Word: blough
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...where both business and government frequently based their most impor tant economic actions on the need to become more competitive in world markets. The turning point of the year for the U.S. economy?the great steel crisis?seemed a peculiarly domestic fuss. But when U.S. Steel Chairman Roger Blough decided to raise steel prices $6 a ton less than a week after his company had signed its first noninflationary labor contract since the Korean war. he used foreign competition as a justification for his move. Overseas competitors, paying lower wages and operating more modern plants, were able to sell nails...
John F. Kennedy's hasty and white-lipped counterattack against Blough showed the President's belief that he had been doublecrossed: in persuading the United Steelworkers to hold the wage line, the President thought that he had an unspoken promise from Blough to hold the price line. But Kennedy, like Blough, based his case on the exigencies of the world market. A price rise in steel. Kennedy told the nation on TV. would set off another U.S. "inflationary spiral'' that "would make it more difficult to withstand competition from foreign imports, and thus far more difficult to improve our balance...
...S.O.B. Club. When things cooled down, many businessmen concluded that Blough had been wrong, and that if the President had only held his temper, the workings of the free market at a time of softness in steel demand would have forced Blough to rescind his price rises within a few weeks anyway. The President won a backdown from Big Steel when Chicago's Inland Steel refused to go along with Blough's move. Inland executives have repeatedly implied that they would not have raised prices even had the President not intervened...
...whatever they thought of his economics, virtually all U.S. businessmen were outraged by the tactics Kennedy used against Blough; the Administration's threats to deny U.S. Steel defense contracts and to harass the company with trustbusters and internal revenue agents raised business hackles as they had not been raised since the days of F.D.R. A number of grown-up businessmen sported "S.O.B. Club'' pins. Behind the anger was the fear that the Government would meddie in every labor settlement, clamp down on every price rise, and thus discourage all businessmen from undertaking any expansion or modernization. Said Chase Manhattan Bank...
This late-year surge gained speed after the Cuban crisis. In board rooms around the country, businessmen were impressed that President Kennedy had talked even tougher to Khrushchev than to Roger Blough. Heartened too by signals of economic upturn, managers stepped up their spending for plants and machines in the fourth quarter to a record yearly rate of $38.4 billion. On Wall Street the big mutual funds and pension funds moved back into the stock market (though badly singed small investors continued to spend their money elsewhere), and the market recouped 55% of its $96 billion paper loss. The mood...