The Iron Age 1917-03-22: Vol 99 Iss 12

ee ow rn “Se y ' 5 %. a. New York, March 22. 1917 ‘STABLISHED 1855 VOL. 99: No. 12.3 Se Pneumatic Tubes for Dispatching Orders How Job Tickets Are Now Handled in Franklin Automobile Plant—A Forward Step in Mechanism of Scientific Management NOTABLE advanced step in the machinery of A management has been made at the plant of 4+ the H. H. Franklin Mfg. Company, Syracuse, N. Y.. maker of the Franklin automobile. It amounts to the use of pneumatic tubes for dispatch- ing shop orders from a central point to terminals distributed about the works. Formerly the issuing orders or job tickets was done in the way com- only followed in plants operating under scientific vement, as is the Franklin works. Small dis- id patching rooms were located in the different depart- a nents and the workmen there turned in the tickets pleted work and got their tickets for the new ihe replacement of these scattered dispatch- ie- ¥ offices by the pneumatic system is the creation ge D. Babcock, production manager of the se ) ie system has been installed also to transmit ges and mail matter, and when it is mentioned bs e Franklin plant comprises a group of build- ned re or less contiguous and several stories in 00 an idea of the time economizing advantage stem may be apprehended. The chief re- h the system has accomplished, however, ndicated by a brief explanation of the way ght the old system worked. When a workman finished a job and wished to work on a new one, he would very likely find a number of workmen at the dispatching cage so that he would have to wait his turn in hand ing in the old and getting the new job ticket. Often a man would start an argument over the job he was given or the job which he thought he should have The clerk in the cage would sometimes be blamed and at any rate all the men waiting would be de re the job tickets against various machines for different operations When the carrier from some depart works is received from the pneumatic tubes, the job ticket for the completed work is replaced b new ticke ind the carrier is inserted in the tub ry to the depa ter? I layed and the production of all of them unneces sarily held up. Under the new system there may readily be more terminals than there were department cages Al the workman needs to do on finishing a job is to in sert the card in the pneumatic tube carrier, wait short time and a new job ticket reaches him through the tube. Although there are approximately 1500 jobs dispatched in a day, there is practically no delay in getting the new job ticket to the waiting work man. The central point from which all the tubes radi ate is on the sixth floor of one of the factory build ings at one end of, and in direct communication with the planning, tool and operation department. The departmental! dispatch cages have thus in effect been 701 Eee 702 At each pneumatic tube terminal throughout the shops is the tube In the first picture is shown the rolling of a } the third the air coming out of the tube is tested, if air i other on its way to the terminal In the fourth is shown the closed and the carrie moved to the planning room. Here is also the pro- duction manager’s office and the control boards (al- ready illustrated in these pages) which show at a glance if the rate of manufacturing of any part or assembly is clearly up to the required schedule in or- der that completed parts may be delivered on time. Indeed the path from the factory manager’s office to the workman’s hands is so short and the informa- tion of the organization is so entirely within his control that plant supervision has become one of the small problems of the works. The centralization of the machinery of putting work through the factory makes for a quick adjust- ment of any difficulties which the workman may have with regard to machine or tool breakage, slow- ness of machine with resulting loss of premium, working on jobs out of their regular date order, etc. Also it has eliminated, as stated, personal contact between the workmen and the dispatching clerks and thus unnecessary conversation is a thing of the past. The result is a more rapid handling of the jobs and a greater degree of harmony between management and men because of the rapidity and ease of adjust- ing difficulties, for which often the clerk in the cage was unjustly blamed. Now, the workman waiting at the tube terminal, knows there is nothing personal about his designation to a given job and that if the lot of material is not at his machine or the machine THE IRON AGE March 22, 11 posted a group of pictures to show the workmen how to »b card and in the second how it is inserted in the carrier felt issuing, the carrier must not be inserted, as there is method of inserting the carrier, and the fifth the valve r sent on its journey is broken, the difficulty is easily taken care of action of the proper persons in the planning depart ment. The system comprises 3500 ft. of tubes in 25 lines, three of them 3 in. in diameter and the re- mainder 2% in. The system is operated by com- pressed air, an electrically driven compressor with a 35-hp. motor being provided. The carriers are of leather slightly less in diameter than the tubes and each is fitted with a felt washer at the bottom large enough to fit the tube snugly and act as a gasket or piston against which the air pressure acts. At the central dispatching point or pneumatic tube desk is a row of. pegs corresponding to each tube. When a carrier has been emptied it is in- verted on one of the pegs. It remains there the short interval required in getting the new job ticket before being returned to the tube. The number of inverted carriers thus indicates the number of men waiting at a terminal. If three carriers, for ex- ample, are found inverted at one tube, it follows that there are three men waiting for new tickets at the terminal. The work of the dispatching room is done so rapidly that seldom are there as many as three men waiting for jobs in the same department. The group of small photographs here reproduced was made from a set of instruction photographs placed at each tube terminal. They are regarded as neces- In this nearer view of the pneumatic tube desk may be carriers inverted on pegs The clerks have gone for new mun is waiting at each terminal for which there is a noted a job tickets pegged carrier number of and a In the main office a pneumatic tube is provided for the dispatch of mail ! shipping orders, etc. March 22, 1917 ‘ because the men, not knowing the principles of the pneumatic system, may make mistakes and a in production is sufficiently costly to warrant effort to explain its use. It may be added that ve ticket is stamped and sent along with the ticket to a terminal and the move ticket remains e terminal for the attention of the head move It will be recalled that the use of move men illed, working under the instructions of move ts, is a feature of scientific management. The ticket of course authorizes the movement of to and from machines and departments. The move man makes a round of terminals on his very 5 minutes and turns the move ticket over regular move man, who takes away the finished the given machine and brings up the new lot. One of the illustrations shows a terminal point tubes used for dispatching the office and factory This is located at the main office and the are used, for example, for sending shipping ers to the shipping department and for distribu- factory mail. Safety Work in Ohio e third annual Industrial Safety Exposition under ispices of the Industrial Commission of Ohio and ond annual meeting of the Society of Ohio Safety ers were held in Columbus, Ohio, last wek. The r of the Safety Engineers was held at the Colum- \thletic Club, March 8, and was followed by a in the evening which was attended by a num- ruests, including men interested in safety work states and men associated with industrial com- that manufacture safety appliances. Society of Ohio Safety Engineers is said to be State organization of the kind in the country, line along which it will conduct its activities onsiderable interest generally to men associated afety work. Its active membership is limited to vhose principal occupation for two years has been prevention work and who have been engaged ponsible positions in an engineering or mechani- ipacity for at least three years. However, an ed professional diploma is considered equal to ears’ engineering or mechanical experience. Asso- embers must be qualified by business relations ractical experience to co-operate with the active s, but they are not entitled to a vote. It is the the society to maintain a high quality of mem- ) rather than to secure a large number of mem- \t present its membership is 20, of whom 18 tive members. society will hold meetings every three months, * the present Cleveland will be the regular meet- e. Half of each session will be devoted to the leration of one particular safety subject. The n side of safety work will be avoided as much possible, attention being mainly given to mechanical devices. The aim will be to get mechanical equipment on an engineering basis. Following issions on a particular safety subject the society k out devices, not necessarily patented ap- , that it regards as best for the prevention of in that particular field, and will make these jects of pamphlets that will be prepared and to members. However, the society, in picking devices that it deems the best for a certain line dent prevention, will avoid giving them its approval. Pettibone, director of safety and welfare of Mather & Co., Cleveland, was re-elected nt of the society. Other officers elected were sident, J. M. Woltz, safety director of the town Sheet & Tube Company; secretary and r, E. R. Rose, secretary of the general safety tee of the Republic Iron & Steel Company; as- ecretary and treasurer, G. F. Hudson, safety Republic Rubber Company, Youngstown. e safety exhibit under the auspices of the Ohio rial Commission a large number of safety ap- THE IRON AGE 703 pliances were shown, and all attracted much interest. While many were similar to those displayed at the previous State exhibits, there were a number of new ones. Among these was a very interesting exhibit by the American Rolling Mill Company, Middletown, of a model of a cross section of its open-hearth plant, showing the charging and pouring sides, two furnaces, cranes, etc., the safety features being distinguished in green and the other parts of the model being painted black. Rectifier for Automobile Charging The General Electric Company, Schenectady, has developed a rectifier for use in the recharging of auto mobile storage batteries. It is designed to convert 60-cycle alternating current at a potential of 115 volts into direct current, the capacity of the unit being 450 watts at 6 amp. and 75 volts. The apparatus is inclosed in a perforated sheet iron casing. The voltage at which the batteries are charged can be adjusted according to the number of cells con nected in the circuit. A compensator with 15 taps is provided, and these are cut in and out of the circuit by manipulating the dial switch at the lower left of the accompanying illustration, the amount of current flowing up to the maximum of 6 amp. being indicated on the instrument to the right and above the dial Alt it'nge Current t 11 Volts Is Ce I ] Tir t Cu 7. Volts for Cl ging the S g } tte Au ! starting I Lig g S ! } \ Current Being Regulated in 15 Steps up to 6 Amp switch. After the two upper wires are connected to the alternating-current source of supply and the direct current leads coming out of the bottom of the rectifier are connected to the batteries, the charging process 1 started through the alternating-current snap switch at the upper left corner. This is of the triple-pole type, one pole being in the direct-current circuit and the other two in the alternating-current supply. The batteries, which have from one to three cells, are con nected in series, it being possible to charge as many as 30 cells of battery at one time. It is pointed out that if the supply of current should fail for any reason the battery will not discharge through the rectifier but will start recharging when the current comes back on the line. Tests made on the rectifier have shown that the cost of charging is about 3c. per hr. per cell when 50 cells are being charged and 4c. when 15 cells are cor nected to the rectifier. The shipments of beehive coke in February, 1917, showed a decrease of 18.9 per cent, compared with January, 1917, according to the United States Geologi- cal Survey, and a decrease of 20.1 per. cent, compared with February, 1916. reo he Revelutio ot the Spindle Is Controlled by the Sto Plate i and the Two Pins B. One of Which Is Show A THREAD-CUTTING MACHINE Of Semi-Automatic Type for Inside and Outside Work on Ammunition Milling external and interna! threads on ammunitio1 is the special field for which the American Ammunition Company, Inc., 25 Broad Street, New York City, de semi-automatic machine. The attachment, which was the special feature of the machine, is now being offered for general thread milling work where the pieces are not more than 4 in. and 1% in. in diameter over all, with a 1-in. A multiple-tooth straight relieved cutter is used, the work being finished at a single revolution. If it is desired to take a finishing cut, the change of a single the machine to make two revolutions, one for the rough ing cut and the other for the finishing. the lead screw and nut threads of any pitch up to % it either right or left hand, can be cut. The machine is being simply signed a long pore. fina screw will enable By changing entirely automatic in operatio! necessary to move the table backward o1 forward and open or close the collet for external thread ing work, while for internal work the cross-slide of the machine has to be moved in addition. Any hand o1 screw feed milling machine can be used, and where a greater angle is being cut than can be taken care of with the clearance provided by the cutter, the milling attachment can be raised or lowered to locate the cutter either directly underneat! on top of the work and the attachment Ss set at tne } per ngle to clear the > (43 Le A et >. iby , ; + Bs / J "A SA J i Vee yh ; — } i Eats +t | ; Ti 4k! , 7 . fg f e | ae dncsancasdl a d { saan | — iy a a CMM SLL OIA PATON we, or Controlling the Spindk M« the Table Forward Are Show: The Automatic Arrangement Which Is Partl in Sectior and the Means for Feeding n This Elevatior March 22. 197 than 4 Ii Internally or Long Can Be Threade Externally thread. The spindle, gears and lead screws are cast hardened and the nut is of bronze with provision for taking up the wear. The stop plate A, a revolves loosely on the hul the gear and is stopped by the two pins B, b giving total of about 1.1 revolutions to the spindle. The wedg« C, ec, which is attached to a stationary part of the frame or the knee of the milling machine, brings the driving worm into contact with the wormwheel adjacent to the stop plate. In this way, when the table and the milling attachment are moved forward, the worm is automati- cally brought into contact with the wormwheel and starts the machine in motion, while the withdrawal of the work reverses the motion and releases the worm The rod D, d passes through a hole in the arm £, e, which is fastened to the stationary part of the machine, the motion of the rod being regulated by two pairs of nuts. A spiral spring is located behind the lo bringing the arm into full contact and causing the work to revolve before the cutter bears against the work. The compression of the spring F, f makes additional forward motion of the table to the full juired depth possible. A round belt running ove ‘ountershaft drives the feed pulley continuously In operating the attachment the table is ru ind the piece to be threaded is placed in the collet, w! is then closed by the pilot wheel on the end spindle. This revolves the spindle unit stop plate A, a bears against the stop g. I! forward motion of the table by either automatically brings the worm into mesh the work revolving, this motion beginning just be the cutter bears against the work. The revolution of the work and the cutter continues until the loose sto} plate assumes the position h, when the clutch is throw! ut of engagement and the machine stopped. The r irn movement of the table causes the worm to d and releases the wormwheel, thus enabling the collet to be opened by the handwheel and the finished piect removed. The placing of another piece in the collet and latter brings the stop piece to the and the cycle of operations is repeated lock nuts for motion (cost lever or scré and start ‘ the closing of the starting point The Tennessee Cast Iron Pipe Company, Rockwood, Tenn., has been organized by the election of F. H. Cly- mer, president, and J. R. McWane, Lynchburg, V@ vice-president and general manager. The capita! stock of $100,000 has been subscribed and it is proposed ' call for the first subscription on April 1 and beg™ operations for the construction of the plant on that date. A five-acre site has been donated by the Roan Iron Company. 1917 reh 22, Too Many Structural Shapes here are too many structural steel sections rolled, least too many weights of the various sections, ding to J. A. McEwen, sales manager Pittsburgh ve & Iron Works, Pittsburgh. In a discussion fol- ng the presentation of two papers on cost of struc steel shop work, read before the Engineers’ So- y of Western Pennsylvania on Oct. 31, 1916, Mr. Ewen said that the weights of beams and channels ild be limited to one or possibly two different ghts on each section. ‘We think it would also be wise,” he continued, vecially in busy seasons such as we have at the pres- time, that the mills should discontinue rolling great vers of sections found in the handbooks. This d simplify matters very much and enable the rehouse to carry the majority of sections really The selection of sections in designing is ely a matter of judgment and should be done only who are familiar with sections these sections should be limited in est possible.” essary. tnose obtainable, number to the regard to specifications for structural steel work, held that there are entirely too many of them have foolish clauses making shop work more ex- e than necessary, such as requiring great num- of stitch rivets in tension members, ers of separators, etc. “Why not have uniform ations for buildings and also for bridges?” he “We do not see why the various engineering ties of the country do not have committees appoint adopt uniform specifications.” papers mentioned were contributed by E. W. an, manager McClintic-Marshall Company, and e H. Danforth, structural engineer Jones & lin Steel Company. Discussing these subjects in g the meeting, Mr. Danforth said: ‘In regard to the matter of beams and channels ir one or two weights, nobody wishes that more than unnecessary ‘ lo, but I do not think I shall ever see it. The rolling n of this country, for the last ten or twelve years, k, without exception, have picked from the shapes t} made and have indicated in some way in their handbooks, by asterisk or otherwise, the sections rge used. Yet within the last two weeks I have firm engineers in good standing throughout intry call for such a monstrosity as a 15-ir rye ry vould like to see iniforn specifications but do I shall do so. When you begin to talk of ns, you come to the matter of personal equa F it is the personal equation of the men that We all have our ow deas, notions and opinions ike nave those notions, ideas and rive ttle eign New V-Block with Special Clamp e% Tool Compa! Vy. Wo MSOCKE 4 R. | — new type of V slo oO! the “ITNT market. It is ardened steel and is finished by grinding o es, the height being 1% in. and the width depth 2% in. each. The clamp is of specia on to permit the block to be used on its side grooves are provides the sides for clam} a se a ll Special Clamp Enables This V-Block to Be Its Side, While the Grooves in the Sides e for Clamping Purposes and at the Same Time Leave the Top Clear THE IRON 705 AGE The blocks are made in pairs which, it is empha sized, will give perfect alignment when used together A block may be used either resting on the base or on the side. In the former case it is possible to remove the regular clamp and employ the two grooves in the sides for clamping purposes thus leaving the top clear for the work. When the being side, it is pointed out that the clamp, by reason of its special design, will not. interfere. The V is ground to give a 90-deg. angle, the point being centrally located with reference to the sides \ line passing through the center of the V is parallel! to the sides and the and is at right angles to the ends block is used on its Nase New The force and the use of a mechanical in that features of control switches developed Type of Remote Control Switch closing of the switch contacts by magnetic latch to hold them position are new line of remote by the Cutler-Hammer Mfg. Company, Mil waukee. As current is only at the and the switch consumed f closing o which is opening . made n single, double and triple pole types, it is from the of current econom- ical standpoint consumption. The switches are with a made capacity of 100 amp. for ise on either direct cur One of the alternating or rent circuits. applicatior of the switches is the lighting circuits distant point or } location, the control o from a centra advantage ri Kemot ( trol Sw of this arrangement being One 1 and Closed | that needless use of cur Energizing of Push eon rent is eliminated and it is Se ine Ke pt Cloned by ot necessary to run ci? Mec} p em, bs cuit wires for long dis ( tances to reach a desir le location for controlling number of circuit The cuntact fingers used are of the uilder’ tand ard type for control apparatus and are mad of cold led copper, a wiping motion in closing being relied ipon to keep the surface clear Iw solenoids are ‘ mployed for operating the switc! one for osing j and the other for opening Phe energized Dy ; ircuits connected to pus! puttor ont i witch : which may be placed where desired. When tl ng olenoid has operated and the contact ha en mad ' ne f rere se } a i! I ce ‘ al ite? y ree Uf cts pa } tubes. Oil Fuel Saved by Mechanical Soot Blowers \ saving of 3.9 pe ent the mount of ¢ fue onsumed was effected by the a mechanical ot blowers at a central statior n the Pacif ast cording to the Diamond Power Specialty Company, De ; troit. The temperature of the stack gases was reduced from 553 deg. Fahr. to 483.75 deg., and at the same é time the temperature of the superheated steam was f raised from 499.5 deg. to 502.5 deg. The apparatus was . nstalled in two 822-hp. Stirling boilers and consisted of . six revolving units for each boiler, one at the top and ~ 5 one at the bottom of each pass, the units consisting of ‘% 2-in. pipe extending the entire width of the boiler with . special Venturi ozzles spaced between eac!l ne of | » The Sykes Metal Lath & Roofing Company, Warren, Ohio, has discontinued its warehouse at New York, and will now take care of al! its Easterr from the home office at Warren. business direct Corporation Confident as Arguments Close Justices Enliven Proceedings by Colloquies with Attorneys—Solicitor General Declares No Effort Being Made to “Dissolve Judge Gary” WASHINGTON, March 20, 1917.—Great confidence in the outcome of the case against the United States Steel Corporation marked the demeanor of its coun- sel upon the close of the hearing before the Supreme Court last week. While experienced observers of proceedings before this great tribunal are disposed to discount all surface indications including the bias of individual justices, as indicated by their interrog- atories, the attorneys for the corporation and many lawyers of wide experience, who followed the argu- ments closely, point to substantial reasons for the impression that the court will differentiate the case of the big steel combination from those brought against the American Tobacco Company, the Standard Oil Company, the International Harvester Company, and others which either by the Supreme Court or by the courts below have been decided in favor of the Government. Solicitor General Davis and his able staff were manifestly handicapped in presenting the case against the Steel Corporation by the fact that they had but just completed the presentation of their arguments in this court against the Harvester Com- pany, which was charged not only with acquiring all but a small fraction of the trade of the industry with which it is identified, but with employing ques- tionable methods to suppress competition. The Gov- ernment’s attorneys were also at a disadvantage in seeking to apply to the steel combination the rulings of the Supreme Court in the American Tobacco and Standard Oil cases in both of which substantial monopoly of the industry and unfair competitive methods were held by the Court to have been essen- tial features. Counsel for the corporation, on the other hand, took every possible advantage of the strong con- trast presented between the policy pursued in the formation of the big steel combination and in its fair dealing with employees, competitors and con- sumers, dwelling with special emphasis upon the high code of ethics adopted for the guidance of the corporation in all its dealings. So strong was the apparent impression made upon the court by this feature of the arguments of Mr. Lindabury, M; Reed, and Mr. Severance that Solicitor Gener Davis, in his closing argument, felt that it was necessary to remind Chief Justice White and his associates that the case at bar was not a proceeding to “dissolve Judge Gary” and to urge that however just and fair and farsighted the past and present policies of the Steel Corporation might be, a new group of officers might change them and employ the great power and influence of the “super-combina- tion” for far less altruistic purposes. The possibility, amounting almost to a proba- bility, that the court will hand down its decision in the Steel case as well as in the Harvester case before the adjournment of the present term in June lends an added interest to these proceedings. While there are other important issues before the court, the im- pression gathered by experienced court officials and py other competent observers is that the anti-trust cases will be taken up promptly and ruled upon as expeditiously as is practicable. Following the close of the report in last week’s IRON AGE, Henry E. Colton, special assistant to the Attorney General, argued at length to show that the various subsidiaries, combined to form the Steel Corporation, manufactured competing lines of prod- ucts and were active rivals until consolidated. David A. Reed, for the corporation, replied to Mr. Col- ton, describing the non-competitive character of the subsidiaries at the time the corporation was organ- ized. Cordenio A. Severance, on behalf of the ap- pellees, analyzed the decisions of the Supreme Court and other tribunals under the Sherman act as ap- plied to the Steel Corporation, contending that on every essential point in the issue the conduct of the corporation was easily differentiated from the sev- eral combinations that had come under the ban of the court. George Wellwood Murray presented a brief argument on behalf of the so-called Rocke- feller interests and Solicitor General John W. Davis summed up the case for the Government. Mr. Colton’s Argument for the Government Mr. Colton made an extended argument directed chiefly to demonstrating that there was a great deal of competition between the subsidiary companies before the “super-ombination” was formed. He quoted figures showing the contemporaneous production by several of the companies of rails, plates, structural shapes and other products, and declared that while geographical location did result, Mr. Lindabury claimed, in preventing such concerns as the Illinois Steel Company from shipping their products into Penn- sylvania and other Eastern States, it did not prevent the Carnegie Company from distributing rails, plates, structural steel and other articles all the West in direct competition with the output of the Illinois Steel Company. Justice McKenna asked whether it was the Gov- ernment’s claim that any of the subsidiary companies were “fully integrated” in the sense in which the term as over has-been used in this case, to which Mr. Colton re- plied that several of them were “wonderfully in- tegrated” and were able to take the ore from the ground and make it into nearly all the chief products of the industry. Continuing, Mr. Colton quoted WT ty ai ~ Messrs. Carnegie, Frick and Schwab as constantly re- ferring to the competition of the Illinois Steel Com- pany, especially in rails. This, he asserted, clearly demonstrated that there was open rivalry between the Carnegie Company and its competitors, and, further- more, he declared that the entry of the National Steel Company into rail making and the failure of the Ili- nois Steel Company to live up to the then existing pooling arrangement were two powerful considerations which had much more to do in bringing about the organization of the “super-combination” than any de sire on the part of its promoters to “integrate the industry” or to put themselves in position to develop foreign trade. Belittles the Foreign Trade Development Counsel for the corporation, Mr. Colton said, had devoted a great deal of time to expatiating upon the extraordinary development of the foreign trade of th: big combination, and had spoken of this form of the corporation’s enterprise as though it were highly cre¢- itable. Nevertheless, he asserted, the leading stee! 06 March 22, 1917 its of the corporation have been almost in- ibly sold to foreign customers at lower prices than ymestic consumers. What do you deduce from that statement?” asked ‘e Pitney. That it is questionable whether this foreign trade, ich emphasized, is really as valuable to the in- ial development of this country as counsel would is think,” replied Mr. Colton. Referring to the claims made on behalf of the cor- ition that its competitors were well treated and always “friendly” to it, Mr. Colton said that was no reason why the little rivals of the giant nation should not exhibit “friendliness” as long ey were “permitted to stand under the corpora- big umbrella.” As manufacturers they may benefited by the influence of the corporation in taining prices, and they certainly would not quar- with it on that account. The question for the rt to consider, however, was rather the influence ich a combination upon the consuming public than competitors who secured larger profits as the t of price maintenance. The Position of the Rockefellers George Wellwood Murray, attorney for John D. THE IRON AGE 707 Rockefeller and his son, John D. Rockefeller, Jr., who were made defendants in this case by the Government’s petition, argued briefly that there was no basis in the record for bringing his clients into the case. The Rockefellers, he said, had sold to the corporation the Lake Superior Consolidated Iron Mines, Duluth, Mis- sabe & Northern Railway Company and Bessemer Steamship Company, but they did so merely as vendors and in no sense as co-partners were they interested in the organization of the corporation. They owned certain properties and facilities which the corporation wished to buy, and upon these they put a cash price which the corporation accepted, the amount being $56, 500,000. <A part of this sum was paid in cash and the Rockefellers took the remainder in stock of the Steel Corporation at the market price, their position being exactly the same as if they had received the whole price in cash and then invested a portion of it in the stock of the corporation. For a short time, from 1901 to 1904, they had served as directors of the corpora tion, representing the stock they owned, but they both retired from the directorate more than seven years before the Government’s suit was even thought of. On the record, Mr. Murray therefore insisted, his clients had never participated in the formation of the cor poration. Mr. Reed on Alleged Ore Monopoly lavid A. Reed, for the Steel Corporation, discussed etail the Government’s charge that the corpora- had attempted to monopolize the sources of raw erial of the steel in- ry. In trying to show so-called “preponder- ce” of the corporation in the ownership of iron ore, Mr. Reed said, the Govern- ment in its statistical ta- had excluded all ores rwned by competitors of the combination which not in the immediate mity of those owned » corporation. There is not an atom vidence in this volum- added: record,” said Mr. Reed, “showing that any petitor of the Steel oration ever had the est difficulty in pur- g ore deposits. All witnesses examined a frank skepticism to the power of the cor- tion to monopolize the ipply, and they evince inbecoming lack of eciation of the Gov- ent’s attempt to pro- them against the ag- ns of te corp. EEE competitor of the corporation, for a long time ild have purchased within a period sufficient ‘or the drawing of the necessary papers, a 50 ears’ supply of ore. There is no contradiction here in the record of this fact and the testimony ear as language can make it that it is humanly ble for any interest, no matter how powerful, polize the iron ore of any important district simple reason that any attempt at monopoly merely stimulate development. We have it on ientifie authority that in the Lake Superior alone there are not less than 67,000,000,000 ore of the same standard of merchantability ‘ils in the principal ore producing regions of ®, or enough to supply the entire industry of this for 2000 years.” Reed added that the corporation controlled only small part of either the red or brown ores of No Desire to Dissolve Judge Gary Justice Pitney interrupted Solicitor General Davis at one point in his argument to ask whether he had anything to suggest as to the eign consumer at lower practical form in which relief should be granted by the court in case it should be found that the Government is entitled to it, to which the Solicitor General replied that he would whieh discuss that phase of the case in closing. He “If your honors please, I desire to say that this is not, as our friends seem to believe, a show that the delivered suit to dissolve Judge Gary. We are not ask- ing the court either to dissolve Judge Gary or to abolish him. We are not asking the court to disapprove his views about business, but we are holding up to the court the nature of the combination he has formed, and it is expressed in the language of one of the com- interest in this phase of petitors, Mr. Campbell, of the Youngstown Company when he said, ‘I believe if Judge Gary were to die, there would be a good many of us lying awake of nights. the Birmingham district and of the valuable Cuban ore deposits only one-seventh as much as its leading competitor. The Corporation’s Foreign Selling Policy Mr. Reed then took up the charge made by Mr Colton that the Steel Co1 poration sells to the for prices than to the domestic user. This allegation, he said, was based upon prices made f.o.b. the mill, was an unfair method of figuring. As the consumer paid the freight, it was a simple matter to cost of exported products, including the freight, would average far more than the price paid by the domestic consumer. soth Justices Pitney and Mc- Kenna manifested a lively the subject, Justice Pitney suggesting that the cor poration had found it nec- oo” essary to cut prices in or der to get into competitive markets in foreign coun- tries. “Exactly,” replied Mr. Reed. “We have been obliged to sell at whatever prices we could get, and we have been obliged to compete with the Government- aided kartels of Germany and with the big British com binations of producers. Of course we have encountered all sorts of difficulties, and it has taken much patience to build up our export trade.” Justice McKenna here sought to secure from Mr Reed a definition of the word “undue” as applied to restraint of trade, and an interesting colloquy ensued “In using the word ‘undue,’” replied Mr. Reed, “1 mean just what the court meant in the Standard Oil case. Your honor knows better than I do just what was meant in that decision.” “You should not answer my question by asking me another,” admonished Justice McKenna. “T did not mean to evade your question,” rejoined Mr. Reed, “and I will answer it seriously and as well Se yienY +8 ed ae e FE LOTIE TG! e ee eee * year Here Ory it Tey 6 . as I can. I think we can take the decision in the Nash case as a fair definition. The court in that case defined ‘undue restraint’ as such an interference with the nor- mal operation of competitive conditions as unreason- ably and seriously hampers the flow of commerce.” Mr. Reed insisted that the corporation had never restrained trade unduly and called attention to the steady decline that had occurred ir the corporation’s share of steel productio Trade Conditions Discussed Justice Pitney interrupted to ask if it common for big corporations to show tions in the amount of their production, to which Mr. Reed replied in the negative, adding that the output of the American Tobacco Company had increased steadily and that the production of the had declined but little. Chief Justice White dissented vigorously from Mr. Reed’s statement concerning the Standard Oil Com- pany, drawing from Mr. Reed the explanation that he referred to the company’s pipe-line and refinery opera tions and not to its production of crude oil, whereupon Justice White signified his with the state ment Was not great fluctua- Standard Oil Company agreement In reply to a question by Justice Pitney as to how many real competitors the Steel Corporation now has, Mr. Reed said that the answer would depend upon the character of the product. It was obliged to meet eight or nine rivals in practically every article produced and two hundred or more in some things. Justice Pitney also asked the ratio of the output of rails of the co poration’s largest competitor, to which Mr. Reed re plied that it about one-fourth, figuring on the basis of conditions when the testimony in this cass closed. If the calculation could be made to-day, hi said, the ratio of the largest single competitor would be considerably greater owing t of &s was recent consolidations . } : , ne vera large produce rs THE IRON 1917 AGE March 22 Mr. Reed urged the court not to fall into the of accepting the Government’s contention that t} n- ditions prevailing in the industry immediately the Steel Corporation was organized were normal. (); the contrary, he said, they were distinctly ab; 4 and the stabilizing of prices on a somewhat higher level which immediately followed the formation the combination was merely a return to the normal. This stabilizing, he insisted, should not be confounded with an attempt to fix prices or to raise them. It had sim ply been the policy of the Steel Corporation t deavor to steady the market and prevent wid sudden fluctuations in prices in so far as it could | erly do so by its own course of conduct. Man) nesses testified to the benefit which had resulted to t} trade from this policy, which was also highly ben ficial to the public and clearly within the legal rights of a manufacturer. In spite of the steadying of the market, however, the general tendency of prices fron the time of the organization of the corporation unt the close of the testimony in this case was downward both actually and as compared with the prices of other commodities, and it was a significant fact that at the time the bill against the so-called super-combinat was filed a given amount of steel would buy less lum ber, less food and less clothing than at any time in th history of the industry. “What do you take as your standard in figuring that the price of steel since the corporation was formed is less than before?” asked Chief Justice White. “We take the whole period of the existence of thé corporation,” replied Mr. Reed, “and average the prices and compare them with the average of a similar period of equal length immediately before. stantial decline amply this regard.” Mr. Reed that the general policy of the proved of great benefit to the had injured no one ¢ This shows a sub and proves our contention ir concluded with an emphatic declaration Steel Corporation had entire steel trade and Concluding Argument for Corporation In concluding the argument for the Steel Corpora tion, Mr. Severance declared that the Government had abandoned one contention afte regard to the organization of the Steel until its another with (0) poratio1 claim was finally reduced in effect to the charge that by reason of the possession of what is termed an “over whelming preponderance” in the trade it has dom nated it The rade,” Mr expression “preponderati severance said, was used in the ge share of the t opinion of the District Court in the Cash Register case, the court holding that “it is sufficient that outsiders are sul stantially excluded so that the insiders ha o tl selves approximately, or largely preponderating part of, the whole field.” It was thus obvious that the court meant that the combination possessed so large a part of the business as to substantia exclude competito which, of course, was not the cas to the Steel Cor poration. The test as applied to the Cash Registe ase by the District Court was the only possible test that could be made and under it could not be held to haves the Steel violated the law. Co poratior “There is no question that the Sherman act ha clearly established, as has been well said by Mr. Ju tice McKenna in more than one opinion, that competi tion and not combination is the rule prescribed by th law. That competition has been free, fai in the Steel Corporation has estab lished by witnesses whose testimony fills 11 entire vol umes of this large record. Nothing the character of any one of thes« against their and effective ease of the been is alleged agair noth upon the witnesses and ing can be said information subject.” During the so-called Gary dinne Severance said, there movement, M1 Was a variation in price between the corporation and its competitors. While the cor poration reduced its prices two or three times during 1908 and made public announcement thereof, its com petitors took its business by underselling these pub lished prices. The Gary movement, he dinne! said, was the ne of the corporation’s lack of power to fix prices Without While the that the strongest evidence of the recognition by every Power to Fix Prices record was full of testimony showing corporation had not fixed prices in the past but that there had always been active competition, Mr Severance said he thought it important in add on to had no power to reg existence trade. was know that the corporation ilate prices and hence that its to the steel merce in the iron and steel industry, he declared, did upon the life of Judge directing the was in nm Freedom of con ense a menace ot depend Gary or upon h nfiuence in policy of the cor “1 cor is important this to observe the sidering matter,”’ Mr. Severance said, difference between the in which steel is marketed and in which prod combinations such as the Standard Oil Con marketed. It appeared in the Standard VU oil was sold in various towns direct to co! small retailers, and a great ‘ould, of course, drive out of business a small ret ‘a4 nanne icts of pany are ase that umers 0! organizatior ler ry selling below his costs and putting up prices alt obtaining a monopoly, and this was repeatedly 4 Steel products, however, are sold in quite another wa) The market is general. They are disposed of t roads and to large manufacturers direct. Outside 0! these large buyers, the remainder is mainly wholesale merchants. These large manufacturers, order to compete with their rivals, must buy their raw materials at an approximate parity of prices, and the wholesale merchants in the different states throughou! the country meet the competition of wholesalers their that it is localize 4 sold t cities so impossible to steel war. In conclusion, Mr. Severance described to the art the laborious efforts made by the corporation to build up its foreign trade in competition with the producers March 22, 1917 THE IRON AGE 709 nany, Belgium, France, and England. Mr. Far ployed exclusively in distributing its product to its o had previously had charge of the export busi eign agencies and large customers the corporation, had established no less thar ‘orporation found that its rivals had an important ad ies in 50 foreign countries, equipping them vantage in the banking facilities wh they possess¢ arehouses and sending out from the United and the whole export movement i te products f1 the ablest men to be found to take charge of the the United States was uph ttende These agencies were forced into competition lifficulties and re g ¢ reign manufacturers, who were able to utiliz push it What the porat ha eeded iblished steamship lines with regular sailings. hing, Mr. Sev e de corporation, in order to make any progress at t ite to the tern? ' \ om pe led to yuild A iarge fi t of vessels rY reneral Davis, making the I Ma for tl Government, < lared that th t bethlenem, the ¢ e Steel Corporation had beer ight in tl | L, iwan! St the decisions of the United Stat Sup. rd removed t B ively estal 1 mbination ) ) tors in an} r Se COMPELICIO! An Amusing Incident Recalled - hemselves and ; vort ertions for a In the course of his argument, Solicito it the rm a viola General Davis said: “I remember a story told nizatior [ th onerman law, yy the witness Stevenson as the wire nai estraining of . , . : Ain Ing a pool in 1896, which illustrates the reasons wh ? } rising is . ; ynam but tne st pools were not entirely adequate for the pur i the { ; z > l “— pose they had in mind He says they met ra oO arising OT gn a : | . matter of together, all the wire nail manufacturers, and - ' om e.ore luncheon had sreed upon a price hit nerf ag etitors together When the luncheon hour was announced, he that ha ne ex reponderance went out to wire that price to his partners at el e, a dom 1iome, so that they might fix their contract the trade; iccordingly. One of his compet:tors went ou Un reun from the meeting on the same errand, and the oni = ~ telegrapher made a mistake in handin “ - - , : eat the copy of the telegram, and handed him no Mi : mdu vhicl s own, but the one his competitor, a man 1t Pitt ean re a n named Baackes, had just sent. Whereas the Pen! ad the | : ool had fixed the price at $ 1 keg, M na then Baackes had gone out and wired home to h some 0 act den tion of ompany to sell 100,000 kegs at $1.4 M t \ yanize l, if material, Stevenson carried that copy of the Baack I I nga 7 cue telegram into the meeting, and when they re lence of the na . As n hat ee ot.” Mr. D convened he handed it to the chairman and cig kk ian | ss ; - - invited him to read it to the meeting The e White ng ¢ pteiet sa chairman did so, and closed the reading with Phen ine t the statement that he authorized Mr. Steven +} contin nication sug i f omp) Mr. Lindabury son where the par stairs, but old Stevenson, being a canny Competit va tive + to take Mr. Baackes and kick him down tion,” rey i Mr. Da not so combined Scotchman, closed the incident with the state | e etlo : ‘. . ss ‘ . mong ti ; wetitor ss competition u ment that Mr. Baackes was a larger man than . peu! ‘ share or pro he was 9 +} Neelwes ‘ ippre the field, but rom t e to time by vol ressed it in some intary agreement ina their acts still ry ‘ every _ rf the egal upon a positive showing of an intent t trade the history was a p ! lay to divide law, because the law is leveled not only ata the output and fix the price, and i reaking ot tnat mopoly, o1 it a iniversal restraint, | pool to-! rrow ind the ftormatio I inother in it mpt to accomplish a restraint or a mono} stead They went from pool to mpetition and fron preventative force may be invoked as wel competition back to pool, but alway vith an effort t t is begun as when it has progressed to eep the poo! side in the ascendar rh pools h a ntinuing, Mr. Davis said: ertain inherent, visible humar tne itterly essential facts in this co! Ihe most ir] ing tl put I ihe Essential Facts Handled by a Few Men | ‘ t They can be stated historically, and it wil these combinatior ind ti rcombinatior * i } ‘ it in reference to them there is practically Mr. Davis said, was the meag hand f ’ f testimony. Here was a great industry vhom these consolidatior er ought about 4 vn up in this country. In a general way “The two Moores, Reid, Leeds ed itself geographically in the area ithers,” he said, “busied themselves first wit! ; the Ohio River on the south and the Great plate industry, and they brought togethe Decen the north, and a meridian drawn just east of er, 1898, practically all of the tin-plate plar h on the one hand and just west of Chicag¢ United States, certainly all those that had any resp: r would have embraced practically the en ible standing in the tin-plate trade, and try. East of that meridian it is true, there into a single combination, controlling at the time of it ve been such companies as the Pennsylvania organization 90 per cent of that trade Capitalizir mpany, with its plants at Steelton and Spar it at a sum $36,000,000 in excess of th alue of tl 710 subsidiary properties, and taking to themselves as their reward for so doing about $11,000,000 of its stock, which was not mere worthless scraps of paper but certificates entitling them to practically one-fourth ownership in all the property, be its market value what it might. “Now, if your honors please, if this case should stop there, can there be any question under the de- cisions of this court of the status of that organization? If, instead o