The Cairo bulletin. (Cairo, Ill.) 1???-1928, 1911-05-30
THE STEEL TRUST
JOHN w. GATES SAYS Carnegie
LIKE BULL IN CHINA
SHOP.
Declares Rockefeller Was Punched
When He Attempted to Get In
Forced to Sail Out 40 Gems
On Dollar

II
WASHINGTON, Mar ~, After john
w. Gates had left the witness stand
| this afternoon Charm an Stanley OF
| the special committee OF the House
| which is Investigating the steel trust
expressed the opinion that suffclent
Information already had been divulee'
| to Justify suit BY the government
to dissolve the United States Steel
Corporation.
! Mr. Gates was frank witness. He
stated that the great steel corpora
ton, which he called a holding com
pany, was organized primarily by
himself j. Pierpont Morgan and
Charles VI. Schwab He said the real
reason for the consolidation was that
Andrew Carnegie was bull in q
CHINA shop" in the steel business, had
demoraized prices aad was tnreaten-
! ing to construct 0 railroad and ser.
ionsly interfere with other steel
manufacturers.
| incidentally Mr.. Gates expressed
the opinion that the laird of Skioo
was anxious TO sell out and adop.
this method for the purpose of max
| ing good bargain He succeeded in
'faising the ante" from $lGo.0Oo,000
to $500, 600, 900 and later added to this
enormous figure
Missourian's Name Drawn In.
The witness brought the name OF
Harry Smith of Sedalia, Mo- into the
investigation by way of illustrating
how Mr.. Carnegie operated The
| principle he was making wa that Mr.
Carnegie would never agree to any,
thing proposed by an associate for
| him and did not hesitate to cut under
the established price on occas ON.
| Why said Mr. Gates, IF Fricl,
an,l | agreed to one thing in the morn
! Ing, Frick would come to me in the
would not have it. In other words,
nobody in Carnegle's company con.
trolled Carnegie.
| I'D like to tel yon little story
Along about 81 or 'SS a man name
Harry Smith who was purchasins
gent for the Missoar;, Kansas and
Texas Railroad. Wanted to buy some
steel rails. The price of rails was
$50 a ton The Carnegie concern was
a member Of rail pool and the pen.
| lty for cutting prices was enormous.
smith was friend of mine and told
me that everything being equal he
| Woul 1uy from me. Blu he happened
to meet Carnegie one day in New
YORK City. and Andy cut the price
materially and got the contract
charges We're preferred against the
| Carnegie concern. We questioned
| Carnegie about the cut, and he would
not say anything. | knew, however.
that the cut had been made by throw.
ing IN Tree track spikes and angle
bars, amounting to S. a ton"
Combine Punched Rockefeller.
| Present at the United States steel
CORPORATION birth Mr.. Gates de
scrloed how it was the natural out.
GENE OF what he described as the re.
fuSal of Andrew Carnegie to no
bound by The "gentiemens agree.
mehts that marked the early days
OF open competition in the steel bnsj.
ness.
Relating how Carnegie had been
forced 10 abandon plans for eytandinn
his steel business, Mr.. Gates frankly
admitted the combination was formed
to throttle competition, and that when
John u. Rockefeller had sought to
enter the steel business a deal was
put through, which forced him TO sell
ont for 40 cents on the dollar.
Ar. Gates also told the committee
OF the taking over of the Tennessee
Coal and Iron Company by the Uni
| ted States Steel Corporation during
the panic OF 1907, "a deal in which he
WIS interested as stakeholder of the
tennessee compny. This, he sad
was forced transaction carried out
ny Mr.. Morgan and other financial
leaders to save the Trust COMPANY
OF America, threatened in the finan.
cial upheaval because it had loaned
100 mucn money on stock of the Ten.
nessee Company
How Morgan Became Interested.
Plans made by Mr.. Carnegie in 1899
and 1900 to circle his steel interests
with railroad of his own and to com.
pete with the National Tnbe com.
pany, organized by Mr.. Morgan h !.
the erection of a tube works AZ Ash.
tabula, Ohio, were factors that led to
the birth of the steel combine.
Mr.. Gates revealed how Mr. Morgan
al'rmd by Mr.. Carncgie's plans had
sought the advice of himself ana
James J. Hill how Charles NJ
Schwab. who he said, was the only
m N IN n A.