New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1894-03-27
THE FRAUD AT CARNEG1E'S.
cnrrARY HERBERT TELLS ABOUT THE
COMPROMISE.

=, DIP CENT But THE fi'-SiDE>i HEDOO@D
~ n PER COMMUNICATING COIN
OFFENCE THAT THIS REDUCTION WAS
GOT ORDERED TILL MIR. CARNEGlD
vporD HIS TARIFF LETTER-A
COMFORTABLE SUM FOR
THE INFoRMANTs
INV TELEGRAPH TO TRIBUNE
u,,sbing,on. March 26.-At last Secretary Her
49,, has completed and transmitted 10 the house
:. representatives his reply TO the resolution
.,u,ng for information in regard TO Imperfect or
,.,oc,ive armor plates furnished by the carnegie
c,oe, Company under its contract with the Navy
nenartment and also for a report OF the action
!, the Department in regard thereto. In the
mo,n and in most Of its material statements 'he
J@c;aI report made public to-day agrees VITA
s.a,aments in these dispatches relalihs 10 the
came subject and published in the Irouhe Oh
,,orcb and subsequent dates despite the Iact
.ho, the information upon which the latter were
,,ased was not and could not be obtained or Verl-
ena at the Navy Department. the lips OF whose
ne were sealed by the most positive injunc-
tons OF secrecy ,,..
nublished in The Tribune-which prompted MI
rrn,ro,ngs,s resolution of inquiry and which has
.o-dav-attention was invited to an important
and significant coincidence in regard to the da'e
:. p~ocident Cleyeland's decision on the appeal OF
AZ carnegie Steel Company from the Secretary
- .,a NAVY and the da e of Mr.. Carnegie's letter
a. Tho Tr,hune in behalf of the Wilson BILL the
concordance and significance of this coincidence
.nnear with even stronger force in Secretary Her.
horts reply TO the House resolution. MI Car
,acie left washington after his second visit ana
avail appeal to the President on December ~
and two weeks afterward he wrote his letter 10
The Tribune approving the Wilson bill with such
amendments as Republican Senators might De
able TO engraft upon it in Democratic Senate
cARNEGIE's LETTER WELL TIMED
u NAV be properly added just here that when
Ar Carnegie wrote that letter on January ne
tnew that the debate on the Wilson Dill was 10
,heein in the House Of Representatives on Jahu-
airy 8. His letter was, indeed. timely one ioi
the advocates of that measure Again. "heh lie
wrote the letter, he must nave been auNiseu a'
10 what the decision of the President wouio De-
because he was to sail for Europe on the Hollow
ing day. But the decision of the President was
NOT reduced to writing and signed until week
after the letter was written, two days alter l'S
publication in The Tribune and six days al'er
Mr. Carnegie had sailed from New ork' Inc
Administration evidently did not Intend 10 take
anv risk The publication OF Mr.. Carnegie
formal approval of the Wilson bill ana MS APP
900, ~ bis "brother manufacturers not to OBJ
etuct Democratic tariff reform legislation
.rs, .ntedate Mr.. Cleveand's formal decision
mon the appeal from the Secretary OF the navy
Mr. Carnegie kept faith with the Admnistra-
.or and the Administration tried to keep faith
9TH hin, by preventing any hint OF the arrnor
,,ate transactions from reaching the pubic. IL
s;a avon more Secretary Herbert had approved
.ba renort of Captain Sampson ana MS as-
.oc,ates of the Bureau Of Ordnance. when rec
ommended a fine of Is per cent upon the aiioui
~ armor plates furnished under the contract
The President not only RENTED one-'h'u Vi
The fine but decided that 1T should be assessor
only upon the amount Of armor plate turhiSheo
bv the Carnegie Steel Company from NoVempei
1892 to September 16. 1893 Whatever else
NAV be thought of 1t nobody VIII oehy 'hat
ube,ber Mr. Carnegie was wholly satisfied with
the decision or not he did wisely In wrltihe ina
letter to The Tribune at that particular 'i''e
He had obtained not only a pledge thal tn'
transaction should be kept from the puDhc, ou
also remission of one-third (aoout s'o'oo" VI
the fine imposed by the Secretary OF the Navy
and a Limitation Of the amount OF arh'oi P'
,nor tho contract price of which the fine was t(
no as
-.or,ant and valuable considerations pecuniarilS
.o,, os o.bervrise. and Mr. Carnegie undoubt
.d,v thought that he could well afford 10 "rl''
49, ,o.,er that he did write for publication II
The Tribune .,ou,, -
vealed to-day, can believe that the letter was
voluntary spontaneous and sincere tribute
snnroval. or that 1t was not wrung from IL
author by stern necessity? Its production seem
IN have cost him fortnight Of thought am
effort for II was not completed until the I'd!
before he sailed for Europe Within iortv-eis"
hours after its publication President Cievelah'
formulated and signed his decision ana trans
mitted it to the Secretary Of the Navy.
MR.. HERBERTs EXPLANATION.
The text of Secretary Herberts reply to tn
resolution Of inquiry is in part as follows;
Some time in September last 1 received informa
Non from an attorney of Pittsbure. who represehte
certain persons then in the employ or the 'arhesi
Neel Company, Limited that these employees ma
"a their possession information which wouid
sa,uable to the Government relating 10 irauus 'ie
ke,np nerpetrated as It was alleged by certain EN-
naoves of this company, and that they would CIV
This information to the Government for suiicien
consideration. The attorney had letter Oh 'i'io
duction TO me showing that he was repu'ao'
hvyer I Informed him that had no money
my command with which to pay for inrorina'oi
but tina, II the information should lead to the RI
coyery Of moneys from the Carnegie Company
thought could remunerate the informants iro'
the sum so recovered; that would not under'ah
to pay any expenses whatever. or any money eA
cept In this manner.
This proposition was satisfactory ana 'ne''up N
three OF these employees and the attorney repi'
sentne them James II. Smith. talked with 1T
freely The informants. although they asked NOR
finally consented to take 25 per cent of such SUI
- might be recovered.
STATEMENTS OF THE INFORMANTs.
These men had been gathering Information lot
long time and this they submitted 10 the Depar
ment in grea. detail. The allegations were that "
companys employees had failed to temper arm'
evenly and properly; had plugged and concealt
blow-holes. which would have probably caused
rejection Of plates by the Government inspector