The Pensacola journal. (Pensacola, Fla.) 1898-1985, 1911-08-05
sy Associated Press.

New York, Aug. 4.-Charles M
Schwab, now a competitor of the
United States Steel Corporation, told
the Stanley committee today that the
corporation was a child of his brain,
and said the corporation was not
formed to maintain prices but TO oe.
velop trade. He admitted he could
make rails as cheaply as the Germans,
but they can ship cheaper to the Pa
cific coast than Pittsburg. He declared
it q mistake to have the tariff so low
that foreigners could reach the Pacifc
coast He said an option given on the
Carnegie plants to j. H. Moore and H
C.. Frick, who lost money because the
deal was not consummated, and was
for man whose name had never been
mentioned. He refused to give the
mans name.
Mr.. stanley asked Mr.. Schwab to tell
the whole story about Andrew Carne-
gie's desire to dispose OF his property,
the preliminary conferences with Mr..
Morgan and his part in the plans which
developed into the formation of the
United States Steel Corporation.
81 am very glad of the opportunity,
Mr., Schwab began, ito tell the story
about which there have been SO much
nI1sinformation.
In the fall Of 1889 ]. Edward Sim
mons, q New York banker and Mr.
Charles Stewart Smith rendered me a
dinner at the University Club. There
were present Mr.. Morgan, Mr.. Carnegie
and seventy or eighty New York finan-
ciers. There ! spoke about the future
Developments Of manufacturing steel In
the organization of such corporation
as the United States Steel Then I
outlined what became later the steel
corporation.
Il gave my reasons in detail" Mr..
SchWab continued "I showed first
how thought that instead of many
companies manufacturing the same
line of goods, that by organization
many companies could get together
raomla aunaaugt in great economy.
showed. secondly, how by organ
Nation there would be greater economy
iii distribution
There was no thought OF limitation
Of production, or the maintenance OF
high prices. The possibility of ninety
blast furnaces coming together in that
way In producing economy, proved so
great that recently at the Brussels con-
ference, advocated the idea of all in
dependent manufacturers exchanging
their cost sheets for the ultimate bene-
ft OF the steel industry"
could they 60 that without injury
to each other?" asked Chairman stan
ley.
"Oh, yes, they can and do. I pro-
pose to extend the idea. still farther
and have companies exchange cost of
every item that goes into ton of pig
iron"
Suppose asked you to furnish this
committee all your cost sheets, would
you be willing to do .it?'
Quite 50, and we do"
Then is there any reason why the
United States Steel Corporation should
hesitate to submit It's cost sheets?"
II think not. Since leaving the
United States Steel Corporation have
had access to most OF their cost items. "
R''Some time after received a mes
sage from John w. Gates asking me to
meet ]. p. Morgan" continued Mr..
Schwab II talked with Mr.. Morgan
for hours expounding my ideas for the
NeFmation of the organization OF steel
manufacturers. Mr.. Morgan told me
he was convinced of the advantages of
such an organization. and he asked me
II could get a price from Mr.. Car
negie for his steel plants. told him !
would see. ...... ......-.
II got q price from Mr.. Carnegie
and took II to Mr.. Morgan Beyond
being consulted about details with ref
erence to the properties, had nothing
to do with the organization of the
United States Steel Corporation"