The Irish standard. [volume] (Minneapolis, Minn. ;) 1886-1920, 1912-03-02
MAcRAE FINDS THAT CORPORA.
TON is OPERATING IN RE.
SAINT OF TRADE.
EXPERT MAKES REPORT
Net Earnings for Nine Years About
$13 a Ton-Control Of Minnesota
Ore Declared Basis for Control
Of 80 Per cent Of Business.

Washington, Feb. 20. - That the
United States Steel corporation is
combination in restraint Of trade, and
that its control of the ore fields of Min.
nesota is the basis for the control Of
80 per cent OF the steel business of the
| country is the statement made in a re-
port to the Stanley steel investigating
committee by Farquhar j. MacRae, an
expert accountant who Investigated the
accounts of the corporation by author.
| ity of the committee.
Mr.. MacRae takes issue with the
steel corporation officials that it con.
| trols only 60 per cent OF the steel bust
! ness, and that 1t mas control of only
| SO per cent of the ore.
MIR. MacRae says, in part:
THE per cent of ore owned and oon-
trolled by the corporation must be
viewed as to its effect in the light OF
the conduct and policy of the corpora
tfon. The passive ownership of large
reserves would be of not effect upon
the steel business except, of course.
Of the available supply.
But the ownership of 76 per cent
of the competitive ore in Minnesota, as
estimated by the Minnesota tax com
mission, and 50O.000,0OO tons In the
south, or. in all. $500. 100000 out of
4,462,940,O0O tons of commercially
available ore in the United States, but
which is held by owners engaged In
line of business in which new compe-
| tition is inherently and unusually diff
cult because of the immense initial
outlay required and under which own
ers do not sell ore, but enhance the
price Of pigiron by purchasing all the
known available supply. who monopo-
lize 30 per cent of the export sales
largely at prices below domestic
prices, who through combinations are
able to maintain standing cash bal
ance of $75,000,O00, who have so much
lowered cost of production that it is
admitted that the so-called independ-
ents cannot compete with the men
who have power to recoup the dimin.
Ished profits or expenses of one branch
|
organization, who while operating in
this manner keep down the prices of
finished products, such rs rails---this
is an ownership and control Of ore
which must interfere with competi.
ton"
The report also says that by means
Of consultations, the ore roads in Min.
nesota are prevented from competing.
The MacRae report reaches the con-
clusion that the steel corporation oper-
ates in restraint of trade and prevents
competition through manipulation of
prices, through the influence of the So
called "Gary dinners" by control of
raw materials, and through a system
Of interlocking directors in various
companies. 1t also tends to contradict
some of the testimony given by steel
trust officials.
Some of the figures dealt with in
the report are startling. 1t is shown
that J. p. Morgan e. Co. received ap-
proximately $70,OO0,OOO in cash profits
for organizing the big steel combine,
| and that the net profits of the concern
for the first nine years Of it's existence
we're more than $1.OO0,O00OOO.
]. p. Morgan & Co., heading the
syndicate which organized the steel
corporation, received cash profit of
500, 300, 900, of which $62,500,OOO was
tor promotion, with an additional COM
mission of s6,8O0,OO0 for a bond con-
version scheme.
The net earnings of the corporation
for period of nine years were 1922
sS5,3S9, or an equivalent of approx
mately $13 a ton on finished product,
instead of $3.50, OO0.311, as asserted by
the corporation in its report.