East Oregonian : E.O. (Pendleton, OR) 1888-current, 1912-02-28


the formation of the steel trust by j.
p Morgan and company, which
framed the combination, the report
says. the steel trust books show. A
total of $6O,3OOOO0 was paid the
Morgan concern for financing the
syndicate that organized the trust. OF
tins, s62,500,000 was a promoters
profit, while the remaining $6S00,O 900
was the profit on a bona fide conver-
sion scheme. In the first nine years
of it's existence, the corporation
earned net, the report says, $1,029,-
6S5,390 instead of SO,00O,311, as
is set forth in the reports of the cor
poration officials
This amounts to a net profit of S13
a ton on finished steel products.
Eighty per cent of the steel pro-
ducing properties of the country are
dominated by the corporation, the
report says, although E. H Gary and
H. C. Frick, told President Roosevelt
when they absorbed the Tennessee
Coal and Iron Company in 1907, that
the trust controlled and desired to
control less than sixty per cent of the
steel business.
Even in making its profits, the re-
port charges, the steel corporation
restrains competition by concentrat-
ing the greater part of it's profits in
its operation on raw materials and
semi-finished poducts while confining
the finished products plants to a low
profit This operates, says the re-
port to keep the price of raw ma
terials up, to the advantage of the
corporation and the detriment of in
dependent competitors.
The report showed in detail the
dividends paid by the subsidiary
companies of the steel trust during
the first nine years of its existence.
The total amount was $75S,1S4, 1885,
So. The facts that the subsidiary
companies, operating in raw material,
made greater dividends than the fin
ished products concerns was cited to
show that the corporations kept the
price of raw material up to the em-
| barrassment of competitors,
A voluminous argument in four
teen sections to prove the steel trust
| is combination in restraint of trade
was presented to the conclusions of
the report
lone hundred and eighty one pre-
viously competing corporations were
concentrated under the control of a
single holding security company
known as the United states Steel cor
poration."
Among these concerns the report
puts forth are owning and mining
now restrained from competition in
| the sale of ore, railroads, combined
to prevent competition, blast furnace
| plant, the com mbination of which elm
mated competition in the sale of pig
| iron, coal and coke companies and
other formerly competing concerns
The greater concerns in the iron
| and steel trade, the report says, were
acquired at vastly inflated values due
to the superior effect given the mer-
ger by the elimination of the corpor-
alton of these companies.
"Other acquisitions were made in
related lines of business" the report
said, "for which no explanation ap-
pears except the visible consequence,
the removal of such concerns from
the Independent field"
This was the case, according to the
report, in the absorption of the Ten
nessee Coal and Iron company.
I In discussing the corporations
control of ore the report asserts that
in all, $500, 100000 tons out of A.
462 100000 tons of available ore in
the country is under the control OF
| the trust