Priorities Begin

BUSINESS & FINANCE

To millions of U. S. citizens, the U. S. defense program was still a distant noise last week. These millions did not include Hazard E. Reeves, a Manhattan businessman to whom defense had suddenly become very real. Mr. Reeves's Audio Devices, Inc. makes recording blanks for radio transcriptions, which defense conceivably could get along without. Neither defense nor Mr. Reeves could get along very well without aluminum, and for the time being there was not enough for both. So Mr. Reeves waited and waited for a February shipment of aluminum which had not arrived, meantime wondered how he was going to make the masterplates, from which he pressed plastic records for sale.

No longer than two months ago, Defense Commissioner Edward R. Stettinius Jr. denounced alarmists who talked about aluminum "shortages which do not exist." But last week the Office of Production Management 1) clapped mandatory control on the supply of aluminum (also of machine tools), and 2) took steps to conserve scrap aluminum for defense.

"Mandatory priorities" was OPM's phrase for this control. Manufacturer Reeves, many another in his spot understood precisely what the phrase meant. For him, it meant that his aluminum supplier (Alcoa) now had to send its order books to Washington once a month. Somebody in OPM would carefully scan those books, allot to each would-be buyer one of a series of preference ratings. If Mr. Reeves by some miracle were rated AA, his aluminum would be shipped posthaste. But top ratings were reserved for such MUST customers as aircraft manufacturers. Other ratings ran all the way down to A10, and Mr. Reeves presumably was somewhere near the A-10s, meaning that he had better stop worrying about aluminum and go look for a substitute. Any supplier who ignored the OPM ratings and gave a higher preference to Mr. Reeves might have to pay a fine up to $50,000, spend three years in prison.

OPM's only control up to last week had been through voluntary priorities (i.e., suppliers were asked but not ordered to follow Government preferences). To all defense materials except aluminum and machine tools, this halfway control (or none at all) still applied last week. But official pressure on the producers and fabricators of tungsten, zinc, stainless steel, nickel, copper, steadily increased, their control became less and less voluntary. Mandatory priorities were surely in the offing for a big segment of U. S. industry. OPM continued cheery about the situation, just as Mr. Stettinius had been two months before. The President, discussing the steel outlook, was cheerful to the point of disingenuousness (see p. 77). But Mr. Reeves and others like him knew that the pinch was on.

This file is automatically generated by a robot program, so reader's discretion is required.