The Oskaloosa herald. (Oskaloosa, Mahaska County, Iowa) 1885-1919, 1913-05-22
SCHWAB RETELLS
STEEL TRUST TALE
Is Witness in Dissolution Suit OF
Combine.
TREATS RIVAL WITH FAIRNESS
Declares J. p. Morgan Had No intsR.
ton Of Creating Monopoly, His
Idea In Forming Cooperation
Was Economy.

New York, May 2O.--Charles NJ
Schwab repeated for the third time
before a public tribunal the story of
the formation of the steel trust, Of
which he was the first president. He
was a witness in the hearings being
conducted here in the government s
dissolution suit of the giant combina-
ton. His examination was conducted
by former Judge Jacob M. Dickinson,
chief counsel for the government.
Mr.. Schwab, now at the head of the
Bethlehem Steel company, the trusts
chief competitor, treated his giant
rival with eminent fairness In his
statements.
What was the policy OF the United
States Steel corporation towards its
competitors? asked Richard v. Linda
bury, the trusts leading cosnsel.
Says Were Not Cut.
TT was always the endeavor not to
hurt, stife or destroy any competi.
tors" replied Mr.. Schwab. Il always
caused the prices for our goods to be
published and we stuck to these
prices. In some instances very large
customers may have been given lower
prices but as a rule there was no
deviation from our published price
lists"
WAS there ever secret price,"
mo; l never heard of secret price
being maintained as against the pub
iished price by the steel corporation"
"Pools were entered into in the old
days"
Yes. when / was president of the
Carnegie company we went after the
business and we got it the best way
we could" replied Mr.. Schwab.
MIR. Schwab said he had recently
sold goods to the steel corporation
and they had resold them at a price
lower than the Bethlehem company
would have sold them. He explained
that the corporation endeayored to
maintain standard prices and abstain
from exacting premiums. ...
No Plants Dismantied.
Mr.. Schwab said that no plants had
ever been dismantled by the corpora
ton except where two were manufac'
turing the same products In the same
district or were obsolete,
To show that the corporation could
not have a monopoly of ore Mr.
Schyab described ore bodies In vari'
GUS parts of the world which he de-
cided were available to manufactur'
ers In this country. .ls
Mr.. Schwab said he had never
heard" of the existence Of foreign
rail pool or any agreements with for
etgn manufacturers to divide neutra!
territory or to keep out Of each others
territories.
interested J. p. Morgan.
Mr.. Schwab told Of conversation
he had with j. P. Morgan following a
dinner at the University club in 1899
This conversation led to the formation
of the steel trust. Mr.. Morgan was
interested in the steel business at the
time for two years before he had or.
ganized the Federal Steel company
a pointed out to Mr.. Morgan" said
the witness, the great economic and
business advantage of an even larg0l
and more completely integrated organ
ization. ''a5"
II also pointed out to him." he said
that the steel business had been nom
inal in regard to export business and
that half dozen individual companies
manufacturing one or two lines Of
products could not do an export bust
ness because they could not indiVid
ually maintain the facilities In foreign
countries. / told him that only BY
combination of these companies could
the export business be made profit
able. Probably more than anything
else impressed upon him the adysii
tages of combining for the sake OF es
tablishing an export trade" IT,.
Following this conversation he saw
Mr. Carnegie and laid the plan be
fore him and secured some figures
which were used as basis for the
purchase OF the Carnegie concern by
Morgan. f f. Z -. ~
All the economies which he had de
tailed to Mr.. Morgan were put into Ell
feet, the witness continued, and tn;
export business was Immediately de
veloped. ~