Manchester Democrat. [volume] (Manchester, Iowa) 1875-1930, 1912-03-06
BARES steel ! GRIP R ?
PRoBERs' EXPERT, FINDS COM
BlNE CONTROLS 80 PER CENT.
3 OF BUSINESS.
EXCEEDS ROOSEVELT FIGu RES
Profits OF Corporation Are Also De-
cIared 100000 Greater Than
Its Reports Had
- ls. Shown, = II 70 ~ Y Y

Washington.-The house steel trust
investigating committee made public
the result of the inquiry into the books
and minutes of the United States
Steel corporation conducted by Far
quhar ]. McRae. an expert accountant.
Restraint of trade is effected. the
report charges, through manipula.
ton of prices, through the influence OF
the so-called Gary dinners" BY con.
troll of raw, materials, and through
system OF interlocking directors In
various companies. u I. 81
!. Some Of the charges made In the
report are:
That J. P. Morgan & Co.. heading
the syndicate which organized the
Steel corporation, received q cash
profit OF 69,30O,000, OF which ~ $62.-
10000 was for promotion, and w.
100000 for a bond conversion scheme
That the net earnings for nine
years were $l,O29, 685,380 or an equiv
aent OF approximately $1S ton I on
finished product, instead Of $3.50. OOO,-
311 as claimed by the corporation IN IN
its report.
That the statement made by Judge
Gary and H c. Frick to President
Roosevelt in 1907 that the Steel cor
poration did not control more than 60
per cent. OF steel properties In the
country was wrong; that It controls
on the contrary about 80 per cent. Of
4 the steel holdings.
The Gary dinners" where indie
pendent as well as corporation steel
men assembled, and where the So
called independents are influenced TO
reduce their production sconformably
to their estimate OF the reduction In
the demand existing. and to maintain
prices, is Objectionable as FAR as 1t
operates to exclude free competition.
ut can be no justification Of the
cooperation OF the participants In the
Gary dinners that no penalty attaches
to violation OF the declarations mu.
tually exchanged. The antitrust act
would prevent the enforcement OF any
penalty for reducing prices or exceed
Z ing ones share of the business.
.Restraint OF competition is fur.
thered by the policy OF making the
greater portion OF its profits IN raw
materials while the finished product
plants make very low profits. The net
earning OF S13 per ton OF finished
products from 1902 to 1910 inclusive
was divided thus:
"By manufacturing companies, $S.Ol
per ton; coal and coke companies. ~
cents; iron mining companies, @2.l2;
transportation companies. S1.S1: mis- mis-
&cellaneous, SO cents. 4
This, the report says, is equivalent
Ito an earning ofS40 per cent: on cost.
ts8 Backing up his contention that the
steel corporation controlled 80 per
cent, OF the steel business instead OF
go per cent. as its officials asserted
TO former President Roosevelt. Mr.
s;AcRae says: .5ss 5S 5
..The total property OF the Bethle'
hem, Cambria, Colorado. Lackawanna,
Pennsylvania and Tennessee compa.
/ MES, added to the capital stock Of
Jones & Laughlin because statement
of property is not availabie). amount
ed to S365, 76S, 8S9, these companies be-
ing the only important concerns In the
steel business In the Limited States,
outside Of the United States Steel cor or
iporation. This amount added to that
Of the United States Steel CORPORATION
equals q grand total OF $1,Sll GOT, S39,
of which the property account 81 the l9
\ United States Steel corporation
an. amounts to S1.445, s37, 45o. or about 80
tner cent n t}{S ZEl5