The Sentinel=record., 1911-05-28
STEEL TRUST SECRET BARE
JOHN w. GATES TELLS HOW ROCKEFELLER WAS souEz-
 BY THE CORPORATION.
Carnegie Received Double Value tor His Holdings and Trust Created
 to stifIe Competition, Says the Millionaire.

washington, H. V. way Zl--JOnH w. Gates gave the house steel trust' investigation committee today the history Of the United States Steel Corporation. Present at the birth or the greatest steel manufacturing con cern in the world. he described hcw 1t was the mutual outcome of what he described as the refusal of Andrew Carnegie to be bound by the gentle mans agreements' that marked the early days of open competition in ihe steel business
 He told also of millions lost ana created almost in breath; how the Carnegie mills appraised at sib0.- 100000 We're recognized as warfh $320.000.0O0 almost within the tlmle required to make the transfer to the corporation: the grim clash in the formative days when John D. Rocke Teller was dissuaded from joining Tn the creation of the corporation and manner in which others were pre- vented from engaging in the steel trade.
 Relating how Carnegie had been forced to abaraen plans for extending his steel business MT. Gates frankly admitted that the gigantic industrial combination was formed to throttle competition. and he surprized the conn mittee with the further information that when John D. Rockefeller had sought to enter the steel business q deal had been put through by which |the Standard oil magnate was forced to sell out at forty cents on the dol lar.
 Characterizing Mir. Carnegie as a bull in china shop.r Mir. Gates told of midnight conrerence between himself. Charles NJ, Schwab and J Pierpont Morgan. At which the steel corporation was conceived and how 1t resulted in Carnegie getting Sszu.- 100000 in the corporation's securit es for his steel interests which lie pre- viously had offered for slG0. 100000 lin cash.
 Mir. Gates also told the committee of the taking over of the Tennessee Coal and Iron Company by the unned States Steel Corporation during the panic of 1907. deal in which he was interested as stockholder Of The Tennessee company. This. he decIar- led, was forced transact on carried out ny Mir Morgan and ether fnanciat
 leaders to save from rnin the Trust Company of America. threatened m the financial upheavel because 1t had
 loaned too much money on stock or he Tennessee Coal aid Iron Com pany.
 Plans by Mir. Carnegie in 1859 anu 1900 to circle his steel interests with a railroad of his own and to compete with the National Tube company just organized by Mir. Morgan. by the erec- |tion of tube warks at Ashtabula. O.. were the factors that led to the birth of the steel combine. The story of the negotiations which led up to the com bination, now the subject or congres- sional inquiry, were enter.aingly told by Mr. Gates.
 He revealed how Mir. Morgan. alarmed by MT. Carnegie's plans had sought the advice of himself ana lanes J. Hill; how Char'es M. schwab, who he said. was the only
 man who had the influence Of Mir. Carnegie, was called in to suggest q l way to stop Carnegie and how the pioneer steel king of the country was lcurbed in his purpose. though greatly IIy to his financial gain.
 | He explained that the steel busi-
 hess was threatened with several de
 moralizing forces when Carnegie's |plans became known and that MT Nor gan and others became alarmed fear lCareegie would demoraiize both raii-
 road interests and steel prices.
 This was the situation as described Iby MT. Gates. hi1assIs as director at
 present in tse Republic Iron ana
 steel company. when MT. Morgan sent
 word to him throsyh James J Hlst
 seeking conference to determine |what could be done. Mir. Gates said ne
 told Morgan that Charles N. schwap
 was the one man who could Influence sfr ssr Carnegie Out Of thaf eaaae e1
 might conference at MT MQI