The star-independent. [volume] (Harrisburg, Pa.) 1904-1917, 1914-10-27
Counsel for Steel Cor
poration Refutes the
Charge That 1t Con-
trolls Production
PAY HIGH WAGES
AS PRICES FALL
U. s. Steel Corporation Did Not Organ
ize Pools in Which the Company
Participated and Did Not Cocrce
Competitors to Join

Philadelphia Oct 27.-David A.
Reed, Pittsburgh, concluded his areu-
ment for the defense to-day in the fed.
erai government S dissolution suit
against the United States Steel Corpo.
ration brought under the Sherman anti
trust law. He devoted the closing part
! OF MS address to the trend of prices
since the steel corporation was organiI-
| ed and submitted charts tending TO
SHOW that the purchasing power of iron
and steel as compared with other com
moditles has steady fallen. with the
/ exception of two or three years, since
! lS99. This showing he argued, refutcs
the. government S charge that the steel
corporation controlled prices The steel
trade is bigger than the steel corpora
ton, MIR. Reed said and competition has
steadily forced down prices.
High Wages While Prices Fell
Speaking of the cost of production,
Mr.. Reed concluded by saving that it
is high tribute to the steel companies
that they continue to remain prosper.
Gus and pay high wages while prices are
steadily falling.
, Noiu'Hlo y. severance, OF st. Paul,
followed Mr.. Reed also on behalf Of
the steel corporation He spoke on what
the defense contends is the fairness
and extent of competition by the steel
corporation, its lack of power to cou-
troi prices and its lack of power to ex.
clude competitors of the steel trade.
Alr. Severance touched on the pools
IN which the steel corporation was Il
participant for a number of wears after
the concern was organized. He said the
steel corporation did not organize Them
as they were in existence before the
corporation was formed. After the con-
cern was chartered it never coerced COM.
petitors to come into the pools he said.
and they were broken up by the steel
corporation when it withdrew from
them.
Control of Prices and Output
Mr. Severance wanted to know how
the court could punish the steel cor
poratlon for having been member of
fo0ls and let the other members 90
free. One of the many allegations made
by the government in support of its
charges tnat the steel corporation Nas
monopolistic in its tendencies was that
1t had been a member of pools to con.
troll prices and output. Since the abo-
! htion of the pools in 1904. Mr.. Sever.
ance said, competition in the steel trade
has been open and uninstructed. and he
called the attention of the court to the
testimony of more than 200 witnesses
in the ease to that effect.
Counsel for the defense conlbated
the government charge that meetings
of steel manufacturers which included
both the steel corporation and independ-
ents were held to control prices. Moth.
i ing was done at these meetings in the
way of controlling prices, he said and
there is nothing in the law to prevent
business men from getting together and
talking over business conditions.
Growth Between 1901 and 1918
Mr.. Severance presented figures to
show the growth between 1901 and
1913 of competitors of the corporation.
The statistics showed that the percent
age of increased business of competi.
tors ranged from AS per cent. TO
3I79.7 per cent.
1 Taking up interlockng directors. Mr..
Severance said that it was ridiculous
for the government to cnarge that steel
corporation directors who were also rail
road directors, used their influence to
throw railroad iron and steel business
to the steel corporation. He presented
figures to show that concerns which had
steel directors on their boards gave
+, their iron and steel business. as the re
suit OF competitive bidding, to compa-
nies other than those identified with
the corporation.
Competitors Cut the Prices
Answering the complaint of the gov
ernment that the steel corporation held
| up prices, Mr.. Severance reviewed the
evidence of witnesses to the effect that
when competitors cut prices the steel
corporation was compelled to meet the
cut or lose business in the products re-
duced. With the steel corporation hav-
ing but 40 per cent. of the iron and
steel business of the country it is like
the tail wagging dog to say that the
corporation could control prices or put
competitors out of business.
/, Mr.. Severance also discussed the
prayer that the Duluth and Iron Range
Railroad Company and the Duluth, Mis-
, sabe and Northern Railroad Company
be made independent of the steel cor
poration. He said that it was to the
interest of the steel industry of the
country that these railroads remain in
the control Of the corporation. He cit
ed witnesses to show that the two roads
: give a better service than other roads
, that tape ore mines in the Lake Su-
perior region because of better equip.
mept of the two ore carrying railroads.
, There is no evidence to show that com
, petition steel corporations steel shipped
over the two roads have ever been dis
criminated against in the matter OF
freight rates to the advantage of the