January 10, 1912, The Evening Telegram, Carnegie On Steel Rack,

January 10, 1912, The Evening Telegram, Carnegie On Steel Rack, Panics Are Due To Bad Banking System, He Says,

Tells Congress Committee on the Witness Stand That Method Practised Here Is 'Disgrace to Civilization."

Excerpts:

Mr. Carnegie denounced the banking system of the United States as "a disgrace to civilization."
"When panics come in this country," he said, "they are due to the fact that we have the worst banking system in the world. Panics spread ruin, and if the bill now before Congress is passed you will have something to prevent such panics."

Mr. Carnegie, in the written statement filed with the Committee, pointed out that the Steel Committee's task had arisen from the fact that the law of competition in business has seemed recently to be impaired in certain fields, notably those of natural oil, steel and tobacco. Even now a gigantic railway system, embracing nearly one-half of the world's railway mileage, has been affected, and several retail companies have been tried and convicted under the Sherman law."

In a Transition Stage.

"We are in a transition stage," said Mr. Carnegie, "and naturally suggestions are numerous and divers for effective compliance with the Sherman act as interpreted by the Supreme Court. That a satisfactory measure will finally be evolved is certain—one which does not go further than actually necessary to prevent restraint of trade and monopoly. These two and unendurable evils prevented, government and courts may well rest from further action until experience dictates any necessary modifications. There is no cause at present for either alarm or haste, upon the part of the courts, Congress or producers or consumers, whose interests will become mutual whenever freedom of trade from monopoly is established. Nothing revolutionary is required."

Continuing the story of his life. Mr. Carnegie said that during the civil war he suffered a sunstroke, and was ordered to spend his summers in a cooler,climate.

"I went to my native land, Scotland, and there watched the Bessemer process of making steel. There, too, I met a Mr. Dodds, who had invented a patent for hardening the face of steel. I purchased the patent and brought Mr. Dodds to Pittsburgh, where we built a furnace and made the first hard surface rails in this country."

Mr. Carnegie referred to "that great mechanical genius. Charles Schwab," as the "greatest man I ever knew in that line."

Mr. Carnegie said he suggested to Mr. Schwab that he test a process for making ore in open hearth furnaces and then "build an open hearth furnace,"

"Charlie," according to .Mr. Carnegie, "said he would try and it was not more than a week later that he came to me in my office In New York and laid on my desk plans for eight magnificent open hearth furnaces. We sold open hearth steel for $5 a ton more than other steel"

No Restraint of Trade.

Mr. Carnegie said that in the open hearth mills at Homestead, "the greatest in the world," the committee would find "no restraint of trade."

Mr. Carnegie frequently pounded the table with his hand.

"Why," he said, "we were going to build at Conneaut. Ohio, an enormous tube mill that would hare astonished the world and outdistanced competition. That's where Charlie Schwab comes in again. He told me he was satisfied he had a plan whereby we could build a tube mill that would save $10 a ton in the cast of manufacture over any other tube mill In the world."