actual market conditions.

At the same time each individual manufacturer makes his sales independently, and these sales are largely made by contracts extending over a period of some months, sometimes even over a period of one or two years. In consequence of that fact, the majority of the manufacturers of steel may be selling their output on a contract price fixed six months before, while the few manufacturers who are making late sales may be obtaining a price 50 per cent. higher. As a matter of fact, the quoted market prices during the first half of the year 1899 were probably considerably higher than the prices actually realized by the manufacturers. On the other hand, it is also probable that the prices at the close of the year 1899 represent much more nearly, in the case of both the crude and finished product, the real prices secured by the manufacturers. While these different circumstances need to be taken into consideration, it is, nevertheless, doubtless true that the chart represents fairly well the changing conditions of business during the period covered.

Since the American Steel and Wire Company was formed, January, 1899, the margins.

between the crude steel and all the finished products seem to have followed substantially the same course, the relations being especially close during the later months. The price of smooth wire did not, however, follow that of wire nails at the time of the wire-nail pool in 1895-96.

Through ownership of patents the American Steel and Wire Company has a legal monopoly in barb wire, so that we should expect a wide margin between A and D, and possibly an increasing one from the combination of patents. The line E shows this increase, though it is not much more rapid than that shown by the lines H, representing the margin for wire nails, and F, representing that for smooth wire. the whole, though, the great increase in the price of all these finished products is due chiefly to the increase in that of the raw material. The combination, however, seems to have enabled its managers to have made the best use of its opportunities, for margins as well as prices of products increased rapidly from the date of combination.

On

CHAPTER IX

THE TRUSTS AND WAGES

If the statements made in the preceding chapters regarding the savings of the wastes of competition are true, it is evident that industrial combinations, through these savings, create a fund from which the wages of laborers could be raised, provided it seemed wise to the managers to raise wages instead of increasing their own profits or lowering prices, or provided the laborers were able to enforce a demand upon their employers for higher wages.

Experience also seems to show that, when Trusts are first formed at any rate, the wages of their employees, in a good many cases, have been raised, although later at times men have been apparently thrown out of employment arbitrarily by the sudden closing of plants. When the Whiskey Trust was first organized in 1887, the wages of several classes of employees were comparatively soon raised. Mr. Greenhut, the president of the Trust, in his testimony before

*

the Committee of Manufacturers of Congress, testified to this effect. He expressed the opinion that it was but just to give to the employees part of the benefits which were to come from the new form of organization. He stated further in conversation that public opinion was strongly directed against the Trusts on the whole, and that it was perhaps wise to show that the managers of these organizations did not intend to conduct them selfishly for their own benefit solely, but that they wished to distribute fairly among those engaged in production the advantages which came from them.

It is also in evidence that the employees of the American Sugar Refining Company have had their wages increased somewhat, although as their labor is largely unskilled the increase has not been at all great.

According to testimony from both the managers of the Standard Oil Company and from its opponents, that company has been in the habit of paying to all its employees regular standard wages, and in many cases of paying to

* 50th Congress, Second Session, H. R. No. 4,165, pp. 66, 67.

those who showed exceptional diligence or skill

in their work very high wages. It is certainly true that they often keep their employees for a series of years, and that in the case of superintendents or managers or those acquiring special skill the ablest men are usually chosen, and the wages or salaries paid are high. Recently that company is reported in the newspapers to have increased wages voluntarily by 10 per cent. One should note that dividends this year have already been over 40 per cent.

Within the last two or three years the new combinations in the iron and steel and tin plate industries particularly have all of them increased the rates of wages, but some of them have also closed plants without warning. The president of the Tin Plate Company testified that the average increase in wages in that industry had probably been 15 per cent. The American Steel and Wire Company had increased its wages in many cases as much as 40 per cent., and in the other related industries the wages had been increased all along the line. It is, however, just to the managers themselves to state that they did not ascribe this increase entirely, if at all, to the formation of the Trust.