The Birmingham age-herald., 1913-06-12
Day Came When Only Capt.
tai Was Necessary to
Give America Mastery
HEWITT FORESAW
COMING CHANGES
Morgan Become Immediately Inter-
ested When Magnitude of the
Growing Industry Was
Called to His Attention
by HOLLAND


late Abram s. Hewitt, one of the great
est American business intellects, great
also in many other fields of intellectual
activity, predicted some 10 or II years
before the organization of the United
States Steel corporation that the oppor
tunity was within the reach of Amer
lean manufacturers and American CAPT
tai of gaining pre- eminence among the
nations of the world as a producer of
iron and steel commodities. Mr.. Hewitt
based his assertion upon his knowledge
of the wonderful advances which inven-
ton, especially in the field of electric
energy and other sciences was making,
and that these, combined with the nat
ural resources sof the United States,
We're sufficient to create the opportuni-
ty The only contingency that remained,
in his view, was the intellectual ability
of American business men and the CO.
operation of men who possessed enor-
nous resources in the form or capital
or credit.
In the testimony given by Percival
Roberts, Jr., at the hearing now in
progress in this city, before a special
examiner at which testimony is being
Offered in the prosecution proceedings
by the federal government against the
United States Steel corporation, he fully
justified the prediction made by Mr.
Hewitt. Science and invention, as he
showed, have done their part. There
fore by the year 1900 majority of the
concerns which manufacture iron and
steel products had failed in business
or were abandoned by their owners for
the simple reason that they did not or
could not for want of capital reorganize
and revolutionize their methods in SYM
pathy with the lessons taught by science
and invention.
There had been a tremendous output
of steel and the worlds, as well as the
domestic, demand for this commodity
was continuing. Among the few man.
ufacturers of steel products who man
aged to keep pace with new conditions
We're the Federal Steel and the Carnegie
Steel companies. By reason of distance,
neither of them could greatly compete
with the other. although there was a
small middle ground in the west. be-
tween Chicago and Pittsburg, where
possible competition might be carried
on.
Discarding Machinery
But in order to take advantage of the
remarkable economies which science
had shown to be possible it was nee
essary to install manufactures with
which almost talked, auto
matte apparatus which seemed to have
brains behind 1T. Furthermore, in or
der to install this machinery it was nee
essary to send to the scrap heap other
machinery which was in fine condition,
but had really become obsolete. To do
that would cost a great deal of money
Judge Gary, Charles M. Schwab, Per-
cival Roberts, Jr., and one or two others
had through intellectual cooperation
worked out plan for the enlargement
of steel manufacturing interests and for
'integration' upon a great scale where.
by the highest possibilities of an eco
nomic kind could be secured.
A plan of that kind would remain in
the air, however, until it was fortified,
really quickened, by the infusion OF
capital and necessarily very great cap
ital. To secure this capital required re-
rewed cooperation. Little details of
testimony given by Judge Gary. Charles
M. Schwab and Percival Roberts almost
tell one of the most ro-
mantle and exciting stories In the entire
history of modern business develop
ment. II they We're to seek great cap
ital--and very great capital would be
needed-who but Mr.. Morgan would be
the first personality suggested to these
men? True, Mr.. Morgan was banker
whose business was the buying and
selling of securities. the negotiation
of bills of exchange and the accepting
of deposits. He had been actively iden-
titled for 20 years and almost exclusive
ly identified with breathing vitality into
railroad companies that We're in como :
tose condition. The iron and steel in
dustry would be for him new propo-
sition. He had 1t is true. been asso-
ciated. although somewhat remotely,
with the Federal steel company, but his
of that company was proxy
knowledge.
Judge Gary knew well that the great
er the proposition, relatively speaking,
the more intuitively certain were the
intellect always worked along very
intellect alwaysy worked along yer
great lines. It's operations We're in
tuitive. for It seemed to grasp ideas
without conscious reasoning.
Some Big Figures
When, therefore, Mr.. Schwab, at n
little gathering at which Mr.. Morgan
was present, spoke in terms of magni-
tude of the steel industry, gave de-
tailed figures which revealed the enor-
nous proportions to which 1t had
grown in the United States and out
lined the opportunities of the future
Mr.. Morgan's attention was instantly
fixed upon the proposition. Magnificent
figures appealed to him. He had no
reason to doubt the accuracy of Mr..
Sohwabs statistics.
He seemed upon the instant to realize
how very great capital could supple
ment and make complete the plans
phich Judge Gary had already laid
down mentally. He called into consul
tation several mastery intellects. These
men told him what science had done and
that the revelations of science only
needed the support of capital, magnitl-
cent in its terms in order to secure
for America the world mastery of the
iron and steel business. Moreover, with
intuitive understanding Mr.. Morgan
realized that the organization of the
kind contemplated did not mean ruth
less destruction of competitors
He grasped instantly Judge Garys
statement to him that fair and reas-
enable competition was stimulus
which was entirely healthful, but that
ruthless destruction competition was
not only foolish but ultimately reacted
upon those who carried on warfare OF
that kind.
MIR. Morgan seemed to have turned
the idea over in his mind for only a
few hours For he said after two or
three comparatively brief discussions
in his office. that he was prepared to
organize the syndicate which would fur
nish the final thing needed for the con-
sumption of this plan-namely, capital.
Thus complete co-operation was estab-