The Richmond Virginian. (Richmond, Va.) 1910-1920, 1913-05-21
SCHWAB TESTIF|ES

Continued from First Page-)
that time and the formation Of the
United States Steel corporation the
Carnegie company rolled a few girder
rails, and that the only reason the
company did not extend it's plant 30
it could compete in the girder rail-
business was financial.
As things stood they could not roll
girder rails at profit. His company
for consideration from other COM
panies. TIE Carnegie company got
100000 from the Lorraine Steel COM
rany ard the Pennsylvania Steel com
pany, after the Carnegie had spent
$61 900 in preparing to compete In
the business, but Mr.. Schwabs recol-
lection OF the reason for the payment
was that it was to stay out of the
girder rail business for one year.
Never in q Foreign Pool.
Mr.. Schwab said that he was never
in a foreign pool in rails because he
never got a satisfactory chance. The
American manufacturers were offered
an allotment OF 100000 tons Of rails,
including Canada to keep out of the
English market, but this offer was
turned down.
You were after something big ?"
suggested Judge Dickinson.
Right said Mr.. Schwab.
Questioned about the Empire Steel
company. Mr.. Schwab said that ii was
formed as a selling company by prac-
tically all the rail makers in the
United States. but that Mr.. Carnegie
caused this project to be stopped. after
several steel company presidents had
committed themselves to 1t. Under
this agreement the Carnegie company
agreed to make rails for export only
for FIVE years. The reasons for stop
ping the project were that the by
laws of the company, which was in
corporated In New Jersey, would be-
come public. the company would be
, trust. and as such would be attacked
under various State laws and discussed
in the newspapers and trade journals
and IL II raised the price OF rails
the railroad presidents would attack
liz
Mr.. Carnegie suggested instead that
his company and the Federal Steel
company make an agreement which
than the Empire proposition. Mr..
Schwab said that the arrangement
with the Federal was the absolute
division of business. The Colorado
Fuel and Iron company and the
Cambria were both at times made a
party Of that agreement. both being
Western rail millA
In reference to this agreement
Judge Dickinson read from the board
Of directors minutes OF the Carnegie
Steel company, letter dated January
;. 1899. from Mr.. Carnegie. which
caused much amusement. and read;
Ready for . Fight.
III our president steps forward at
the right time and In the right way,
informs these people that we do not
propose TO be injured, on the con-
| trary we expect to reap great gains
from II, that we will observe an
armed neutrality as long as It Is
made to our interest to do so, but
that we require this arrangement
then specify what 10 advantageous
| for us. very advantageous, more adj
vantageous than existed before the
combination, and he will get 1t. II
they decline TO give US what we want,
then there must be no bluff. We
must accept the situation and prove
that II. 1t II night that they want, here
We are always ready.
Here II q historic situation for
managers to study-Richelieu's ad-
vice-frst. all means to conciliate:
aainnG that. all means to crush"
Shakespeare has Il:
First In your right carry gentle
peace"
But after peace In gone the worst
policy IL gentle war"
We should look with favor upon
every combination Of every kind up-
| on the part OF our competition. the
bigEer they grow the more vuiner-
able they become. 1t Ia with flrms a
| II Is with nations. scattered possess
| sions are not in 1t with . solid, COM
pact. concentrated force.''
Richard v. Lindaburg. chief coun-
SCI for the defense. objected to the
Introduction OF the letter a. ire
iavant, except from philosophical
and literary point of view
Docs Not Remember.
MT 6chwah said that he did not
remember that the Carnegie stayed
out "a the steel car industry for 4
conmderatt0ns that the steel car COM
bination approached his company
with an offsr to pay 100000 a year,
put that this payment was because
the Carnegie concern contracted to
FURNISH the combination with 1000
tons % sfeet . day. and because there
was no minimum price agreed upon
TOT TINS steel and the money was to
Reimburse the. Carnegie company for
possible lee,
Mr.: Schwab said that In 1898 the
Carnegie Steel company was selling
about 10000 tons or steel bars abroad
and about 40, 900 tons in this coun-
Try. Judge Dickinson then dwelt at
lesIk ~. and m .atntrthu-
ton OF territories M. Schwab said
that while there WUrs number o.
these pools No disertbutton q terri-
ouesttons1 fnrthaf along this Iins,