J 
 
 Remarks 
 
 by 
 
 Elbert H. Gary 
 
 at a 
 
 Meeting of Steel Manufacturers 
 
 Waldorf-Astoria Hotel 
 
 New York 
 
 December 9, 1918 
 

 MAY 19 1W 
 
0-" 
 
The General Committee of the American Iron & Steel 
 Institute has been invited to appear before the War In- 
 dustries Board in Washington on December 11th to con- 
 sider the question of prices on and after January 1st, 
 and perhaps for the discussion of other matters. Follow- 
 ing the practice of the last year or more, this represen- 
 tative gathering of the Iron and Steel Industry has been 
 assembled for consultation and instruction. The pro- 
 posed meeting in Washington may be the last of its kind 
 as it is rumored the War Industries Board and its sub- 
 committees will soon be relieved and the fixing of prices 
 discontinued. If so, then within a comparatively short 
 time, perhaps sooner than we now suppose, the matters 
 relating to production, deliveries and prices for our com- 
 modities will be left to us as individuals or firms or com- 
 panies; and we will reassume responsibilities varied in 
 character and important in results. 
 
 The General Committee was originally appointed by 
 the President of the Institute at the request of Mr. B. M. 
 Baruch, representing the Secretary of War and the Sec- 
 retary of the Navy, to mobilize the Iron and Steel Indus- 
 try of this country for the purpose of concentrating and 
 co-ordinating its efforts in assisting the Government to 
 provide the military necessities of the United States and 
 others. 
 
 Several sub-committees were appointed to take im- 
 mediate charge of different branches of the Iron and 
 
Steel business. You are familiar with their efforts and 
 results. I need not dwell on the work of the General 
 Committee or the sub-committees. It has been arduous 
 and often perplexing; but with the unanimous, unwaver- 
 ing and loyal support and effective aid of the entire in- 
 dustry there have been secured results which have been 
 appreciated and praised by Government officials. As you 
 know, the different departments of the Government at 
 first, and later the War Industries Board, with anxious 
 insistence, have asked for more and more steel of dif- 
 ferent kinds and qualities to supply the war necessities 
 of the United States and associate countries, for use here 
 or elsewhere; and with little, if any delay all demands 
 have been met. Unlike many other lines of production or 
 service the Iron and Steel Industry has been left entirely 
 in the control and management of its owners, subject 
 only to our voluntary agreements, which referred mainly 
 to the full operation of plants for the production of war 
 material and to priorities of deliveries so far as neces- 
 sary. Therefore the responsibilities for results have been 
 left to us and we have accepted and satisfactorily dis- 
 posed of them, as demonstrated by our accomplishments. 
 We have increased capacity, at the cost of millions upon 
 millions, and we have diverted our facilities from or- 
 dinary uses whenever and wherever it appeared essen- 
 tial to keep supplies up to the demands made upon us. 
 I do not refer to these things in a spirit of boasting. 
 There is no ground for that. The little we could do was 
 contributed to a great cause in which all of us were 
 vitally concerned. I utter these words to emphasize the 
 
further statement to all those present and to their asso- 
 ciates in business, that the Iron and Steel Industry has 
 clearly conceived and faithfully performed the obligations 
 resting upon it in consequence of the war. 
 
 But our responsibilities as representatives of a great 
 industry are not yet ended and they will be referred to 
 later. 
 
 As suggested, it now seems probable there will be no 
 occasion to again call a meeting of the iron and steel in- 
 terests for the consideration of matters to be presented to 
 the War Industries Board, and it is deemed appropriate, 
 at this time, to refer to that body of men. You know who 
 compose the Board and how extensive and important 
 the business in its charge has been. I may be permitted 
 to speak of the experience of the General Committee be- 
 fore the Board. Some of us have occasionally given ex- 
 pression to feelings of dissatisfaction with the agreements 
 which have been reached relating to price fixing or dis- 
 tribution departments; but I would be less than sincere 
 if I failed to state that all in all, from the time of our 
 first appearance before the Board to the last, its mem- 
 bers have exhibited great ability, careful study and de- 
 liberation, unusual patience, and above all, a disposition 
 to be fair and considerate. In view of the variety and 
 complexity of the questions presented to them by us and 
 hundreds of others, the wonder is that an organization 
 was formed which could so smoothly and efficiently com- 
 prehend and dispose of the stupendous and important 
 transactions which, from necessity, were forced upon this 
 Board. The difficulty of reaching conclusions which 
 
would at the same time fully protect each and all of the 
 different classes of our industry was apparent. The 
 problem of the Board was to secure the largest possible 
 production of steel required for military necessities by the 
 fixing of prices which would permit the operation, with 
 some profit, of the plants having the highest costs, and at 
 the same time to fix prices and make adjustments which 
 would not allow the low cost works to receive unrea- 
 sonably large earnings. From beginning to end, the 
 Board has been just and reasonable toward us and to the 
 Government as well. After an experience of many 
 months, which has given us a clear understanding of the 
 reasons and motives which prompted the Board to act, 
 and the President of the United States to approve, I 
 think all of us are satisfied we have no valid reason for 
 complaint. 
 
 The most colossal, destructive and costly of all wars 
 has terminated. Right has prevailed. The overthrow of 
 civilization has been prevented. The principles of liberty 
 and freedom and equal opportunity have been re-estab- 
 lished. We need not permit to go unchallenged the state- 
 ments which have been made and widely published as to 
 who won the war. So far as human effort is concerned 
 victory was achieved by a combination of circumstances. 
 In the sense that the expression has been used, though 
 improperly, the war was won at Liege and Namur by the 
 brave soldiers of Belgium, who fought an enemy far 
 superior in numbers, equipment, organization and train- 
 ing, and delayed the passing of the German Army for a 
 few vital days. It was won at the Marne in September, 
 
1914, when the French, undismayed and assisted by a 
 comparatively few English, made their splendid defense 
 and later succeeded in their counter-offensive. It was 
 won at Verdun, after it seemed apparent, to us at least, 
 the Allies would certainly be overcome. It was won at 
 Ypres where a whole brigade of Canadian soldiers, which 
 was practically destroyed within a few minutes, made 
 their brilliant fight. It was won at the Piave by the 
 Italians, who assisted by their allies, re-established their 
 lines and forever interrupted the further progress of 
 what had seemed an irresistible foe. It was won in the 
 Balkans by the Serbians and French when the Bulgarians 
 were finally destroyed. It was won in Palestine when 
 the Turks were overcome by the English. It was won 
 at Chateau-Thierry when the American soldiers for the 
 first time in the history of this war not only stopped the 
 onward and continuing rush of an apparently invincible 
 army, but actually turned an orderly and successful 
 offensive by the Germans into a confused and disorderly 
 retreat. The commanding French General, who had di- 
 rected the American forces to hold that part of the de- 
 fensive line, when informed that the Americans had not 
 only held the line but had assumed the offensive and were 
 succeeding, remarked the men were too brave, even reck- 
 less. Nevertheless, he immediately ordered an attack 
 by the French armies on the right and left flanks of the 
 German army on the Soissons and Eheims sectors re- 
 spectively. The result you know. The Prussians never 
 did and never could re-establish their battle lines. They 
 were pushed back and still further back, from day to 
 
 5 
 
day, until they collapsed and surrendered. Many, many 
 places and times might be mentioned as proof that the 
 war was won at that particular place or time. The war 
 was won by the magnificent English Navy which kept 
 open the seas so that men and materials could be trans- 
 ported from country to country, and which smashed the 
 German ships at Jutland and other places whenever they 
 could be reached. It was won by the enormous supplies 
 of money and credit and material which the United 
 States furnished to the Allies. And the American army, 
 two millions strong in Europe, and thirteen millions 
 strong in the United States, preparing for transporta- 
 tion and for service at the front, added very materially 
 to the power and to the morale of the whole military 
 forces of the Allies. This won the war. 
 
 Let no individual, let no separate country, claim the 
 sole credit for winning the war. History will discredit 
 the assertion. Coming generations will fairly consider 
 and justly determine the demands for recognition in the 
 bestowal of praise. Even Russia, betrayed and demoral- 
 ized as the result of intrigue and corruption, will some- 
 time be accredited with faithful and valuable service to- 
 wards the cause of justice and right during the earlier 
 stages of the war. Poor Russia ! We may hope, and ex- 
 pect for her, better conditions than those which now exist. 
 
 The throngs of men and women of all countries who 
 have contributed labor and money to the cause which is 
 won are entitled to and will be given due credit for their 
 part in winning the war. 
 
 6 
 
The soldiers and sailors, including officers, who of- 
 fered their lives that justice might prevail, will forever 
 have a place on the rolls of honor and glory. 
 
 But new problems confront us. They are numerous, 
 complex, difficult. We may not be idle. We must be 
 thoughtful, studious, diligent. 
 
 First of all in significance are the questions to be con- 
 sidered by the Peace Commissioners who will represent 
 at Versailles the different nations of the world. Selfish- 
 ness is certain to appear because it is human. Unfairness 
 and unreason will be indulged. Aggressiveness, ob- 
 stinancy, even cupidity, are to be feared. There is some 
 danger in the situation. A wise and final determination 
 will depend on the ability, discretion, patience, persis- 
 tence, courage and absolute honesty of purpose of those 
 who participate. 
 
 We have reason to believe the actions and conclusions 
 of the convention will not be disappointing; that they 
 will be injurious to none and beneficial to all; for every 
 delegate will realize that in order to be effective and per- 
 manent the international settlement and compact must 
 recognize all the rights and interests of each and every 
 nation and must secure for them in future equal safety, 
 privilege and opportunity. There must not be included 
 anything to prevent any nation from the adoption of laws 
 or regulations which will result in placing it, in regard 
 to all economic matters, on a parity with all others, It 
 is believed there will be firmly established a permanent, 
 impartial and competent international tribunal which 
 are calculated to prevent future prolonged wars be- 
 tween nations. 
 
 7 
 
The discussion and references thus far lead us to a 
 consideration of the attitude we are to assume and the 
 part we are to take in the business matters under our 
 charge or influence at this time. How shall we conduct 
 our affairs? What, if anything, shall we recommend to 
 the War Industries Board next Wednesday concerning 
 maximum prices? And what of the future? Can and 
 will the management of our industry exercise any stabil- 
 izing and beneficial influence upon the economic interests 
 of the country? 
 
 Necessarily we must consider of paramount impor- 
 tance the labor situation. During the war the wage rates 
 have been increased materially and frequently. They 
 are now much higher than ever before so far as I am 
 informed; it is claimed in some respects they are out of 
 proportion. For one, I believe we have not been paying 
 more than was proper and just. The necessary costs of 
 living have been growing and unless and until they are 
 reduced it would seem that, on the average, the present 
 wages cannot be reduced. 
 
 It is urged that on the basis of the present scale of 
 wages the employers cannot afford to make reductions in 
 the prices of their commodities, and many insist they are 
 entitled to higher rates. As we, in this country at least, 
 are operating and living on a basis of general prices that 
 are abnormal, we might consider the propriety of making 
 reductions at the same time in every direction; but this 
 would be impracticable. Therefore, if there are to be re- 
 ductions they must be gradual and considered in indi- 
 vidual cases. We must commence at some point or place. 
 
 8 
 
Judging from the past all of us believe we should not 
 commence to make reductions at the point of wage rates ; 
 sacrifices must previously be made by employers. Our em- 
 ployes must continue to be treated liberally with respect 
 to their compensation and general welfare. We will con- 
 tinue to show to them that it is our intention to consider 
 their merits, and to treat them as associates and valuable 
 assistants in our work. We should give no cause for rea- 
 sonable complaint or unfavorable criticism. There is no 
 ground for believing, as sometimes hinted, that the work- 
 men of this country are desirous of controlling the 
 methods of production or distribution. They know they 
 could not be successful in the experiment. They under- 
 stand as well as we that all lines of human activity must 
 succeed or fail together; that every individual must con- 
 sider and recognize the rights of all others if we are to 
 have prosperity, comfort and happiness ; that he who agi- 
 tates for anything else is disloyal to his country, his 
 friends and his home; that the average leader who tries 
 to disturb the friendly relations between neighbors or 
 associates is acting from selfish motives; for pecuniary 
 profit or individual power or position. 
 
 If the workmen generally are treated fairly and liber- 
 ally they will stand and contend for fair treatment of the 
 employer. I refer now to the wage earners. But who 
 are workmen? You and I, as well as the man who works 
 by the day. Most of us, if not every one of us, started on 
 the farms or in the shops or mills, for very low compensa- 
 tion, and we are proud of it. We are still workmen, with 
 long hours and laborious tasks. No man wishes to remain 
 
at the bottom of any ladder. All wish to climb and to 
 prosper. All desire to occupy positions of independence 
 and they want to secure this by hard work. Let us use 
 our influence in assisting our employes to progress and 
 succeed. Let us retain their confidence and loyal support 
 by our action. They will meet us half way if they are 
 permitted to exercise their own judgment and spirit of 
 fairness. Conditions now are good and you who are lis- 
 tening to me have been a potential factor in bringing this 
 about. 
 
 I am assuming you will not favor reductions in the 
 wage rates unless and until it shall become absolutely 
 necessary, notwithstanding it is possible the War Indus- 
 tries Board may decide there ought to be conservative 
 reductions in the prices of our commodities after Janu- 
 ary 1st. Our prices have been high during the last year, 
 and in the cases of a few companies the profits have been 
 large. In order to maintain production up to full capac- 
 ity of all manufacturing works, so as to meet the military 
 necessities of this country and its associates in the war, 
 it has been necessary to fix prices larger than normal, 
 because of increasing costs of production, by reason of 
 wage increases and higher prices for everything the pro- 
 ducer has been obliged to buy or pay for. However, the 
 war is ended and producing and selling conditions are 
 changing. Furnaces and mills will be returned to ante- 
 war uses and methods. The law of supply and demand 
 will again control. There will soon be no restrictions in 
 prices nor anything to prevent their settling down to a 
 lower basis, depending upon circumstances. Costs of 
 
 10 
 
production probably will, in the course of time, be de- 
 creased, though not to former levels. It is to be hoped 
 no seller of our products will feel inclined to make prices 
 too high simply because he may be able to secure them, nor 
 to make them too low simply because there is need of ready 
 cash. Everything depends upon the individual producer. 
 If we are fair and reasonable toward our employes, our 
 customers, our competitors and those who own our prop- 
 erties, we shall not become demoralized nor foolish and 
 we will be entitled to the approval of all other lines of 
 business and to the people generally. No one in the long 
 run is benefited by unreasonably high or low prices. This 
 has been tested over and over again. The general public, 
 as in 1907, expects the steel industry, called the barome- 
 ter of trade, to exercise moderation and skill, and, so 
 far as legitimate and right to lend its efforts in aiding the 
 stabilization of business. For our past attitude we have 
 been commended. In the future we may expect to receive 
 our just deserts. 
 
 If the War Industries Board shall fix prices, or if its 
 members shall counsel us as to the future in accordance 
 with the opinions I have expressed, it is to be hoped we 
 will not dissent nor fail to adopt. 
 
 I have intimated that values or prices generally 
 throughout this country are abnormal. We ought to get 
 back to a peace basis so soon and as speedily as possible. 
 It should be accomplished in an orderly and methodical 
 manner and with the least disturbance to general busi- 
 ness and without injustice to any. This is peculiarly a 
 time for constructive thought and action ; for cool heads, 
 
 11 
 
for courage, for the exercise of a spirit of fairness ; even 
 for sacrifice when necessary. There should be no danger 
 in this country of serious business depression. We are 
 so rich and prosperous and our resources are so large 
 that the indulgence of feelings of fear or doubt as to our 
 financial, commercial or industrial safety and progress 
 would be wholly unjustified. Our prospects are bright, 
 our opportunities for success are greater than ever be- 
 fore. Even if there should be some decreases in volume 
 we may look forward with confidence. I predict the next 
 five years, in this country, will be the most progressive, 
 prosperous and successful of any like period in our his- 
 tory; the results will astonish even the most optimistic 
 of today. We need to be conservative, thoughtful, per- 
 sistent, fair-minded and wise up to the limit of our 
 understanding. 
 
 And now, gentlemen, I am going to surprise and per- 
 haps disappoint some of you, and no doubt you will have 
 justification on account of your own business situations ; 
 but I beg of you do not hastily reach a final conclusion 
 in regard to the suggestion that is to be made. 
 
 After a painstaking and exhaustive consideration and 
 discussion, covering the larger part of two days, the 
 General Committee, or at least a majority of its mem- 
 bers, perhaps all of them, have reached the conclusion 
 that at the meeting to be held in Washington next Wed- 
 nesday there should be recommended to the War Indus- 
 tries Board a moderate reduction in the scale of maxi- 
 mum prices for our commodities, commencing January 
 first, the reductions and adjustments to be made on an 
 
 12 
 
equitable basis, in consideration of all the circumstances, 
 and after careful study. If all present would assent to 
 reductions and are now prepared to systematically make a 
 new schedule, it should be done at this meeting, but I 
 think that all interests would be subserved if these mat- 
 ters, as heretofore, are referred with power by this meet- 
 ing to the General Committee, for submission and con- 
 sultation with the War Industries Board. The proposed 
 schedule would be completed prior to the meeting in 
 Washington, though its preparation necessarily involves 
 much study and labor. 
 
 I presume many of you, at first blush, taking into ac- 
 count your costs of production, will present arguments 
 against the adoption of the proposal. Still, I hope you 
 will give due consideration to the thoughts which have 
 been expressed by your chairman. 
 
 We have a chance to do something valuable towards 
 sustaining the business equilibrium of the country. 
 While some might suffer losses at present, perhaps it 
 would prevent greater losses in the future. We would 
 be leaders in a movement calculated to methodically re- 
 adjust conditions in an orderly way. We might have 
 some influence in steadying business generally; and re- 
 member, the workmen are more interested in this ques- 
 tion than any others, for labor constitutes the greater 
 part of the cost of production from the raw material 
 down to the finished product and its use by the consumer. 
 
 It seems to me the unanimous consent of the mem- 
 bers of the Iron and Steel Industry to a recommendation 
 to the War Industries Board for a reduction in prices is 
 
 13 
 
called for at this time, especially after a long period of 
 united effort, on the invitation of the War Industries 
 Board, to agree upon prices. 
 
 If reductions are made now and manufacturers accept 
 them willingly, even though sacrifices have to be made, 
 we may be consoled by the fact that we are approaching 
 better times, lower costs, a more natural and substantial 
 basis, and that we are probably doing the right thing. I 
 feel reasonably confident the Iron and Steel men will, 
 as heretofore, especially during the war, be willing to 
 do their part in promoting the welfare of all who are 
 interested. Those who buy our products will correspond- 
 ingly reduce their prices and thus do their part in the 
 direction mentioned, and so on down the line; and this 
 may extend to others. 
 
 The Iron and Steel men have been broadminded, lib- 
 eral and big in every way, and I appeal to you at this 
 time with confidence. « 
 
 14