The Gerlinger is Known for STRENGTH Outstde

The Gerlinger HS is unequaled for sturdy construction. The framework is made from heavy armorplate steel one-half inch thick;the braces insure absolute rigidity; sections are of angle or channel construction, hot steel riveted; all heavy parts are so distributed that the weight is litde if any more than other cariers.

In keeping with such exceptiond strength in its framework, the Ger' linger HS is powered by the fam' ous 55 Red SeaI Continental |\4[s1ss-a heavy.duty motor unit that meets every demand made upon it. No wonder then that the Gerlinger HS is known for strength as well as for its hydraulic lift and adaptability to all conditions.

(Continued from Page 12) preference, but cannot with justice to his railroad spend a cent more than the price of the cheapest machine on the "acceptable" list.

The X Company's price comes down; but in the meantime the Z Company is told that, though his price is low among the "accept- able" bidders, the engineers prefer another make, and his price must be made much lower to justify overriding the engineers' recommendation.

The Z Company price comes down. The X Company is again called in to be informed that their latest cut still leaves them just as high above another "acceptable" bidder as before because of a "revised" price. When these Christmas presents to the railroad, in the form of "revised" prices, begin to lag slightly, the Y Company is introduced to liven up the picture and to stimulate further donations. When all is finally settled, the bidder is told that, although the prices were asked for on the basis of five machineg, only one is to be bought; and it must be furnished at the same unit price as quoted for five together or all bids will be rejected and requests made for new bids.

An equitable return on investment an economic right of the railroads? Yes, for those railroads who, by recognizing the economic right to an equitable return on investment for those from whom they buy, have removed themselves from the class of purchasing profiteers."

Bcaesome Specifications

A favorite practice, resorted to by large corporations, and particularly by the steel industry in the purchase of machinery, is the insistence upon getting complete detailed drawings of the machines purchased, In the case of specially designed machines, for which the cost of drawings is to be included in the purchase price, there is often much justification for such request.

But in the purchase of standard machines, the threat is frequently made that the company will make no purchases unless detailed drawings are furnished. No compensation for the years and thousands of dollars spent on the development of the machine is contemplated.

Having taken away the last remaining dollars of profit in the sale of the machine through coercive purchasing, it is proposed that the spare-part business of the victim be turned over to the pur- chasing profiteer as well. Many specious arguments are given to justify the donation of these business assets of the machinery industry; but it is seldom explained that when spare parts are made in the user's repair shops under cost system which include no engineering, selling, administration, and other such overheads, and frequently on a material-and-labor basis only, it is exceedingly useful to the purchasing department to make valuable comparisons as to "exorbitant spare-part prices" in an endeavor to remove the last vestige of profit from this branch of the machinery industry.

The steel industry would not be where it is today if it ryere not for the past and present inventive genius in the machinery industry which in almost every line has revolutionized methods of production, transportation and handling of materials during the past forty years. Is there any reason to suppose that similar progress is not possible in the coming years? Certainly not, unless through coercive purchasing all stimulus is rentoved from the engineering machinery manufacturer to devote time and money to further advances in the art.

Industries suffering from these practices must either choose to face annual losses leading toward bankruptcy, or to enter into defensive combinations among themselves in conflict with our obso- lete laws against combinations leading toward federal indictment for control of prices. Self-defense shiuld surelv be a valid olea against the charge of combination in restraint oi trade. under such ctrcumstances.

Inadequate Prices, Bad Economics

In the conclusion to a recent address the head of a large steel company drew attention in these words to the economic nicessitv of 'main_taining_.the purchasing power of customers, employes ani stockholders alike:

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. "Inadequate prices do not inure to the benefit of the public and in. the long run are harmful alike to the employe and to the rndustry.

"It must be conceded that although the interests of the employes and of the customers have been well taken care of, it would ippear that in our drive for manufacturing supremacy we in the -iteel industry have failed to appreciate fully the diminishing rate of return on our investment and that in some quarters the interest of the holders of our securities has not beerr givin the consideration it deserves.

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_"It is important to maintain the high purchasing power of our labor and our customers. I think you will also igiee that it is equally important to maintain the purchasing power *of the "uer"gi investor."

If it is important to maintain the high purchasing power of the customers of the .large corporations of this country,- could there be a more short-sighted policy than that of "purchasing profiteer- ing" which.destroys or seriously impairs the purchasinE -power of the companies from whom the automobile industry, the stiei industry and the railroads purchase?

Practices Affect Public

The companies subject to this penny-wise and pounrl-foolish purchasing. policy are directly, as well ai indirectly through their employes,- large_ customers, of thes_e corporations. -They aie large buyers of steel, large shippers of freight, large useri of mot6r trucks, _and their employes-in the aggregate aie large buyers of aytomobiles so long as they are maintained in piofitable em- ployment.

It is the higher qxecutives of the large corporations who should take..cognizance of.the purchasing methods .of their organizations. While these executives are making addresses at banqueis and conventions commending the high standard of business ethics of which the American business man is proud, encouragement, or at least silent consent, is given to unethical purchasing practices further down the line in the organization.

In the long run such policies are detrimental, not alone to the industry whose profits are preempted, but to the economic welfare and future prosperity of the country as a whole, and will orove a boomerang.- to those who continue the practice of the ,,purchasing profiteer."

John Cushtng Vtstts The Northwest

John Cushing', Los Angeles manager for the Donovan Lumber Co., has returned from the Northwest where he sp-ent sev_eral days at the company's millat Aberdeen, Wash. On his return,. he was accompanied by Francis Donovan of the Donovan Lumber Co. - Frank O'Conno.. San _Francisco manager of the _company, met Mr. Cushing and Mr. Donovan in the Bay City and accompanied theri to T,os Angeles where they spent a few days lboking over lumber conditions. They also made atripto lumber docks at San Pedro.