The Butler County press. [volume] (Hamilton, Ohio) 1900-1946, 1920-07-09
Union Engages Expert Who DeIves
Into rIvsteries Of Wall Street
And Coal Combine

Scranton, Pa.-Charglng that the
anthracite coal industry, made
up of seven distinct railway systems,
is knitted closely into a single monop-
oily by inter-stock ownership, by inter
locking directorates, by informal con-
ferences, and in general by the en-
crossing control of the great Wall
street banking combine which centers
about J P. Morgan & Company and
the National City bank, w. Jett Lauck,
consulting economist for the United
Mine Workers of America, today laid
before the anthracite coal commission
a survey which, he stated, had been
made to discover the degree of inter-
relationship and combination to con-
troll the production, transportation
and market which prevails in the am
thracite industry. Mr. Lauck deelar-
ed that this survey pointed to the fol
lowing conclusions:
"The anthracite industry is today
dominated by seven different rail
roads, each of which controls the pro
duction, transportation and sale to To-
cal dealers of a certain proportion Of
the total anthracite consumed, pro
portion which tends to remain con
stant;
Railroads Established High Freight
Rates
This domination has resulted from
consistent effort to render secure fol
all time an adequate proportion of an
tracite traffic. The only surety fol
this lay in buying up the majority Of
anthracite coal lands, reserves anc
operations, or securing permanent
control of the output of independent
operations;
Before the end of the 10Th century
the railroad companies, either operat
ing directly or through their Goa
companies, had come into the owner
ship of over 90 per cent of the un
mined coal If we add the amoun
controlled by contract the percentage
of unmined coal free from the contro
of the railroad companies amounted t
less than 4 per cent;
"The majority of the anthracite
roads came to be represented in th'
mining of anthracite by separately in
corporated coal companies either ere
ated by the railroads or acquire,
through stock purchase Until tn
period of reorganization the entir
stock of these coal companies wa
held by the separate railroads;
"The railroads established such hig
rates for the transportation of anthra
cite coal that it became impossible 70
a coal company to operate at profit
The railroad coal companies wer
then supported on the basis of sub
sides granted in one form or anothe
by the parent railroad company Thi
was made possible by bookkeepin
system which rendered the finance
of the coal company and the railroa
company practically one. The parer
railroads carried the bonds, mad
good losses, granted working capita
and in other ways assisted the coz
companies financially either at lo'
rates of interest or without charge;
"The coordination of the variou
companies which composed each or
of these anthracite systems is conclt
sively demonstrated by the all-pel
suasive treatment of profit polio
from a single standpoint. The raj
road coal companies have practical
without exception failed to make
profit. The profits of the indust1
have appeared almost together in Il
dividends, reserves, and bond intere
of the seven anthracite railroads.
Gently also in dividends of certa
sales companies whose stock is own'
by the stockholders of the railroad
"The history of the largest comp
nies in the anthracite industry
marked by financing methods, chara
teristic of the reorganizations
which the bankers have had han
These have resulted in heavy owe
capitalization, which affords a bas
for high prices and low wages;
"The combination of excessi'
transportation rates with the cons
quent coal company losses has fu