The New York herald., 1922-06-02
UNTERMYER FIGHTS
STEEL MERGER PLAN
Five Company Combination
Faces Inquiry as Three
Companies Join Forces.
HINTS AT INJUNCTION
Heads of Industry Say U. s.
Steel Could Profit at Cut Of
S3 to S5 a Ton.

!, Samuel Untermyer. counsel to the
Lockwood Housing Committee. yes
terday sought to draw a picture of the
control exercised over the steel in
dustry by the United States Steel Cor
poration. and to establish that the
smaller independent" companies ex-
listed only through the grace of the
larger corporation.
In doing so Mr.. Untermyer brought
from the heads of the largest inde-
pendent companies-the Lackawanna,
Republic, Bethlehem and Midvale-
testimony on the proposed merger Of
the Bethlehem and Lackawanna and
Of another contemplated merger Of
five companies-the Steel and Tube of
America. the Inland. Republic, Mid
vale and Brier Hill. 1t was not until
later in the day that the merger OF the
Midvale. Republic and Inland was
announced. ,sve
Mr.. Untermyer further developed that
the United States Steel Corporation en-
joys differential of from IS to s. a
ton on manufactured prbducts and that
no actual competition exists. He
charged that the Steel Corporation. con-
trolling 45 per cent. of the output. could
sell its products from SO to s. a ton less
than IL did and still make money. Steel
men called as witnesses testified that n
1t did so the smaller companies would
ii. %
Elbert III. Gary. chairman OF the board
OF the Steel Corporation. will be called
to-day to testify on this point
Hint of EnjoininR Merger.
Mr.. Untermyer further charged that
because of it's control of the industry
and It's preferential the Steel Corpora
lion could. IL so disposed, market its
products eat from SOL .000.0 .0c0 to SIS. .0o0. 900
a year less than it did and still make
money.
One of the developments of the ses-
sion was the hint that court action to
enjoin the merger of the five companies
now contemplated might be sought.
John A. Topping. chairman of the board
of the Republic Iron and Steel Com
pany. explained that Thomas l.. Chad
bourne counsel, had advised against
revealing the basis of the ne1 yer until
the negotiations were closed. dr. Un-
termyer said neither the committee nor
the officers of justice would want to
lock the sta BILE door after tie horse had
escaped and the IDEA OF enjoining mer-
gers after they had taken place was
not satisfactory.
The original merger contemplated was
a seven company combination to In
clude the Lackawanna and the Youngs-
H.. 1.a
Lackawanna dropped out after negotia-
tions with the Bethlehem Company. The
Youngstown Company withdrew a few
days ago and Mr. Untermyer sought to
show through A. c. Dinkey, president
OF the Midvale company, that the with
drawal was because of objections to the
Youngstown company by J. p. Morgan
& Co, who he said, dominated the Steel
Corporations affairs. Mr.. Dinkey de-
MED knowledge on this point.
You would not like to buck UP against
the United States Steel Corporation with
a merger that was not agreeable to J.
termycr asked.
There would be n lot pleasanter
occupations than that"
There would be lot safer ones.
wouldn't there?"
There would"
The four steel men called--George +.
Downs, president OF the Lackawanna !:
Eugene G. Grace OF the Bethlehem, Mr.
Topping and Mr.. Dinkey-agreed that
the United states Steel Corporation con-
troled about 45 per cent Of the coun-
try's production. Because OF the dis
tribution of the corporations plants and
mines and its ownership OF transporta-
ton lines Il was able to make and
market steel at from SO to s5 a ton less
than the independent companies. This
meant an extra profit OF from s51. .000.-
900 20 100000 year. 1t was esti-
mated.
wages hut Not Freights Cut.
Mr.. Unterinyer referred to the Inter-
state Commerce Commissions order re-
ducing freight rates 10 per cent and
said to Mr.. Topping
isn't It fact that whilst the Labor
Board has reduced the wages OF the men
on these roads owned by the United
States Steel Corporation almost con-
temporaneously with the general reduc-
ton OF rates by the Interstate Com
merce Commission. that IN the case OF
these corporations owned by the United
states Steel Company. whilst the Labor
Board has reduced the wages, the In
terstate Commerce Commission has not
reduced the freight rate?"
Mr. Topping said that was the fact,
and II Il should continue "it would be
very unjust"
Among the roads controlled by the
United states steel Corporation are the
Continued on Page Three.
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