Newark evening star and Newark advertiser., 1912-12-19
Morgan Denies Possibility
OF Organizing Money Trust
Gives Probers information Re-
garding Various Big Corr
poration Contracts.

ganized for the handling of securi-
ties.
You established one for the Chi
cago Great Western. asked Mr.. Tn
termyer.
Yes, I forgot that
There was one for the Interna-
tional Harvester Company"
Il did not know anything about
that
i But it was in your Officer
/ yes. I guess 1t was, but Mr.. Per-
kins had charge of that" said Mr..
Morgan.
And you didn't know anything
about it,"
NO, sir; l saw 1t In the paper the
next day. said Mr. Morgan.
He said he did not know of the or
ganiza ton of voting trusts within the
firm for the international Agricul-
tural Company. Answering questions
by Mr.. Untermyer, Mr. Morgan ad-
nitted there probably were voting
trusts in his firm for the corporations
named, and for the Erie railroad, the
International Mercantile Marine, the
Southern railway and two trust COM
panies.
Mr.. Untermyer asked Mr. Morgan il
he was one Of the voting trustees for
the international Marine.
Trustees Name Directors.
The voting trustees In all these
corporations have the power to name
| the boards Of directors, have they
not?" asked Mr.. Untermyer.
| Yes, SIR said Mr.. Morgan.
And they in turn usually select the
oficers2''
Yes. sir"
Have you ever known of an in
stance where eompany's stock is
widely scattered, where the stock
holders were able to procure a
| change of management"
Mr.. Morgan said he knew of no
such instance.
Mr.. Untermyer suggested that
American stockholders took little in
terest in the management of their
corporations.
Yes said Mr.. Morgan, that is
why when a company is reorganized
we organize a voting trust in order
to protect the company said Mr..
Morgan.
That's the reason for this pater-
nalism on the part of the reorgan-
lzers 2''
Yes"
Mr.. Morgan had Mr.. Untermyer
read into the record the report of
the voting trustees of the Reading
Railroad Company made in 1904,
when the trustees surrendered the
company to stockholders.
/ Reading Prosperity.
Mr. Untermyer read the figurers
| showing the prosperity voting trus-
tees had brought to the Reading.
How much has the price of coal
been raised?'' asked Mr.. Untermyer
when he finished.
/ Mr.. Morgan said he did ont know.
You don't know how much the
Heading has increased the price of
coal to secure this prosperity" asked
Mr.. Untermyer.
No. / don't know what the price
has been," said Mr.. Morgan. MY
idea is that voting trust Is a neces-
sity to big company in its infancy,
in order to protect the company"
Mr.. Morgan" asked Mr.. INTER
myer, don't you think these voting
trusts bring enormous control and
concentration of money and business
in few hands,"
No, sir, do not" said Mr.. Nor
gan.
Mr.. Untermyer asked If one bank
er, such as Mr.. Morgan, would not
have enormous control If he had vot-
ing trusts in all the railroads, banks
or industrial corporations.
But that would be impossible. -
said Mr.. Morgan.
Mr.. Untermyer insisted that the
system brought about great concen-
tration and control
DO you think they ought to have
The same representation in compet-
ing concerns?" he asked. LET us
! take a concrete example Members
of your firm are directors in the
Bankers Trust, the Guaranty Trust,
First National Bank, the Bank of
Commerce, Chase National Bank, the
| National City Bank, Liberty National
Bank, the Chemical National Bank,
the Austor Trust and other COM
| panies."
| Does Not Control Directorates.
Mr.. Morgan explained that he did
not believe that from one TO three
men on each board of directors could
exercise control.
you take three men and put them
| in al those banks. In one bank they
are three out of fifteen, in another
three out of twelve. in another, three
out of ten." he said.
But through a voting trust they
might have appointed all the board of
directors" suggested Mr.. Untermyer
They could not control the bank so
long as they were in the minority"
said Mr.. Morgan. ''I don't think I
could carry any proposition through
any board of directors against the
wishes of the stockholders.
''You are opposed to competition p"
mo. But l would rather have
combination than competition. 1 like
a little competition, but like
combination better. I'd like TO say
something right here that l may not
have a chance to say again. With
out control you can't do thing. Con-
troll is the important thing. Now you
speak of money trust. no one man
can get control of all the money"
You mean no man could monopo-
lie money!"
Yes. that's it,
But when a man has a vast power.
such as you have-as you admit you
have-don't you?" asked Mr.. Inter
myer.
mo" answered Mr.. Morgan.
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