The Montgomery advertiser., 1909-02-21
Steel Merger Violated Anti Trust Law. THE SUBCOMMITTEE
 WILL MAKE ITS REPORT President Unwilling to Direct Attof- ney General to Interfere. If Full Committee subscribes to the Findings, the Effect win Be to Administer sevcrest
 0f Rebukes to the
 President.
 

ndsuiuBtonp rep. ZV,--By N1te OA three to two the sub-comaittee of the Committee on Judiciary. which has been Investigating the merger of the TenneSee Coal and Iron Company and the United States Steel Corporation, today decided to report to the full com mittee that the President was not au- thorised to permit the absorption.
 The committee found also that Pres. ident Roosevelt was equally unwilling to direct the Attorney General not to interfere with the merger and not to enforce the Federal statutes against 1t. IL was decided alec that as both com panies were engaged in interstate com merce, the absorption was in violation Of the Sherman antitrust law and that the effect and purpose of the absorp- ton was to monopolize the Iron ore supply Of the country and generariy to eliminate the Tenpessse Company as a competitor of the United stateB Steel Corporation
 The fact that such a report was to be made created consternation in the Senate. It was realized that if the full committee subscrlbes to the findings of the subcommittee the effect would be to administer the severest of re- bukes to President Roosevelt and prac- 'tically to instruct the Attorney Gen eral to bring proceedings against tho Steel Corporation under the sherman antitrust law.
 Leaders in the Senate make no se- cret of the fact that they are unwii- ling to go that far. Under these cir cumstances. the committee when 1t meets on. Monday. probably will decide to consider very carefully the possl- b1e effect Of the report before deciding to adopt it. It is conceded that tho deliberations of the committed must extend ever many days ana t is likely that an action cannot be had at this sassionN The report acted upon 2 was drafte& by Senator cuIberson. author oc the resolutions providing for the in quiry.
 oondactea by sah-cansaaa4aee.
 The inhniry was conducted bk aUbs committee of five, Meesrs clark tWyn.1 Dillingham;. I1lttridEe. cuibetson and Overnaan.
 The first three of these are Republh cans and the last two Democrats.
 Senator Kittri0ge joined with the tws Democrats in making the majority Tef port. No minority report will be made by Senators Clark and. Dillingham;, as they expect that when the whole mat ter Is gone over by the full committee there will be division requiring mora than one report. The subcommittee decided not to make the text of it's re- port public although the interest in it was so great that the findings became known to practically the entire Senate during the afternoon.
 In addition to the findings of law. the committee reported on many ques- tions of fact connected with the merg- CT. It was found that during the panicky days of November, 1907, the United States Steel Corporation pur- chased all of the stock of the Tennes- see Coal and Iron Company, except $22O.16O. the amount of stock acquired being $SO. .7s5,s2s.
 7, It fs shown that, only f5s3.ss6 in bonds of the Steel Corporation were issued to the amount of s34.6B4,97Ss or nearly S6,O00,000 in excess of the par value of the Tennessee Company stock purcha
 The report quotes from the Presi. dents message dclaring that the ab- sorption was necessary, according to the representations to him by Judge D. H. Gary and R. c. Frisk, on be- half of the Steel Corporation, as . certain business firm of importance in New York circles would undoubted- ly fail >unless the deal could be made.
 From testimony of a number of wit nesses, the report declares that the firm of Moore & Schley, stock brokers of New York City, was the one referred to by Messrs. Gary and Prick. This Is the concern which managed the af- fairs of a party of financiers who bought a majority of the stock of the Tennessee Company and held It until November, 1907.
 It is asserted by the report that banks in New York, some of them known as Morgan banks, pressed loans on the Tennessee Company stock vtg- orously, and that these demands were met successfully. unfearful Of the req suit on account of business uneast- ness in regard to Tennessee stock. terms were made with the Steel Cor poration. It Is asserted that the syndicate did not wish to sell its stock but was forced to do so. After giving much of the testimony on this point, the report specifically denies the as- sertion of the President that the merger was necessary to save an. ini- portant banking concern or business house in New York.
 Sarcastic references were made by the committee report to the statement of Judge Gary and Mir Prick In their interview with the President, that they did not want to buy the Tennes- see concern, and that but little benefit would come to the Steel Corporation PrOv, tha nurrhaaa