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Show Can Put Independent Produce fl ers Out of Business and IH Still MalU Profit. M FRANK. ADMISSION BY II CHAIRMAN GARY MADE- Believes the Great Corporation m Should Submit to Govern- Vfl ment Control. Bffl . WASHINGTON, Dec. IS. "If you m protect our competitors, you leave us llJil above protection, and I believe that JH the United States Steel corporation jrM should niake public its affairs and sub- 1 mit to government control," was the ffflk remarkable' declaration of Judge E. TL mtm Gary, chairman of the board of directors Kg! of the United States Steel corporation, Bahf , at the' hearing before the House vayl Bwl and means committee today. KSm "This is radical," he added, "but fii remember that I am npt speaking for : & j tho .steel corporation in saving this." S Judge Gary, like Charles M. Schwab, 1 J who appeared before the committee on I ; Tuesday, gave much information and ; 1 j submitted to a severe cross-esamination. 1 I His testimony showed chat the tariff 1 is-needed more as a protection for the j jt I independent steel manufacturers than 1 1 fbr the steel corporation. He declared m I that the reduction of the duty on cer- m j tain steol products would compel ths M I steel ,compan;es to reduce the cost of IS I labor, no-said that the competitors of Hi ! tho steel corporation needed protection, Its ! but that the corporation could take cars ail of itself. Sf Might Stand Pros Trade. sfm "Suppose this committee were t ail wipe out the steel duty entirely. ths m 1 United Slates Steel corporation "would 9m 1 stiU survive?" inquired Representative B t Champ Clark of Missouri. Kl "I cannot say," replied Judge Garyj f "but I am of tho impression that if wfl Mil did we would have a monopoly of thj Jrl market in this countiy. I don't think ml H we could make a reasonable and fair fi B profitif tho tariff was put on that Eg 8 Former Judge Gary, who, said ho haj Rl I been chairman of the board' of directors II of the United States Steel corporation S I for five voars, took the stand and was Smi tho first witness whon the steel sched- 'Dll nle was taken up. Ho said, that Mr. Hfif I Schwab in his testimony 'rie'fore tin wj "f B comfhi'tTee Tuesday had not in bis esti- ifij 1 mate figured enough for depreciation in Sjw 8 tho cost of pig iron. Judge Gary placed gi$ tho cost to produce pig iron at from 15 .$14.75 to $15 a ten, as compared with W $H, the cost given b3 Mr. Schwab. Ill Cost of Production. wl This afternoon Judge Gary devoted I much timo to giving a detailed state f ment of cost of production of steel. Rc Mi said that tho average, cost in the LaLa jfSI Superior region is $1.43, including royal- fcf t3 Ho said that tho manufacturers1 cost of pig iron at Chicago amounts to t J between $14.75 and $lu. This cost f does not include ihe interest of the steel company om? its investments in j mining properties t and transportation companies. il Judge Garj- declared that tho mann-facturers mann-facturers in this country, in figuring ft 8 the cost of production, have not stipu if lated a sufficient amount for deprecia- "& 8 tion to keep up their plants. Ho said that tho United States Steel corpora via tion can produce iron and stool material ; a I lv cheaper than most of its competitors, Mr-He Mr-He estimated, tho differouco in cost a ;J about a doHar a ton, which ho said waa 1 duo to tho -modoru character of equip f ment and cost of certain material ta BN the corporation. SB "Don't you believe it is more than a fart-dollar fart-dollar a ton?" asked Chnirmau P.Ty-na lO "The corporation which has a de jgBNj cided advantage in the quality and fltfltB quantit3F o'f ore and an advantage iu if? owning its own lines of transportation &ff b3' lake and rail can natural manufac BSffM tare pig-iron cheaper than "those com jf9 panies which havo not thoso advantages ORfnl ,1 thhik.Tr.horo is no doubt that tho dif jtttlli forcnco.-'in cost is more than two dob flwil lars. ' ' $Wl Judge Gary toda3 testified that the Bffiif cost to. produce pig iron in England i $9 a "ton; tho lowest cost, in the Lor iiiitfp mine district of Gemini-, is $S.50 a rflitil ton,-and in other parts of Germany $11 iif a ton.- He said that, eliminating thf ifffliffl profit all along the. lino that entered! isPIin into tho manufacture of pig iron, tha BTStt! cost of production in the United States Mlife IS $12.G5 a ton. no said that the gen-' BfirJi oral manufacturer could not produce ifl tSanl for less than $15 a ton. irciifl Gives Moro Figures. Wxia Declaring that tho average cost of! flwffl producing pig iron in all of the plants Irani of the steel corporation is $15.30 a ton, KlsJij Judge Gar3 gave tho figures b3' -which tftlfPi this avorago was determined. . dToIS The iron ore used in the prpduction fiwtJ in a ton of iron costs $S.62. he said. fflira The othor items which go to" make up tKHB tho $15.30, ho said, aro: Cake, $1.15: llfiftuB limestone, 49c; scrap, IGc; cinder anq Imk scale. 11c: labor, material and operating Hgfvl cost, $1.35. and depreciation, 40c An OaPNl important declaration made b.y tho Ojra steol magnate was that, tho ore is now flSftnrf poorer in quality than formorlj, and It-tffls that the cost of pro'ductiou is therefore ielF increased. 1 2 fa "No railroad that .is able to pay $23 JFfe'B a ton for rails has gone without "them SkiIIc becauso they cost -$28." said Judge , pUffi Gar3. "I think this question should iSl3F be approached from a different stand fffl point. I don 't thiiik a manufacturer, on a-sIE account of tho tariff of anything else, 8a tn should got more than a fair return 011 CrIb his investment. .If ho does not churgit (Rln n fair price ho ought to bo compelled &ffl to sell for less.'? gKljg Mr. Chirk inpuircd how Judgo Gan Va'tn proposed to pre' vent the manufacturer wjffilft from charging -a price that gave- theiu 3t-Bt moro than a fair return on their iu n Kl vestment. M Rl "B3- publicity and government con mt va trol of the -' manufacturers," he xo mtm spoudod. .'" v HS'tW "Tho price of steel rails was' fixed IfiS'wi in IS99 at tt-confjrenco of steol maun fSf iffi facturers and with the advico of poa Bill ibly-a few. railroad commissioners ,ns to what would bo a fair prico for rails. Sincd tJi.it tiniti the steel manufacturers have adhered to that prico and 1 doubt if any would i'.hariro it .without notify ' inptho others. They have no agreement agree-ment 'and do not have any meetings." Trust Agreement. ''Isn't it true that you have such a control that if you fixed the price nono of the independent manufacturers would dare-lo set a price below vours?" asked Mr. Clark. "That may be true as far as steel rails arc concerned," replied Judge I Gary, but qualified his answer by say ing ho did not. mean that the ateel cor-A cor-A poration had a hold on the industry. j, but that the independents recognized I the advisability of maintaining ono I price." I "Suppose the United States Steel cor- I poration put the price lip to $30 a ton, I do you think there is an independent I manufacturer who would not mark his I price up to $30 u ton because you had I marked vours up?" I "I cahnol say," was the reply. "fX- I cent that 1 think they would mark the I price up." , ,, , , I .fudge Gary admitted that the steel I corporation could drive the indenend- I onts out of business in a competition I because the steel corporation can pro- I duce rails cheaper than the independ- I cuts. I Judge Garv said that the steel cor- I porntion-could not survive in the tin I plate industry without ft tariff possibly I less than the present duty on this ar- I ticlc. I ...... EnonnouE Profits. I Representative Clark wanted to know. I howmuclr profit the United States Steel i I corporation is making. Judge Garv said I that ilic interest paid out amounted to I $180,711,000; the dividends paid out I $2G2,331,000: that a surplus of $97.- I (545.000 has been accumulated and that I $103,694,000 has been Daid out for con- I struction. Ho said that the total profits I on the capitalization approximated 73.1 I 'per cent. The United States Steel cor I poration, according to .ludgc Gary, is I capitalized at $360,281,000 iu proferrod I stock and $50S,302,500 in common stock, I and. t.ho bonds of tho corporation I amounted to $1S0,1 99.000, on which tho Irate or interest is n per cent. 'i ne subsidiary sub-sidiary companies have a total bond issue is-sue of $125,3-16,000, he said. Representative Underwood . asked Judge Garv if he agreed with Mr. Schwab, wiio testified that the cost of labor iu a ton of pig iron in this couu trv and lngland is about, the same and that the increase cost of labor in this country is due to increased efficiency effici-ency and improved methods. ''This is probably correct in regard to the pig iron, but it is not so of other steel products." ho replied. "The corporation cor-poration manufactures annually ten to eleven million tons of nig iron and the same quantity of finished steel, including includ-ing steel rails, structural steel, stool wire products, .snch as nails, fence and piano wire, tubes and tin plate." What percentage of tho iron production produc-tion is turned out by your company?" asked Chairman Payne. "Last year 41.7 per cent of all." "Would you bo adverse to our securing secur-ing the figures t.liat you originall.7 furnished fur-nished to tho bureau of corporations as confidential information?" asked Mr. Payne. ;"I would le veiling that tho com-Tnittoe com-Tnittoe should have that data for its own information," replied Judge Gary. Chairman Payne said ho could not t romise that tho newspaper men would .ot get hold of the figures, as tho committee com-mittee believed the public should have the benefit of all information presented to the committee. , "Well.' said Judge Gary, "I will an swer in tho negative; we are not adverse ad-verse to the committee having those figures." . t was annouueed by the committee today that Andrew Carnegie will appear before it Monday- |