Scrap Scare

A Japanese shipping agent in Manhattan buys a cargo of rusty old rails, iron pipe, sawed-off steel girders, stoves, smashed automobiles. He loads it into a creaky freighter already headed for the junk heap. Manned by Japanese, the ship takes on enough coal for one voyage, limps south through the Panama Canal, manages to reach Nagasaki 11,000 mi. away. There the cargo is dumped into smelters. The ship proceeds to Osaka where, in the world's largest ship-breaking yard, acetylene torches reduce its hull to hunks of scrap. The crew works back to New York for another ship, another cargo. The scrap goes into Japanese skyscrapers, bridges, turbines, locomotives, spinning wheels or, according to many a suspicious U. S. citizen, into armaments and ammunition.

As the world's biggest importer of steel scrap, Japan is wholly dependent on the U. S., which is the only large industrial nation with no scrap export embargo. Last week the Department of Commerce announced that scrap shipments during 1934 had reached an all-time high of 1,835,554 tons against 773,000 tons the year before. Of this total export 1,168,000 tons or 63% had gone to Japan. Italy, which like Japan suffers a shortage of good iron ore, was next biggest buyer with 225,644 tons. Great Britain was third with 134,434 tons.

Nothing irritates U. S. scrap dealers so much as to be told that scrap shipments are creating a U. S. shortage. Scrap is abundant, they say. There are about 750,000,000 tons of steel in use in the U. S., part of which must go into scrap every year as new steel is forged. Theoretically, the entire 1928 production of automobiles is ready for the junk heap this year. And compared with annual domestic scrap consumption of 17,000,000 tons, last year's exports of 1,835,000 tons was only a piffling 10%. Because scrap is an international commodity, it tends to flow to countries whose steel industries are operating at capacity. Japan's steel mills happen to be running at 100%. Hence the focus of scrap shipments to Japan. Thus, the scrapmen.

But others take a darker view. William Randolph Hearst and certain members of the U. S. Senate believe that the U. S. is 1) depleting valuable national resources by shipping scrap, and 2) unwittingly helping Japan build a more powerful military machine for aggressive action. They point to the fact that Japan's sharp increase in scrap buying (500% in three years) has taken place since 1931, when fighting began in Manchuria. Hence some members of the Senate Munitions Committee, which is currently investigating Japanese purchases in the U. S., favor an embargo on scrap exports.

At the last session of Congress President Roosevelt vetoed a bill to prohibit export of tin-bearing scrap. Scrap dealers expect new agitation for an embargo at this session, are confident that President Roosevelt will oppose it because he is trying to develop export trade. But last fortnight, Raymond Moley, the President's friend and counselor, published as the lead article in his magazine Today a sharply critical analysis of Japan's scrap buying by Ray Tucker, longtime Washington newshawk. Reporter Tucker concluded that Japan's demand for scrap was unmistakably for the purpose of 1) modernizing her army, 2) hoarding steel in case of war, and 3) constructing naval auxiliaries. "The junk piled up in American backyards during five years of depression," wrote he. "is helping to forge a modern, Oriental fighting machine against the day when the bugles blow again."'

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