The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1909-02-21
CONSTITUTION
VIOLATED BY
THE PRESIDENT
Absorption of Tennessee Coal
& Iron Company by Steel
Trust Illegal.
SENATE SUBCOMMITTEE
REBUKES ROOSEVELT
FRIENDS OF EXECUTIVE WILL
MAKE EFFORT TO KILL
THE REPORT.

Washington. Feb. 20-By vote of
three to two the subcommittee of the
committee on judiciary, which has
been investigating the merger of the
Tennessee Coal & Iron company and
tie United States Steel corporation, to-
day decided to report to the full com
mittee that the president was not au-
thorized to permit the absorption.
The committee found also that Presi-
dent Roosevelt was equally una1thor-
lied to direct the attorney general hot
to interfere with the merger and not
10 enforce the federal statutes against
IL. 1t was decided also that as both
companies were engaged in interstate
commerce, the absorption was in viola
ton of the Sherman antitrust law 1t
was found that the effect and purpose
of the absorption were to monopolize
the iron ore supply of the country ana
generally to eliminate the Tennessee
company as a competitor of the United
States Steel corporation.
Rebuke to Roosevelt.
The fact that such a report was to
be made created CONSERVATION in the
senate. It was realized that If the full
committee subscribes TO the findings
of the subcommittee, the effect would
be To administer the severest of re-
Dukes to President Roosevelt. and
practically to direct the attorney gen.
eral to bring proceedings against the
Steel corporation under the Sherman
law. Leaders in the senate make no
secret of the fact that they are unwill-
ing to go that far Under these cir
Cumstances the full comm ttee, when
it meets on Monday, probably viii de-
eide to consider very carefully the pos
sible effect of the report before decid-
ing to adopt il. The report acted upon
was drafted by Senator Culberson, au-
thor of the resolution providing for
the inquiry.
kittredge Joined the Democrats.
~ inquiry was conducted by sub
Committee of five, MeskTs Clark Of
Wyoming, Dillingham;, Kittredge, Gull
berson and Overman. The first three
OF these are RepubI cans and the last
two Democrats. Senator kittredge
Joined with the two Democrats in max
ing the majority report. No minority
report was made by Senator's Clark
and Dillingham;. The subcommittee
decided not to make the text of its re-
port public. although the interest in IL
was SO great that the findings became
known to practically the entire senate
dgking the afternoon.
~ addition to the findings of law.
the committee reported on many ques-
tons of fact connected with the mer-
Ger. Il was found that during the
panic DAYS of November 1907, the
United States steel corporation pur-
chased all the stock of the Tennessee
Coal q Iron company except S220,16O,
the ametnt Of the stock acquired being
So. S75.S 26 Il is shown that only $685.
656 in cash was paid for the stock,
and that bonds of the Steel corpora
ton were issued To- the amount of SS41-
6S4.97S. or nearly five million in excess
OF the par valus of the tennessee COM
PAM stock purcha sed-
Presidents Error.
The report quotes from the presi-
dents message declaring the absorp-
ton was necessary according to the
representations to him by Judge Gary
and II. G. Frick, on behalf of the Steel
corporation, as certain business firm
of real importance in New York cir
cles would undoubtedly fail unless the
deal could be made. From testimony
of a number of witnesses. the report
declares that the firm of Moore &
Schiev. stock brokers of New York. was
the one referred TO by Messrs. Gary
and Prick. This is the concern which
managed tie affairs of party of
financiers who bought a majority Of
the Sloth VI the ATliifCoStt NoAitbohs
and held it urtil November, 1907. II
is asserted by the report that banks
in New York. some of them known as
Morgan banks, pressed the loans on
Tennessee Coal company stock vigor-
ously. and that these demands were
met successfully. until, fearful of the
result on account of the business uneasi-
ness infregard 10 the Tennessee stock,
terms were made with the Steel cor
poration 1t is asserted the syndicate
did not wish to sell its stock but was
forced 10 DO so.
Sarcastic references were made by
Continued on Page 9.