The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-10-24
SAYS STEEL co. MADE
ALLIES BOOST PRICE
Government Charges Corpora
ton Covered Own Action by
Using Smaller Concerns.
CARNEGIE LETTERS READ

PHILADELPHIA, Oct. z3.--Letters written
by Andrew Carnegie fifteen years ago
were introduced by the Government to-
day in ITS effor; to prove before the Fed
eral Court OF Appeals that the United
States Steel Corporation is a trust
Tho Government Is attempting to show
that the Steel Corporation maintained a
number of smaller corporations which
were secretly allied with the main or
ganization TO announce price Increases.
When the boost was safely established the
big corporation followed tho lead.
The Federal attorneys took rails and
rail prices and Mr.. Carnegie's letters to-
day TO prove the practice Of this theory
Information was brought out yesterday
tending 10 show that while s2s a ton was
referred to regularly as a standard price
OF rail. the real rate ranged from $50 TO
$50. CaTuegie's letters were quoted to-
day to shoS that at {2S ton rails
brought him $50 n ton IN profits. Tho
same letters were used To indicate the
bitterness OF the competition among the
steel companies prior to the organization
Of the United States Steel Corporation.
II am disappointed" wrote Mr.. Car
nege In one OF the letters. that the HI
nois Steel Company IL 10000 tons ahead
OF its division. They owe us 10000 tons
at $40 "A ton proht--that is $1,000 600
What II the use OF all tho petty econ
omes at the mills compared to a loss Of
this kind? The probabilities are that
now, at best we never will be able TO
get our just amount. Not a day should
he lost In getting the Illinois Steel Com
pany to transfer TO W the $4,000 tons due
even after giving 10000 tons TO tho Ma
t!onal steel Company"
Another OF Carnegie's letters. dated July
II, 1900, was his parting adnonition TO
the men whom he left In charge OF the
steel Industry II follows:
put your trust In the policy Of attend
ing to your own business In your own way
and running your mills full regardless OF
/ prices. Put very little trust IN tho
/ efficacy of artificial arrangements with
I YOUR competitors. which have the serious
result OF strengthening them II they
/ strengthen you"
Another letter. written in 1900, admitted
that pig iron had been forced up from
/ Sl0.5s TO $25 n ton In the two previous
( years. This the Government said. was an
instance of the artificial boosting of steel.
! Lawyers for the Government also re-
| called the panic OF 907 and intimated
| that a good deal Of this was a pool ar
rangement to boost prices. II was as
serted that previous 10 this there had
! been big production, rapid sales and low
/ prices.
The Carnegie letter. and the long series
! OF quotations that accompanied them were
offered az the Governments proof OF price
/ boosting pools aud competition prior to the
I organization OF the Steel Corporation.
4 Tho Government read the minutes OF a
7 secret meeting OF the board of directors
OF the Steel Corporation held Il few
{ months after it's organization.
Judge Gary was In the chair. Rails
7 tAkpn FOR digTtIo They
/ selling at s2s a ton. Judge Gary said
! they should he made $40 a ton at once.
/ There was "A general disagreement. some
one feared that the press would say nasty
I things about the sdvance-so soon after
tho formation OF the corporation. Some
/ one remembered the smaller companies
, which, while not members of the combina-
! ton were accustomed TO send representa-
| tves to the Gary dinners as II they had
! been hidden.
Let them raise tho prices first" some
/ one said. Tip them off. There'll De no
! talk then"
| Six weeks later tho small companies
! quoted rails at $40 "A ton and a week
after thai the United States Steel Corpora
| ton price went up TO a like figure. This.
| tho Government charges. Is the price
/ making system which still prevails over
/ 80 per cent. OF the steel industry in this
! country.
Henry e Cotton. assistant 10 Special
! AttorneyLieneral john VI. Dickinson.
charged that the Steel Corporation put
| into operation n plan to boost prices OF
steel in 1907 by curtsilng production.
He said this was the direct cause OF the
great amount of idleness IN that year.
/ This charge followed the statement that
| several pools had been broken up ten
years earlier, before the formation of the
corporation.