The Washington herald., 1909-02-21
SCORES PRESIDENT
FOR 7. c. |. DEAL
Senate Committee Declares
the Merger Illegal.
BONAPARTE ALSO CRITICISED
Report Condemning the Chief Ex-
ecufiye for the Combination VIII
Be Made 10 the Full Committee
Tomorrow, and 1t Il Believed
Il viii BE Accepted.

The subcommittee CT the Senate Commit
tee on judiciary. by vote Of three 10 two.
decided yesterday on the form Of report
70 be submitted to the fun committee to
morrow in response 10 the Culberscn res
olution directing the committee 70 investi-
gate and report whether the President
exceeded his authority by permitting the
merger OF the Tennessee Coal and Iron
Company with the United States Steel
Corporation.
The report is a sweeping condemnation
Of the Presidents action IN the matter
on the question Of whether It should be
submitted 10 full committee, Senator A.
3. Kutredge. Of South Dakota, Repub-
ucan. and Senator's Charles 4. Culberson.
Of Texas. and Lee :. Overman. Of North
Carolina. Democrats. voted in the afr
native.
The two negative votes were cast by
Senator Clarence D. Clark. Of Wyoming.
chairman OF the judiciary Committee.
and Senator William P. Dillingham;. OF
Vermont
Report Of Committee
Among the findings OF fact reported by
the committee are:
That the Tennessee Coal. Iron and Rail
road Compeny was absorbed BY the
United States Steel Corporation on or
about November 3. IsJ3.
That the stock OF the Tennessee com
pany. when acquired. MAS quoted around
Sc, while the bonds given il exchange
were quoted five or six points higher,
from which the committee concludes that
the price paid for the stock Of the Ten
nessee company was about One-ffth more
than the market quotation.
The committee concludes from the cor
respondence that passed between the
President and the Attorney General and
from other testimony submitted that the
President actually approved o. the pro
posed merger.
II finds also that the firm OF Moore &
Schley did not hold as assets. as repre-
sented TO the President by officers Of the
Steel Corporation. any Of the stock OF
the Tennessee Coal and Iron Company
Driver to Merger.
The conclusion is also reached in the
report that the Tennessee Coal and Iron
Company was driven 10 make terms with
the steel Corporation. and the holders Of
the securities Of the first named com
psny were unwilling 10 sell TO the Steel
Corporation until they were forced to
DO 50.
The committee denies that there Is any
warrant for the statement that the mer-
ger was necessary 70 save the firm oi
Moore & Schley. The committee hold;
that the acquisition Of the Tennessee
company was very valuable to the United
States Steel Corporation. and practically
gives it the control Of 81 Il per cent OF
the total supply Of high grade iron Or'
{ in the country. having added TO its g.
/ timated holdings Of a per cent, II II pel
cent represented by the holdings OF ths
/ Tennessee corporation.
characterized sS Monopoly.
This is characterized as monopoly
which viii ultimately give to thu
Steel. Corporation the practical contro
Of the ore supply Of the tinted States
The committed concludes that the prop
ertv is very valuable. being worth sev
/ eral hundred million dollars. and give!
I 10 the Steel Corporation, as the result o.
the merger. the control Of the open
/ hearth output Of steel rails. the uItimat'
/ control Of the iron ore supply Of TIT
country. q. monopoly Of the iron and stee
trade OF the South. and eliminates a ven
| strong competitor
/ In its conclusions Of law the sUbcom
mittee practically says that the Presiden
was not authorized 20 permit the merger
and that hts action in permitting 4
! amounted to annulling or suspending ;
law. and that in so doing the Presiden
disregarded HIS oath to see that the Law.