The Indianapolis journal., 1899-11-15
STEEL AND WIRE TRUST
JOHN w. GATES TELLS OF HIS Eff
FORT TO MAKE 1T WORLDWIDE.
Failed I'm His Attempt Because Ger.
man Manufacture Were Too Ra-
pacious-Effect Of the Tariff.

w XSOf. 6NihS Ills
testimony before the Industrial Commission
to-day John w. Gates. managing director
of the American Steel and Wire Company.
gave an interesting account Of his effort
to effect a consolidation of all the wire
producing countries, including all the Euro
pean nations. He said he had visited Great
Britain, France, Germany, Belgium and
other countries for this purpose. Germany
he found to be the principal competitor.
England's work in that respect not being
sufficient to deserve serious consideration.
In Germany the one source of fear in man.
ufacturing centers was competition with
the United States and bounties and subsi-
dies were given on every hand to hold up
the manufacturing interests of that coun-
try.
The German manufacturers first proposed
that in case of an international consolida-
ton the United States should be content
with % per cent. of the product. This he
had declined and they had afterward in
creased the allowance to So per cent He
had run away from Berlin to avoid ac-
cepting this allowance. He had himself rep
resented the possibility of increasing prices
to the extent of about $40 per ton in case
of the proposed amalgamation, but found
that the Germans had in view an increase
OF ABOUT $3o per ton-
In this connection Mr.. Gates commended
in high terms the German method of en-
couraging the producing and exporting in
terests. saying that II the government of
the United States would adopt the plan
there pursued they soon would be doing 30
per cent. of the iron and steel business of
the world. He advocated subsidies to steam
ship lines and to national corporations of
nit l,zat tfop nd IIa
have the corporations pay literally for such
charters in the beginning and then have
them pay large sums annually for the con-
tinuance of the franchise. increasing the
amount as the capitalization increased until
the annual fee should be no less than a
million dollars for a company capitalized
at hundred millions. He advocated gov
err ent supervision OF all such corpora
tioi He said the protective tariff had
had much TO do with building UP the iron
and steel industry and that the continu-
ance Of the policy was necessary to the
future prosperity Of the industry.
Mr.. Gates said that his consolidation
had been effected last January. A number
of plants that could not be operated had
been shut down. The company employs
36.0C0 men and wages had been increased
on an average of 40 per cent. The company
did no., he said, recognize trades unions,
dealing with it's men as individuals and
would not recognize the unions as such, He
said the company controlled all the barbed
wire patents and had a monopoly in this
respect. On this product a higher charge
was made than on other products because
OF the monopoly OF the patents. This was
because of the money spent In their acqui-
sition. Generally speaking, the advance in
-
TO the increase OF the prices of raw ma
terial and OF wages. He considered that all
these advances had been due TO demand
and supply and not TO the combination In
deed, he asserted that the American Com
pany did not seek a monopoly OF the pro:
duction OF unpatented articles, or seek to
eontro1 con ,ne seng Inn Prees OF Its patrons On
age other organizations. Ii was not true
as people seemed TO believe, that the trusts
country. As matter OF fact they only
controlled about 10 per cent
Mr.. Gates deprecated the present high
prices OF iron and steel products. principally
because OF the high price of raw material
He, however, expressed the opinion that the
present prices We're continued for the next
two or three years, predicating the opinion
upon his knowledge of the demands OF the
railroads, the shipyardS and the building
trades. He said that his company was ex-
porting no less than 200 tons OF wire per
day, supplying England, for instance with
~ per cent. OF the wire products purchased
lie the BOoUS were sold
at lower rates abroad than at home. but for
the present this was necessary 10 hold the
outside trade. He had found that In Ger
many all lines OF the iron and steel in
dustry were syndicated He had procured
copies or the agreements, but he declined
20 produce them. laughingly saying that he
had had them stolen He said the Ameri-
can Company had earned dividend on its
common stock. as We'll as on It's preferred
the directors considering IL wiser TO lay
aside something fo- a possible rainy day.
other witnesses OF to-day were Max Pam,
counsel for the American Steel and Wire