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Show LU iliiUL III rtLIL B iuUU i O Would Be Welcomed by the Head of the Steel Trust Washington, Juno 2. Elbert H. Gary, chlof executive officer of tho United Statos Steel corporation, resuming re-suming his testimony before the houBO "Steel trust" Investigating committee today denounced the Sherman antitrust anti-trust law as archaic and declared that governmental control of corporations eventually would come, Mr. Gary asserted that the ySteol corporation would welcome such a chango and would be glad if the government gov-ernment would go 60 far as to dictate tho prices of steel products. The explanation of the reported world-wide "trust," Mr. Gary said a conference would be held In Brussels, July 5 and C, next, to organize nn international steel institute similar to tho American Iron & Steel Institute. Tho latter, he asserted, was formed to prevent demoralization In trade and to permit an exchange of ideas for the bettorment of the steel industry. Ip no instance, Mr. Gary said, had there, been any attompt at any unlawful un-lawful combination or an expressed or Implied agreement He said he would do all he could, morally and legally, to further the proposed international Institute. (Continued on Page Eight) oo oo CONTROL OF ALL TRUSTS (Continued from Page One ) What the United States Steel cor poiation wanted, ho said, was some responsible and official dopartment or the government to whom It could go nnd say. "What prices can wo charge nnd just what can we do?" "Personally, I believe the Sherman act," said Mr Gary, "does not now and never will, fully prevent the organizing or-ganizing of great combinations of capital. cap-ital. I believe we must come to enforced en-forced publicity and governmental control con-trol of corporation." "Do you moan government control even as" to prices'" Mr. Stanlev asked. "Yes, even as to prices. So far as I am concerned, speaking for the United Unit-ed States Steel corporation, I wouln be very glad if we could know exa' where wc stand and could be fi e from the dangers and criticism of the public. I wish wo could go to some responsible governmental source and say: 'Hero are our facts; hero is our business; here is our property and our cost of production,' and could be told just what prices we could charge and Just what wo could do " Believes In Supervision. Mr Gary said the real problem was not the making of big profits, but it was rather the establishment of a definite def-inite understanding on the legal situation. situa-tion. "Do I understand that you believe In strict government supervision of corporations?" asked Representative Littleton of New York. "Yes, I do," said Mr. Gary. "I know that is a radical position, but something must be done." "Is It your conviction." Mr. Littleton Little-ton Inquired, "that the Sherman antitrust anti-trust law Is archaic and unable to deal with the modern situation?" "Yes." "Do not the interpretations of the Sherman law practically order a continuance con-tinuance of the old competitive system sys-tem as opposed to co-operative modern mod-ern methods?" "I am afraid they do," Mr. Gary re piled. "We do not want a condition of uncertainty in which we do not know just what wo have a right to do." Representative Young of Michigan asked Mr. Gary if he thought the national na-tional government had a right to fix mflTr7m"'gm' ",11 ' 'I Ill I I I llllll lU'BiTTrTT the prices of commodities of interstate inter-state commerce. "My opinlonAsaid Mr. Gary, "is that, "so far as It relates to Interstate commercu. the federal government has that riRht" Mr Gnry was asked if the United States Steel corporation was In a position posi-tion to Qx prices, so that co-oporativo biiBinesa methods which succeeded highly competitive methods had made It possible for big corporations to influence in-fluence prices "Wo cannot dominate them," he said. "It Is not the big corporations that change prices so much as tho small corporations that cut prices and forco the big ones to come down." The Gary Dlnnorc. Taking up the Hubjcct of the inter-1 national trust and Gary' dinners at which It had been Intimated prices were fixed, Mr Gary said: "At the time of the panic there was great demoralization In steol business. ) A fear existed that It would extend nnd become dangerous. The Iron and steel business has been recognized as one of the lending barometers of trade. Tho situation caused Jobbers all over the country to appeal to tho corporation to do something to prevent pre-vent business chaos " Mr. Gary called tho steel men of the country togethor at a dinner to discuss conditions. Ho said these dinners din-ners of consultation had proved so beneficial in maintaining the stability of reasonable prices that representatives representat-ives of the steel Interests would moot at Brussels, July 6, next, to determine whether an International steel Institute Insti-tute similar to the American institute insti-tute should be organized He said he would participate In tho organization organiza-tion of this Institute, unless he became be-came convinced that morally or legally legal-ly It would not be well to form such an organization. In elaborating tho Idea, of the Gary dinners, the witness explained that when the panic camo the Jobbers heifc large quantities of material for resale re-sale and, If prices wero reduced, failures fail-ures woro certain and a prolonged panic would ensue. "The United States Steel corporation, corpora-tion, with 50 per cent of tho steel business of the country,'' Bald Mr. Gary, "thus was confronted with two propositions. We had no right to endeavor en-deavor to prevent a reduction In prices and maintain the equilibrium of business by means of an expressed or implied agreement, nor had we a lawful right to agree with our competitors com-petitors to maintain prices. Prevnted a Panic. "On the other hand we believed we had no moral or legal right to become involved in a bitter and disastrous competition such as follows any kind of depression in tho Iron and steel Industry, In-dustry, for the reason that If we did It, it would mean a war for tho survival of tho fittest and many persons engaged en-gaged In the huslncss would be forced forc-ed Into bankruptcy. "Therefore, it was believed by me at lea6t that It was not for the best Interest of the manufacturers or tho laborers or tho people generally that prices be reduced The question was how to get between the two oxtremes, ono of securing a monopoly by driving out competition in a bitter flghf, the other of maintaining prices without making an agreement "So I Invited a large percentage of the steel Interests of the country to a dinner and I presented to them these views." He said he 'told the exact situation and suggested a remedy. He suggested suggest-ed that the leading steel and Iron men of the country come together at frequent Intervals and discuss the conditions con-ditions of their business. Chairman Stanley directed Mr. Gary's attention to the question of the supply of Iron ore. The latter denied that his organization controlled the ultimate supply of iron ore In the United States despite his statement In 1908, to the ways and means committee com-mittee of the house, seemingly to that effect Independent manufacturers, said Mr. Gary have large holdings. Dumping of Ralls. After the discussion as to the supply, sup-ply, Mr. Gary's attention was directed to the manufacture of steel rails. He denied that the steel corporation controlled con-trolled the price of rails, adding that they could not be sold for less than ?2S a ton. "In this, country," Interrupted Mr. Bartlett In reply, Mr. Gary undertook an explanation ex-planation of why steol rails could be sold cheaper abroad than at home. Ho said, like the merchant who clears his shelves once a year, by selling his goods at cost, so tho steel manufacturer manufac-turer could sell his surplus abroad at $26 a ton, or at cost. The result was the mills were kept running, reducing the cost of production, keeping togethor to-gethor organization and again bringing this country large sums of money. The ultimate effect, he added, was to reduce re-duce the price to the domestic consumer. con-sumer. All countries practice dumping," dump-ing," Mr. Gary declared. "How long has it been slnco any country 'dumped' rails on us?" inquired in-quired Chairman Stanley "In about 1905 or 190G," came tho reply. "Last year some rails were 'dumncd' on tho Pacific coast" Representative Littleton, taking up the examination of the witness, inquired inquir-ed If It was not true that the steel manufacturers were trying to steer a nice course between the Sherman anti-trust law on tho one hand and the obstacles of competiticn on the other, "It is," replied Mr Gary. "I wis"h we knew how we could rightfully and lawfully do it" Prices Cannot Be Maintained. "Then you think, in the light of the experience of the last ten years, that mi in iiiiii mi ii n -'ni i present prices can not be" maintained for another long period and still avoid i the sharp corners of the Sherman law?" Mr Littleton asked. i "I do not think it can be done," said I Mr Gary. "There is such a dlver?'tv j of Interests in the steel business th.it it seems to me that there must be j some way devised to allow tho manu- j facturers to protect therase'ves j from obstructive competition that will 4 drive manufacturers out of business o: 1 else we will be In chaos." j "Then," Mr Littleton continued, "do you believe there is no way compti- tion can continue freely and the steel business develop and result in benoQt to the consumers?" "I do not think It can. except under government control," said Mr. Gary "You think then, the time has como when we must surrender the comne'i-Uon comne'i-Uon methods In business for accent- j ance of a new policy in big buslr.csS I affairs." ' "It seems to me it has." j Chairman Stanley asked Mr Gary J if business under government control J could stop short of absolute govern- j ment ownership j "I think It enn be done." Mr G"T j answered. "The banks and railrcds ,, have done it to a certain extent, The ' banks have only gone to the cxtcn ri t ' absolute publicity and that demnn- 'i stratcs the feal right of the gnven- i ment to control business corporaticnF." 'J Mr. Littleton asked the witness if (! the United States Steel corporation could effect a dissolution of its sub- . sldiary. js Mr. Gary informed the committer that the Tennessee company took the i, j first steps toward its acquisition b? the United States Steel corporation. i Ho said it was "offered to us manr r I times" and that Lewis Cass Lodyard ' $ made the final suggestion F The committee will summon Mr. , I Ledyard. .jj Increased prices are to be charged fe for steel rails in the near future, ac- : fit cordlns' to Mr. Gary Higher cost of k labor and raw material, together wllfl , ii a demand for heavier rails, was given , as the reason for tho proposed ad- , Jkf vance. j |