The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1911-06-08
Conference at Morgan,s House.

There had been a conference at Mor-
gans house. Mr. Bacon did not tell me
anything about John w. Gates having
been there. | never heard thai he was
there until | read this testimony before
this committee in which he said he was
at Morgans house and that the plan of
the United states corporation was formu-
lated there. cannot see how II could
be that such plans were made that night.
MFR. Bacon said that Mr.. Schwab had
submitted the Carnegie letter which
fixed q price for the steel plants, and that
Mr.. Morgan had told him To submit the
whole matter 10 me. We went over the
whole matter until lunch time. and Mr..
Bacon went TO see Mr.. Morgan and came
back and we spent the entire evening
going over the matter.
"Al that time the Federal Steel COM
pany was in need of finishing mills and
sought a corporation OF sufficient inan-
clal strength to Increase Its lines OF busi-
ness and particularly its export trade,
which then was small. II was necessary
10 increase the export trade In order that
this country should get Its share OF the
business from neutral ports. We had
great deal of discussion about Mr.. Car
negie's price | having known that TWO
years before he had offered Ia sell for "A
much less sum, but realized that the com
pany had increased It's earning capacity
and its value.
Il told Mr. Bacon then that if through
the acquisition OF the Carnegie company
A corporation could be completed large
enough and rich enough TO furnish ade-
port business. | believed his proposition
was worth considering and | agreed To
meet Mr.. Morgan the next day. Monday.
Meeting With Morgan.
Il met MIR. Morgan. explaining my
ideas and the details OF the business rca
sons for entertaining the proposition.
think a consolidation OF steel interests OH
this line is practical that we should start
with the Federal Steel company
I'VE decided to call in the men inter-
ested in Federal steel and telephoned for
Norman Il. Rcam. II: II. Rogers. D, o.
Mills and others. We got into long
distance telephone communication with
Marshall Field OF Chicago, who also was
director of the Federal Steel company.
\ meeting was arranged and | told OF
the proposition explaining the business
opportunities as best | could. Mr.. Nor
gan then stated that ne knew enormous
responsibility would be involved. but that
II We concluded II was g good safe and
reliable undertaking he would act as
financial sponsor of a syndicate TO carry
II out. There was some opposition at
FIRST on the part OF some OF the Federal
Steel directors. but they finally assenteG:
and that is where The United States
Mr. Gary then told the committee or
the details OF working out the plan and
Of taking over the American steel &
Bridge. the National Steel. and other con-
Germs. and of the capitalization Of the
United States Steel corporation al
$3.50. 00O, 00Q.
II want to say" he continued. THAT
from the standpoint of the original cost
OF the concerns which were taken In and
what IL would have cost TO reproduce
them at the time. there Is no doubt that
the United States Steel corporation was
overca pitalized. but from the standpoint
of what all the properties were actually
worth nut together as z growing con-
cern. do not believe that the steel cor
pora ton was oVcrCaDitalized.'
Throws Doubt on Story of Gates
Mr.. Gary said that in all the necotia-
tlons preceding the organization Of the
United States steel corporation. he never
had heard that the threats OF Mr.. Car
negie 10 build plant to rival the Ma
uonal Tube COMPANY organized by Mr..
Morgan, and 10 build 3 railroad from
Pittsburg TO New York. connecting all his
steel plants had anything 10 do with it.
Such matters as ] learned were tes-
mittee." Mr.. Gary said. never were
spoken Of in our deliberations. l do not
remember that Ny Morgan ever men
toned these matters TO me
Mr.. Gary said that when ii came to
the matter OF discussing charter and
alton. Mr.. Gates had nothing 10 do with
ii. Mr.. Gates's connection, he said was
10 look after the interests OF the Ameri-
can Steel Wire company in the trans
action.
The committee today issued subpoena
Steel corporation and for the production
OF the minutes OF the corporations
finance committee meetings. al which the
purchase OF the Tennessee Coal q; Iron
company WAS discussed.