Why There is No Shortage

One shortage is over, anyway: paper. The U.S. can stop saving its old newspapers and magazines. U.S. papermakers last week were looking not for raw materials but for business. Some of them angrily protested that there never had been any paper shortage at all.

Paperboard Started It. All this sounded sillier to the paper-saving citizens than it actually was. Fact is, paper leads a double life. First it appears as newsprint or book and magazine paper, writing paper or strong kraft wrapping paper, all of which are made primarily out of virgin wood pulp. Later on, some of it is used a second time to make paperboard, and (except in the South, where some board is made of kraft pulp) 85% of the raw material for that comes from old papers. When the demand for cardboard to package war materials shot up skyhigh, a lot more old paper was needed than ever before; and so a great patriotic drive was launched to get it collected.

When the public heard there was a shortage of old paper, it logically but erroneously decided that there was a shortage of new paper too. This started a shortage scare, which led to a lot of over-buying and actually created a temporary false shortage in many grades.

Then the vicious circle began to close: 1) people began to stop using paper, out of misguided patriotism; 2) the curtailment of civilian-goods manufacturing cut demand for book paper (for direct mail,* instruction booklets, etc.), for wrapping paper, even for newsprint (because advertising fell off). The ever-tightening shortage of ships cut down paper exports to Britain and South America (where the paper shortage is real). So the U.S. shortage-that-never-was became a burdensome surplus.

The real shortage of wastepaper for paperboard, which started it all, turned into an embarrassing surplus almost as soon as the scrap-saving drive got under way. Many board mills began to refuse to take any more scrap; others would take it only at prices well under OPA's ceiling. By last week, WPB Conservationist Lessing Rosenwald's division was reduced to writing shamefaced letters to State salvage chairmen calling off wastepaper collections except for areas where paperboard mills were willing to take it. The mills themselves were lazing along at 82% of capacity in the third week in May, v. an average of 102% in January.

Even so, WPB is still nervous about paperboard. No one can tell what huge new demands will grow out of peak war production. The packaging industry has not yet converted from tin to paper. WPB therefore instructed salvage committees to be "very careful to leave the door open for resuming paper collections."

Pulp magnified the confusion in paper. Since wood pulp is also a raw material for rayon and for explosives, and since the Scandinavian source was cut off, a pulp shortage was expected. But North America found it was self-sufficient in wood pulp, so long as it could not export it for lack of ships.

Newsprint had its own special scarcity scares. Its chief raw material, Canadian groundwood, requires huge amounts of power, which might be required for power-hungry aluminum mills instead. But Canadian newsprint mills today are running at only 75% of capacity: the power freed by the remaining 25% (not to mention excess capacity in other areas) should be more than enough for the new aluminum capacity scheduled to come in next fall.

There is a real threat to the paper industry, but it is the same threat that darkens the future of all U.S. civilian industry: shortages in transportation, metals and manpower. Most ominous single paper statistic: at some point or other in its progress toward paper, 80% of all U.S. pulpwood travels on rubber. In the South, trucking is especially strategic, since Southern pine cannot be floated, and, once cut, deteriorates fast.

This week many an afternoon newspaper prepared to cut to one or two editions. The purpose was not to save paper, but to save the rubber on delivery trucks. To papermen it was just one more unhappy step away from a paper shortage. Wailed a Glens Falls, N.Y. paperman: "There is only one thing we lack--sufficient orders."

* Direct-mail advertisers, like Government publicity agencies, have been getting angry letters from people who think such mailings are wasteful and unpatriotic. This week The Reporter of Direct Mail Advertising confessed that "the direct mail business has just about gone to pot in the last month," blamed "people with axes to grind" for fanning shortage talk, cried "There is plenty of paper."

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