Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-09-10
BETHLEHEM HEAD
ANSWERS HOOVER
Grace Admits Hiring Shearer,
but "0nIy as Observer"
at Geneva in 1927.

E. G. Grace. president of the Beth
lehem Steel Corporation, one of the
three companies sued by William B.
Shearer for money he claims is due
him as an agent to work against the
Governments disarmament programs in
letter to President Hoover today ad-
mitted sharing the employment of
Shearer, but only as an observer at the
Geneva disarmament conference in
1927. He said the company severed
connection with Shearer as soon as it
had been determined that he was a
propagandist.
Grace's letter to the President was
an answer to the Presidents public
statement last Friday in which he bit
terly denounced the practices which
Shearer is claimed to have alleged these
three Shipbuilding corporations INDUCED
in. The corporations president. after
explaining in some detail the manner in
which Mr.. Shearer was employed and
the things which prompted his employ
ment, declared that the Bethlehem cor
poration has nothing to conceal regard
ing its share In Shearer's employment
and stated that his company would be
glad to furnish any further information
on the subject the President desires.
Grace Explains Action.
The Bethlehem president explained
that his company had no desire to en-
ploy Mr.. Shearer as propagandist in
connection with the disarmament con-
ference and that the latter'S activities
in that connection with the conference
were solely on his own initiative and
were in no way inspired or supported
by the shipbuilding industry. He ex-
planned also that the Bethlehem cor
poration joined with other shipbuild-
ing companies in 1926 in the employ
ment OF Shearer In connection with the
movement OF encouraging the develop
ment Of an American merchant ma
rine, for fee of $500, of which the
Bethfehem corporation paid one third.
Mr.. Grace claimed that the fee for
Shearer's services as an observer at
the Geneva conference was to be $685.
600, of which the Bethlehem corpora
tion was to nay third
In making Mr.. Grace's answer public
at the White House today. it was ac-
companied by no comment from Presi-
dent Hoover himself. Mimeographed
copies of the letters were distributed to
the press.
Mr.. Grace's letter follows:
Honorable Herbert Hoover, President
of the United States of America, Sir:
In your public statement of September
Z 1929, referring to the suit of William
b. Shearer, against certain Shipbuilding
lieve that the responsible directors of
these shipbuilding corporations have
been party to these transactions as re-
ported in this lawsuit, but their state
ment of the case is needed. The
Bethlehem Steel Corporation Is ad-
dressing you this letter in response to
that invitation.
Minor Official Is Blamed.
ITO the best of our recollection, Mr..
Schwab and were not conscious of the
existence of William B. Shearer, prior
to December, 1927, when we were asked
to comment on the rumor that Ameri-
can Shipbuilding interests had main
tanned at Geneva during the Naval dis
armament conferences of the previous
Summer a propagandist in the person
of one William B. Shearer. We first
branded the rumor as false but upon
its repetition we caused inquiries to be
made by S. w. Wakeman, who was in
charge of Bethlehem'S eastern build
ing operations, with headquarters at
our Fore River shipbuilding plant at
Quincy, Mass.
I'VE then learned for the first time
that in the previous Spring, Mr.. Wake
man had joined with other Shipbuild-
ing companies in the employment OF
Mr.. Shearer as an observer at the Ge-
neva disarmament conference for
fee of $25 900, of which Bethlehem was
to pay third. Mr.. Wakeman assured
us that his undertaking was that Mr..
Shearer was employed only as an OBJ
server to furnish information and that
his activities as a propaganda in con-
nection with the conference were solely
on his own initiative and were in no
way inspired by the shipbuilding in
dustry.
"Mr. Schwab and soon ascertained
that Mr.. Shearer was and had been Tor
years an active prUpagandisr regard-
ing the naval policies OF the United
States. We felt that the employment
of such a man AS an observer was In