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Show PATRIOTISM AT ANY PRICE After dispute and litigation with Bethlehem Steel Corporation Corpo-ration for almost 20 years concerning exorbitant profits on World War work the government finally-loses. Federal Judge Dickinson in Philadelphia has dismissed the government case, though with regret and a rebuke for the corporation. The judge ruled that a contract was a contract and could not be overthrown. But this was a contract for shipbuilding on which Bethlehem obtained profits of more than $25,000-000 $25,000-000 on $122,000,000 of work. This is patriotism a the rate of 20 per cent; pretty fat going. These high profits were based on the cost-plus and bonus system. Under that setup a contractor was paid 10 per cent over cost price as his profit. Naturally, it was to his advantage advan-tage to push costs up as high as possible. In addition, he was paid a bonus of 50 per cent of whatever what-ever he saved by spending less than the original estimates. This was supposed to be a check on the desire to push costs up. But the contractors put all figures high enough to get their profits coming and going. If a job was estimated at $100,000,000 and turned out to cost $75,000,000, the contractor would get 10 per cent of $75,000,000, or $7,500,000 as his profit. Since he had saved $25,000,000 on the estimate price, he would get half of he saving, or $12,500,000 as a bonus, or a total of $20.-000.000 $20.-000.000 profit on the job. Bethlehem placed the estimates plenty high. Judge Dickinson's words are worth remembering: "As wartime is to other citizens a time sacrfice, it seems unlikely and sinful to make of the calamity of the people a source of inordinate gain "The managers for the contractor adopted the famous Rob Roy distinction. He admitted he was robber, but proudly proud-ly proclamied he was no thief. The contractor boldly and nnpnlv fixed the fiflrures in the estimated cost so high as to give him the promise of a large bonus profits. The managers mana-gers of the (wartime) Fleet corporation protested it. "The reply of the contractor's managers was that we will make this contract with the promise of bonus profits incorporated in it, but not otherwise. Take it or leave it.' " An this during wartime. Could there be any better argument for nationalization of the munitions industry than this? Half our net national debt of about $30,000,000,000, of approximately $15,000,000,000, represents money spent on the last war. How much of it was paid out in .ways like this? Exchange |