The Daily Missoulian. [volume] (Missoula, Mont.) 1904-1961, 1909-02-21
SUB COMMITTEE FINDS THAT
ROOSEVELT EXCEEDED pow
ERS IN STEEL CASE.
WILL MAKE ITS REPORT
Approval Of Absorption Of Tennessee
Coal Company by Big Cooperation
Was Unauthorized, as Were His In
structions to Attorney General.

Washington. Feb. 20.-By a vote of
three to two the subcommittee of the
committee on judiciary which has been
investigating the merger of the Ten
nessee Coal & Iron company and the
United States Steel corporation, to-
day decided to report to the full COM
mttee that the president was not au-
thorized to permit the absorption.
The committee found also that
President Roosevelt was equally unau-
thorized to direct the attorney general
not to interfere with the merger and
not to enforce the federal statutes
against it. 1t was decided also that
as both companies We're engaged in
interstate commerce the absorption
was "A violation of the Sherman anti
trust law. 1t was found that the ef-
feet and purpose of the absorption
were to monopolize the iron ore sup
ply of the country and generally tc
eliminate the Tennessee company as
a competitor of the United States
Steel corporation.
The fact that such report was tc
be made created CONSERVATION in the
senate. 1t was realized that if the full
committee subscribes to the findings
of the subcommittee the effect would
be to administer the severest rebukes
to President Roosevelt and practically
to direct the attorney general tc
bring proceedings against the steel
corporation under the Sherman law
Leaders in the senate make no secret
of the fact that they are unwilling
to go that far Under these crcum-
stances the full committee when il
meets on Monday, probably will de.
eide to consider very carefully the
possible effect of the report before
deciding to adopt it, The repor
acted upon was drafted by Senator
Culberson, author of the resolution
providing for the inquiry.
OF Great Interest.
The inquiry was conducted by ;
subcommittee Of five, Messrs. Clarke
of Wyoming. Dillingham;, Kittredge
Culberson and Overman. The frs
three of these are republicans and tn,
last two democrats. Senator Kittredg,
Joined with the two democrats IL
making the majority report. No min
ority report was made by Senator!
Clarke and Dillingham;. The sub
committee decided not to make tn,
text of its report public, although tn,
interest in it was so great that th'
findings became known to practically
the entire senate during the afternoon
In addition to the findings Of law
the committee reported on many
questions of facts connected with tn,
merger. 1t was found that during tn,
panic days of November, 1907, tn,
United States Steel corporation pur
chased all the stock of the Tennessee
Coal & Iron company except 1920, 100
the amount of stock acquired beint
$50, ,375,S25 1t is shown that only
$632, $50 in cash was paid for the stocl
and that bonds of the steel corpora
tion were issued to the amount OF
s34,6S497S, or nearly $5,000,0OO in excess
of the par value of the Tennessee
company's stock purchased
Quotes Message.
The report quotes from the presi.
dents message declaring the absorp-
tion was necessary, according to tbs
representations to him by Judge Gary
and Fl. C. Frick on behalf of the stee
corporation, as certain business
firm of real importance in New Yorl
financial circles would undoubtedly
fail unless the deal could be made
From testimony of a number of wit
nesses the report declares that the
rm of Moore & Schley, stock broker.
of New York was the one referred tC
to by Messrs. Gary and Frick. This
is the concern which managed the af.
fairs of party of financiers who
bought majority of the stock of the
Tennessee Coal & Iron company an6
held it until November, 1907.
1t is asserted by the report thai
banks in New York, some of then
known as Morgan banks, pressed the
loans on Tennessee Coal &, Iron com.
pany stock vigorously, and that these
demands were met successfully, until
fearful of the result on account OF
the business uneasiness in regard tc
the Tennessee stock, terms were made
with the steel corporation. 1t is as.
serted the syndicate did not wish tC
sell its stock, but was forced to do so
Ultimate Control.
From the testimony it is asserted
that the Tennessee property is worth
several hundred million dollars, ant
would give the steel corporation ulti'
mate control of the iron ore supply
for the country, and the iron and stee
trade of the south.
1t is asserted by the committee tha
whatever may be the supposed emer
gency no discretion is lodged in tn,
president as to the enforcement of the
law. 1t was found in the opinion o
a majority of the subcommittee tha'
the presidents communication to At
torney General Bonaparte was in effec
direction not to interfere with the
merger. 1t was pointed out that un
der the federal constitution the presi
dent is the one official who is ex
pressly enjoined to take care that IN,
laws be faithfully executed