Kansas City journal. [volume] (Kansas City, Mo.) 1897-1928, 1899-11-15
JOHY- w. GATEs-TRIED TO FORM IT
IN WIRE BUSINESS. -
GERMANS WANTED TOO MUCH
MR.. GATES WOULD sUBsIDIZE ALL
BIG CORPORATIONS.
His Company Has n Monopoly ON
Barb Wfre-Protective Thrift Nee.
essary to Prosperity of Iron
Industry - Deprecates
Present High Prices.

WASHINGTON. Nov. 14-In giving his
testimony before the industrial commission
to-day. Mr.. John W. Gates, managing di-
rector of the American Steel and Wire
Company, gave an interesting account of
| MS effort to effect consolidation of all the
wire producing companies. including those
| In Europe. He said he had visited Great
Britain, France, Germany, Belgium and
otner countries for this purpose. Germany
ne found to be the principal competitor,
Ensiands work in that respect not being
sufncient 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 couIt-
try.
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 increased the
allowance to 90 per cent. He had run away
from Berlin to avoid accepting this allow
ance. He had himself represented the pos
sibility of increasing prices to. the extent
of about SO per ton, in case of proposed
amalgamation. but found that the Ger
mans had in view an increase of about
$50 per ton.
In this connection Mr. Gates commended
in high terms the German method OF en-
couragfng the producing and exporting in
terests, saying that If the United States
government would adopt the plan there
pursued they would soon be doing 80 per
cent of the iron and steel business Of the
world. He advocated subsidies to steam
ship lines ard to national corporations OF
100000 capitalization and over He would
have the corporations pay literally for
such charters in the beginning and then
have them pay large sums annually for
the continuance of the franchise. increasing
the amount as the capitalization increased
until the annual fee should be no less than
81 10000 for a company capitalized at $780,
10000 He advocated government supervis-
ion of all. such corporations
He said the protective tariff had much
to do with building up the iron and steel
industry, and that the continuance of the
perity of the industry.
He said that his consolidation had been
effected last January. A number of plants
been shut down. The. company employs
ZOO men and wages had been increased
an average of 40 per cent. The company
did not he said, recognize the trades
unions. dealing with its men as individuals,
and would not recognize the unions as
such. He said the company controlled all
the barbed wire patents and had monop-
oily in this respect. On this product
higher charge was made than on other
products because of the monopoly of the
patents. This was because of the money
spent in their acquisition.
Generally speaking. the advance in wire
products had been only proportionate to
the increase in the prices of the raw ma
terial and of wages. He considered that all
these advances had been due to demand
and supply. and not to the combination.
Indeed. he asserted that the American
company did not seek monopoly of the
production of the unpatented articles. or
seek to control the selling prices of its
products. On the contrary. the disposition
was TO encourage other organizations. 1t
was not true, as people seemed to believe,
that the trusts controlled the iron and steel
fact they only controlled about 40 per cent.
Mr.. Gates deprecated the present high
prices of iron and steel products, princi-
pally because of the high prices of raw
material. He, however. expressed the opin-
ion that the present price would continue
for the next two or three years, predicating
the opinion on his knowledge of the de-
mands of the railroads. the ship yards and
the building trades. He said that his COM
pany was exporting no less than 1000 tons
of wire per day. supplying England. for
instance. with 60 per cent Of the wire pro-
ducts purchased there. He admitted that
the goods were sold at lower rates abroad
was necessary to hold the outside trade.
He had found that in Germany all lines
of the iron and steel industry were syn
dfcated. He had procured copies of the
agreements. but he declined to produce
them, laughingly saying that he had stolen
them. He said the American company had
earned dividend on its common stock as
we'll as on its preferred, although none had
been declared the directors considering it
wiser to lay aside something for a possible
rainy day.
Other witnesses OF the day were Max
Pam, counsel for the American Steel and
VIII Wire Company PM James Pearson organ
Frederick C. ]. Wiss, vice president of the
last named company.