-benefit" in its finished product --the value of a longer lasting part subjected to severe wear. A. B . JSeiman, Airco Technical.Sales Representative, recommended oxyacetylene flame hardening. With this mod ern process; hardening could be local ized to the sheave -throat, without affecting the balance of the sheave's ductility. This was highly important for finished machining. Using a set-up of three Airco No. 4383 torches, with hardening tips especially designed for this job, three sheaves are simultane- ously hardened ,to a predetermined degree that - insures maximum wear- resistant qualities. Since flame hardening was intro duced, the company still has gone further in its efforts to increase the cus tomer-value of its products by expand ing this modern, localized hardening process to include- gears, jaw clutches, and other parts requiring longer "inservice" life. TECHN ICAL SALES SERVICE - AN O THER A IR C O PLUS-VALUE FOR CUSTOM ERS To assure its customers of high efficiency in all applications of the oxyacetylene flame or electric arc, Air Reduction makes available the broad, practical experi ence of its nationwide Technical Sales Division personnel. The collective experi ence and knowledge of these specialists has helped thousands to a more eective use of Airco processes and products. Ask about this Airco "Plus-Value" service today. Write your nearest Airco office. (In Texas: Magnolia Airco Gas Products Company . . . On West Coast: Air Reduction Pacific Company) [AIRCO] A i r R e d u c t i o n Offices in A ll Principal Cities Headquarters for Oxygen, Acetylene and other G a s e s . . . Carbide . . . Gas Welding and Cutting Machines, Apparatus and Supplies . . . Arc Welders, Electrodes and Accessories 122 ECA'S LEDGER Reports From Washington The Netherlands' ban on all U. S. im ports that can't be bought with ECA dollars may stir up a tempest here (BW -N o v .6 '48,pl23). If other Marshall Plan countries follow suit, Congress could have a bunch of angry exporters on its hands the next time the su b let of ECA comes up. ECA has been telling western Euro pean nations to trade as much as pos sible among themselves. It has not al lowed them to use ECA dollars for some "traditional" imports from the U. S.-- automobiles, fountain pens, and count less brand-name consumer goods--lest ECA be accused of wasting the taxpay ers' money. But U. S. manufacturers stand to lose their long-standing European markets. If a manufacturer wants to market non recovery goods in Western Europe,' j chances are he won't find many conn- : tries with the dollars--other than ECA's --to pay for them. Top industrialists touring Europe lately have been speaking bluntly on this score. An executive of the Studebaker Corp.--ECA boss Paul Hoff man's own company--has warned the Dutch Ministry of Economic Affairs: U.S. industry might shift its influence against the Marshall Plan if U. S. mar kets abroad are hurt. And other top in dustrialists are squaring off for a battle with Congress over additional appro priations. ECA's answer: If it weren't for the Marshall Plan, there wouldn't be any western European markets at all--just economic collapse. Other Developments Procurement Authorizations. For the week ended Nov, 6, ECA authorized almost $19 3-million worth of purchases. Primary iron and steel mill products came m for S27.4-million; machinery, $27-million. Included under machinery -e were $ 5.4-million for metalworking ma chinery and machine tools; $ 5-million j for engines, turbines, and electrical equipment; and S4.6-million for con- __ struction and mining equipment. More than 75% of this week's spend ing was for commodities to be delivered in the future. The rest was reimburse ments for purchases made earlier. But | the dav of reimbursement financing un- | cler ECA is almost ovei: Deadline for all requests was last week 1 Investment Guarantees. The StOU- r million that ECA tentatively set aside to cover new-: U. S investments in wes - ; ern Europe hasn't had manv takers. One reason- Undei ECA law, the gua^ n^ e_ money was to be deducted from the -p BUSINESS W EEK . Nov. 13, 1948 billion earmarked for ECA loans; each try in which there's ECA-backed -estment loses that much from its Joan allocation. 'Western European nations don t think that most of the proposed invest ments would give them as much for their dollars as a straight loan. They mwht buy the guarantee idea if it were offered in addition to a given country's total allocation of dollars. R eports From Abroad Allied military authorities in Germany have approved several small investments bv U. S. publishers to be covered by E'CA's guarantee fund. MacFadden Publications International Corp. and Fawcett Publications, Inc.,-were guaran teed conversion of earnings m German currency up to $87,000 for the coming year. This is what the Germans get: 10,000 assorted comic books a month, plus copies of True Confessions, Start ling Detective, True Police Cases, and Movie Story. Moreover, MacFadden in tends to publish a German edition of True Story. Occupation-Generals Clay and Rob ertson approved. They did so because they could find nothing "Nazi or un suitable from a security point of view." Forge-Proof Licenses This printing press at Todd Co., Inc., Roch ester, N. Y., is turning out export license onns designed to foil the cleverest forger. B part of Commerce Dept.'s drive against " Tort racketeers (B W -Ju l.l7 '48,pl08). e Todd process makes export licenses as Safe as banknotes. A surface pattern of dots, arranged in a complex mathematical fornla, is printed on each form. T he formula Was destroyed for secrecy after the printing Pk*es were made. business w eek Nov. 13, 1948 ADVERTISERS IN THIS ISSUE BusinessW eek--November 13, 1948 ACME STEEL CO................................................. 76 MERCURY MANUFACTURING CO....................... 64 Agency--Leo Burnett Co., Inc Agency--O'Gtady-Andersen AIRKEM, INC........................................................... 46 THE MINNEAPOLIS &. ST. LOUIS Agency--Riooke, Smith, French & Doirance, Inc. RAILWAY .................................................... ||2 AIR REDUCTION SALES CO .. 122 Agencv--The Padell Co. Agency--G. M Bastord Co. MISSISSIPPI AGRICULTURAL &, allied structural steel INDUSTRIAL BOARD ............. 100 COMPANIES ....... ... 14 Agency--Dixie Advertisers Agency--The Fensholt Co. MISSISSIPPI COAST COUNCIL....................... 78 AMERICAN AIRLINES, INC ....................... 71 Agency--Dixie Advertisers Agency--Ituthiauff & Ryan, Inc. MORSE CHAIN C O .................................................75 AMERICAN PHOTOCOPY EQUIPMENT CO.. 98 Agency--Brooke, Smith, Fiench . D'oirance, Inc. Agency--Arthur Meyerhoff A Co. AMERICAN SURETY CO. 99 MOSLER SAFE CO 95 Agency--Albert Fiank-Guenthei Law Inc. Agency--AJbeit Frank-Guenthei Law, Inc NATIONAL CASH REGISTER CO AMERICAN TELEPHONE &. TELEGRAPH CO. 5 Agencv--McCann-Ei lckson. Inc Agencv--N W Ayet A- Son. Inc NATI ONAL CITY BANK OF N. Y ........ ANCHOR POST PRODUCTS, INC........................54 Agency--The Albeit Woodley Co Agency--Van Sant, Dugdale & Co. Inc. NATIONAL.STANDARD CO .......... BANK OF THE MANHATTAN CO. . . . 92 Agency--The Gnswolcl-Eshleman Co. Agency--Kenyon & Kckhaidt, Inc. NEENAH PAPER CO............... .......... BANKERS TRUST CO .. .... I Agencv--Kn kgassei -Diew Agency--Cowan & Denglet, Inc NEKOOSA-EDWARDS PAPER C O ............ BOWER ROLLER BEARING CO 2nd Cover Agency--The Cramer-Kiasselt Co Agency--MacManus, John Adams. Inc, NORFOLK & WESTERN RAILWAY C O ... .. 93 BRISTOL BRASS CORP.. 29 Agency--Houck & Co., Adv. Agency--Suthei land-Abbott OHIO ADVERT. DISPLAY....................... THE BROWN-BROCKMEYER CO . 70 THE OHIO CRANKSHAFT CO..................... . . . 31 Agency--Joseph B. Deadv, Adv. Agency--Carr Liggett Adv., Inc BURROUGHS ADDING MACHINE CO. 3 OHIO ELECTRIC & MFG. CO..................... . . . 6 0 Agencv--Campbell-Ewald Co. Agency--Palm & Patterson. Inc CAPPER-HARMON-SLOCUM. INC 103 ORONITE CHEMICAL CO............................ .. 12 Agencv--The Buchen Co. Agency--L C Cole, Adv , CARDINAL CORP.................. .......... 108 - OWENS- CORNI NG FIBERGLAS CORP... Agency--F. H Faber, Adv. Agency--Fuller & Smith & Ross Inc. CHAMBERSBURG ENGINEERING CO.. 52 PACIFIC INTERMOUNTAIN EXPRESS .. . . . 3 9 Agency--Willard G. Myers Adv Agency Agency--Bnsacher, Van Norden & Staff CHRYSLER CORP..................................... 108 FRANK D. PALMER, INC. 77 Agency Doremus <fc Co Agency--Harold Hitchcock Assoc. CHRYSLER CORP., DODGE DlV . T ,, . . . 81 PERMUTIT CO.......................................................... 79 Agency--Ross Roy, Inc. Agencv--Newell-Emmett Co COLD METAL PRODUCTS CO _. ,8 4 PETROLEUM ADVISERS, INC ....................... 65 Agencv--H. M. Klingensmith Co. Agency--Ellington & Co , Inc. COMBUSTION ENGINEERING.CO., IN C .. . 2 PITNEY.BOWES, INC. .. . 57 Agencv--G. M. Basford Co Agencv--L. E McGivena & Co., Inc. COMMERCIAL CONTROLS CORP . 107 PITTSBURGH STEEL CO. ................. 106 Agency--'Hutchins Adv. Co., Inc. ' ' Agency--Bond & Starr. Inc. CONNECTICUT DEVELOPMENT'COMM" ' , 7 4 ' PORTLAND CEMENT ASSOC .. 40 Agencv--Albert Woodley Co . Agency--Roche. Williams & Cleary, Inc. CONTINENTAL CAN CO., INC J v 3rd Cover PRESS-tlTE ENGINEERING CO . 8Q. Agency--Batten, Barton, Durstme & Osbom, Inc Agency--Oakleich R French & Assoc. DICTAPHONE CORP. . . . .................... 67 RADIO CORPORATION OF A M E R IC A ....... 85 Agencv--Young & Rnbicam, Inc Agencv--J Walter Thompson Co DISTILLATION PRODUCTS, INC......................51 RCA COMMUNICATIONS, INC I . . . . . - . . . " . 119 Agency--The Griswold-Eshleman Co. Agencv--Albert Frank-Guenther Law, Inc. DOUGLAS FIR PLYWOOD ASSOC 62-63 THE RAULAND CORP . ; . . . J 91 Agency--The Condon Co., Inc Agencv--George Brodsky, Adv. DRAVO CORP....................... 105 RECORDAR CORPORATION Agencv--Ketchum. MacLeod Grove, Inc (EASTMAN KODAK) JI3 E. I. duPONT de NEMOURS & CO ... 7 Agencv--.1 Walter Thompson Co - 1 Agencv--Batten, Baitnn. Durstme & Osboin. Inc REMINGTON RAND, INC , ........ . 4 DURANT MANUFACTURING CD...................... 101 Agencv--Leeford Adv Agency, Ilici' ; 7 Agencv--Keck-Franke Adv Agencv REVERE COPPER & BRASS, INC___ . . . . . . 90 ELLIOTT ADDRESSING MACHINE CO.......... 58 Agencv--St. Georges & Keyes, Inc!- Agency--Aliev & Richards Co REZNOR MFG. CO . . . . 102 ELMES ENGINEERING WORKS ............... 34 Agencv--Meek & Thomas, Inc Agencv--Erwin, Wasev & Co , Ltd. ROBBINS & MYERS, INC . Iff FARM JOURNAL, INC.......................................... 43 Agency--Erwin, Wasey & Go , LtdJ 1 Agency--Lewis & Gilman ROYAL TYPEWRITER CO.. INC.......................54 FARR CO. : ............................................................... 89 Agency--Young & Rubicam, Inc - - Agencv--Willard G. Gregotv & Co JOS. T. RYERSON & SON, INC ................. . 27 FOOD MACHINERY CORP . 38 Agencv--Aubrey, Moore & Wallace} Inc. Agencv--The McCaitv Co ST. REGIS PAPER CO .. . 37 FORT WAYNE CORRUGATEDPAPER CO 73 Agencv--Robert F Branch, Inc ' ' Agency--Doremus & Co. SCHIFF, TERHUNE & CO., INC 98 FRANKFORT DISTILLERS, I N C ............. 41 Agencv--Bruce Angus Adv Agency Agency--Young & Rubicam, Inc. SHARON STEEL CORP. . . . . . . . 87 FRUEHAUF TRAILER CO .................................49 Agencv--McClure & Wilder, Inc " Agency--Kudner Agency, Inc A. 0. SMITH CORP .......... II GENERAL AMERICAN TRANSPORTATION Agencv--Henri, Hurst & McDonald, Inc. CORP................. 59 L. C. SMITH & CORONA Agency--Weiss & Geller, Inc TYPEWRITERS, INC. . . ............97 GENERAL ELECTRIC CO., CONSTRUCTION Agencv--Newell-Emmett Co MATERIALS DlV ................ 47 SOUTHERN RAILWAY SYSTEM............... 61 Agency-- G M Basford Co Agencv--Newell-Emmett Co GENERAL ELECTRIC CO ................... 86 TIMKEN ROLLER BEARING CO . 4th Cover Agencv--G. M. Bastord Co Agency--Batten, Barton, Durstine & Osborn, Inc. GENERAL ELECTRIC CO., CHEMICAL DEPT. .... 18 TOLEDO SCALE CO .. ..104 Agencv--Benton & Bowles. Inc. Agencv--Beeson-Faller-Reichert. Inc GENERAL MILLS, INC .......................................28 THE TORRINGTON CO. 6 Agencv--Batten, Barton. Durstme & Osbom, Ini'. Agency--Hazard Adv. Co. GLOBE AUTOMATIC SPRINKLER CO., INC 106 UNITED STATES MOTORS CORP........................56 Agency--Marschalk & Pratt Co. Agency--Geer-Muiray Co A. L. HANSEN MANUFACTURING CO........ 110 U. S STEEL CORP. CYCLONE FENCE DlV. 109 Agency--J. M. Haggard, Adv Agencv---Batten, Barton, Durstine & Osbom, Inc. THE HINDE &. DAUCH PAPER C O ............. 50 Agencv--Howard Swink Adv Agency VICTOR ADDING MACHINE CO Agencv--John W Shaw Aclv , Inc, 36 HYSTER CO............................................................... 32 Agencv--Simon & Smith VIRGINIA HOT SPRINGS, INC ' .110 INGERSOLL-RAND CO. .. IL4 Agency--Edward Howard & Co Agency--Beaumont, Ileller & Spelling, Inc. VISUAL PLANNING EQUIP . 122 INTERLAKE CHEMICAL CORP...................... 44 WAGNER ELECTRIC CORP. . . . 53 Agency--The Bavless-Kerr Co. Agency--Arthur R Mogge, Inc. THE INTERNATIONAL NICKEL CO., IN C .., 17 THE F. W. WAKEFIELD BRASS C O . . . . . . . . 68 Agency--'Marschalk & Pratt Co Agencv--Blaco Advertising Agencv KELLER TOOL COMPANY......................... 52 WESTINGHOUSE ELECTRIC CORP ............ 8- Agency--The Fensholt Co. Agency--Fuller & Smith & Ro-.s Ine. P. R. MALLORY &. CO.. INC ............................ 88 WESTINGHOUSE ELECTRIC CORP. Agency--The Aitlun-Kynett Co MANNI NG, MAXWELL & MOORE, INC.46,-10 (LAMP DlV.) .. .. .. 55 Agency--Fuller & Smith & Ro>s Inc. Agencv--Bnggs & Varley, Inc THE MARINE MIDLAND TRUST CO. WHITING CORP. ........ .121 OF N. Y............................................................. 30 Agencv--The Fensholt Co. Agency--Batten, Barton, Duistine & Osborn, Ine WIREBOUND BOX MFG. ASSOC. .. 94 MATHEWS CONVEYER CO............................... .8 2 Agency--Behel & Waldie & Briggs, Inc McGRAW-HILL BOOK CO., INC ............. 120 WORTHINGTON PUMP &, MACHINERY THE MEAD CORP ....................................... 35 CORP....................... .... 69 Agency--Gray & Rogers Agency--James Thomas Chirurg Co 123 THE TREND Congress Can Reinforce U. S. Industrial Strength T he U. S. came out of W orld W a r II holding clear title to the industrial championship of the world. As the champ, this nation so far has not gone soft; on the con trary, it has added to its industrial strength. B ut we m ust not adopt a ho-hum attitude. America's industrial m ight is no t invincible; it can be weakened or hobbled in many ways. And anything th at hinders plant maintenance, replacement, or expansion should be sus pect. O ur No.' 1 candidate for investigation on th at basis is th e depreciation tax policy of the Federal government. This policy was w ritten into law for the same purpose most tax provisions are'drafted: to increase revenues. The law', as now phrased, limits the am ount of tax exemption for depreciation reserves to the am ount of cash necessary to replace the equipm ent at original cost. T h at provision was designed to prevent companies from making exces sive deduction for depreciation to- avoid paying .heavier faxes. - ' 1 T h at theory appears to be satisfactory--even desirable --oh th surface.' I t is hard to argue against any law'w'hich produces:revenues' and puts a: stop :to tax 'evasion. ' B ut a study of that-policy at this tim e and in light of existing conditions does -not sustain, the opinion that the policy is sound. ' 1-l- -J-- Higher Costs Cause Trouble 1 ; - : 1 - Inflation' of prices `Began' during- the -war 'and hascon tinued since. It has h it the'm anufacturer as 'well as the individual consumer. -- B ut the se'k "on th e hose -dealt by inflation is no t all th at th m anufacturer feels.' -He is also h it by thedepreci- ation tax policy. This is wffiat happens: s ' T H e has been writing off his old equipm ent on th e basis of original cost as the law requires. H e follows the gen eral practice of figuring depreciation for tax purposes by the straight line method. This means getting tax exemp tion for equal amounts annually to make up the original cost of the equipment. However, he now finds that today's replacem ent costs are so m uch higher that the money earmarked is not nearly enough to pay for the new equipment. W h a t will happen if the present law stays on the books unchanged? Probably one of two things: (1) A company can take off for depreciation only the am ount allowed for tax purposes. But then it will not have enough money put by to replace existing equipment. In fact, if prices have doubled, it can replace only half of its equipm ent as it wears out. M ultiply th at single example by all the companies of the nation. W h at do you get? T he ability to m aintain all of our productive capacity at present levels is cut in half, (2) A company can step up depreciation funds beyond those allowable for tax purposes. T h a t is being done by a num ber of companies today, t h S. Steel Corp. is a prime example. It has been setting aside extra funds which it would otherwise considei as net earnings. But it is no t getting relief in the w?a) of taxes, because the governm ent still considers those hinds as net earnings; the corporation still is only entitled to credit for depreci ation on the basis of original cost. At the same time, companies following this method are drawing criticism from several directions. Stockhold ers, for example, do not like to see dividends cut or with held to build up depreciation funds. W e plan to discuss that point in a later Trend. What Can be Done? N either of these alternatives are satisfactory. So the wisest course would seem to be a change in th e tax stat- utes. B ut what kind of change? O ne proposal is to provide th at the depreciation tax exemption is to be based on replacem ent costs, not on original costs. It would perm it a company to step up the am ount for depreciation when costs are rising. As an offsetting factor, the company would be required to reduce the depreciation fund when costs are falling. A nother proposal is to provide for more rapid deprecia tion of the cost of new facilities. Instead of being required to write off original cost over the useful life of th e project as determ ined by the government, let the company amortize the cost for tax purposes over a m uch shorter period. T h at is the plan followed during the w;ar in order to get more private investm ent in war facilities. No proposal for changing the depreciation tax policy has won full favor in W ashington. But there is recog n itio n -ev en among New Dealers--of the im pact depreci ation policy has on plant expansion. T he new' Demo cratic Congress should look upon a change in deprecia tion policy not as a sop to business b u t as a boon to national welfare. Some resistance to the change has been shown by taxpolicy framers because revenue will be lost. W e admit that the present high cost of government and the huge public-debt burden m ust be seriously considered before any proposal involving sizable revenue losses are contem plated. But there are other things to take into considera tion: W h a t will be the effect if industry cannot maintain its physical plant and thus provide employment for work ers at high wage levels? W h a t will be the effect on world affairs if the U. S. begins to lose its position as the indus trial leader? Those are serious questions too. They point up the reason why the Joint Congressional Com m ittee on Tax Policy should explore this subject carefully as soon as possible. T hat com m ittee should urge Congress next January to put this vexing problem high on its agenda for consideration and positive action. 124 BUSINESS W EEK Nov. 13, 1948 ' m r TO A FOOD PACKER ffHO IS THINKING ABOUT HIS SUPPLY OF CANS (.4 m em o th a t m an y a fo rw a rd -lo o k in g businessm an w ill fin d worth a minute o f his lim e.) You know that these are difficult times. Uncle Sam is fighting a cold war, and he is in the market for both the raw materials and finished goods needed to build up our defenses. Today's food can shortages may continue. So it is sound business to check your sources of supply right now. See if they should be supplemented to reduce the possibility of your being caught in a spot shortage. We'd like to tell you right here and now that you can't beat Continental Can Company *as a dependable source of supply. We have the manufacturing capacity, the research staff, the sales organization to serve the largest customer. And we have the willingness, the "on-the-toes" spirit it takes to give any processor the finest service possible. We'd welcome an opportunity to sit down with you to see what we can do to supply you with the food cans you need, when and where you want them. `' f t * | CANS SAVE = SHIPPING COSTS/. ^ O N T lJ S fE J s ix *MA* S OF; T in r 100 East 42ad Street C o n ta in . A ^ Luho8rnDh , Yrk 17, jv. ^ 4 Cai:pstaalnCdocnt^a^v rof j : b: ef n'Urns c o m pa n y D<xoware . Cntainere <&, / A way for "fat" men to beat the heat COM PAN Y that distills anim al fats for soap m anufacturers was having trouble w ith its superheater c o il--a w inding section o f steel tubing in w hich steam is superheated to a blistering 1200F. Continuous opera tion at this reel h o t tem perature weakened the steel. T oo-fiequent replacements were necessary and valuable hours of production time were being lost. Learning of the problem , metallurgists of T h e Tim ken Rollei Bearing Company sug gested that the coil be m ade out of Sicrom o # 5 -- a special analysis Tim ken high tem perature steel. So w hile the m anufacturer was having a new furnace installed he decided to p u t in a new Sicrom o coil, too. T h e results vveie amazing. W here the steel form erly used had to be replaced every year, the Sicromo tubing sto o d up u n d e r the terrific heat fo r seven years before replacem ent was necessary. Valuable pioduction time was saved. And less m oney was spent fur tu b in g --thanks to T im k e n 's ability to specify the high temp e ratu ie steel that dehveis the best life/cost ratio for each particular application. As specialists in fine alloy steels, the Tim ken Company ofleis a com bination of reseaich a n d experience that is uniq u e in' the industry. T h a t's why you'll find so m any tough steel problem s stamped: "S o lv ed --by T im ken Alloy Steel" . It s a record no other alloy steel produce! has equalled! W e'd like a chance to consult w ith you on your steel problems, too. W rite T he Tim ken R oller bearing Company, Steel and' T ube D ivision, Canton 6, O hio. Cable address: "T IM ROSCO'k iap ered Roller Bearings, Alloy Steels and Seamless T ubing, Removable Rock Bits. C O PR . 1943 T H E TI M K EN R O L L E R BEARIN G C O M PA N Y F in e Alloy STEEL and Seam less Tubes