United automobile worker. [volume], January 01, 1944, Page 2, Image 2

About United automobile worker. [volume] (Detroit, Mich.) 1936-1957

Image provided by: Central Michigan University, Clark Historical Library

                
2
'43 CORPORA TE PROFITS
REACH A RECORD HKH;
HEW GRAB IH TAX BILL
By DONALD MONTGOMERY
Consumer Counsel, V AW-CIO
WASHINGTON —“Profiteer-
ing on war contracts is on the
march.” That’s Leon Hender
son talking. He broke the story
a week ago Saturday on his
Blue Network program. The
newspapers followed on Mon
day.
There must be a special
kind of Santa Claus for profit
eers. Along with Henderson’s
story, there were other pretty
profit stories coming out of
Washington just before Christ
mas.
Henderson was talking about
action taken by the Senate Fi
nance Committee which opened
the door to war profiteers. Sen
ator George of Georgia and hi|
fellow members fixed up the tax
bill so that war contractors may
recover all the excess profits
they have already agreed to sur
render through re-negotiation.
Five and a quarter billion dol
lars may be returned to them if
the law goes through the way
the Committee framed it. After
the Treasury has taxed that extra
gravy as much as it can, the
Government will still be out a
billion and a half.
RECORD PROFITS IN ’43
On the same day Henderson re
vealed this Christmas gift for war
contractors, the Department of
Commerce announced that cor
poration profits as a whole were
breaking records in 1943.
It said, “Corporate profits after
taxes for the calendar 1943 are
estimated at about $6 billion, an
all-time high . . .”
It said, “Total corporate profits
before taxes in the third quarter
of this year were $5.7 billion, the
highest for any quarter in Ameri
can history . . .”
It said, “Profits after taxes
for the first nine months of this
year aggregated more than 11
percent over the same period
of 1942 ... before taxes were 20
percent above the corresponding
1942 total.”
MORE PROFITS
Finally, in the profit parade,
thc»re is a story of why work
clothes, cheap house dresses, and
other low-cost merchandise have
disappeared from the stores. The
reason is profits.
There's more .money for man
ufacturers and retailers in fancy
clothes that sell at high prices.
With the supply of textiles and
manpower running way behind
the demand, the high-price
high-profit goods are getting
first call and the low-cost goods
aren’t being made. Consumers
must take the expensive stuff
or do without.
Now it happens that WPB can
stop this particular brand of
profiteering. It has the power. It
can, and does, allocate textiles to
various uses. It could, if it wished,
order manufacturers to put as
much of their man hours and
machines into low cost goods as
they did in peacetime. But WPB
doesn’t want to.
WPB AIDS PROFITEERS
On the contrary—WPß haS been
fighting side by side with the
manufacturers to demand that
price ceilings be raised on these
low-cost items so that those goods
will be profit lines also. OPA and
Stabilization Director Vinson on
the side trying to hold the line,
WPB and the manufacturers on
the other side trying to break it.
That’s the picture.
And while they’ve been waiting
for OPA to up prices they haven’t
been producing the goods which
so many million people need for
themselves and their kids. If
workers act that way the Govern
ment says they are striking. But
UNITED AUTOMOBILE WORKER DETROIT MICHIGAN JANUARY 1 IM4
“LEON HENDERSON SPEAKING”
Senators Plan Gift
for War Profiteers
Not satisfied with taking eight billion dollars profit,
after taxes, in 1943, American corporations are trying
to do the government out of some five billion dollars now
due the government through re-nogotiation of war con
tracts. The attempted steal, which is part of the tax bill
engineered by Senator George (Ga.) and the Senate
Finance Committee, would do these things:
Exempt from contract renegotiation all contracts involving
standard articles, such as all ship construction, 75 per cent of tank
construction and a large proportion of the airplane industry; base
the profits of corporations on net profits after taxation (that would
merely nullify the effect of the so-called “heavy” taxation in war
time profits); allow all the so-called voluntary re-negotiations already
reached, worth SSJOO,OOOjDOO (five billion, three-hundred million dol
lars) to be taken to the courts for reconsideration.
Leon Henderson, former director of OPA, discussed the at
tempted steal in a recent radio broadcast. Here are some excerpts
from his talk:
FIVE BILLION GRAB
“If these few greedy profiteers have their way, I know of
case after case of outrageous and completely unjustified war
profiteering which would result.
“I know, and the Senators of the Finance Committee know,
of companies which made on their net worth, one hundred and
three percent, four hundred and forty eight percent, yes, nine
hundred and sixty five percent, or even nine hundred and eighty
nine percent before renegotiation and after taxes.
“The government might have to refund over five billion
dollars representing profits which companies have voluntarily
agreed are excessive.”
• • •
AUTO FIRMS INVOLVED
“I’ve been over the profit record of some of the companies
which have bawled the loudest. Companies like Budd Wheel,
Warner-Swasey, Lincoln Electric, and Timken-Dctroit Axle.
Each of them are making larger earnings than before the war.
I think they are doing all business a disservice. One of them com
plained that some government men pushed them around. Well,
the Marines who took Tarawa Island got pushed around, too.
“Senator Guffey sat in the conference when the Budd Com
pany's profits were * Before the war, Budd averaged
four and two tenths percent on its net worth. In 1942, after
paying its taxes, had a profit of fifty five percent before
the government a&»ked it to give some back.
“Warner and Swasey is another example. Well, this company
has been making four times the profit it did before the war. In
1938 its net worth was five million dollars. In the next four years
it paid dividends larger in amount than its entire net worth, and
finished last year with three times what its net worth was before
the war.
“Let’s look at Timken. As Senator Bennet Clark remarked
at the hearings, Colonel Rockwell, of Timken, wept all over the
place, beat his breast, claiming he was robbed. Before the gov
ernment renegotiations got around to them in 1942 they were
making fifty-two and six-tenths per cent of their net worth, or
more than four times their profit before the war.”
“SOME TAX BILL”
“The net effect of the bill as it stands would be to require the
Treasury to add six-hundred million dollars to the debt.
“But the consumer as an individual would pay, more and the
corporations would pay less. The consumer will pay a billion
more in excise taxes and half-a-billion more in income taxes in
the lower brackets. The corporations would pay six-hundred
million more in taxes, but would have renegotiation refunds
available amounting to a billion-and-n-half.
“Some tax bill, I say.”
manufacturers have not taken a
no-strike pledge; so when they
strike it isn’t a strike.
But that’s what has been going
on—a strike of textile mills with
WPB walking \he picket line.
VINSON'S ORDER
A
Recently Vinson issued an order
about this to WPB and OPA. It
was hardly what you would call
a strike-breaking order. It was
too gentle for that. It said WPB
should plan to get some low-cost
goods produced, but it didn’t say
how much. It said OPA should
raise the price ceiling on such
goods enough to cover cost and
allow a profit. This seems to take
better care of profits than of con
sumers.
For example, some large man
ufacturers of cloth for men’s work
shirts will be allowed increased
prices under this order as an in
ducement to get them to make
this kind of material. Yet these
manfacturers already are making
from 3 to 5 times as much profit
on each dollar of sales as they
made in the pre-war period.
Even with these profit conces
sions the strike may not be settled.
WPB says the gravy is not spread
thick enough by Vinson’s order.
Meanwhile Christmas news of
quite another kind has come
from the war department. The
army announces that casualties
in the U. S. Army to date are
131,385. These figures were is
sued with a warning that the
next few months, probably as
the cost of an invasion of west
ern Europe, loss of life in the
D. S. armed forces may go up
another 394,000,
"Wolf! Wolf I"
/ caw
WPB Announces
Committee On
Plant Feeding
Action to promote establish
ment of suitable in-plant feeding
facilities for war industry workers
is announced with the formation
of 13-county area committee con
sisting of representatives of man
agement, labor, and government
agencies, under the chairmanship
of the War Production Board.
The committee will investigate
complaints of poor feeding con
ditions, price and ration relief,
food allotments, sanitary improve
ments, feeding facilities, inability
to obtain manpower for plant
cafeterias or restaurants, and
other problems arising out of
feeding employees within a plant.
The area to be served by the
committee will include jurisdic
tion over the thirteen county
territory covered by the Detroit
O.P.A. district which includes the
counties of: Wayne, Washtenaw,
Oakland, Macomb, Monroe, Liv
ingston, St. Clair, Lenawee, Jack
son, Ingham, Hillsdale, Eaton,
and Clinton, plus Genesee County.
LABOR MEMBERS
The committee members, as
announced by A. S. Luchek. Re
gional Labor representative, WPB,
chairman of the group, include:
for Labor, Paul Silver, CIO, and
A. R. Potter, AFL.
To solve problems which may
arise the committee has establish
ed certain steps to be followed in
relaying problems to it:
I Complaints concerning in-plant
■ feeding should be taken up
first with the plant management,
through the recognized labor
organization where one exists.
O When the condition cannot be
™ corrected at the plant level*
the employees should report the
complaint through the plant com
mittee to the international union,
who will screen the case at that
level before further presentation.
Management may likewise initiate
the steps outlined below.
PANELS TO BE SET DP
O After screening, the interna
** tional union or central labor
organization may present the
complaint to the government pro
curement agency responsible for
production in the plant corlcemed.
A If the matter is still not correct
ed, the case is referred to the
area In-plant Feeding Committee,
who appoint a panel consisting of
one representative of labor, one
representative of industry, and
one representative each from the
civilian governrrfSnt agencies In
terested. ’Die panel investigates
the situation «nd their findings
provide the basis for adopting
corrective measures.
tj
Thomas Joins
Fight Against
Anti-Semitism
NEW YORK “Dedicated to
the proposition that anti-Semitism
in any of its forms is fascism,”
an organization named the “Na
tional Committee to Combat Anti-
Semitism,” sponsored by several
hundred prominent leaders in
various fields of American life,
is being formed on a nationwide
basis.
Among the prominent initial
sponsors are included: Bishop G.
Ashton Oldham, president, Amer
ican Council World Alliance for
International Friendship through
the Church; R. J. Thomas; Van
Wyck Brooks; James W. Gerard,
former ambassador to Germany;
Raymond Massey; Dr. Daniel L.
Marsh, president, Boston Univer
sity; Pierre van Paassen; Phili*
Murray; Carl Van Doren; Mrs.
Stephen S. Wise; Serge Kousse
vitzky; Mrs. Thomas N. Hepburn;
and Louis Adamic.
SLEKS LEGISLATION
The immediate purpose of the
Committee is to effect the intro
duction and help in the passage
"of national legislation outlawing
anti-Semitism.
It is expected that the Com
mittee will work in legislative
and educational fields in an effort
to expose anti-Semitism, and
according to the Committee’s
statement “ftiake every American
realize that anti-Semitism is the
problem of every American, a
threat to his life and liberty, and
treason to the United States.”
Cooperators Vote
To Pay Halt Rent
Of Drafted Fathers
NEW TORS A truly exem
plary spirit o£ cooperation and
communal responsibility in war
times was evidenced by the stock
holder-cooperators of the Amal
gamated Cooperative Apartments
here last week. Without a dissent
ing vote they accepted Manager
Kazan's plan, previously approved
by the House Committee and the
Board of Directors, to pay half
the rent of drafted fathers, co
operators in the house, out of a
special fund to be raised for that
purpose through voluntary con
tributions.
For Victory
Ik IT TAKES BOTH
1. Tun
It 8. War Bond*
run mom war ionds