New-York tribune., 1912-01-23
FARRELL STEEL WITNESS.
President of Corporation Objects
to Unnecessary Publicity.
TELLS OF GARY DINNERS

Had No Influence on Fixing
Prices-Takes Issue with Some
of Carnegie's Statements.
Washington. Jan. 22-Jamcs Farrell,
president Of the United States Steel Cor
pora;ion. protested before the Stanley in
estgating committee to-day against un-
necessary publicity Of manufacturers cost
Of steel products in this country as ruinous
to the foreign trade of domestic manu-
faCturers The Steel Corpora ton head also
discussed with the committee the Gary din
ners' and expressed ideas Of trust regula-
ton. which differed somewhat from sug-
gestions previously made by Elbert II.
Gary, executive head q" the Steel Corpora
tion. Andrew Carnegie and others
President Farrell asserted that the Cary
dinners at which steel manufacturers as
semblcd TO discuss the trade had no influ-
ence in fixing or maintaining prices. though
he thought they helped to maintain the sta
rility of the market.
II do not believe" he said. that the
prices of any two steel manufacturers in
the United States to-day are alike"
why has Judge Gary said that the day
Of competition has passed." asked Repre-
sentative Beall.
81 think he referred to destructive COM
petition" said Mr.. Farrell. "As a natter
Of fact. steel prices to-day are very low.
There is no doubt that reports Of some
corporations soon to be made will show
that they are not getting the cost Of man
ufacture out Of present prices"
Are you one OF the apostles of this new
cult of industrialsm advocating govern
ment control of corporations, as suggested
by Judge Gary, Mr.. Carnegie and others?
Against Government Fixing Prices.
II believe that there should be ublicity
OF corporations: that this should show
profits and losses and general conduct of
business" said President Farrell. II think
that there should be a supervising board,
but believe that il would he impracticahle
almost impossble-for governmental
board 10 fix priccs-even TO fix maximum
prices. To determine the cost of articles
manufactured I'm the steel business alone
requires a corps of hundreds Of experts.
Il would have a supervisory board which
would have authority to investigate all cor
porations for the purpose of preventing, not
only unusually high rates, but also unusu-
ally low rates. which would result In re
duced wages and impairment Of plants
Mr. Farrell said he did not believe that
the Sherman law should bo repealed, but
that It should be clarified so that business
men would know exactly what to do under
It.
When asked about a statement made by
Andrew Carnegie that It was obvious that
there was some sort OF combination among
steel men to-day to maintain prices, Presl-
dent Farrell said:
Il understand Mr.. Carnegie made that
remark but Mr. Carnegie has not been In
the steel business for eleven years. You
gentlemen probably were surprised at the
alacrity he displayed In giving you informa-
tion you desired"
This was the only positive statement he
did make" said Representative Beall,
laughing.
Yes. about something lie knew nothing
about" rctorted Mr.. Farrell
President Farrell told the committee that
steel rails I'm this country which sell for
SIS a ton. the basic price supply only half
the market. Special rails are made at
higher prices lie also urged more cN-
pcnsive rails for safety.
Rails to-day" he said. ARE too near the
danger zone OF brittlcness. The liability
OF breakaGe and danger is greater than I'm
the days Of the softer rails We should
have rails with a lower grade OF carbon
and Of softer steel. They would necessarily
he heavier and would cost more"
Mr.. Farrell and j. \. Reed, general coun-
sci for the Steel Corporation. said they had
10 objection to members Of the committee
examining records to satisfy themselves,
but they insisted that publication would
work irrcparable injury. not only TO the
Steel Corporation. but to every one Of its
in this country
Gave n. X. Smith information.
Mr.. Reed said cost information had been
furnished 10 Herbert Knox Smith, Com
missioner Of Corporations.
Il asked Mr.. Smith TO take me into his
confidence and tell me what he had learned
as 10 what It cost you TO produce a ton OF
pig iron" replied Mr.. Stanley, and he told
me ne could tell no one but the President.
| went TO see the President, and found that
he had no desire to make a deep and mys-
ferrous matter about the cost OF pig iron.
As n matter Of fact. It turned out that Mr..
Smith never had told him the details TIE
President authorized Mr.. Smith 10 tell me.
end when | went back TO the Commissioner
he said he did not have the records any
been sent back TO you-and
that his recollection on the subject was
not accurate. Then | went back to the
United States Steel Corporation and asked
for a peep al their records, and they OBJ
iected, on the ground that 1t would en-
barrass them I'm their business. Thus did
this information, like the Arab, disap-
near. leaving no trace In the government
archives.
"It Is most vital that this committee get
this information" continued the chairman,
"and. come what will. we will know 1t.
There Is power enough in this government
to find ii out
Mr. Reed asked il the committee would
not be satis.fed to let Mr.. McRae, their
accountant, examine the records verify
tbom and make general report thereon.
and Mr.. Farrell added that publication Of
the costs would affect 1000 employees en-
gagged in the foreign sales department OF
the corporation.
Chairman Stanley said he did not intend
ia cxposc secrets unnecessarily. but he
would insist upon the corporation comply
ing with subppnas duces tecum for rec
ords not yet produced.
il was tentatively agreed that McRae
should examine the cost sheets Of the cor
Uoration to verify figures 10 be submitted
regarding composite costs Of production
Subpmnas will be issued for officer of
Il number Of subsidiaries Of the Steel Cor
poration. requiring the production OF books.
L. .1-