The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-08-10
THE STEEL INDUSTRY.
True STORY or THE GENESIS or
THE GREAT STEEL TRUST.

Of His Colossal F0rtune-rhe Secret
webste and what 1t did and Indid-
Worth the Great Price Paid-An
Extraordinary Chapter I'm the History
Of Great Indusiry--The Conditions
rs They Are Now and the Outlook.
PIrrsBuRG, Aug. Steel appears to have
been a storm centre throughout the whole
great industrial disturbance. Its magnitude,
ats representative character as the leading
industry In manufactures, the type of con
oentration Of energy and capital, the first
of all the great corporations TO challenge
the direct hostility Of President Roosevelt
an these considerations have seemed TO
make Steel a focal point.
Perhaps there are some matters con-
nected with Steel which are at this time not
devoid Of interest. The general commentary
upon It when it was launched was of a some
what different character from that which
has attended it's career during the past six
months, and it may be worth while to look
Into its general aspect, quite apart from
speculative conditions.
"Steel is either king or n pauper." This
familiar saying is said TO be original with
Andrew Carnegie, and he ought to know
what he is talking about. The profits Of the
business Of steel making are at one time
enormous and at another time nil. That is
Mr. Carnegie's meaning. and he was mostly
q steel king and certainly made a great
many steel paupers in his career. The colos-
sal success OF Mr.. Carnegie's operations in
steel was not unlike that of the Standard on
corporation, and it was based upon the
same fundamental principle-control OF
transportation. The competitors of the
Standard Oil Company withered and shriv-
elled before its methods. 1t got rebates from
the railroads not only on its own oil, but on
all the oil shipped by It's competitors. 1t
developed new and overwhelming factor
IN business. TO wit: the enjoyment of adj
vantages denied to others. When Mr.. Cas-
satt was elected president of the Penrsyl-
vania Railroad he did the most unexpected
and revolutionary thing that ever was done
by an American railroad presdent-he
abolished the rebate, the secret rebate, the
preferential rebate, and every other kind
Of rebate. The steel industry was aghast
II could not believe its ears. Not even Mr.
Roosevelt himself ever dealt such a blow to
intrenched and fortified capital.
As for Mr.. Carnegie, it turned him into a
Scotch Berserker.
With his enormous control Of capital
his powerful associations and his notorious
methods, Mr.. Carnegie was formidable
figure TO deal with. He both stormecl and
acted. He started in to parallel the Pennsyl-
vania TO the Atlantic, to upset the whole
railroad apple cart from Chicago TO the sea
He turned the whole iron industry upside
q down. 1t had got into very fair shape
and its prospects were the most cheerful
IN its history. One leading and separate
feature Of it after another had been reor-
ganized and cleaned up. had acquired plenty
OF king capital, and all around there was
an excellent understanding as TO live and
let live This understanding necessarily
included the Carnegie industries. 1t had TO-.
No understanding in the iron trade at that
time that did not include Mr.. Carnegie
would have been worth anything. Mr.. Car
negie did not stay included. He was on the
warpath, and neither agreements nor I'M
derstandings nor conventions could include
him any longer. He flung them all to the
winds.
The country was full of his engineers in
no time. They we're surveying new railroads
and the sites of new steel plants. plants to
be established in competition with those
that had just been reorganized and with
which Mr. Carnegie had the most solemn
agreements of non-interference. tanta-
mount indeed. in some instances, to guar
antees OF immunity from competition on his
part.
The whole iron trade of the country was
confronted with chaos and disaster. Panic
invaded it; prices went tumbling in every
direction, business confidence was de-
stroyed- except Mr.. Carnegie sand
the whole outlook was most discouraging
and unhappy Two alternatives presented
themselves: one was to let Mr.. Carnegie
and Nature take their course and have a
general smash-up from one end Of the coun-
try TO the other; and the second was to sup
press Mr.. Carnegie Mr.. Carnegie had not
In long time failed to make known his
susceptibility to suppression. He was al
ways a reasonable and tractable gent le-
man, and would subside-for considera-
ton. 1t was thought worth while to as
suage MIR. Carnegie s feelings and save the
country from the danger that threatened.
The United States Steel Corporation was
formed.
IN passing LOT us iupr lIidI lne oCCdshOH VI
It all may be the last in the history Of our
railroads, and that We have seen the end OF
the whole corrupt and corrupting system
of rebates. These secret and dishonest
compacts between the great transportation
companies and equally or more dishonest
corporations and individuals have done an
infinity OF evil, and it will yet be long be-
fore we recover from it. When the public
learns fully that the great bulk of the rate
cutting by railroads has for its object less
the acquisition Of tonnage for the road
than OF pelf for people who can cut the rate
and pelf for the people who want the rate
cut, there will be better understanding OF
the rise and fall Of corporations and the
sudden wealth Of individuals.
But 10 return to Steel. The corporation
which superseded Mr.. Carnegie staggered
the imagination. 1t was colossal. The con-
sentative looked upon It's dimensions with
alarm and scrutinized with distrust the
prices that were paid for the constituent
properties. 1t seemed an awful price to pay
for getting rid of Mr.. Carnegie. but if the
general sentiment Of the steel trade could
be trusted it was not too much Besides. the
immediate benefit was great. The enormous
capital embarked in tho general iron trade