The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1911-06-01
Head Of the Great Trust
Frankly Tells the House
Committee of the Manage
ment of Corporation.
MINE PLANTS OWNED
BY PARENT COMPANY
Gary Names Officers and Di-
rectors of All These Com
panies-Holding Company
Fixes the Prices.

(National News Association
Washington. June 1.-Elbert III.
Gary, head of the United States Steel
revealed before the Stan
ley House Investigating committee to-
day how the steel corporation, as the
parent company. controls all subsi-
daries and practically the entire steel
industry. Under pressing interroga-
tions Gary admitted that the corpora
tion absolutely dominates nine manu-
featuring companies. is distributor OF
their products, and fixes prices where
two companies manufacture the same
articles. 1t also controls their policy
and administration. with little discre-
tion left to the individual companies.
Gary also said he himself names the
directors of these concerns while the
stockholders nominally re-elect them.
Boards of directors and officers dis
pleasing to the management of the
parent corporation naturally would be
displaced, as the .steei corporation
owns most of the stock of most OF
these companies, Gary stated.
Chairman. Stanley first ascertained
from Gary that he was the executive
official, chairman of board of direc.
tors and finance committee of the
United States Steel Corporation, and
that in addition he also was director
in the various subsidiary companies
owned by the steel trust
A Frank Statement.
Gary was pressed to explain who ap-
points the directors of the nine subsi-
dary companies
The stockholders name the direc-
tors" he replied. But il you ask for
an individual / suppose / am the one
who names the directors
Gary then admitted to the commit
tee that the steel corporation is not
an operating company; that it manu-
factures no steel itself but 1t absolute.
ly dominates several subsidiary COM
panies that do manufacture the pro-
duct
THE profits of these correlated COM
panies,' said Gary. ARE turned into
the treasury of the United States
Steel corporation and that corporation
distributes the profits as It sees fit"
Suppose two of the subsidiary COM
panies manufacture the same product"
asked Stanley, does the parent COM
pany fix the price for both OF the
manufacturing companies?"
Gary admitted the United States
Steel corporation fixed the price. The
committee also drew from Gary. who
declared that he wanted to be frank
and truthful with them, that but lit
tie discretion is left to the individual
companies, but that the policy and ad-
ministration OF all of these companies
are controlled by the holding company.
the United States Steel Corporation.
"Of course" said Mr. Gary. these
smaller companies have their boards
of directors and officers, but 1t goes
without saying that If the management
| was displeasing to the United States
Steel Corporation, the directors would
be displaced sooner or later. 1t
might be done in day or month. but
eventually it would be done. The
United States Steel corporation owns
most of the stock OF most all Of these
companies and naturally it would die
tate the policy of them"
! Gary then reviewed some of the
transactions testified to by J. w. Gates
who appeared before the committee
few days ago. Gates explained how
the Gary yMorgan-Frick syndicate had
assumed control of all the large steel
concerns in the country by means of
a holding company with no plants OF
it's own. Mr.. Gary was accompanied
today by P. c. Roberts and Norman
Ream. directors of the steel trust: W.
B. Dickson and James Gayiey. former
| ly vice president of the United States
Steel Corporation, w. J. Fflbert. assis-
tant to Mr. Barry and Richard Linda
bury. counsel for the corporation.
Gary admitted that all companies
merged under the corporation had
been more or less competitive before
the corporation was formed.