Omaha daily bee., 1899-11-15
HISTORY OF WIRE COMBINE
Managing Director Gates Gives Account Of
His Efforts in Europe.
TRUST DOES NOT RECOGNIZE UNIONS
American steel and Wire Company
Controls All the BHrbed Wire
Patents, Giving IL Complete
Monopoly of This Product.

WASHINGTON, Nov. 14-In giving his
testimony before the Industrial commission
today John W. Gates, managing director OF
the American Steel and Wire company, gave
an Interesting account Of his effort to ef-
feet a consolidation OF all the wire producing
countries. including all the European ma
tons. He said he had visited Great Britain,
France Germany Belgium and other coun-
tries for this purpose, Germany he found
TO be the principal competitor, Englands
work in that respect not being sufhcient TO
deserve serious consideration In Germany
the one fear In manufacturing centers was
competition with the United States and
bounties and subsidies were given on every
hand to hold up the manufacturing interests
OF that country.
The Germans offered first, in case OF inter-
national consolidation, the United States
should be content with 20 per cent OF the
product. This he had declined and they had
afterward Increased the allowance to 5S per
cent. He had run away from Berlin to
avoid accepting this allowance. He had him.
self represented 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 in
crease of about 500 per ton. In this con-
the German method of encouraging the pro-
ducing and exporting interests, 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 steamship lines
and to national corporations OF s5,OOO,OOO
Capitalization and over. He would have the
corporations pay literally for such charters
in the beginning and to have them pay large
sums annually for the continuance OF the
franchise. increasing the amount as the capl-
talization increased until the annual fee
should be no less than $1,000 600 for a COM
pany capitalized at $780, 600 He advo-
Gated government supervision OF all corpora
tions.
He said the protective tariff had much to
do with building UP the iron and steel in
dustry and that the continuance OF the policy
was necessary TO the future prosperity of
the industry. He said that his consolidation
had been effected last January and mum
ber of plants that could not be operated had
been shut down. The company employs
36 900 men and wages had been increased on
an average OF 40 per cent.
Do Not Recognize Trade Unions.
The company did not he said, recognize
the trades unions, preferring to deal with the
men as individuals, and would not recognize
the unions. He said the company controlled
all the barbed wire patents aud had a
monopoly in this respect. On. this product
4 higher charge was made than on other
products because CT the monopoly of the
patents. This was because OF the money
spent in their acquisition. Generally speak
ing the advance in wire products had been
only proportionate to the increase of the
prices OF raw material 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 a monopoly of the
production OF unpatented articles, or seek TO
control the selling prices of its patrons On
the contrary, the disposition was to en-
courage ether organizations 1t was not true
as people seemed to believe, that the trusts
controlled the iron and steel business of
the country. AS matter of fact, they only
controlled about 40 per cent.
Mr.. Gates deprecated the present high
prices Of iron and steel products, principal
ly because of the high prices OF raw ma
terial. He, however, expressed the opinion
that the present prices would continue for
the next two or three years basing the
opinion upon his knowledge of the demands
of the railroads. the ship yards and the
building trades He said that his company
was exporting less than 700 tons per day.
supplying England, for instance, with 60 per
cent of the wire products purchased there.
He admitted that the goods were sold at
lower rates abroad than at home, but for
the present this was necessary to hold the
outside trade. He had found that many
lines Of the iron and steel industry were
syndicated. He had procured copies of the
agreements, but he declined to produce
them, laughingly saying that he had them
stolen. The American company had earned
dividend on its common stock as well as
the preferred, the directors considering 1t
wiser to lay aside something for a possible
rainy day.
Other witnesses of the day were NJ AK Pam,
counsel for the American Steel and Wire
company; James C. Pearson organizer of the
National Shear company. and Frederick c. |
j. Wiss, vice president of the last named !
company.