INNER HISTORY OF THE STEEL TRUST.

Taranaki Daily News, Volume LIV, Issue 49, 19 August 1911, Page 8

INNER HISTORY OF THE STEEL TRUST.

£65.000,000 SPENT IN ATTEMPT TO FREEZE OUT MR. CARNEGIE. Mr. Joint W. Gates, the well-known capitalist, who was instrumental in forming the .Steel Trust, has given evidence before the Congressional Committee which is investigating the affairs of the Trust with a view to Government prosecution as an illegal combination. Mr. Gates' testimony was most interesting, because he outlined the beginnings of the .Trust and disclosed some of its workings in the early days. One of the charges against the Trust is that it is excessively capitalised with large bond and stock issues, not representing real values. Some of Mr. Gates' testimony would seem to confirm this charge. He said that the Trust had its inception—or, to use his words, "was born overnight"—at a meeting at Mr. Pierpont Morgan's home in New York. The only men present were Mr. Morgan, Mr. Charles M. Schwab, who was then the president of the Carnegie Steel Company, and Mr. Gates.

Mr. Gates said that after 'discussing the situation for some time and canvassing the steel companies which should he taken over into »a combination, it was decided to "freeze Mr. Andrew Carnegie out," because Mr. Morgan feared that Mr. Carnegie's entrance into the combination would demoralise the railway industry. Overtures were therefore made to Mr. Carnegie, with the result that the Trust bought the Scotch iron master's interests in the Carnegie Steel Company for the huge sum of £05,000,001), which Mr. dates said was just double the option price of the year before. "Andy." said Mr. dates, "was always kicking over agreements, and all round it was decided best to have him out." The investigations, so far as it has ftone. is highly satisfactory from the Government's point of view, and it is slated tlwt (lie committee believe that they will easily prove it. to be a comhiutition '"in unreasonable restraint of trade," ami satisfy the Supreme Court that the Trust should be dissolved, as was the Standard Oil Company.