The Democratic press. [volume] (Ravenna, O. [Ohio]) 1868-1901, 1891-09-30
THE AGE OF TRUSTS.
Immense Combinations Organized
to Enjoy McKinleyism.
The steel Rail Association.

and of the Scranton steel works by the
Lackawanna coal and iron company,
have directed attention to the fact that
steel rail manufacturing is slowly but
surely becoming a monopoly. In 1880
the field of steel rail making was cut
up by the competition of ten different
concerns Now there are but six. In
the decade intervening nine other con-
Germs have either discontinued the bus
mess or been absorbed.
Pennsylvania produces two-thirds
of the steel rails made in this country.
'"There is a tacit understanding
among the six concerns now making
rails which prevents cutting in prices
and insures division of orders. None
of the companies is powerful enough to
absorb the other, but the business has
been so centralized as to make the
formation of trust an easy matter
whenever the manufacturers feel so
disposed. ''-Associated Press.
NOT A POOL, AN ASSOCIATION.
The above report of the absorption
of the Scranton Steel Co. by the rail-
makers trust evoked this explanation
from the secretary of the Illinois Steel
Co.:
''The Dispatch calls the combination
of steel-ran makers a pool. This is not
correct. The various companies have
formed the Railmakers' Association.
The object of the association is simply
to prevent ruinous cutting of rates.
There is absolutely nothing in the
rumor that our profits are pooled. Each
company is independent of the other,
save in one matter of underselling.
Now that the Scranton company has
Joined the association there are no rail
companies outside. The Scranton COM
pany has been disturbing element for
a long time, but suppose that it has
found that it would be more profita bic
to join the association"
That the new concern is not spool,
but an association" will be comfort
to consumers of steel rails who are
thus officially assured that the mem
bers of the association" will find it
more profitable to join" and prevent
the ruinous cutting of rates. The
league, pool, trust or association will
not, presume, interfere with ruin
Gus Ito consumers) imitation of rates up
to the full limit permitted by the Nc
Kinley tariff.
The manufacture of rails has thus
been concentrated IN the hands of six
companies, and the price of rails has
been advanced about So. 90 or 81. 90 from
the very lowest figures There were for
merly eleven companies which produced
rails, without. counting the Troy or
Cleveland works. The Illinois Steel
Co. absorbed three companies, the
Carnegies bought out one, and the
Lackawanna Coal and Iron Co. and the
Scranton Steel Co. have consolidated
This leaves the illinois Steel Co., the
Carnegies, the new Lackawanna Co.,
the Cambria, the Pennsylvania and the
Bethlehem Iron Cos. in possession of the
field. 1t is understood that the new
Laclzawanna Co. will issue So, zoe, 900 in
stock, and its capacity will be 400, 900
tons per annum.
During the yeer 1887, 2.O49, 6Ss tons of
steel rails were produced in this
country. The combination, with the
aid and protection of the tariff wall,
forced the prices up from $27 per ton,
in 1885, to $40 per ton at the beginning
Of 1887. Prices then declined to $50. so,
under the pressure of the railroad COM
bination, which found it profitable tc
import 1, 800, 900 tons, notwithstanding
the duty. This importation of 1,soo,-
BOO tons of steel rails, conclusively
shows that American combination
prices are, on an average, S175 per ton
higher than English prices
Previous to 1870 the duty on steel
rails imported was As per cent. adva-
loren. Up to 1869 and 1870, Sir Henry
Bessemer had a patent on the steel
rail process, and. like any other article
patented, he might have charged any
price for it. In 1869 he was selling steel
rails at S11O per ton In 1870 his patent
ran out, and steel rails fell to $5S pei
ton. In 1869, in this country, the price
of Bessemer steel rails was $132. so per
ton, and in 1871 the price was $102 per tom
and the manufacturers of steel rails in
this country, seeing that they could
now have the benefit of Bessemer's in.
vention, and wishing to ward off for
eign competition, sent a confidential
communication to the committee on
ways and means of congress, asking
for duty of two cents pound, OF
| B44.S0 per ton, on steel Notice right
here, that this duty was proposed by
the very men who expected to reap the
benefits, and not by congress at its OWL
instance. They did not wish the real
reasons and motives to be known. This
letter, nevertheless, was very honest
document; they put in no idle words
They proposed, by means of heavy
| duty on foreign steel, to keep that out
of the country, and with their owr
mills, then running, to supply the
whole domestic market. But the com
mittee and congress did not give them al
that they asked-tvo cents per pound
or $44. 80 per ton-but only fve-eighth:
of what they asked, or $2s per ton
| Now, how did this duty operate-frst
so far as the people were concerned
second, SO far as the laborers were con
cerned?
First, then, as to how it affects tn,
people. For the thirteen years endinl
in 1883, there were produced in tn,
United States 6,944, $50 tons of stee
rails. The average higher American
price for rails for those thirteen year
than English rails, was $22. IS per ton
which average higher price was tn
only motive for laying the duty on thi
foreign rails. That is to say, the effec
of the laying of the duty was to in
crease the average American price, no
to the full extent of the duty (S25 Pc
tony, but to only 80 per cent of the du
ty; that is, $22. Is. Now, multiply tn
total number of tons produced by tn
average higher price occasioned by tn
duty, and you have the enormous sun
of $153, s22, 21a. so.
Senator Blaine, in his Farmingtol
speech, estimated that the steel raj
men made for themselves, for the ii
teen years ending in 1885, $3.50, 900, 600
S15S, 1872, 212 of which is directly traces
BILE to the effect of the tariff. Accord
ing to Blaine, their profits were $3.50
O00, 900. Had it not been for the tarih
these profits would have been less tina
$153, ,s22, 212, which would have left the
profits $97, 600, 600, on capital OF $50
600, 900, or S37S per cent. on the none
invested. But as it was, their prof1
were $3.50. 600, 900, over n per cent
T the capital invested
The facts which were brought to u
attention of the public, by itigat1c
brought before the orphans court
100