The Iron Age 1924-05-08: Vol 113 Iss 19

ESTABLISHED 1855 THE IRON AGE New York, May 8, 1924 VOL. 113, No. 19 a Increasing Production by Good Lighting One-Eighth More Pieces Inspected Per Man-Hour When [ilumination Is Brought Up to Requirements BY FRED L. PRENTISS lumbus, Ohio, plant of the Timken Roller Bear- ing Co. in an effort to establish the relationship between illumination and production in the inspection department. During the test period, lasting for ten weeks, 7,313,323 pieces were inspected and interesting data were secured that seem to prove that, for this class of work, production was materially increased by a well-designed system of illumination and these showed that production increased with each increase in illumi- nation. With the maximum illumination used in the tests the production increase was 12.35 per cent and the total cost of lighting was less than 2.5 per cent of the payroll. The tests were conducted in the green inspection department, where cups in various sizes, cones and threaded cones used in making roller bearings are in- spected after leaving automatic screw machines and before heat treatment. The work is carried on by three groups of inspectors. The first group gages the mate- rial for diameter and depth. The second inspects for defects such as chatter, tool marks, ingot breaks, thin ribs and bad chamfer. The third group inspects for imperfections on the tread on the inside of the cones, bad milling and chamfering operations and inadequate burnishing. Some of the work, such as the inspection of threaded cones, ingot breaks and chatter marks re- quires close visual inspection, while in some of the gaging which is done by indicating and limit gages relatively little is required of the eyes. | |Y taba, Ob tests were recently made at the Co- RINNE Nde hens MANE NNRN UNG THHNLE LH atOEDOGeENCOTUNEED TONED UOARELELUGEALIOUECUEOLEDL Aa eeLoNeunts DeMCaENEonOeRr RIOET UAHiaee The personnel of the department at the time of the tests consisted of an average number of 44 inspectors, the number varying slightly each week. The green inspection department occupies a space approximately 30 x 60 ft. in a large sawtoothed roof type factory building. At the beginning of the test the lighting system in this department had six outlets, four of which were equipped with 200-watt clear lamps and two with 150- watt lamps. The six lamps had enameled steel reflec- tors and gave an average illumination of about 2 foot- candles. The distribution of light, however, due to wide and irregular spacing of units, was uneven and caused bad shadows. The department is so located that it re- ceives daylight from windows at a distance on one side and from skylights in-the sawtooth roof. During the greater portion of the first two weeks of the test the lighting system as above described was supple- mental to the natural daylight. The resulting average illumination in the test session for this period was ap- proximately 5 foot-candles. The new lighting system consisted of 28 Glassteel diffusers located on 8 x 10 ft. centers and mounted 12 ft. from the floor. This type of lighting unit has a globe that incloses the lamp, producing an even distri- bution of light with soft shadows and a noticeable absence of objectionable specular reflections. To main- tain the levels of illumination as uniform as possible, the skylights of the sawtooth roof were blackened dur- ing the tests made with the improved artificia] illumi- TO Tn ea ee 400 PERSLCCCTC CEE REECE Fig. 1 — Improve- ttt tt AVERAGE PIECES INSPECTED ae person pee Hove. esaae ment in Output CPT eee ee Followed Each PEE EEE eee 20 Addition to the TriLiIiiari it LL LE Bee Be 2 eee Effectiveness of the TTT Trey ee Lighting and the ea BEE EE EEE 5 Gain Was General, PTT Tyr eet the Diagram Show- PCC eee ee ing the Average ia FEEEEEEEEEEEEEEEEEEEEEEEECEEEEE Nee atta for Saree al Pr ee et eee s spection Force BSRARBRHKIAR BH LS eee eee eee TT TTL [AVERAGE FOOT-CANDOLES OF ILLUMINATION Seaeaee CITT Pp nee 3 8 é z : s 3 4 : GQ e E 5 3 z 3 SCOPE PO TENLN “HI HOTS: AREER TOPORPTTOROEEED, SORT. “CR CCOPTEROD CFI? Manet CoN MENON NCC Sel ee Tate an: ‘ * RR nla? eevee ps 3 oS - x‘ on) em oes 7, ETON r ee ee ee ee ee en eee Oe ee eee Se a SREY ss TS RS — eee SEY CPR QR RM Se FP peeenstees 2 ae filha in AS ARI : o a ma aeRO as — 9 — 2 , Grid behe . EA NS LS AM - es POR Qerrere ie ce S— 2 se: a ani: “9 0 = sry tag a oa: Peat nee ’ a - el Siig gor eS a ae Ou - . - er eee Ip 8 8 ge me nee fangs cr ~» =e PS siT id een are PE oF EE See SS sk aie Fame oar ee * 2 " Ree eerie tare? ee aa) 1344 THE IRON AGE nation. The tests included taking production records with the use of the old system and with 6, 13 and 20 foot-candle systems and the ten weeks was divided into ten test periods. The table shows the total number of pieces inspected, the total inspection hours and the average number of pieces inspected per person per hour, during each of the ten weeks of the test. Each line represents one week. Average Pieces Total Total Inspected Foot- Pieces Inspec- Per Person Candles Inspected tion Hours Per Hour 5.0 (Old System) 684,164 1,644 415 5.0 (Old System) 581,709 1,449 400 20.0 (New System) 681,621 1,476 462 12.8 ( New System) 708,559 1,620 437 5.7 (New System) 739,627 1,778 415 11.9 (New System) 735,316 1,698 432 20.2 (New System) 763,762 1,737 440 6.2 (New System) 809,631 1,866 434 20.2 (New System) 842,138 1,783 472 13.5 (New Systém) 766,796 1,700 451 5.0 Fe (old lighting) 6.0 Fe (new lighting) 13.0 Fe (new lighting) 20.0 Fe (new ligh ting) FOOTCANDLES | INCREASED ILLUMINATION PRODUCTION oO 5 10 15 50 fe old lighting) } 6.0Fe(new lighting) F 4.0% [30 new lighting UMMM 8.0% 200fe (new lighting) 12.3% The increase in the average production as well as the percentage of increase are shown below. Average Pieces Inspected Increase Per Person Per Hour Per Cent 20.0 Foot-Candles 458 12.3 13.0 Foot-Candles 440 8.0 6.0 Foot-Candles 424 4.0 5.0 (Old) 408 These tests were the subject of a paper on “The Relation of Illumination to Production,” presented be- fore the last annual convention of the Illuminating En- gineering Society by D. P. Hess, manager of the Colum- bus plant of the Timken Roller Bearing Co. and Ward Harrison, illuminating engineer of the National Lamp Works of the General Electric Co., Cleveland. The authors of this paper, from which the information re- garding the tests is gleaned, state in conclusion: “The tests furnish apparently conclusive proof that, for the class of work carried on in the green inspection department, the production is materially affected by the character of illumination supplied. It will be noted ‘hat a well-designed system of illumination, giving ap- proximately 6 foot-candles with a minimum of glare and objectionable specular reflection, results in an in- crease of 4 per cent in production over that obtained under a faulty system which gave about the same aver- age foot-candles. Likewise, an increase in illumination from 6 foot-candles to 13 foot-candles with a well- designed system results in a further 4 per cent increase in production. Increasing the illumination from 13 foot-candles to 20 foot-candles results in an additional 4.3 per cent increase, or, comparing the 20 foot-candle system with the one originally in use, a 12.3 per cent increase in production is found. May 8, 1924 “The current consumed with the 20 foot-candle svc. tem amounts to 8.4 kw., which, at a rate of 3c. per kwhr., results in a cost of 25c. per hour for current, to which should be added approximately 7c. for lamp renewals and other charges, making a total cost of 3c. per hour. With the old 5 foot-candle lighting system, about half of which was daylight, the cost for current and lamp renewals was 4c. per hour. The inspectors receive an average wage rate of approximately 30c. per hour or, for 44 people, a total of $13.20 per hour. A 12.5 per cent increase in production means, therefore. a saving of $1.47 per hov« 1n labor, which is nearvy five times the added cost of the lighting. To put the matter in another way, the new lighting increased the produc- tion 12.3 per cent at a cost of less than 2.5 per cent of the payroll.” The results of the test are shown graphically in the accompanying charts. Fig. 1 shows the weekly rate UL Fig. 2—(Left) Average Pro- duction Under Each Light- ing System and Intensity Fig. 3— (Lower Left) Per- centage Increase in Produc- tion Over the Old Lighting AQAA System, Showing How the Increase Develops with Greater Intensity of Light 440 Fig. 4— (Below) Cost of Light in Percentage of Pay- roll Showing That the Highest Type, Producing One- AS©& ‘ ae ~- One Portisth of wae Payroll 5 10 15 50 Footcandles Helf Daylight 03% 60 footcandles 08% [30 footcandles 1.6% 20.0 fookcandles 24% of production for the entire period and indicates how production increased with the increase in illumination. Fig. 2 shows average production under each lighting system. Fig. 3 shows the percentage of increase in the production and Fig. 4, the cost of light in percentage to the payroll. In an effort to obtain data as to whether atmos- pheric conditions materially affect the output of factory worker, wet and dry bulb thermometer readings were taken four times a day and from these the relative humidity was calculated. The daily weather bureau record showing the per cent of sunshine, exterior tem perature and amount of precipitation was also tabu- lated. As the tests were made during the winter season when heat was necessary, both the interior temperature and the humidity were fairly constant. There was con- siderable variation in the proportion of sunshine in the successive weeks, but this variation apparently did not influence production. In March, Mattie blast furnace at Girard, Ohio, A. M. Byers Co., ordered out of blast last week, es- tablished a production record for a hand-filled stack in turning out 14,783.9 tons of pig iron, for a daily average of 476.9 tons. During this period, the largest production for a single day was 511 tons. The coke consumption averaged 1918 Ib. per ton of metal, while 250 tons of scrap were used. All iron produced during the month was cast in sand and only one off-cast was recorded. The furnace is 85 ft. high, hearth 15 ft. in diameter and the stock line 65 ft. Pittsburgh Basing Is Strongly Denounced Examiner Bennett’s Report Calls Custom an Artificial Practice in Violation of Economic Law and Not Compatible with Free Competition— Denies Chicago District Is Center of Underproduction HE Pittsburgh basing point practice,was not the result of the law of supply and demand functioning in a free, competitive market, but was a practice adopted as part of the sales policy of the United States Steel Corporation because it was to its best immediate business advantage to do so. This epitomizes the find- ings of Trial Examiner J. W. Bennett, in a comprehen- sive report recently submitted by him to the Federal Trade Commission. This document, comprising 302 single-spaced type-written pages, besides 43 pages of addenda, deals only with the facts of the case and gives no opinion as to whether any statute has been violated. In dealing with the economic phases of the case the examiner first carefully defined economic terms and economic facts necessary to a full understanding of the charges in the complaint and the allegations in the answer. On this basis he concluded that Pittsburgh plus was an artificial practice inhibiting free and un- hampered competition. In his opinion, the contention that the Chicago district is a center of underproduction favoring the natural development of higher prices than at Pittsburgh, a point of surplus output, is not sub- stantiated by the facts. Large quantities of steel have been shipped from Chicago to points east and the largest market for finished steel is still east of the Chicago mills. Price exhibits, in the examiner’s opinion, establish a close adherence to the Pittsburgh plus practice by Chicago producers as well as other mills Economic Definition of a | defining economic terms necessary to understanding the issues of the case, the examiner said, in part: “Any truly competitive market price of any com- modity is substantially uniform and nondiscriminatory at the point of sale, which, for a manufactured article (economically speaking) is always the point of pro- duction and shipment unless the product is transported physically to another location and there sold. Dump- ing and the discriminatory prices involved are economic indications of the failure or hampering of free com- petition. -Free competition and discriminatory prices are incompatible. Discriminatory prices attempt to meet competition at one point by evading competition at others. Higher prices maintained in a restricted sales territory about a market or center of production, while lower prices are made in outside territory, are monopolistic prices intended to get all the traffic will bear after competition has been declined. “A monopolistic market (economically speaking) is a market in which the factors of free competition are not fully functioning. Any agreement of minds of traders that leads them to maintain prices rather than to compete interferes with competition. Uniform delivered prices are not uniform market prices in the economic sense, where the points of destination are at different distances freightwise from the points of ship- ment. “Fixed and uniform price differences between markets or between producers indicate controlled markets. Slight or irregular variations lacking in fixedness or uniformity are not such an indication of controlled markets. 1345 and the evidence indicates that this adherence was first dictated by associations, agreements, pools and under- standings and latterly by the immediate business ad- vantage to the independents or their fear of punitive measures. Artificial methods of establishing prices dating back as far as 1873 are covered in considerable detail. Frequent references are made to the Gary dinners, and the methods supposedly resorted to since the abandonment of those meetings are also outlined. Separate sections of the report are devoted to a review of the testimony of consumers of bars, plates, structural shapes, sheets and wire products to show that the Pittsburgh basing point practice lessened competition and discriminated between different pur chasers from the United States Steel Corporation. The examiner adds, however, that evidence in the case fails to indicate a systematic application of the Pittsburgh plus practice to billets, wire rods, sh bars, angle bars, tie plates, car wheels, spikes, forgings, armor plate and steel piling, nor methods of selling such products which substantially lessen competition in their sale in interstate commerce. With reference to tubular goods, he states that the evidence fails to demonstrate that such products are made in the Chicago or Birming- ham districts in sufficient volume to supply the con- sumption in those territories, nor to show specifically that the Pittsburgh plus practice, in the circumstance, has substantially lessened competition in those products. Truly Competitive Market “In an industry like the steel industry it is im- probable that perfect uniformity of mill base prices of all producers in a market would result, since no steel market has the perfection in this respect of a speculative exchange market. It is certain, however, that when prices of any given producer to his own cus- tomers vary materially, f.o.b. mill, there are not con- ditions of full and free competition. “Tt must be fixed firmly in the mind in drawing economic conclusions in this proceeding, that the uni- form price which free competition tends to make is the f.o.b. realization price of the sellers, but evidence in this proceeding shows that when rolled steel was being sold in accordance with the Pittsburgh plus practice, prices of producers outside the Pittsburgh district, reckoned f.o.b. realization, varied widely, depending upon the location of the producer and of the buyer, while each producer reached any certain cus- tomer at a uniform price. This is a double indication that the practice was not compatible with free com- petition.” Dumping Denotes Failure of Free Competition The alleged failure of Chicago producers to sell in unhampered competition is touched upon as follows: “Instead of decreasing base prices in Chicago and meeting the requirements of the territory tributary to Chicago by location, the Chicago producers, when pric- ing and selling rolled steel in accordance with the Pitts- burgh plus system, have kept up their prices in the immediate territory and adopted the practice of dump- ing to get rid of their surplus production.” EE Na ll 2 oe = ai os =r et, ete > . ede NT ee eit nee cae mee a Pao rie A eo wees ratte ee ; ‘ rs ae ae OS eee a ea F 1346 THE IRON AGE Defenders of the Pittshurgh basing point practice as applied to Chicago mills have urged that it was the natural economic consequence of underproduction in May 8, 1924 the Chicago district. The examiner in his report takes the opposite view and cites the fact of a surplus pro- duction there. He says, in part: Surplus of Rolled Products in Chicago District gy. all times since 1910, except at short intervals of peak demand, when rolled steel was sold in ac- cordance with the Pittsburgh plus practice, there has been a surplus of rolled steel produced in the Chicago district at prevailing prices for delivery from plants in the Chicago district. What territory might be supplied by steel producing plants in the Chicago industrial dis- trict running to full capacity under full and free com- petitive conditions, or what might be the demand for steel from such plants under full and free competitive conditions, has not been determined by the evidence offered in this proceeding. Whatever the conditions may have been as to Chicago district production or demand, the Pittsburgh plus practice of pricing and selling rolled steel was an important factor in bringing it about. Such Pittsburgh plus practice prevented full development of the steel industry in the Chicago dis- trict, but to what extent it prevented such development cannot be accurately determined by the evidence in this proceeding. The same is true of the Birmingham in- dustrial district, the Cleveland industrial district, and the Buffalo aoe district. “The Birnfmgham industrial or producing center has been hampered in all the years of its existence as a producing center of rolled steel except in times of peak demand, by reason of difficulty of finding an adequate market for steel products there produced. “Assuming that there was free and full competition in the rolled steel producing industry for the past several years, evidence in this proceeding does not show that there was a shortage of steel production to meet demands in Chicago and Western territory as com- pared with Pittsburgh territory at the times that rolled steel was being sold by Chicago producers in accordance with the Pittsburgh plus practice. Sellers’ markets due to surplus demand occurred in but few of the 15 to 20 years that the Pittsburgh plus practice was followed in the West in the sale of plates, shapes and bars and of the 20 to 23 years that the practice has been followed on wire and wire goods, sheets and light plates. Gen- erally there was surplus capacity, if not production, in the Chicago district at the times when rolled steel was being sold in accordance with the Pittsburgh plus practice. ‘ “Chicago and Western mills so designated by re- spondents shipped into Eastern territory as designated by respondents, 583,604 tons of rolled steel in the high- demand year of 1920. According to uncontradicted testimony of economists, that indicated a surplus in the Chicago district at the prices then prevailing, so far as that steel was sold in accordance with. the Pittsburgh plus practice, and so indicated a lack of free competi- tion in the steel industry. “In submitting the supply and demand statistics, respondent assumes that the steel produced in the East- ern district as delimited by them, is produced in Pitts- burgh. Otherwise, while it might serve to cause Chicago prices different from the Chicago f.o.b. mill prices, it could not serve to cause Pittsburgh plus prices. As a matter of fact, less than one-fourth of the rolled steel of the country is produced in Allegheny County, and the major fraction of the Eastern steel is distributed among points as distant as Cleveland, Columbus, Wheeling, Buffalo, Philadelphia, Bethlehem, Youngs- town and Birmingham, “Western producers have been kept out of the best sales territory, for the largest demand for primary rolled steel products is still in the East. In fact, rolled steel consumption probably amounting to one-half of that of the entire country takes place east of a north- and-south line coinciding with the Ohio-Pennsylvania boundary, but respondents, in Exhibits 491 and 494, are silent upon this point, as they are on shipments to Eastern territory except from Chicago and the West. “Testimony in the case tends to show that in years of great demand all steel producing points are over- loaded with business and all are behind in their de- liveries. It is doubtful if Chicago producers are more behind with their deliveries than are Pittsburgh pro- ducers at such times. Chicago Would Be Quantity Production Center Under Free 6é(‘NARY, IND., is admittedly the surplus production point of the corporation mills upon blue annealed sheets, and from that point is supplied much of the trade of the corporation in such product further east. This has not led to the abandonment of the Pittsburgh plus practice in the sale of blue annealed sheets. In fact, there seems to have been no real connection be- tween surplus production or surplus capacity or the lack of it and the functioning of the Pittsburgh plus practice. “It goes without saying that the Pittsburgh plus practice was not followed so strictly in times of slack demand as it was in prosperous years, but this is notoriously the history of any device tending to a lessening of competition or a uniformity of prices.” Testimony as to comparative costs of Steel Corpora- tion plants in various districts is reviewed by the exam- iner. He concludes that under free competition Chicago would become the quantity production center for the country. He asserts, in part: “Chicago could sell most of the products if it in- dulged in price competition with Pittsburgh as far east as Pittsburgh and still make the same profit that Pitts- burgh would make. In some cases, it could, upon a strictly price competitive basis, drive Pittsburgh out of all markets in the country. Evidence in the record indicates that this condition lasted for years. Under free competition Chicago would in the long run become Competition the quantity production center for the country in com- petition with Pittsburgh. “Producers were not on the same competitive basis. Pittsburgh producers had a country-wide sales terri- tory, while producers outside Pittsburgh had restricted territories. Charges Discrimination as Between Purchasers “Purchasers were not treated alike. Purchasers from Pittsburgh were systematically given lower prices than purchasers elsewhere, no matter what point fur- nished the product. “Purchasers from the same producer outside Pitts- burgh were compelled to pay different prices for their goods. “Prices at Chicago were not reduced toward the cost level. Purchasers served by the lowest-cost plants paid the highest prices for the goods bought. “Dumping and discriminatory prices were resorted to outside Pittsburgh as soon as surplus developed at any outside production point. “Purchasers were not given the benefit of low pro- duction costs, which from the standpoint of public in- terest is the chief function of price competition. — “Uncontradicted evidence shows that fabricator purchasers served by Chicago producers have their sales territory curtailed seriously when rolled steel is sold by producers in accordance with the Pittsburgh May 8, 1924 plus practice, and that fabricator purchasers served by Pittsburgh and Eastern producers at such times have free access to all territory in the United States upon practically the same price basis as the Chicago and Western fabricators. Such curtailing of such fabrica- tors’ sales territory has reduced their demand for rolled steel raw material and has tended to prevent the development of the steel industry in the section in which Western fabricators are doing business. Such lack of development, and this is considered a fact thoroughly established by the evidence in this case, is due in a measure at least to the sale of rolled steel in THE IRON AGE 1347 accordance with the Pittsburgh plus practice. It could not therefore be a justification for the Pittsburgh plus practice, since the Pittsburgh plus practice is a factor which has effected a curtailing of competition and a preventing of such industrial development as might have occurred under free competitive conditions. It is therefore a sales practice inimical to publie policy. “For these and other reasons disclosed in the record, the examiner has concluded that to the extent that steel has been sold in accordance with the Pittsburgh plus practice there was no free competition in rolled steel and no price competition at all. How and Why Pittsburgh Plus Was Adhered To (Oe Pittsburgh plus practice was not the result of the law of supply and demand functioning in a free, competitive market, but was a practice adopted as part of the sales policy of respondent corporations and in accordance with the best immediate business advan- tages of such respondents. “Between 1899 and 1904 it was adopted as a con- stituent element of price-fixing understandings or agreements among producers, to which understandings or agreements respondent corporations were parties. “When the Pittsburgh plus practice was adopted respondent corporations dominated the steel industry even to a greater extent than at the present time. “They dominated the steel industry in the Pitts- burgh industrial district to a greater degree than else- where. “When respondent corporations produced about 73 per cent of the steel in the Pittsburgh industrial dis- trict, a practice which was to the advantage of steel producers in such district was to the advantage of re- spondent corporations. The Pittsburgh plus practice was of advantage to Pittsburgh steel producers and to wespondent corporations. “Respondent corporations dominated the steel in- dustry in the Pittsburgh district from a production standpoint. Pittsburgh district dominated the steel industry in the United States from a production stand- point between the years 1901 and 1904. The Pittsburgh plus practice had a capacity and tendency to perpetuate that condition. “The Pittsburgh plus practice also had a capacity and tendency to cause the Pittsburgh industrial district to dominate the steel industry from.a merchandising standpoint. The Pittsburgh plus practice had a capacity and tendency to aid respondent corporations to dom- inate the steel industry from a merchandising stand- point and to extend the sales policy of respondent corporations to the rolled steel industry in the entire country. It also tended to prevent the activities of in- dependent producers from interfering with or termi- nating that dominance or that policy. “After the lapsing of the Gary dinners, the Pitts- burgh plus practice was observed as a practice by re- spondent corporations, who were in this respect gen- erally followed by other producers. “Other producers had knowledge of respondent corporations’ prices and of the fact that they were scell- ing in accordance with the Pittsburgh plus practice. Such knowledge had the capacity and tendency to take the place of specific price understandings and to bring about uniformity in quoted and delivered prices, and to curtail price competition. “Producers independent of respondent corporatiens knew of respondent corporations’ prices and whether they were selling in accordance with the Pittsburgh plus practice, and they generally followed these prices. Pittsburgh Plus Advantageous to Pittsburgh Independents ¢¢TT was to the business advantage of Pittsburgh pro- ducers to follow the prices of respondent corpora- tions and not interfere with the Pittsburgh plus prac- tice. It gave them a sales territory coextensive with the United States and protected Pittsburgh producers from price competition in territory contiguous to Pittsburgh, on an equal footing with producers outside the Pittsburgh industrial district. “Departure from the practice by rolled steel pro- ducers independent of respondent corporations placed such Pittsburgh producers at a disadvantage in price competition, not only with independent producers with plants at production centers outside the Pittsburgh in- dustrial district, but also with respondent corporations which had plants at these centers. Respondent corpora- tions had branch plants at production centers other than Pittsburgh, while other Pittsburgh producers had not, and abandonment of the Pittsburgh plus practice tended to shut Pittsburgh industrial district inde- pendent producers out of the sales territories con- tiguous to other production centers which they reached on an equality when the Pittsburgh plus practice was followed. Such conditions resulted in the practice gen- erally being followed by respondent corporations as well as by rolled steel producers in the Pittsburgh in- dustrial district independent of respondent corpora- tions. “Respondent corporations’ plants in producing centers other than Pittsburgh were usually dominant in these production centers, or at least the largest single interest in the center, as in the case of Chicago, on plates, shapes, bars, wire, sheets, etc., and in the case of Birmingham, on such rolled steel materials as were produced in that district, and in the Cleveland production center, on all steel wire and wire products. “No producers independent of respondent corpora- tions had in such production centers outside the Pitts- burgh district the natural advantage of location against respondent corporations that they had against producers with plants in the Pittsburgh industrial dis- trict only. Against the latter the freight charge from Pittsburgh to the other production center, such as Chi- cago or Cleveland, gave such protection as permitted a Chicago producer to build up a local business against Pittsburgh if his selling costs (costs of placing the product already sold f.o.b. car Chicago) were approxi- mately equal with Pittsburgh competitors’ or even more than those of Pittsburgh competitors if still not in excess of the Pittsburgh cost plus the freight charge. “Respondent corporations’ plants at Chicago, how- ever, had all the advantages which the Chicago loca- tion gave to independent plants in price competition. The same was true of other producing centers where respondent corporations had such plants. “In addition, there was a conviction among inde- pendent producers in Chicago and Birmingham, at least, and probably elsewhere, that respondent corpora- tions, with their more complete integration and other advantages, were the low-cost producers in these centers, and on a basis of price competition eould and would drive independent local competitors from busi- ness, at least in standard lines or quantity production. This conviction was held also by officers of respondent corporations and expressed publicly at times. It was also made known by such officers that respondent cor- porations would punish price cutters and on some oc- casions respondent corporations actually did so, in co- operation with other producers who were not involved. ~ ent ire Romaine etna ar - woe Pe eet Le CTT TREE UE Te pen oy Se ~ au Te ie : ee “s a i a et a a Ne ee ‘ r Bala co . bia i —_ baie ta gO 5 ss — ts, oy ~— - abies ’ , eat _— “ * sah tLe See ne fecllias ekOTES ee ak Saini : . * aii aie Sa Mare Gata cat ~ me ng ig ee eee 2 a hagn Sampras sso Prbenws £o 1348 THE IRON AGE “Producers of rolled steel independent of respondent corporations located east of Chicago but west of Pitts- burgh, in such centers as Youngstown, Wheeling, Cleveland and Columbus, were given by the Pittsburgh plus practice a protection like in kind to the protection given the steel producers in the Pittsburgh industrial district independent of respondent corporations, but less in degree, when competing with all plants further to the West, such as Chicago or St. Louis or Indiana or Wisconsin plants. It also gave producers of rolled steel products independent of respondent corporations with plants near Pittsburgh but to the east thereof, such as at Johnstown, Pa., an advantage similar to the plants at Pittsburgh in competing with plants of such pro- ducers farther east, such as at Bethlehem or Phila- de] phia. “This situation made it to the immediate business advantage of independent producers to accept the pro- tection against price competition offered by respondent corporations in their adherence to the Pittsburgh plus practice. Outside the Pittsburgh District “Producers outside the Pittsburgh industrial dis- trict independent of respondent corporations did adopt and adhere to the Pittsburgh plus practice and did follow prices of respondent corporations, as a general rule, probably on 90 per cent or more of the products sold in accordance with the Pittsburgh plus practice. “In following the Pittsburgh plus practice, prices of respondent corporations were regarded as minimum prices, and there was no objection voiced to any pro- ducer’s getting higher prices for his products. Getting May 8, 1924 prices above the market prices announced by re. spondent corporations was not a departure from Pittsburgh plus practice. “Respondent corporations were regarded as the quantity producers in their several fields of manufac. ture. They produced, as a rule, standard materials an avoided specialties requiring exceptional skill or care. While such specialties were produced at plants of re- spondent corporations, such corporations were not re garded in the trade as specialty producers. “The Pittsburgh plus practice applied to standard products rather than to specialties. Independent pro- ducers in many producing centers gave their attention more largely to specialties, as for instance, Worth Brothers and Lukens on locomotive steel, and Bethle- hem on special sections. “Even when a base price related back to standard material the specialty commanded higher prices. Spe- cialty producers had clients of their own; selling them at higher prices in no way interfered with the Pitts- burgh plus practice on standard materials. “As quantity producers respondent corporations carried big tannages of unfilled orders, which, since 1902, had not fallen below 2,674,757 gross tons, and had been as high as 11,711,644 gross tons. “Respondent corporations have ‘not sought premium sales nor quick deliveries. Purchasers from them have been obliged, except in dull periods, to take materials from respondent corporations at the convenience of such corporations. While definite deliveries have been made, it has been at periods when they did not inter- fere with the regular working program of respondent corporations’ plants. he Premium Sales Do Not Disturb Plus System ¢¢—FRODUCERS indenendent of respondent corpora- tions, especially small producers, sought premium sales and premium deliveries, without disturbing the Pittsburgh plus practice or stimulating competition in prices with respondent corporations. “Many of the variations in prices in the more prosper- ous years of the steel industry, or the years when de- mand was greatest, indicated premium prices on tonnage the Steel Corporation could not handle. This was ton- nage upon which deliveries were important to the pur- chasers, and to get deliveries within the times which might suit the customers they were obliged to buy from others than respondent corporations and to pay pre- mium prices. There were times when respondent cor- porations were out of the market except for deliveries at mill convenience. “All these conditions and all these factors had the capacity and tendency to extend, support and perpetu- ate the Pittsburgh plus practice of pricing and selling rolled steel products. Up to July, 1921, with minor ex- ceptions, they had been of sufficient potency to main- tain the practice as to the sale of plates, shapes and bars, and they have been of sufficient potency up to the present time to maintain the practice in the sale of sheets, light plates, tin plate, black plate for tinning, wire and wire rods.” Ninety Per Cent of Steel Sold According to Pittsburgh Plus Adherence to the Pittsburgh plus practice by mills both inside and outside of the Pittsburgh district is substantially demonstrated, in the opinion of the ex- aminer, by exhibits introduced in the testimony. He goes to great length to explain his reasons for accepting the Trade Commission’s analyses of these exhibits rather than those of the respondent. With reference to the universality of the practice, he says: “For 20 years prior to July, 1921, with relatively minor exceptions in the years 1909, 1911, 1912 and in war times, rolled steel plates, shapes, bars, wire and wire products, sheets, light plates, tin plate and black plates for tinning to the extent of about 90 per cent of the entire volume sold, were sold by respondents and other rolled steel producers in the United States in accordance with the Pittsburgh plus practice. To a minor percentage of sales of such products during this 20-year period the Pittsburgh plus practice was note applied; it was not applied, probably, to less than 10 per cent of such sales, and where it was applied it was not applied 100 per cent in every case; that is, there were variations of 5c. per 100 Ib. or less in the Pitts- burgh base prices upon which the Pittsburgh plus base prices were built up, in 25 per cent or less of such cases. To the extent of these exceptional variations only was there any price competition whatever between producers in the sale of such rolled steel products sold in accordance with the Pittsburgh plus practice. This was an artificial situation and so far as it was adhered to it destroyed price competition, and it was a situation inherent in the Pittsburgh plus practice. “Analysis of 3700 contract sales prices taken from contracts involving the sales of plates, shapes and bars appearing in Respondents’ Exhibits 25 to 44, 129 to 132 and 477 to 480, with Iron AGE prices published in the issues for eight days immediately before or eight days immediately following. the date of the con- tract, showed that 2655, or 71.8 per cent, agreed exactly with THE IRON AGE, while 3417, or 93.4 per cent, agreed exactly or deviated 5c. or less per 100 Ib. from THE IRON AGE prices. “Three thousand seven hundred and nine contract sales prices taken from Respondents’ Exhibits 25 to 44, 129 to 132, and 477 to 480 inclusive, compared with the respondent Carnegie company’s Pittsburgh base price of steel as of the dates of its contracts, showed that 1982, or 53.4 per cent, of such contract sales prices agreed exactly with such Carnegie prices, and 3404, or 91.8 per cent, agreed exactly or varied 5c. or less per 100 lb. as compared with such Carnegie base prices. Varia- tions of over 5c. and less than 10c. per 100 Ib. were noted in 72 such contract sales prices and variations of 10c. and over, in 233 such sales prices. “The examiner feels more confident in accepting the figures arrived at by the commission in this re- gard, from the fact that more than 90 per cent of all the 400 witnesses who testified in the proceeding 4s to Pittsburgh plus and price variations, whether for the commission or for respondents, declared that dur- ing the period indicated, from about 1901 to 1921, Hee eHeHeeNTNACUEUEUDOM Hen etennataneanon rte MM (Concluded on page 1411) May 8, 1924 MICROGRAPHS IN THE SHOP Portable Microscope with Photographic Equip- ment Simplifies Examination of Metals The portable Zeiss microscope, described in THE IRON AGE Jan. 31, has recently been considerably improved in its usefulness by the addition of a metallographic camera attachment. With the aid of this addition, the standard portable instrument can be used not only for all classes of laboratory work, but also for the taking of a permanent record of the structure of the material immediately in the shop. The illustration shows the portable microscope with the micrographic addition. The equipment has the Le Chatelier table top on which the specimen to be photographed is placed. The instru- Zeiss Portable Microscope with ” HOUUUONPEONELEDNRS con pogennanea NNT ment can, however, also be used in connection with the plain flat or ball-shaped table on which small irregular work can be conveniently secured. The microphotographic attachment consists of a base on which all the components*are mounted and their positions are secured by means of clamping bolts. A special illuminating tube with an eccentric dia- phragm is provided. The illuminating device consists of a lamp containing a 50 c.p. Nitra bulb, a condenser, a slide with ground glass, plate holders and a stationary green filter matching in color the Zettnow filter. This filter is attached to the front rim of the condensing lens. The lamp and condenser are so adjusted that the filament of the lamp forms a narrow vertical line on the diaphragm tube and runs in the direction of an arrow engraved on the latter. The line should include the small opening in the diaphragm. The image may, for preliminary focusing, be pro- duced on the ground glass pane, the final adjustment being by the aid of a polished pane and a special mag- nifying lens furnished. The camera is fitted with bel- lows capable of considerable extension. Plates up to 3% x 4% in. may be inserted in the holders. A special arrangement facilitates the finding of the proper time for exposure. Full instructions for manipulation are furnished with every instrument. The Carl Zeiss mi- croscopes are placed on the market by Schuchardt & Schutte, 143 Liberty Street, New York. Decreased Plant Activities in Pennsylvania Iron and Steel Centers HARRISBURG, Pa., May 5.—The iron and steel mar- ket of Pennsylvania is showing a downward trend, ac- cording to the semi-monthly report of labor conditions submitted to Dr. Royal Meeker, secretary of Labor and Industry, for the last half of April. The brightest re- ports are from Philadelphia and Reading. Johnstown reports that operations in its plants have been further curtailed, plants now working at about 60 or 65 per cent of capacity. Johnstown finds that the demand for workers is very low, and that the supply of applicants for work is heavier than it has been for some time. High class applicants, however, are reported to THE IRON AGE 1349 have no difficulty in obtaining employment. Harris- burg finds the entire market showing a downward trend. The Steelton plant of the Bethlehem Steel Co. reports that No. 3 blast furnace has been blown out and the Bessemer plant closed indefinitely. Malleable foundries and electrical machinery manu- facturing companies particularly have been affected in the Erie region. Williamsport reports its foundries and machine shops operating below capacity, with no indication of an increase in activity. Scranton finds no increase noticeable, and says that there are many skilled workmen who are willing to accept common labor as a last resort. Philadelphia reports that the first unit of the Gen- eral Electric Co.’s plant in West Philadelphia will prob- ably start operations July 15 with a working force of 1,000 men, It is planned to increase this ultimately to the Photomicrographic Attachment 5,000 men. This plant will specialize in switchboard manufacturing and assembling. Reading advises that its rolling mills are working full time. The Bethlehem Steel works is busy, partic- ularly in the nut and bolt department. Complaint Against American Can Co. Is Dismissed WASHINGTON, May 6.—The Federal Trade Commis- sion last Thursday announced the dismissal of its com- plaint against the American Can Co.: The complaint alleged discrimination in price and tying contracts in violation of the Clayton act and unfair methods of com- petition contrary to the Federal Trade Commission act. Among other things it was stated that the company granted to some purchasers the right to direct it to buy tin plate in the open market prior to the time when the American Sheet & Tin Plate Co. names its prices. It was declared that it was provided in all such con- tracts that the basic price of cans should advance or decline in proportion as the raw product advanced or declined judged by the official prices of the American Sheet & Tin Plate Co. The allegation was made that this policy allowed certain purchasers to obtain the benefit in price which might result from the right to buy tin plate in the open market prior to the time when the price was fixed and compelled others to forege this priv- ilege and submit to changes in prices based upon the rise or fall of the raw product price. New uses for aluminum paint are outlined in tech- nologiec paper No. 254 of the Bureau of Standards, ob- tainable from the Superintendent of Documents, Gov- ernment Printing Office, Washington, at 5 cents a copy. Fifty per cent less heat from the sun will get through the top of an automobile if the top is painted with alu- minum paint, the Bureau of Standards finds. Applied on the underside of thin metal roofs aluminum paint was found to cut in half the heat radiated on the under- side as compared with surfaces of corroded metal or ordinary paints. On tents and awnings fully 85 per cent of the sun heat that now gets through is found to. be shut out. 40 eT ~ W- . 1350 Crescent Roto-Piston Vacuum Pump The Crescent roto-piston dry vacuum pump here illustrated in phantom perspective and being dis- tributed by the Chicago Pneumatic Tool Co., 6 East Forty-fourth Street, New York, is of the rotating piston type. Two main moving members comprise a rotor (or piston) and case which revolve, one within the other, about a fixed shaft at the same angular velocity. The rotor, being smaller in circumference than the case and set off-center to the case axis, is imparted a rolling motion as it describes an eccentric circle at each revolution. This movement maintains, without a liquid seal of any kind, a crescent-shaped displacement ‘of fixed capacity at all times divided by the brass rotor-vane into intake and exhaust spaces Dry Vacuum Pump of Rotating Piston Type. Short overall dimensions are intended to permit installation where space is limited which change from nothing to maximum in volume throughout each pumping revolution. The absence of clearance spaces and valves serves to provide a volumetric efficiency approximating 99 per cent in exhausting to within % in. of the barometer. Frictional wear, due to the general design, is con- sidered exceedingly low. Working parts, ball-bearings and bronze bushings are lubricated by a force-feed system, with the exception of the drive-shaft ball- bearing, which turns in compressed grease. Short overall dimensions allow for installation of the pump in limited spaces where it may be driven from line-shaft or by electric motor, either direct- connected or short-belt drive. This pump has been applied, among other things, for providing high vacua for vacuum chucks in machine shops and for service requiring high vacuum. President Butler Will Speak at Dinner of National Industrial Conference Board The National Industrial Conference Board, 247 Park Avenue, New York, announces that the principal speaker at its annual dinner, Hotel Astor, May 15, will be Dr. Nicholas Murray Butler, president of Columbia University, whose general theme will be the relation of government to private business enterprise. It is ex- pected that the address will be heard by 200 of the lead- ing industrial executives of the United States, and be broadcast by radio. Frederick P. Fish of Boston, chair- man of the National Industrial Conference Board, will be toastmaster and, following Dr. Butler’s address, talks will be made by other members of prominence in the industries. Both the Metropolitan Paving Brick Co. and the Bessemer Limestone & Cement Co., operating plants at Bessemer, Pa., report improved shipments of cement and brick and better orders. On a recent date, the brick company shipped a trainload of brick from its plant. It is preparing a number of kilns for the manu- facture of face brick. THE IRON AGE May 8, 1924 Steel Tank Rates Declared Unreasonab):- WASHINGTON, May 6.—Passing upon a complaint «f the Parkersburg Rig & Reel Co., Parkersburg, W. Va. the Interstate Commerce Commission last week ren dered an opinion holding that rates charged on fabri cated steel tank material from DeLeon, Leeray, and Ranger, Tex., to Haynesville, La., were unreasonab); to the extent that they exceeded 54c. per 100-lb. and that the present rates will be unreasonable to the extent that they exceed contemporaneous rates under the Texas-Shreveport scale on iron and steel articles. The charges which had been collected on the shipments involved were at fifth class rates of $1.17 from Ranger and DeLeon, and $1.24 from Leeray. The complainant was awarded reparation. Takes Movies of Projectiles in Flight Motion pictures of projectiles in flight can be taken with a camera developed at a Bureau of Standards. The camera is capable of ma he 250 pictures per sec- ond, but it is believed that several thousand pictures per second could be taken by increasing the number of lenses use These lenses are arranged to move across the strip of film, each lens taking a picture and then moving on while the next lens takes the next picture. The film, meanwhile, is kept