^\ jr. «.t 9 I Hi CORNELL UNIVERSITY LIBRARY iB»fe''«'ry J-'gRAHv 3 issr^^ta Cornell University Library The original of tiiis book is in tine Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/cletails/cu31924092560816 RECIPROCITY WITH CANADA HEARINGS BEFOHE THE COMMITTEE ON FINANCE OF THE UNITED STATES SENATE SIXTY-SECOND CONGEESS H. R. 4412 AN ACT TO PROMOTE RECIPROCAL TRADE RELA- TIONS WITH THE DOMINION OF CANADA AND FOR OTHER PURPOSES SECOND PRINT No. 1 :MOXrjAT, MAY 8. 1911 WASHINGTON dOVBRNMBNT PRINTING OFFICE 1911 Q COMMITTEE ON FINANCE. UNITED STATES SENATE. BOIES PENROSE, Oliairman. SHELBY M. CULLOM. JOSEPH W. BAILEY. HENRY CABOT LODGE. F. M. SIMMONS. PORTER J. McCTJMBER. WILLIAM J. STONE. REED SHOOT. JOHN SHARP WILLIAMS. JACOB II. GALLINGER. JOHN W. KERN. CLARENCE D. CLARK, of Wyoming. CHARLES F. JOHNSON, of Maine. WELDON B. HEYBURN. ROBERT M. LA FOLLETTE. II "^'tlt 0( RECIPROCirY WITH CANADA. CoMiMiTi'EE OX Finance, United States Senate, Washington, D. C, Monday, May 8, 1911. The committee met at 10.30 a. m. Present: Senators Penrose (chairman), Cullom, McCumber, Smoot, Gallinger, Clark of Wyoming, Heyburn, La FoUette, Bailey, Simmons, "Williams. Kern, and Johnson. Senator Bailey. Mr. Chairman, before we proceed with this hear- ing the representatives of the Texas Cattle Raisers' Association and the American Live Stock Association will appear, and they want to know when they can be heard, so that thej' can have their officers here. If it suits the committee, I suggest that we set that hearing down for to-day one week. Then, if we do not finish with this hear- ing on reciprocity, we could carry it over, but if we do finish it we will hear them to-day a week. The Chairman. Could not they come Saturday? Senator Bailey. We are not by any means certain that we will have this over by that time. The Chairman. The committee adopted a resolution closing the hearings upon the 13th. Senator Bailey. That was upon reciprocity, not on the free-list bill. Of course we did hear the gentlemen from St. Louis, and other shoe manufacturing centers, out of order, but I should like to have the hearings on reciprocity separate and apart from the hearings on the free-list bill, if that is practicable. The Chairman. I think you are right about that. Senator Bailey. I move that the committee appoint Mondaj^, the 15th instant, for hearings for representatives of the cattle growing . interests ; the Cattle Raisers' Association and the American Live Stock Association are the only ones who have conferred with me. Senator McCumber. You wish to do that notwithstanding that we may be in the midst of the hearings on the reciprocity measure ? Senator Baixey. No ; I would then ask to have it go over, as with a case in court. If the case was set down and another case was not finished, we would just postpone it. I move that we appoint Monday the 15th for their hearing, with the understanding, of course, that if we are not through with this reciprocity hearing, their hearing will be carried over from day to day. The Chairman. This hearing is not to delay the reciprocity matter? Senator Bailey. Oh, no; not at all. The Chairman. If there is not objection, the hearing will be held on Monday next, as suggested. The committee thereupon proceeded to the consideration of the bill (H. E. 4412) to promote reciprocal trade relations with the Dominion of Canada, and for other purposes. 3 4 KECIPKOCITY WITH CANADA. STATEMENT OF ME. GEORGE SULLIVAN, OF PHILADELPHIA, PA. The Chaieman. State your full name to the committee, Mr. Sul- livan. Mr. Sullivan. George Sullivan. The Chairman. "V^Tiat firm do you represent? Mr. Sullivan. The Nixon Paper Co., of Philadelphia, Pa. The Chairman. Will you novr proceed to make any statement you desire to the committee? Mr. Sullivan. May I have the privilege of reading from my notes ? The Chairman. Yes, sir. Mr. Sullivan. Mr. Chairman and gentlemen : I appear before you in behalf of one branch of that poor industry which seems to be an outcast at the present time, the book-paper division of the American Paper & Pulp Association. That has nothing to do with the news- print division, of which I know very little. Book paper is a grade of paper used for various novels and general printing purposes, and a grade which is just above what is known as news-print paper, which is used by the newspapers of the country. In this branch alone there are 46 mills, in which the capital invested is about $105,000,000, and they employ about 30,000 people, and in the industry itself there are about 12 other branches, as far as this bill is concerned. It simply means our going out of business, as we do not only have to compete with Canada, whose natural advantages are great as re- gards water powers and wood, but we have the additional handicap of having to pay duties on other materials that at the present time go in free to Canada, which amounts to about $3. .50 per ton — that is, $3. .50 against us in addition to the advantages they have from their great water powers and their great wood resources. For instance, English clay, of which our paper makers use vast quantities, goes into Canada free. In this country we pay $2.50 a ton. Senator Williams. What is English clay? Mr. Sullivan. English clay is a natural deposit that comes out of the ground and is used as a filler in the manufacture of paper. By a filler we mean a material that holds the fiber together. Senator Williams. Is there none of that in the United States ? Mr. Sullivan. There is some of it in the United States; yes, sir; but at the present time they have found none that gives the same result as the English clay. The English clay seems to have a more soft and velvety finish, and it is prepared very carefully, and seems to give better results than any clay that has been found in the United States up to the present time. Senator Sjro(:)T. Do ^-ou happen to know what the amount of im- portations are into this country? INlr. Sullivan. I do not know. There are very few mills in the country who do not use English clay. Even some of the iiews mills use English clay. Senator Cullom. Do your own mills use it ? Mr. Sullivan. Yes. sir. Senator Cullom. Where do 3'ou get it from? Mr. Sullivan. We get it from England. "\A'e buy it from an im- porter in New York, who brings it into the United States from Eng- land. EECIPEOCITY WITH CANADA. 5 Senator Sjioc't. Where is the best American day produced? Mr. SuLLivAx. They are developing a mine in Georgia. At the present time it seems to produce about as good an American clay as I have any kno\Yledge of. Senator Simjioxs. Do vou use anv American clav at all in your mill? . . .J Mr. SyLLiVAx. Xot in our mill; no, sir. Some of the manufac- turers of the cheaper grades of paper can use it. Bleach goes into Canada free ; in this country we pay one-fifth of a cent per pound. Alum goes into Canada free; in this country it pars one-quarter of a cent per pound. Copper wire pa.ys IT-} per cent duty into Canada and io per cent into the United States. ^ Aniline dyes and colors go into Canada free, and into the United States there is a 30 per cent and 3 cents per pound duty. Felts and jacketings, which they know as the clothing of the mill, pay 30 per cent into Canada and 'into the United States 4-1 cents per pound and 55 per cent. Xow, those things are all against us. As far as the free wood goes, for our branch, there are only five plants out of the 46 that can use Canadian wood. The balance can not use it, even if it were admitted free, as the freight rates are pro- hibitive. In the State of Pennsylvania, which makes one-fifth of the book paper manufactured, there is only 1 mill out of the 11 in our State that ever uses any wood from Canada. All these mills are run by steam. Those few who had any water power in times gone by have none now. All of the investigations by the Mann committee, the Ways and Means Committee of the Sixtieth Congress, and the Tariff Board, certainly confirm all that we claim and ask, and the taritf on our product was allowed to remain — when I say our product I mean the book paper — but in this bill the previous recommendations of only changing the tariff on paper, valued at 2-|- cents and under, is now increased to 4 cents and under. It certainly is manifest that the English realize what it means to them, as the London papers to-day are advertising new companies being formed every day to build new mills, and I have just been told by one man who used to sell us sulphite pulp that they are now mak- ing arrangements to change every mill by the addition of paper machines on account of this bill, so as to use all their pulp in the manufacture of paper in place of selling their pulp to the paper manufacturers of this countrj^ All of this confronts our industry, in addition to the fact that in our owTi country at the present time the production exceeds the demand. It would be presumptious, I may say, to suggest to you what to do, but certainly I can ask you to treat us fairly and give us our share of justice, as we are just as much a part of this great country as the ones who are clamoring for this change. If our President is correctly reported in his speech before the pub- lishers, he has said that Canada would not agree to allowing free 6 EECIPBOCITY WITH CANADA. dressed products of the meat industry, as they could not compete with our Western packing houses. If he was reported truly, and Canada is looking out so closely, why should we be satisfied without any benefit being obtained by the general public? Gentlemen, that is about all I have to say along those lines, and I simply leave the matter to your good judgment and ask that you treat us fairly. Senator Simmons. I understand you to say that by reason of the difference between the Canadian tariff and the American tariff on these things that enter into the cost of producing book paper, you would be at a disadvantage of $7 a ton ? Mr. Sullivan. Yes, sir. Senator Simmons. Can you work that sum out so we can see the various items of it? Mr. Sullivan. I can. Senator Simmons. Will you give the committee that ? Mr. Sullivan. Yes, sir. Senator Smoot. Might it be included in your remarks? Senator Simmons. I mean that you should work up the various items and show the amount that would add to the cost. Mr. SuLLn^AN. I will take a 100-ton mill and give you the cost of the 100-ton mill. The Chaiejian. Work out those items and hand them to the clerk of the committee. Senator Smoot. What is the lowest-cost book paper that your firm makes ? Mr. SiuLLivAN. The lowest book paper that we make, Senator, or the lowest price that we sell it at ? Senator Smoot. I mean the cost. Mr. Sullivan. Oh, the cost? Senator Smoot. Yes. Mr. Sullivan. The lowest cost that we can make book paper for is Si cents. Senator Smoot. Does the bulk of that paper come under 4 cents or above 4 cents ? Mr. SuLLn^AN. Under. Senator Sjioot. Under? Mr. Sullivan. Yes, sir. There is very little in the general book- paper line that is above 4 cents, only when you come to what are known as the specialties. Senator Smoot. That is only a small percentage of the book paper manufactured in this country? Mr. Sullivan. Yes, sir. Senator Williams. ^Yhat do you sell this paper for that costs you 3^ cents to make? Mr. Sullivan. At the present time we are getting S3. (50 for it. Of course, we make paper that costs more than 3i cents, and we get a higher price for it. Senator Willlmis. I am speaking of that which you are referring to as costing Si cents. Mr. Sullivan. Yes, sir. EECIPEOCITY WITH CANADA. 7 Senator Williams. I wanted to get some idea of your profits. Mr. Sullivan. They, unfortunately, are hard to find. Senator Williams. How would the removal of it hurt you — by reducing the cost of the paper or by reducing the price at which you could sell the paper ? Mr. Sullivan. You mean by not excluding Canada ? Senator Williams. Yes. Mr. Sullivan. Simply by putting the industry in Canada where they have those advantages that we can not compete with ; that would enable them to sell at a price that we could not make paper at. Senator Williams. It would injure you by reducing the price of the paper ? Mr. Sullivan. Yes, sir. Senator Williams. What do you mean by reducing the price of paper? Do you mean there will be no profit, or do you mean it will be reduced below the cost of production ? Mr. Sullivan. Reducing their selling price below the cost at which we could produce it. Senator Williams. Do you export any paper ? Mr. Sullivan. No, sir. Senator Williams. Do any American paper manufacturers export any paper? Mr. Sullivan. Yes, sir. Senator Williams. What style of paper is exported? Mr. Sullivan. Most of the paper that is exported to-day is news paper. Senator Williams. Newspaper paper ? Mr. Sullivan. Yes, sir; what they call news print paper. Senator Williams. To what countries is it exported, if you know ? Mr. Sullivan. I do not know all of them. Senator. Senator Williams. Is any of it exported to Europe? Mr. Sullivan. Yes, sir. Senator Sjioot. Are there any book papers that are exported that you know of? Mr. Sullivan. Yes ; there are some book papers exported to Japan, and some to Australia and some to Cuba. Senator Smoot. What class of paper is that? Mr. Williams. Most of the paper that is exported there is what is known as catalogue paper; paper used for seed catalogues, and similar publications. Senator Smoot. That would be the cheaper grades ? Mr. SuLLWAN. Well, it would from ^ cents to 3f cents. The Chairman. Have you any further statement to make to the committee ? Mr. Sullivan. Nothing else, Mr. Chairman. Senator La Follette. "What is the output of your mill? Mr. Sullivan. Our own mill. Senator? Senator La Follette. Yes, sir. Mr. Sullivan. Thirty-five tons a day. The output of the mills of Pennsylvania, which I am speaking for particularly, amounts t« 465 tons a day. The output of the 46 mills in the book industry amounts to 2,500 tons a day. 3 EECIPEOCITY WITH CANADA, Senator Heybuen. What is the difference between wages paid by the American mills and the English mills ? Mr. SuLLivAi0S3 ^ 'I'tter boss assistant. Cutter l:)oss lielper — Super calendars: Runner Helper Do ilacliine room: Maeliine tender Do Back tender Baclc tender lieiper... AVinder boys Beater room: Boss beater man . Ilelper Clay mixer Size, etc Engineers and firemen: riiief engineer Engineers 1.75 1,25 1.60 3.00 2.75 1.35 1.25 Firemen . Asii wlieelers, etc — Mechanical department: Boss Meclianics Do Do Do Do Do Oilers Outside labor: Boss Common Paper loader Night watchman Teamsters Do Do Bleach and wet maciiines: Bleach mixers Wet machines and screens Bleachers, etc Bleachers' helpers Digesters, dumping and alliali: Digesters Digesters' helpers Pan room ■ Pan-room helpers Alkali Alkali helper Evaporators, rotaries, and leachers: Assistant to pulp superintendent. Evaporators Rotary Rotary helper Leacher Leacher helper Chipper: Chipper Helper 2.00 2.25 2.75 1.30 "'i'.ih > 100. 00 1.75 i.eo 1.70 1.75 1.35 3.25 1.50 1.75 l.SS 2.00 2.25 2.50 1S98 80.75 .90 2.00 $1.00 2.10 1.00 1.25 1.60 1.35 1.25 1.65 1.40 3.26 3.00 1.50 1.35 .85 3.00 1.76 1.35 1.36 1.36 1.35 1.50 1.75 1.35 1.76 1.60 1.70 1.60 1.60 1.36 1.70 1.35 1.50 1.60 1 100. 00 1.76 1.26 1.50 1 110.00 1.50 1.75 2.00 2.26 2.60 1.75 1.25 1.35 1.35 1.50 1.50 1.35 1.50 1.75 1.60 1.76 1.70 1.50 1.60 1.36 1.35 1.75 1.60 1.70 1.50 1.60 1.35 1.70 1.60 1.60 1.76 1.70 1.60 1.36 1.50 1.60 1.00 '126.00 2.00 2.00 2.10 1 126. 00 1.60 1.90 2.00 2.20 2.60 2.75 1.60 1.90 2.00 1.45 1.45 1.60 1.75 1.50 1.60 1.90 1.60 1.45 2.20 1.75 1.85 1.60 1.75 1.46 1.85 1.60 1.76 1.75 1.85 1.50 1.85 1908 , Vv""-?,,,^ Total daily wages. X?y"T "^^0 1907 ' ^°°'^- SI. 10 3.00 1.90 1.65 1.80 1. 60 3.50 3.25 1.90 1.50 1.10 1.66 1.90 1.66 1.90 1135.00 2.20 2.20 2.45 1.65 1 135. 00 1.75 2.20 2.40 2.70 2.96 1.90 2.05 2.50 1.65 1.80 1.90 1.75 1.90 2.05 1.90 1.75 2.35 1.90 2.15 1.75 1.90 1.65 2.00 1.75 2.25 2.00 2.15 1.75 2.00 1.60 1.50 1.75 1.65 $0.32 $3.32 .32 ..32 .16 3.82 3.57 2.0{ .32 .16 1.81 2.06 .00 .12 .06 2.12 1.81 2.37 1 Per month. BEOIEROCIiy WITfl CANADA. Companson of wages paid at pulp mill at Luke, Md. 13 Common laborer Tour workers Madiine-room foreman (J. Ryan) Cookers Boss pi^e fitter Chief millwright Assistants to millwrights Chief engineer Engineers Firemen May, 1S91. .51.25 1.333 3.00 2.50 2.25 2.50 2.00 3.50 1.76 1.50 January, 1894.' SI. 15 1.20 2.70 2.26 • 2.26 2.26 2.00 3.66 1.76 SI. 40-1. 50 Hay, 1S99. SI. 20 1.30 3.00 2,26 2.26 2.376 2.00 3.40 1.75 SI. 40-1. 60 May, 1904. SI. 36 1.40 4.00 2.36 3.10 3.10 S2. 25-2. 60 ■3.98 2.00 1.50-1.70 May, 1907. SI. 45 1:59 6.72 3.48 4.61 4.46 S2. 26-2. 60 5. .51 2.10 2. 00-2. 25 Employees working regularly for more than one year now receive 5 per cent bonus, except foremen. This additional 5 per cent has not been figured in the above statement. — West Virginia Pulp & Paper Co. Comparison of daily wages paid at paper mills at Luke, Md. May, 1893. May, 1899. May, 1904. May, 1907. Rns.s finisher 82.50 .75 2.50 .76 3.00 2.50 1.50 1.26 2.60 2.50 11.15 S2. 686 .75 2.75 .666 2.76 2.60 1.60 1.25 2.60 2.60 1.26 S3. 65 .80- 3.46 .70 4.15 3.10 1.99 1.36 2.90 2.90 1.40 ,33. 65 Calendar-room boss (T. Gormley) Cutter girls Machine tenders 4 76 Beater men . . . 3 54 Outside labor 1 46 Boss machinist 3 10 1 Mostly. Machine tenders, beater men, and back tenders are now paid double time for working on Saturday nights, and due allowance has been made for this (as well as for bonuses) in the figures for May, 1907. Wages at present time are same as May, 1907. — West Virginia Pulp & Paper Co. Have not considered the 5 per cent bonus paid employees who remain one year or longer In the May, 1907, column. Goviparison of wages paid at pulp mill at Davis, W. Va. July, 1898. July, 1903. September 1907. Chief engineer Assistant superintendent (H. Male). Machine-room foreman (Martin) Machine tenders Chip-house foreman (Shoemaker) Cooker (digester house) Acid maker Firemen Coal wheelers Common labor Wood peelers .per month. do... per day. do... do... do... do... do... do... .do. $76. 00 > 2.00 .per cord. 1.75 1.60 2.00 2.00 1.60 1.333 1.16 .86 S90. 00 80.00 2.26 2.00 2.00 2.00 2.25 - 1.75 SI. 40-1. 50 1. 36-1. 40 1.00 S185. 60 175. 60 4.93 2.57 3.52 3.52 2.34 2 2.00 None. SI. 35-1. 60 1.10 ' Per day. West Virginia Pulp & Paper Co. 'Gas. 14 BECIPBOCITY WITH CANADA. Comparative labor figures — Paper mill (per day). Finishers Counters (girls) Cutters fmen) Cutters (girls) Cases and frames Boss machine tender Machine tender Back tenders Third hands and reels. . . Beatermen Helpers on beaters Outside labor Mechanics Supers (runners) Supers (helpers) Common labor AU kinds Office, including chemist June, 1900. $1.76 .02 1.61 .69 1.36 4.26 3.00 1.60 1.14 2.62 1.34 1.25 2.50 11.75 11.25 1.26 1.33 2.61 April, 1903. $1.78 .76 1.98 .67 1.35 9.11 3.73 1.79 1.26 3.73 1.40 1.36 2.67 1.76 1.26 1.25 1.66 4.31 April, 1908. 52.17 .90 2.31 .84 1.60 $6.82-7.28 4.21-4.61 2. 24-2. 41 1.43 4.24-4.44 1.74 1.53 2.69 2.28 1.38 1.40 1.87 3.91 ' July- West Virginia Pulp & Paper Co., Covington, Va. Comparative labor figures — Sulphite mill {per day). June, 1900. April, 1903. April, 1808. Foreman ('drainer rnoTTi tn machino room) $3.34 2.75 2.75 1.60 S6.00 $8 26 2.61 1.50 1.40 1.42 1.36 1.50 1.50 1.24 3.01 2.04 1.87 1.29 1.93 2.69 1.47 1.69 1.38 1.25 1.59 3.78 Back tender 1 83 Wet TTianhinps 1 75 i.37 1.33 1.67 1.40 1.30 2.88 2.00 2.00 1.32 2.01 2.69 1.27 1.58 1.33 1.25 1.48 Reel men 1 75 Bleachers... 1 91 Screens, blow pits, and drainers 1 54 Foreman (digesters and acid room) 4 QS-.5 82 Helpers (acid room and digesters) 1 61 Foreman (chip house and yard) 4 03-4 45 Chip house 1 59 Engineers and firemen 1 96 Common labor 1 40 All kinds See paper mill figures for office. West Virginia Pulp & Paper Co., Covington, Va. Mechanics in sulphite mill, April, 1908.— Two at $3.20, 1 at $2.75, 2 at $2.50, 1 at $2.45, 1 fit $2.40, 1 at $2.38, 4 at $2.25, 2 at $2.20, 2 at $2.15, 1 at $2.10, 3 at $2, 2 at $1.75, 2 at $1.60, 1 at $1.50, 14 at $1.40, 1 at $1.35, and 2 at $1.25. Scale of wages at New York and Pennsylvania Co.'s JohnsonVurg mill from 1898 to 1908. Names. Oilers Repair crew: Blacksmith Helper Head carpenter Carpenters Helpers Masons Helpers 1898 $1.25 2.60 1.20 2.25 1.75 1.50 2.75 1.20 31.25 2.60 1.50 2.00 1.75 1.50 2.75 1.20 $1.40 1.35 81.50 1.40 1901 1.50 1.75 2. '25 2. 50 2.110 2. 26 1.60 1.4(1 4. 00 4.00 2.76 2.75 $1.50 1.40 2.25 1.40 2.60 2.26 1.40 |3.26 1.40 $1.60 1.40 2.60 1.40 2.50 2.50 1.40 4.00 1.40 1904 $1.60 1.40 2.50 1.60 2.76 2.50 1.60 4.00 1.60 $1.50 1.40 12.76 \2.50 1.60 3.00 2.60 1.60 4.00 1.50 1907 $1.50 1.40 2.75 2.50 1.60 3,00 2.60 1.60 4.00 1.60 1908 $1.60 1.80 2.76 2.76 1.76 3.60 2.60 1.60 4.00 12. 50 11.60 Per cent KECIPEOCITY WITH CANADA. 15 Scale of wages at New York and Pennsylvania Oo.'s Johnsonhurg mill from 1898 to i905.— Continued. Names. Repair screw — Continued. Machinists Do Do Helpers Millwright Boiler maker Helpers Pipe fitters, headman. Do Pipe fitters, helpers- Painters Do Rotarles. Rewinders Size maker Sample folder Sliippers Evaporator men Acid: Headman Helper Bleachers: Headmen Helpers Engineers Cliipper men: Headman Helpers Digesters: Headman Helper Machine: Machine tender. Cutter \^Tieelers Do Filters: Filter man. Helper Do Do Finishers: Headman.. Trimmer... Finishers... Do Frame handler. Coimter girls Do Leachers: Leaoher men Helpers Machine men: Pulp machine tenders.. Pulp back tenders Pulp finisher Pulp reel boy Paper machine tenders Paper back tenders. Paper third hand. - . Broke hustler. Do Reel boys Do 1898 ■2.25 2.00 2.50 2.50 1.50 2.00 1.50 1899 82.50 2.25 2.00 1.20 2.50 2.50 1.50 2.00 1.50 1.75 1.20 l.SO 1.75 1.20 1.50 1.20 $2.50 2.23 2.00 1.35 2.60 2.50 1.50 1.75 1.75 1.35 1.90 1.35 1.65 1.45 1.35 1.25 1.50 (1.75 \1.50 1.75 2.50 1.50 1.75 1.25 1.90 i.eo 1.40 2.00 1.50 2.00 1.50 1.25 1.20 1.75 2.50 2.00 1.75 2.00 1.50 1.60 .75 3.50 1.60 1.20 2.50 1.50 1.75 1.25 1.90 1.60 1.40 2.25 1.50 2.00 1.60 1.60 1.75 1.50 2.50 1.76 1.76 1.50 1.40 .90 .75 1.60 2.00 1.60 1.60 .75 3.50 1.60 1.20 1900 S2.75 2.25 2.00 1.50 2.50 2.75 1.40 2.00 1.90 1.40 2.00 l.tiO 1. 80 1.60 1.40 1.50 1.75 1.15 2.50 1.50 1.75 1.35 1.90 1.60 1.40 2.25 1.65 2.25 1.65 1.65 1.75 1.60 1.40 2.50 1.75 1.76 fl.40 11.50 1.00 1.60 2.00 1.50 1.60 1.35 3.50 1.60 fl.35 [1.30 1902 $2.75 2.50 2.00 1.60 2.50 2.75 1.60 2.75 1.90 fl.75 11.40 2.00 1.60 l.SO 1.50 1.40 1.00 1.85 1.30 2.50 2.00 1.50 1.75 \.r,o 1.90 1.60 1.40 2.60 1.65 2.26 1.70 1.65 1.60 1.90 1.80 1.70 2.60 2.00 1.75 1.40 1.60 1.15 .90 1.80 $2. 75| 2.50 2.25 1.60 2.50 3.00 1.60 3.00 2.00 1.75 1.40 2.25 1.60 2.00 1.50 1.40 1.60 1.86 1.30 2.60 2.00 1.60 1.90 1.60 1.90 1.60 1.40 2.50 1.65 2.25 1.70 1.66 1.50 1.90 1.80 1.70 1.40 2.60 2.00 1.75 1.40 1.50 1.15 .90 2.00 1.50 1.60 1.40 3.50 1.75 1.60 1.45 1.00 2.00 1.60 1.66 1.40 (3.. SO 14.30 12.15 '\1.90 1.00 1.45 2.00 , 1.45 S3. 00 2.75 2.50 2.26 1.76 2.76 3.00 1.75 3.00 2.00 1.75 1.40 2.50 1.75 2.00 1.50 1.40 1.60 2.00 1.40 2.50 2.25 1.76 1.90 1.50 2.10 1.70 1.60 1.40 2.60 1.65 2.25 1.76 1.65 1.50 2.00 1.90 1.70 1.40 2.50 2.00 1.75 1.40 1.50 1.15 .90 2.00 2.00 1.60 1.65 1.40 3.80 4.30 2.16 1.90 1.66 1.45 1.45 1.00 S3. 00 2.75 2.60 2.25 1.76 2.75 3.00 1.75 3.00 2.25 2.00 1.50 2.60 1.75 2.20 1.50 1.40 1.60 2.00 1.40 2.50 2.26 1.75 1.90 1..50 2.26 1.70 1.60 1.40 2.50 1.66 2.25 1.90 1.50 1.50 1.90 1.50 2.60 2.00 2.00 1.75 1.40 1.50 1.15 1.00 2.20 1.40 2.00 1.60 1.66 1.40 3.75 4.30 2.00 1.90 1.60 1.45 1.45 1.46 $3.00 2.76 2. ,50 2.25 1.75 2.75 2.25 1.75 3.00 2.25 2.00 1.50 2.60 1.75 2.20 1.50 1.40 1.60 2.00 1.40 2.50 2.25 1.75 1.90 1.50 2.26 1.80 1.60 1.40 3.00 1.80 2.25 1.90 1.60 1.60 1.90 1.60 1.40 2.50 2.00 2.00 1.76 1.50 1.60 1.25 1.15 2.20 1.40 2.00 1.60 1.65 1.40 4.00 4.30 2.00 2.16 1.60 1.46 1.45 1.46 1.25 1906 1.60 2.00 1.40 2.50 2.50 1.75 1.90 1.60 2.26 1.80 1.60 1.40 3.00 1.80 2.25 1.90 1.60 1.40 1.90 1.50 1.40 2.60 2.25 2.00 1.75 1.60 1.60 1.25 1.16 2.20 1.40 2.00 1.60 1.65 1.40 4.00 4.30 2.00 2.15 1.60 1.45 1.45 1.25 1907 .3. 00 2.75 2.60 2.25 1.75 2.76 2.25 1.75 3.00 2.25 2.00 1.50 2.50 1.75 2.20 1.75 1.50 1.40 1.00 2.00 1.40 2.50 2.50 1.75 1.90 1.60 2.25 1.90 1.80 1.70 3.00 1.80 2.25 1.90 1.50 1.60 1.90 1.60 1.40 2.60 2.25 2.00 1.75 1.60 1.60 1.26 1.16 2.20 1.40 2.00 1.60 1.65 1.40 4.00 4.30 2.00 2.15 1.60 1.46 1.45 1.25 2.50 2.70 1.85 2.15 1.75 2.40 1.90 1.70 1.60 3.26 2.15 2.40 2.15 1.80 1.80 1.90 1.60 1.60 2.50 2.25 2.00 1.76 1.50 1.60 1.25 1.15 2.35 1.60 2.25 1.76 1.80 1.50 4.00 4.30 2.00 2.15 1.60 1.45 1.45 1.25 16 RECIPEOCITY WITH CANADA. Scale of wages at New York ana Pennsylvania Go:'s Johnsoiibwg inill from 1898 to 7905.— Continued. Names. Cutters; Cutter man. Helpers. Do Girls Do Steam batteries: Water tenders. Do Do... Firemen. Do... Ash men. Yard: Teamster Helpers Track loaders. Laborers Calender men: Headman Calender men . Helpers. Alkal room: Headmen . Helpers... no'.'.'.'. Bleachers Do Do Do Beater men: Headmen . Colormen. liSO. 75 $0. 75 I 2. 00 2. 00 1. 75 ; 1. 50 Helpers Do. .'.'.'.'.'.'.'.'.'.'.'.'. Do Brown stock Do Wet machines Do Engineers: Corliss Nos. 1 and 2. Ideal Corliss No. 3 Do Do Heaters Electric, manuIacturinR Chippermen Helpers Cleaners Digesters: Headmen Helpers Drainers Do Do Do Pelt washer Electrician Helper 1899 I 1900 ' 1901 I 1902 1903 1904 1905 $2.60 $2.00 1.40 1.75 1.35 1.30 1.20 1.80 1.00 1.35 1.60 l.SO 1.00 2.50 1.35 1.25 1.20 1.40 1.25 1. 05 1.00 1.50 1.40 1.20 1.75 1.25 1.25 1.20 .76 1.75 1.75 1.35 1.30 1.20 1.80 1.60 1.35 1.60 1.50 1.20 1.00 2.50 2.25 1.35 1.25 1.20 2.15 1.35 fl.90 [2.00 1.65 1.75 1.35 1.60 1.35 2.00 1.80 1.80 1.70 1.45 1.00 1.50 1.15 3.00 (2.50 14. 25 l.:i5 1.65 1.40 1.65 1.00 1.50 1.40 1.75 1.25 1.20 1.75 1.20 1.25 1.20 1.76 1.50 1.50 1.40 1.75 1.20 1.50 1.60 2.25 2.00 i$2. 65 1.50 ; 1.40 .80 1.00 !$3.00 S.3.25 2 25 2.10 l.SO 2.25 2.10 1.80 1.90 1.90 1.80 1.80 1.85 1.50 1.60 1.40 2.25 1.80 1.40 2.00 1.90 1.55 1.70 1. 60 1.40 3.00 2.50 2.25 1.50 1.45 1.40 1.60 1.45 1.75 1.75 1.40 1.35 1.76 1.40 1.00 1.15 1.00 1.36 2. 00 1.50 1.00 1.70 2.25 2.00 1.40 1.90 1.50 1.40 1.95 1.60 1.45 1.10 1.50 2.25 1.50 1. 45 I 1. 45 , 1. 50 1.85 ' 1-85 1.50 i 1..50 1.60 1.75 1. 40 I 1. 40 2.00 j 2.00 2.25 1.80 1.80 1. 1.40 2. UO 1.90 1.55 1.90 1.40 1.10 :i.00 2.50 2.25 1.50 1.45 1.40 1.65 1.65 1.40 .90 1.00 1.00 .90 1.00 2.45 2.45 *2. 25 2.20 2. 25 2. -15 2. 45 2. 00 2. 20 2- 20 2.00 2.00 1.66 1.90 1.40 1.10 l.fiO 1.45 1.75 3.00 2. .50 2.25 1.60 1.50 1.50 1.45 1.70 1.45 1.75 1.60 1.70 2.25 2.00 1.40 1.90 1.60 1.40 1.95 1.50 1.45 1.40 1.50 1.75 1.75 2.50 2.00 1.40 1.90 1.50 1.40 2.00 1.60 1.46 1.40 1.60 2 2,'i 2.20 2.00 1.55 1.40 1.90 1.40 1.10 3.00 3.00 2.25 1. 65 1.60 1.55 1.45 1.70 1.45 1.75 1.40 1.90 1.90 2.75 2.20 1.50 1.90 1.50 1.40 2.10 1.50 1.45 1.40 1.60 2. 50 2.25 2.20 2.00 1.55 1.40 1.90 1,40 1.10 3.00 3.00 2.76 1.65 1.60 1.60 1.45 1.70 1.45 1.75 1.40 1.90 2.15 2.76 2.20 1.50 2.00 1.90 1.50 1.40 2.10 1.50 1.45 1.40 2.50 2.00 1.55 1.40 1.90 1.40 1.10 3.00 3.00 2.75 1.65 1.60 1.60 1.45 1.70 1.45 1.75 1.40 1.90 2.16 2.76 2.20 1.50 2.15 2. .50 l.SO 1.70 1.40 2.25 1.50 1.45 1.40 1.75 1.75 3. 00 3. 00 2. 25 2. 25 2.50 2.00 1.55 1.40 1.90 1.40 1.10 3.50 .3.00 2.75 1.65 1.60 1.60 1.60 1.75 1.45 1.76 1.40 1.90 2.16 2.76 2.20 1.50 2.15 2 60 1.80 1.70 1.60 1.40 2.25 1.50 1.45 1.40 1 75 3.00 2,25 2.50 2.35 1.75 1.50 2.15 1.10 3.50 3.00 2.75 1.70 1.70 1.60 1.60 1.85 1.50 1.75 1.40 1.90 1.60 2. .50 1.75 1.50 1.50 1.75 3.00 2.25 2,75 22 2.20 10 1.50 2,30 2.90 1.90 H 1.80 44 1.70 EECIPBOCITY WITH CANADA. 17 Rates of tariff on paper. Ground wood, oue-twelftli cent per pound. Chemical fiber, one-sixth cent per pound. Bleached chemical lilier, one fourth cent per pound. Printing paper, value 2 cents per pound. Wrapping paper, various grades. Parchment. liiitcs on supplies for paper mills' use. Clay $2.50 per ton Felts 44 cents per pound and 60 per cent or 100 per cent Colors Wire cloth 35 per cent Cotton dryer felts 45 per cent Hemp twine 13 cents per pound or 100 per cent Alum and alum calve -1 cent per pound or 50 per cent Lumber Machinery 45 per cent Steel forgings 35 per cent Steel sheets 35 per cent Soda ash 25 per cent Leather belting 35 per cent Rubber belting 30 per cent Salt S to 12 cents per 100 Bleach 20 per cent Waffes. American. European. Women About SI per day (indoor work) Men From SI. 50 to S5 per day, variation based on skill.. $0. 37J to .SO. 50 .50 to 1.50 Senator Hetbtjex. Are there any changes in the wages, or other items of cost, which you incorporated in that statement at that time ; are there any changes that have come about since then in wages? Mr. Sttllivan. In some cases the wages have been increased over what that statement shows. Some liave gone under this new system which increases the wages. Senator Sjigot. You mean the American mills? Mr. Sullivan. Yes, sir. Senator Smoot. Have the English mills adopted the same? Mr. StJLLivAx. No, sir. Senator McCumber. The English wages, being so very much lower than the American wages, and having no duties to pay upon the arti- cles which enter into the manufacture of the paper, how is it that Ave can export the same kind of paper to England that they manu- facture there, in competition with the English paper? Mr. Sullivan. Senator, I do not think we export the same kind of paper that they manufacture over there. I think the papers going from this country to England must be, some of them, a special kind that they do not make. Even Avith the tariff against us, English manufacturers are selling paper in New York at 5 cents a pound that no American mill can make and afford to sell for less than 6, paying the freight and the tariff. Senator Smoot. What class of paper is that? Mr. Sullivan. That is bible paper. 93285— No. 1—11 2 18 EECIPBOCITY WITH CANADA. Senator McCumbee. Where is that paper made up ? Senator Williams. The fact is that we make certain paper that that they can not make and they malce certain paper that we can not make ? Mr. Sullivan. No ; I do not think that we do. If any paper goes from here to England, Senator, as I tried to say before, I believe it is a paper that they do not make ; it must be a specialty. Senator Williams. If they do not make it, they do not make it because they can not make it as cheaply as we can ? Mr. Sullivan. That I would have to look up. Senator Williams. What I am getting at is this : There is no secret about the method of manufacturing any of the paper which we export ? Mr. Sullivan. No. Senator Williams. No mystery about it ? Mr. SuLLrvAN. No. Senator Williams. It is a mere industrial process ; they might use it if it paid them economically to do it, could not they ? Mr. Sullivan. Yes; but I would not like to say that there is any book paper exported to England. Most of the paper that is ex- ported to England is the news-print paper, and the paper which is made in Canada and the United States for news print is vastly supe- rior to what England gets from Norway and Sweden, and for that reason some of the English papers prefer it. Senator Heyburn. Now, as to the number of workingmen em- ployed in this country in the making of paper; can you give us some statement in regard to that ? Mr. Sullivan. I can ; yes, sir. Senator Hetbuen. I refer particularly to those whose wages would be affected by a change in the tariff. Mr. Sullivan. Yes, sir. In our own branch of the industry they amount to 30,000 people, and we are only 1 of 12 branches. Senator Hetbuen. Can you give us an estimate of the aggregate number ? Mr. Sulllvan. Yes, sir. I would have to look it up for you. I would be very glad to do it. Senator Heyburn. The committee would like to have that in- cluded in your statement.* The Chairman. Yes. The Chaieman. When you say you are 1 of the 12 branches, will you be good enough to tell us a little more accurately what you mean. What are the other branches ? Mr. Sullivan. The other branches, Senator, are the news, then the book, then the coated, then the writing, then the wrapping — that is, three different kinds, manila, kraft, and straw — news board, tissues, roofing, hanging, and then two pulp propositions, the sulphite and soda pulp. Senator La Follette. Do the English manufacturers turn out paper at a less cost than the German ? Mr. Sullivan. No; I think they are pretty close together. Senator La Follette. About on a level ? Mr. Sullivan. Yes, sir. ' statement not furnished. BECIPEOCITY WITH CANADA. 19 Senator Smoot. Norway and Sweden make the cheapest wrapping paper in the world, do they not ? Mr. SuLLivAx. Yes, sir. Norway and Sweden. Even before the Payne-Aldrich taritJ bill went into effect there was no tariff on what is known at kraft paper, which is a newly developed wrapping paper. Now, even Avith the tariff, which that bill put on, Norway and Sweden are sellino- kraft paper in this country to-day at about 15 cents a hundred above what the Americans are asking for it. Senator Smoot. They have about 75 per cent of the American trade to-day? Mr. Sullivan. Yes, sir. Senator McCumber. ^YhJ is that ? Senator Sjioot. Because they make it cheaper and the woods there, 1 suppose, are particularly adapted for it. Senator ilcCuMBER. I understood you to say they were selling it higher than the American price. Mr. Stjllivan. Fifteen cents below the lowest of any American price that is quoted. Senator Kern. Is it better paper than the American paper? Mr. Sullivan. No, sir. Some American mills are making a better paper. Senator Kern. I understood you to say the wood is better suited to that purpose. Mr. SuLLHTAN. They are making it out of pulp. There is only a small quantity of that pulp to-day that is made in the United States, They are using the imported pulp. Of course, that gives them the same foundation as the Swedish people have. Senator La Follette. Have the Germans or the English manu- facturers of the paper that you make any processes that are superior to your processes, or the processes of those who are making the same kind of paper that you are making in this country ? Mr. SuLLrvAN. I do not think it so. The only processes that the English have that gives them an advantage in making the light- weight Bible paper is their process of using the Esparto pulp. They get that pulp at a remarkably low price, and it produces a very opaque paper, which is a great feature in the Bible paper, being of such a light weight, and that is one of the desired points. In that they have the advantage over us, because we have to import that pulp at too high a price for us to use. Senator Kern. Where does that pulp come from ? Mr. Sullivan. It comes from some part of Spain. Senator Kern. What is it called? Mr. SuxLivAN. Esparto. Senator Smoot. There is another thing affecting Bible paper, isn't there; and that is, there is more labor required to make that class of paper, according to the selling j^rice, than upon ordinary paper? Mr. Sullivan. That labor comes in in a relative sense. Senator, from the fact that your production is less than it would be otherwise. Senator Smoot. That is what I mean. Mr. Sullivan. Of course, that is recognized in your fixed charges. In other words, you take a mill like ours, and if we make 30-pound paper on a machine we would only be able to make 10,000 pounds, pay, a day, whereas on .50-pound paper that machine would make 18,000 to 20,000 pounds. 20 EECIPEOCITY WITH CANADA. Senator Cullom. As I understood you, you are a manufacturer of book paper, and, as such, I understand, you further object to the reci- procity bill. Is that correct or not? Mr. Sullivan. Yes, sir. We feel that under the reciprocity bill, Senator, we are absolutely having no protection of any kind, and at the same time our raw materials that we use have a duty upon them, so that, vulgarly speaking, we are getting it both coming and going. Senator Johnson. What per cent of the products of your mill falls under 4 cents per pound ? Mr. Sullivan. Ninety-five per cent. Senator Johnson. Is that true of the other 46 mills? Mr. Sullivan. Yes; I think I would be safe in saying so. Senator Johnsux. Do yeu manufacture any pulp? Mr. Sullivan. Vi"e manufacture what is known as soda pulp. Senator Johnson. Sulphite pulp ? Mr. Sullivan. No sulphite. We, being in the city of Philadel- phia, could not make sulphite on account of the objectionable odor from it. ^Ve have to buy that. Senator La Follette. There is no substantial difference, as I understand you, in the wage cost in Canada, as compared with our cost here ? Mr. Sullivan. Not as far as the skilled labor is concerned. Senator La Follette. Merely so far as the general labor cost in the wood is concerned? Mr. Sullivan. Yes, sir. Senator La Follette. So that this advantage arises from the ex- cessive cost of the material here, what you call the raw material? Mr. Sullivan. Yes ; the wood. As I understand the tariff, it has been figured out that there is $4.75 a ton against us to start with, and that is without this other $7 a ton that I have just enumerated to you. Senator Kekn. Against you as compared with Canada ? Mr. Sullivan. Yes. Senator Williams. Wliat does that $4.75 consist of? Mr. Sullivan. It consists in raw wood. Senator La Follette. How much of the difference in the cost of the raw material is represented in transportation? Mr. Sullivan. To the United States, you mean, for the finished product ? Senator La Folletttj. No ; I mean of your raw material. How far do you have to transport your raw material ? Mr. Sullivan. Our individual mill, of course, only transports it from Philadelphia, which is about 6 miles. Senator La Follette. Then it is not an item of any importance ? Mr. Sullivan. No. Of course, you take the question of clay, and the freight rates are not very much higher. In other words, you take clay coming into the United States and the freight rates to the various mills, on the average, are not very much higher than they would be to a mill located as we are. Senator La Follette. You were speaking of a comparison ol wages here. You said you submitted a comparison in the Sixtieth Congress to the Ways and Means Committee ? Mr. Sullivan. Yes, sir. RECIPEOCITY WITH CANADA. 21 _ Senator La Follette. Where did you obtain your figures of va- rious wages? Mr. Sullivan. They -were obtained by a committee of the book division, who visited England. Senator La Follette. When did they visit England ? Mr. Sullr-an. Just previous to the meeting of the Ways and Means Committee on that bill. Senator La Follette. Were those figures taken by them from offi- cial reports, or was it the result of personal investigation ? _ ISIr. Sullivan. Personal investigation of mills there of a compara- tive capacity to the ones that we took here. Senator I^ern. How long was your committee in Europe? Mr. SuLLis'AN. I think they were there about three months. Senator Iveen. Did they travel all over Europe ? Mr. SuLLn^AN. Xo ; just England and Germany. Senator La Follette. Did they submit the statements of the own- ers of the mills there as to their wage cost, and as to the rate of wages they were paying ? Mr. Sullivan. Yes; they submitted what they collected there. You mean a signed statement? Senator La Follette. Yes; a signed statement of the manufac- turers. Mr. Sullivan. No ; but it was presented and never questioned. Senator La Follette. Will you submit to this committee an item- ized statement of the cost of producing paper in your mill, of all kinds of paper that you produce? Mr. Sullivan. Yes, sir. Senator La Follette. Including in that statement the capital that you have invested, the actual capital invested, and every item of cost? Mr. Sullivan. I will be glad to give you any information that you may ask for. Senator La Follette. We would like to have that information. The Chairman. Can you file this additional information to-day? Mr. Sullivan. Hardly to-day. The Chairman. Will you file it as soon as you can? Mr. Sullivan. I will file it to-morrow. The Chaieman. Mr. Sharp, do you desire to make a statement to the committee ? Mr. Sharp. Yes, Senator. STATEMENT OF MR. WILLIAM HAROLD SHARP, OF PHILADELPHIA, PA. The Chairman. Will you state your full name to the committee? Mr. Sharp. William H. Sharp. The Chairman. What firm do you represent? Mr. Sharp. The Jessup & Moore Paper Co., of Philadelphia. The Chairman. Where is that located ? Mr. Sharp. Our offices are in Philadelphia and New York. Our mills are in the State of Delaware. I would like to say, Mr. Chair- man and gentlemen, that the duty on book papers for many years has been 15 per cent, and under that we have just been able to get along and keep out a large percentage of the foreign paper. Under the 22 EECIPKOCITY WITH CANADA. reciprocity act the 15 per cent duty is entirely removed and we are obliged to pay duty on many of our raw materials, which Mr. Sulli- van has mentioned to you, clay and bleaching powder, etc. Now, to the companies in which I am interested it makes a difference of about $50,000 per annum, just those two items of bleaching powder and English clay. The Chaieman. The dutjr does ? Mr. Sharp. We are paying those duties now. By taking off the 15 per cent duty and admitting book paper free, I do not see how our industry can exist in competition with Canada, because of their water power and their cheap wood. Senator Hexbuen. What power do you use ? Mr. Sharp. We use water power and steam. Senator Hetburn. What is the product of your mill ? Mr. Sharp. About 100 tons a day. The Chairman. In what portion of the State of Delaware are your mills located ? Mr. Sharp. We have two mills at Wilmington, and also a pulp works at Wilmington. Senator Smoot. How many men do you employ? Mr. Sharp. The two companies in which I am interested employ 1,000, sir. The Chairman. Have you anything further to state to the com- mittee ? Mr. Sharp. No, I do not think that I have, Mr. Chairman, except to say that during the past 60 days I have been in London and the London papers are full of advertisements of bonds and shares of companies about to be formed in Canada, and it seems to me that if the reciprocity act is passed, and all paper under 4 cents per pound allowed to come in free, it is simply a question of time as to how soon our industry will cease to exist. Senator Hetburn. How much coal do you use? Mv. Sharp. We use about 75,000 tons a year, sir. Senator Hetburn. Is that because of lack of water power or be- cause of preference? Mr. Sharp. We have no extensive water power. Our water powers are not large. Senator Hetburn. You are on the Brandywine ? Mr. Sharp. We are on the Brandywine; yes, sir. Senator Hetburn. What labor do vou use; what nationality? Mr. Sharp. Our labor is of all nationalities. Senator Hetburn. Do you use a good many Italians ? Mr. Sharp. Some Italians ; yes, sir. Senator Hetburn. I visited your mills on Friday, on the Brandy- wine, and your labor seemed to be very largely Italian. Mr. Sharp. We have some Italians— was that the upper or lower mill? Senator Hei-buen. The lower mill. Mr. Sharp. Yes ; we have some Italians there. The Chairman. That is all, Mr. Sharp, unless you have something further to say. Senator Simmons. Are most of them just temporary laborers* Mr. Sharp. The Italian laborers? BECIPBOCITY WITH CANADA. 23 Senator Simmons. Yes. Mr. Sharp. That labor, Senator, is not the skilled labor of the mill. The skilled labor is not Italian. Senator Hetbtjen. It was the body of the general laborers. Mr. Sharp. Just the ordinary day laborers, but the skilled labor is principally American. Senator Simmons. Wliat is the proportion of skilled and unskillled labor employed in your mills? Mr. Sharp. I will say about 50 per cent of skilled and about 50 per cent of unskilled. Senator Simmons. What proportion of the unskilled labor is Italian? Mr. Sharp. That I could not state. I should not think it is over 20 per cent. Senator Summons. Senator Heyburn said when he went there that they were pretty much all of them Italian. Mr. Sharp. With all due deference to the Senator, I think he is mistaken about that. Senator Heyburn. About what? Mr. Sharp. About the Italians being a large proportion. Senator Heyburn. I said it appeared to me that the workmen I saw were generally Italians, some of them. Mr. Sharp. There may be some few, but I do not think there is any large proportion. Senator Simmons. What I was interested in was in knowing whether those Italians which you employ were there permanently or just for the purpose of working during the season. Do you know anything about that. Mr. Sharp. I am unable to say. Senator Simmons. There has been a good deal of discussion about that. Mr. Sharp. I understand, but I think most of the Italian em- ployees have houses on our ground and are citizens. Senator Simmons. They own the ground? Mr. Sharp. No; they rent their houses from us. Senator Simmons. They have their families with them? Mr. Sharp. Yes; most of them have their families with them. Senator Simmons. When they have their families with them it is usually some indication that they have come to stay? Mr. Sharp. Yes. Senator Simmons. What proportion of them do you think come to stay, in your mills ? Mr. Sharp. I can find that out for you, Senator, but I think that 75 per cent of them are there to remain. Senator Simmons. Do you employ any other nationality except Italians ? Mr. Sharp. Oh, yes; the largest percentage of our workmen are Americans. There are some Irish, some English, and some Scotch. Ten or fifteen years ago our labor was almost entirely Irish. It has gradually changed. I might add further that we pay Italian labor- ers the same as any nationality, and only employ them because they are the only laborers available. 24 RECIPROCITY WITH CANADA. The CiiAiKMAN. Is there anyone else present representing any of the paper people'^ We have a great many more paper people com- ing here later. I understand there are delegations here from New York and Massachusetts representing the farm industries. If they will present their speakers the committee will hear them. STATEMENT OF ME. N. P. HULL. The Chairman. I understand you are ready for the farmers? Mr. Hull. AYe are. The Chairman. I think the committee heard from you, Mr. Hull, very fully two months ago. Will you state your full name to the committee ? Mr. Hull. N. P. Hull. I am at present master of the Michigan State Grange and jDresident of the American Dairy Farmers' Asso- ciation, and I have been asked by the delegation of farmers who are down here representing 13 or 14 different States to call the speakers and act as general factotum, and I might state to you that I am going to call on the master of the National Grange to give a genera] presentation of the farmers' case here, and then, with 3'our pleasure, I would be pleased to call upon several farmers from these different States that they may testify in regard to certain phases of this prop- osition, and, without going any further, if it is j'our pleasure, I would be glad to call upon them. Senator SiaiMONS. You said you were here representing or speak- ing for the farmers of 13 or 14 States. Won't you put in the record the States which the delegations are from? Mr. Hull. Our secretary will furnish the list. Mr. Gardner has not come in yet, but as soon as he comes in he will furnish the names of the people who are here in these delegations and the States from which they come. (The list furnished by Mr. Gardner is as follows:) Hon. N. J. Bachelder, New Hampshire, master National Grange. F. N. Godfrey, New York, master New Yorlv State Grange; chairman execu- tive committee. National Grange. C. O. Raiiif, ^Missouri, master Missouri State Grange; member executive committee, National Grange. S. H. Messick, Delaware, master Delaware State Grange; member executive committee. National Grange. T. 0. Atkinson, West Virginia, master West Virginia State Grange ; member legislative committee, National Grange. Robert Eaton, Illinois, master Illinois State Grange; president American Dairv Farmers' Association. N. P. Hull, Michigan, master Michigan State Grange. Charles M. Gardner, Massachusetts, master Massachusetts State Grange; chairman Mass;\chnsetts Dairj' P.urean. L. H. Healy, (.'(iinieeticut, mnster Oonnectient State Grange. F. B. Merchnnt, Rhode Island, master Rhode Island State Grange. Richard Pattee, New Hampshire, master New Plampshire State Grange. T. C. Laylin, Ohio, master Ohio State Cr.nige. W. N. Giles, New York, secretiiry New York State Grange. J. W. Hutchins, Michigan, secretary Michigan State Grange. George S. IjHild, Al.iKsaclnisetts, th.iirman executive committee, Massachusetts State Grange. Andrew L. Felker, New Hampshire, lecturer New Hampshire State Grange. J. A. Sherwood, Ccinnecticut, lecturer Connecticut State Grange. M. M. Ware, New York, member executive committee. New York State Grange. RECIPROCITY WITH CANADA. 25 Charles H. Potter, Connecticut, chnirmau legislati\e eounmittee, Coimeetlcut State Grange. C. L. Gold, Connecticut. F. E. Duffy, Connecticut. John MeSparran, Pennsylvania. H. J. Patterson, Maryland, master Maryland State Grange. George W. F. Gaunt, New Jersey, master New Jersey State Grange. Mr. Hull. I take pleasure in introducing ex-Gov. N. J. Bachelder, of New Hampshire, master of the National Grange, who will make a general presentation of the farmers' case at this time. IMr. Bacheldee. Mt. Chairman and gentlemen of the committee : I appeared before your honorable committee about three months ago, when I stated some of the reasons why the farmers of the country, speaking through their principal organization, the National Grange, were opposed to the Canadian reciprocity bill. At that time I was questioned by several members of your committee as to the general sentiment of the farmers toward this bill, and I then stated that in the 28 States in which the Grange is organized, from all the informa- tion I had received from the thousands of subordinate Granges, the farmers were practically a unit in denouncing it as an unjust attack on their interests. Since my appearance before you this question of the sentiment of the farmers has been raised by the President and several Members of Congress, while statements purporting to emanate from the White House have been widely circulated in the news]3apers to the etfect that the majority of the farmers favored reciprocity and that the protests showered upon Congress by farm organizations and individual farmers were inspired by some unknown interests and did not represent the genuine sentiment of the farmers. In a speech delivered before the American Newspaper Publishers' Association in New York the President called in question the action of the Grange in endeavoring to jDrevent the enactment of this mis- called " reciprocity " scheme, when he said : '' I am quite aware that frort one motive or another a great deal of effort and money have been spent in sending circulars to the farmers to convince them that this treatV; if adopted, will do them injury." For the informa- tion of the President I would state that there was one motive, and one only, for the action of the National Grange in writing to the farm organizations of the country warning them against this bill. That motive was the protection of the farming industry against a most unjust iMrce of legislation, which if enacted would lower the price paid our farmers for their products, and cause a general depre- ciation in their property. The National Grange has no apologies to make for its action in this matter, and when it is insinuated, as was done by honorable JMcmbers of the House, that the opposition of the farmers was initiated by some outside interest, I denounce the charge as without the slightest foundation. The idea that the farmers are not opposed to this bill is widely spread by the daily newsjiapers of the country, which are the principal, if not the' only, force behind the reciprocity deal. I call it a deal because it has been openly charged on the floor of the House by ex-Speaker Cannon, and not denied, that the American News- paper Publishers" Association is the influence that has induced the press of the country to favor reciprocity for the purpose of getting free print paper. The newspapers which are clamoring for this 26 RECIPEOGITY WITH CANADA. measure are simply doing so for their own financial benefit, and it is for this reason that they have suppressed the farmers' side of the question, and have only published arguments in favor of the bill. So, when it is claimed that the newspapers represent the sentiment of the country I answer that they represent only the sentiment of their own pockets. When I previously appeared before your committee I urged that this bill was a direct violation of the pledge made by the Eepublican national platform of 1908 to maintain protection to the country's industries equal to the difference in the cost of production in this and foreign countries, and pointed out that the farmers were clearly entitled to have the condition of production in this country and in Canada investigated by the Tariff Board. It has been officially stated on behalf of the President that he is a protectionist and expects to use the veto power to prevent the en- actment of bills revising the tariff on manufactures unless they are based on the report of impartial investigators. This confirms my assertion that the reciprocity bill is an unfair discrimination against the farmers, for that measure was prepared, introduced, and passed by the House without any hearings by the Tariff Board or an oppor- tunity given to the farmers to present facts showing a higher cost of production in this country. Why should the manufacturers be entitled to an investigation by the Tariff Board before their tariff rates are reduced, while the farmers are tried, convicted, and sen- tenced to have their products put on the free list without any con- sideration of their claims to equal protection with the manufacturing industries ? An attempt has been made to disprove my former statement to you that the Canadian farmers have an advantage over our farmers m that they pay lower tariff taxes on all the manufactured articles they use, and are therefore able to buy these articles cheaper. As proof that I was right, I wish to submit a comparative statement of the tariff' taxes paid by the farmers of the two countries. The Canadian tariff law has three kinds of tariff rates, the lowest being the British preferential tariff. As the greater part of the manufac- tured goods imported into Canada come from Great Britain and as the goods imported from other countries must be as low in price as those coming from Great Britain, else they would not be pur- chased, it is only fair to take the rates of duty on British goods as the standard of comparison with our tariff rates. The following statement shows that on articles generally used by the Canadian farmer he pays an average tariff tax of from 20 to 35 per cent less than is paid by our farmers. Earthenware. Tin plate Tinware Wire Hats Sugar Carpets Oilcloth Furniture Cottonclotli Canadian tariff. 15 per cent Free 15 per cent /Some kinds free \None over 10 per cent. 20 per cent 35 per cent 17i percent 25 per cent 20 per cent " per cent. Soap 1 ti5 cents per 100 pounds United States tariff. CO per cent. 45 per cent. 45 per cent. 75 cents per 100 pounds. 55 per cent. 80 per cent. CO per cent. 45 per cent. 35 per cent. 50 to CO per cent 50 per cent KECIPHOCITY WITH CANADA. 27 Canadian tariff. United States tariff. Gloves and mitts . Hose 22^ per cent. 25 per cent.. Dress goods , Automobile farm trucks. Pianos Celluloid goods . Cement UndercIotliiQg.. Salt Shovels Scythes Stoves Chains (iron) Knives Eind forks . Agateware Sewing machines . Lemons Window glass. Rice Figs 15 per cent 22 per cent 20 per cent /Some kinds free \None over 5 per cent. 5 per cent 22i per cent Free 15 per cent 20 per cent 15 per cent 15 per cent 5 per cent 20 per cent 22i per cent 20 per cent Free Free. Jute bags Cotton thread Glassware Lamp chimneys Brass goods Lamps Baskets Rubber coats , Rubber boots and shoes. Books Lead Clocks and watches Bicycles 7^ per cent 50 cents per 100 pounds., 40 cents per 100 pounds. , 15 per cent.. 17i percent. 15 per cent. . 20 per cent. . 20 per cent.. 20 per cent.. Free 15 per cent- . 15 per cent.. 15 per cent. . Free 20 per cent. . 20 per cent . . 60 per cent. 70 cents per dozen pair and 15 per cent to S5 per dozen pair and 55 per cent. 60 per cent. 45 per cent. 45 per cent. 60 per cent. 10 per cent. 45 per cent. 11 cents per 100 pounds. 45 per cent. 45 per cent. 45 per cent. 45 per cent. 45 per cent and up. 50 to 65 per cent. 40 per cent. 30 per cent. 1 cent per pound and 30 per cent on the package. 1 i cents per poimd and 3D Jffir cent on the package. ' 60 to 76 per cent. $2 per 100 pounds. 51 per 100 pounds and 35 per cent. 45 per cent. 45 per cent. 60 to 100 per cent. 60 per cent. 45 per cent. 45 to 60 per cent. 45 to 60 per cent. 35 per cent. 35 iser cent. 25 per cent. 80 per cent. 40 to 60 per cent. 45 per cent. Senator Williams. The chief trouble with your New England farmer seems to be that he is already overtaxed; that is it, is it not? Mr. Bachelder. That seems to be the trouble, that if our products are to be competed with by Canada, that we would be already over- taxed. Senator Williams. Would it be better to relieve him from his situation by taxing the man who buys from him or by untaxing him? Mr. Bachelder. It would be better if he were to have both done. I submit that no civilized nation in the world would negotiate a treaty with another country having a much lower tariff, under which the farm products of the low-tariff country would compete freely with the products of farmers paying the high tariff taxes. It is self-evident that the farmers buying goods lightly taxed would have an advantage over their competitors who were compelled to buy the highly taxed articles. ^^ i It is said that trade in farm products between Canada and the United States should be as free as trade between Pennsylvania and New Jersey. If the State of Pennsylvania had a tariff rate of 50 per cent on manufactures, while the New Jersey tariff was only 25 per cent, no fair-minded person would claim that it would be just to allow the products of New Jersey farmers to be sold m Pennsyl- vania in free competition with those of the latter State. Under the same principle it would be manifestly unfair to allow the products 28 BECIPBOCITY WITH CANADA. of low tariff Canada to compete, free of duty, with the products of our more heavily taxed farmers. I wish in conclusion to say a word to my Democratic friends on the committee. Your national platform of 1908 declared in favor of placing on the free list articles entering into competition with trust- controlled products, and such graduated reductions in other schedules as may be necessary to restore the tariff to a revenue basis. Is this reciprocity bill in accord with your platform? Are cattle, sheep and hogs, wheat, oats and barley, butter, eggs and cheese, hay, potatoes and apples, controlled by trusts? You know that they are not, that there is not, and never can be, trust control of these products, in the form in which they leave the farm. Then, why put them on the free list, instead of on a revenue basis, as your platform demands? If you believe in a tariff for revenue, why not raise some revenue from the very moderate duties now imposed on farm products? Why sacrifice $5,000,000 in revenue, in order to allow Canadian farm products free access to our markets? If you are logical you must vote against reciprocity, as being absolutely inconsistent with any system of tariff for revenue only. Free trade in farm products, and high tariff for manufactures, is not, and can not be, part of a revenue-tariff system. But the farmers are told that if they will consent to have the slight protection now given them entirely wiped out, the tariff on manufactures will be reduced some time, somehow. We are not fooled by these promises, for we know that the President is ready to veto any reduction of the high tariff on manufactures that is not based on the conclusions of his Tariff Board. According to the pres- ent rate of progress by that body it will be 10 or 20 years before the investigation of all the tariff schedules is completed. ' Senator Simsigns. Do you mean to say that the President will veto the farmers' free-list bill? Mr. Bacheldek. I do not mean to say that he would veto any particular bill, but I understand he has said he will veto any measure reducing the tariff not in accordance with the findings of the Tariff Board. And it may report that the present high rates are necessary for the protection of our manufacturing industries. I say frankly that we have no faith in these promises that if the farmers will be good they will be compensated some time. ^'\1ay should they be com- pensated? If, as the President declares, they will not 'be injured by reciprocity, they need no compensation. The very fact that a so- called " farmers' free-list bill " has been introduced in the House is an admission that the farmers will be injured. The farmers know something about their own business. They know that they will be seriously hurt by the competition of Canadian farm products; they know that prices of practically all the articles put on the free list have already fallen in anticipation of this bill becoming law; they know that the value of farm lands has already declined; they know that this bill is inconsistent with either the Eepublican doctrine of protectioii or the Democratic principle of a revenue tariff, and they protest against its enactment as violative of every principle of justice and fair play that should govei'n the tariff legislation of this sreat Nation. ^ ^ ■ RECIPROCITY WITH CANADA. 29 Mr. Hull. Now, I nnderstancl that an assertion has been made that no one but the ea-tern farmer is eoniing before this committee to speak on this matt< r of reeiini)eity. The next man I want to call is Mr. Eobert Eaton to lesiify before this committee. He is Master of the Illinois State Grange. STATEMENT OF MR. ROBERT EATON. Mr. Eaton. Mr. Chairman and members of the committee, it is, no doubt, rather unnsnal for you gentlemen who have been addressed and waited upon by men who represent big trusts, monopolies, or combines to have a delegation come here direct from the rural walks of life to protest against this reciprocity treaty which the President of the United States sees fit to insist that you shall enact in direct opposition to the wishes of the agTiculturists of this great United States. I come to you direct from Illinois, a farmer whose business is upon the farm. I left my farm work to come here to plead on behalf of my farmer friends of that great State of Illinois, that State which is second to none in agricultural pursuits in this great country, 400 miles long and 215 miles wide in its widest part, comprising an area of 56,650 square miles. Over this great area are dotted villages, farms, and some great cities, and the pride of our State is its highly tilled_ farms, its beautiful homes, its contented farmers, and its intelligent people. I am not here, gentlemen of this committee, representing any political body, but I am here representing a nonpolitical body, and as a citizen of this great Eepublic I have a right to some of my per- sonal political ideas, and I may be pardoned if I mention a few of them. I was raised by a Scotch Presbyterian, and there were two things he would never allow upon his table. They were a deck of cards and a Democratic newsjjaper. [Laughter.] And coming from that State, not far from the capitol in whose shadows rest the remains of Abra- ham Lincoln, is it any wonder that, reared under the home influences which I had and familiar with the circumstances surrounding the life and death of that martyred man, is it to be wondered at that I should have some very pronounced ideas as to what I consider to be the proper way in which this country of ours should be governed? Illinois, since the day when Abraham Lincoln took his seat in this National Capitol, until the present time, has only surrendered twice to the call of free-trade government. In 1868 John M. Palmer was elected as our governor, and again in 1892 John P. Altgeld broke into our State legislature. During all this time, with the exception of these two periods, our State has been loyal and true to the principles of protection. I am a protectionist personally all along the line. I have no sym- pathy for free trade or cutting the tariff in any way. It has been circulated around, all over the length and breadth of this great country of ours, that the farmers were not interested in this business, that they did not know what they wanted, that they were paying no attention to what you people are doing down here at our National Capitol. But I want to say, gentlemen, with all earnest- ness and candor, if any of you entertain that idea dismiss it at once. 30 EECIPKOCITY WITH CANADA. I have traveled from the East to the West, and I believe that I know the pulse beat of the farmers of my State. What is true of the great State of Illinois is true of all this great agricultural country which is lying out West; and when I say to you that they are protesting against this I know that I am speaking the truth, and I know that if you insist in fastening this reciprocity bill upon the farmers of these United States there is going to be a day of reckoning in the near future. Senator Simmons. A reckoning with the Republican Party ? Mr. Eaton. Gather your own insinuation. [Laughter.] Senator La Follette. It depends upon who does it. Mr. Eaton. Will removing the tariff cheapen the articles to the consumer ? Senator Williams. You heard the argument made by the ex-gov- ernor of New Hampshire. Mr. Eaton. I heard part of it; yes, sir. Senator Williams. In which he produced a list of the deplorable degree to which the American farmer was taxed by the tariff over and above the degree to which the Canadian farmer was taxed. A moment ago I believe you said you were opposed to all reductions in duty. Are you opposed to the reduction of these duties that he read — that directly tax the farmers upon all they use? Mr. Eaton. We are not asking any favors from anybody. Senator Williams. It is not a favor to ask that something be untaxed. It is a favor to ask that it be taxed. Now, then, are you opposed to reducing those duties ? Mr. Eaton. I was giving you my personal views; but in speaking for the organization which I represent I am heartily in favor of every statement which the governor made. What I have been say- ing are my personal views as a citizen and as a Republican of this Commonwealth. Senator Williams. Now, then, as an official of the grange, how- ever, you are in favor of the reduction of those duties that he read ? Mr. Eaton. Yes, sir. Senator Williams. That is what is wanted. Senator McCtjmbee. Have you made any estimate of how much benefit the farmer would get from a reduction in those duties. Mr. Eaton. No, sir; I have not. Senator McCumbee. Do you think he would get 1 per cent of benefit ? Mr. Eaton. From past experience, I would say he was getting no benefit. Senator McGumber. Do you know of any manufacturer of wagons in Europe who would import wagons into this country whether we had the tariff on them or not? Mr. Eaton. I am not prepared to answer that question. Senator Smoot. If you had free sewing machines, mentioned in the governor's list, don't you think that the only result would be that the Singer Sewing Machine Co. would make them in Europe and sell them in this country at present prices ? Mr. Eaton. I don't believe that the man who bought them would receive any special favor from that. Senator Williams. Do you think the grange organization, which you represent officially, is mistaken on that subject? RECIPEOCITY WITH CANADA. 31 Mr. Eaton. No, sir ; I am not prepared to say that. Senator Williams. Talking about sewing machines, is it not a fact that they do make them here now and export them and sell them cheaper in Europe than anybody can make them there in competi- tion? Mr. Eaton. I have heard so, but I am not positive as to that. Senator Smoot. Is it not true that they are made in Scotland and in France and sold in Europe by these manufacturers ? Mr. Eaton. I presume so. Senator Smoot. Is it not true also that you can buy machines here wholesale for about $17.75, and under the system of distribution and sale to the farmer he is compelled to pay $50 or $60 for them, and the tariif cuts no figure ? Senator McCumbee. I want to ask the gentleman another question : About how long does a machine last in an ordinary family. Mr. Eaton. Well, that depends, of course, on what care it receives. Senator McCumber. Assuming it receives the usual care. I said an ordinary family. That means the ordinary use to which it would be put. I have covered the idea in my question. Mr. Eaton. If a person will take proper care of it and replace the pieces that are worn out they can keep the frame for a lifetime, as far as that goes. Senator McCumbek. If you save $5 on the machine you would save $5 in a lifetime. You sell your grain every year, however, don't you? Mr. Eaton. Sir? Senator McCumber. You sell your grain every year? Mr. Eaton. Yes, sir. Senator Williams. And you work every year to make it, don't you? Mr. Eaton. We have to, or we would not make anything. The Chairman. Will you proceed? Mr. Eaton. You people have been drilling me upon that. I_ do not believe I had better take up any more time on it, but I will just read this: Will removing the tariff cheapen articles to the consumer? The Payne-Aldrich bill lowered the duty materially on lumber. What is the result? We are paying more for lumber than we ever paid. Senator Williams. Do you not think that is the cause of the re- duced rate? Mr. Eaton. We are not getting it. We remembered the plea for free hides. We got them at the cost to the cattle owner of $1.25 and $1.50 on every hide he sold, and all leather goods have advanced 25 or 30 per cent, and we people who are right in with the farmer are buying our shoes and harnesses and know what we are paying for them. The Chairman. It was testified here last week that shoes are cheaper to the consumer since the duty on hides has been removed. Mr. Eaton. I am speaking from my own experience — what we are paying for our harness and clothing and shoes that I clothe my children with. It has been said, gentlemeil, time and again, that the farmers were not taking any interest in this. Well, now, if you will pardon me, I am going to read a little selec- tion from an article which a neighbor farmer of naine wrote and sent to the local paper in my home town. I am not going to read it all, I 32 RECIPROCITY WITH CANADA. am just uoiii-- to read a short snatch of it. And, by the way, this old i;vut]eni;i]i. who is almost ready to pass to his reward— a good, loyal Anierieini eitizen— he hits the nail so closely on the head here that I ha\ e decided to read it. I do not know whether you are aware of it or not, but we are. and I use the greatest respect'when I speak of the Presiileiit of the United States, when I speak of his tour throughout the Western country. He visited our legislature and made them a speech, and this man, reading this article, comments upon that. Many of the arguments made by those in favor of the treaty are on a iDar with the President's speech at Springfield, while trying to hypnotize our legislature to indorse his reciprocity foundling. He claimed that the free entry of hogs would be a great thing for the corn-belt farmers, and we wondered if he was so ignorant not to know that the corn-belt farmer is the greatest hog and beef raiser on the continent. Any school boy in the State could have told him that the corn farmers raised corn to feed hogs. He also said that the admission of free barbed wire would be of great benefit to us farmers. If he had got posted up a little before he started on his pilgrimage, he could have learned that Canada never sold a spool of barb wire to the United States. On the other side of the ledger he would have found that the States sold Canada over 100,000,000 pounds in the year 1910. Such claims only exposed his ignorance on existing con- ditions and commercial statistics. His chief ally and lieutenant, J. J. Hill, is roaming and roaring around the country in the interest of the treaty. Nothing selfish — pure patriotism. He don't tell the people that his railroad parallels the entire boundary line, with over twenty lateral branches extending far in the interior of Canada. Lit- tle concern he has for what the farmer receives for his products. Quantity is his hobby. His profits are the same when wheat sells for $1 or down to 50 cents. Our notion is it will take better and more convincing arguments than they or their Canadian followers to con- vince the American farmers that Canadian reciprocity as contem- plated is a bonanza. If I have overstepped my time, I want to say to this committee, and through you I want to convey it to this Congress that you are passing through a crisis which is equal to, if not greater, than that which Lincoln and Washington passed through. I believe we have come to the parting of the ways here in the United States. There are two roads before us to travel, and you are to decide along which of those highways the old chariot of this United States is going to continue to roll. Down along one of those pathways I see peace and prosperity. Along the highway are well-kept farms and a contented people. A little farther along are little villages well laid out and prosperous. Farther down that road are the great manufacturing cities, with their chimneys pointing heavenward, from which pours forth a volume of smoke. From out of these walls come the sound of wheels and the rattle of the shuttle. Above this are heard the happy voices of the workmen as they sing about their work. Come with me a little farther. Near by we find the workman's home. There is a well-kept garden; his little children well dressed and clothed, and starting down the road every morning to the public school. The wife, well fed and happy, sings about her work, knowing EECIPKOCITY WITH CANADA. 33 well that the husband and father will return to her upon Saturday night with his weekly wage. Come with me down this other road, leading into the avenues of free trade and destruction. Pass down that road. What do we find? We find the farmer's home going down, his fields not well tilled. A little farther down the villages are becoming dilapidated. Down farther : from that great chimney pours forth no smoke, from those mills there issue forth no sound of wheels. Come with me over to the workingman's home. The garden is uncared for, the children are clinging around their mother's knee, and are not decently clothed. The workman sits there, almost the picture of a famished wolf. "\ATiy? Because free trade has been forced upon this country, and the workman of America was put upon the level with the peasantry of Europe, and the manufacturing man who had his money tied up in that great manufacturing plant found that he could not run it to any advantage, and he turned the key in the door. Gentlemen, this is no overdrawn picture. I know you are not con- templating free trade. But I know I speak the voice of the farmers of this great country. I believe that if you discriminate against us and take off the protection on our goods and leave it unchanged upon the manufacturer, the farmers and the laboring men of this country are going to retaliate, and they will send men here who will force free trade upon this countrjr. Gentlemen, I thank you. Mr. Hull. I would like to call upon Mr. W. N. Gyles, of the Xew York State Grange. STATEMENT OE MR. W. N. GYLES, SECEETARY OF THE NEW YORK STATE GRANGE. Mr. Gyles. Mr. Chairman and gentlemen of the committee, I am not going to undertake to discuss the intricacies of this question, but I am, however, to bring you news from home. For some reason, which it appears you can fathom, and we can not, the newspapers of the country to-day are not giving a very adequate feeling or ex- pression of opinion of the farmers upon this subject. I am the recording and corresponding secretary of the Grange of the State of Xew York, numbering 100,000 members. And I can answer to the statement that has been made that we have circularized and agi- tated amongst the farmers and frightened them upon this subject. I want to say'that no subject of my correspondence has been so prolific in the last six months, since this matter has been under considera- tion, as the urging from our people that the officers take up this mat- ter and lay it before this Congress. The feeling is not as to the advisability of protection or free trade, but as to the absolute in- equality of this proposed treaty. Now, the word '^ reciprocity " has a good sound, and as patriotic people we are anxious to do what is best for the country, but an analysis under the definitions of Blame and McKinley and those who have spoken for reciprocity, the best definition we can get from it— we don't see in this treaty reci]:>rocity. It is not free trade between friendly nations upon noncompetitive articles, but it is upon competitive articles. We have heard the claim, we need not go on to discuss that the tariff wall between us and Canada was too high and it should be lowered, 93285— No. 1—11 3 34 EECIPBOCITY WITH CANADA. and we are here to say that if in your judgment that is true, let it be lowered equally and maintain its present symmetry. Do not dig the hole in one particular place. This treaty absolutely strikes a blow at agriculture and urges protection upon all the rest. We are not going to say that free trade Avould not be desirable, but we do not know why special concessions should be made to the Canadian Gov- ernment more than any other free government. But the main thing that we want to say and impress upon you to-day is that there is a feeling as widespread as our farming regions that this is unjust, unequal, and we are going to hold the men' responsible who have struck this blow at the agriculture of America. It is said that it is an experiment, but we protest that you can not afford to experiment at our expense. We do not need to go into the schedules. We do not need to ask the question about the price of machinery. Those are technical questions that the proposed tariff board or the wisdom of your committee can handle better than our- selves. But we do say that following the agitation that has gone over this country for the last two or three years about the decay of agriculture and the danger of the very soon overtaking of the consump- tion with the production, and shutting off our foreign exports, that we have got to increase the agricultural productions in these United States, and the only way to do that is to encourage and to assist agriculture, and with that promise in the minds of the statesmen of this country it seems that it is a fatal blow to strike at our industry, which this bill certainly does. It is said that sometimes you should sacrifice for the public good. We can not afford to stand that sacrifice. The question has come up here this morning in regard to the lowering of those other duties, and that we are overtaxed ; and all we have got to say is, if the tax that has been pronounced by one of the greatest statesmen, that the pres- ent tariff schedule is absolutely just and the best this Government ever had, and in your wisdom it should be lowered, it should be lowered equally. If it was right before, this is certainly making it wrong. It is resulting not only in discouragement to the agricul- ture of our State and other States, but it has resulted already In the lowering of land and also of the products that we have to sell. It may be only an incident, but it is the straw that shows which way the wind blows, that a neighbor of mine, who is in the real estate busi- ness had a customer from a western State for some of our lands for growing alfalfa. They wanted the alfalfa farms, and they were going to sell the farms in the western States and buy the farms in our country, and the date was fixed when this bill passed in the Plouse of Eepresentatives, and the deal was called off and the reason given was that they did not want to invest in land with this uncer- tain prospect of legislation. Further, the parties that we were to sell our land to for wheat growing have already bought land in Canada, and we have lost our customers. To-day, in the city of Syracuse, the center of our State, is a large store occupied by the agricultural ex- hibits of Canada for selling Canadian land and advertising for prospectors, and the great point they make in the placard on the wall of the store is this : These are the products that can be produced in Canada, and with the United States market at your doors, which you are going to have as soon as the treaty is made— the place for agriculture is Canada and not the United States. KO-ICIPEOCITY WITH CANADA. 35 It is a discouragement to American agriculture. It is unjust and it is unfair. When we asked one of the advocates of this measure if this were to be done in the interest of the consumers, why the reduc- tion was not made equally on flour as it was on wheat, and he said that we did want it and we pleaded with Canada for it, but they would not have it — admitted the fact that it would be just, and that they worked for it, but Canada would not have it — and we are here to say in the name of the farmers of our State, and not only the farmers but the general statesmen of this country, we are here to say this: That if the proposed treaty can not be ratified with Canada on a fair basis, then we won't have any. And we ask it in the name of agri- culture, and in the name of land values, and in the name of the encouragement of that agriculture which must be cultivated, which must be broadened to feed the world. We ask you to kill this pro- posed treaty. Senator Williams. Give me the products that would be reduced in price by the enactment of this law. Mr. Gyles. Wheat must, of necessity. Senator Williams. Wheat is one. Mr. Gyles. Butter has already shown a marked decline. Canada is one of our principal competitors. It has been stated — and pos- sibly when we get into figures we can figure them out rapidlj' — that the whole dairy production of Canada is but a very small portion of the dairy consumption in this country. Senator Williams. We have wheat and butter. Wliatelse? Mr. Gyles. Cheese. Senator McCumbee. I would like to have him finish. Mr. Gyles. I have not quite finished. I wanted to state this: I have in my possession a letter from an exporting dairy concern in Montreal in answer to some of our creameries in the northern part of the State about the price of butter. They make that some months in advance, you understand. We can not make that until we are fully settled upon this proposition, but if butter and dairy products are allowed free from Canada the entire output of Canada will be marketed in the United States and their home consumption supplied from other territories. Senator Keen. Bring it here and file it with the committee. Mr. Gyles. We have it right here. The CiiAiEMAN. Eead it into the record. Mr. Gyles. This is a letter addressed to W. McGaulley, West Chazy, who has a large creamery, and it is from A. A. Ayer & Co. (Ltd.), exporters of butter and cheese. Montreal, March 2, 1911. W. McGatjlley, Esq., West Chazy, N. Y. Deae Sib : rvemenibering past transactions, it affords ttie writer great pleasure to receive your letter of March 1. In a long experience we have never found it more difficult to size up the market than it is to-day. The cream shipped to the United States during 1910 would have made up about one hundred and fifty thousand 50-pound boxes of butter, and, of course, to that extent is the cause of the surplus in the United States to-day. The total excess of milk products in Canada for export, whether it goes into cream, butter, or cheese, is equivalent to about 2,000,000 packages of butter. During the past season we shipped out as above equal to 150 000 to the United States, about the same quantity to British Columbia 36 EBGIPEOGITY WITH CANADA. and the Northwest, and about 30,000 boxes to England, besides 2,200,000 boxes of S4-pound cheese. If the reciprocity treaty comes into force the butter for the Northwest will mostly come from New Zealand, and the way will be open for us to bring in a large quantity from other countries into Canada, so that, if your marligt can absorb, say, a million packages more than it did last year at, say, 22 cents per pound, Canada will probably be large importers of butter from other countries for our home consumption. We think this will fairly cover the ground of the question you ask, and is the best estimate we can give of conditions as they appear to us to-day. Yours, truly, A. A. Ayee & Co. (Ltd.), Per A. A. A. Corner St. Henry and St. Paul Streets. PATEONS or HUSBANDKY, Cluir.y Onnigc, 9S1. (Presented by Seth Gordon, Dunn Farm, Chazy, N. Y.) (West Chazy, Marcli .',. This is more butter than New York City con- sumes. W.M. ilcGAULLEY. ) Senator Bailey. I think you read 150,000. Mr. Gyles. One hundred and fifty thousand 50-pound boxes. Senator "Williams. Just let me asli you to 20 on ■\Titli the list of jDroducts. Mr. Gyles. jMilk. In the State of New York we had an investiga- tion by the attorney £.>:eneral last year that demonstrated the fact that milk was being bought of the farmer at a less cost than the actual pro- duction for the same. The milk trains supplying the city of New York go to the verge of Canada on our side under the present tariff regulations. Take this down and they will go in, and we will still suffer in our milk sales by the Canadian competition, as provided in this treaty. I am not able to go through this list readily, because my remarks were not prepared. I did not know until 15 minutes before I came here that I was to speak at all. Senator Gallixger. How about cheese. Mr. Gyles. That is in the same list and Avill be lower, of course. Senator ({.'iLltnger. How about haj^ and potatoes? i^.Ir. G>les. ^ iiu can not lower potatoes much now, because they are away below the cost of production in this country. Hay has been lo-ivercd lo the extent of the protection upon hay in the general markets of the State to-day. Hay has been bought in Canada for just the (lifi'ereiice between that and the tariff, and our American hay to-day is less by %-2. a ton than it was before the agitation upon this subject. Of course, these are technical questions. Senator Williajis. They are so sure that this reciprocity bill will pass the Senate that they are lowering the price already. Mr. (rrLES. ^'es, sir; that is right. I sup[X)se. Senator, that there ne-»er has been a discussion or an agitation of the change of tariff duties that has not affected s])eculative]y. at least, the prices of the products covered, whether manufactured or agricultural. Senator Williajis. Oats will not be reduced. Mr. (Jyles. "We fear tliei-e is no reason whj' they would not. Senator Williajis. Barley? Mr. Gyles. Certainly. Senator McCumber. Do you know what the difference between bai'ley on the Canadian side and your side in New York State is? Mr. Gyles. No ; I am not able to answer as to those figures exactly. I would not want to be quoted, unless accurately. That ouo-ht to be EECIPKOCITY WITH CANADA. 37 stated accurately. I do not want to work any bombast on the com- mittee. Senator McCumber. These quotations from the Northwest that he quoted were 28 cents per bushel better on the American side than on the Canadutn. That was over a month ago. Mr. Gyles. My general knowledce of that is— because my business at home, outside of being secretary of the grange, is the manufacture of butter, and our customers are complaining bitterly now at our price of butter, because the price of feed that is being bought is very high— very much higher; and they say that if thev skin us in the butter they may save us on the feed, because we can get oats and corn and other feeds cheaper. ,S", it seems there are two sides to it. But the main point that we want to impress on the committee, which I believe that you did not grasp fully, is that it is not a Republican question, it is not a Democratic question, and it is not an insurgent question. It is a policy question, and the farmer instead of being an unthinking class who will take what is offered to them are thinking, and the last few years they have shown that they are thinking and studying on this matter. I 'come to you and say to you, in all candor and all honesty, the farmers are thinking about this subject and writhing under the injustice that this treaty proposes as they never were before upon any subject, and they are going to hold somebody responsible. Senator Bailet. That will be up to the President of the United States, will it not? Mr. Gti^s. I am not here to talk about him. Senator Gallinger. It depends upon who votes for it, does it not? Mr. Gyles. ^Vliat? Senator Gallinger. It depends upon who votes for it, does it not? Jlr. Gyles. I would tell you I would not like to be either the President — I don't know as I ever shall be. [Laughter.] Don't laugh; that was no joke. I do not know. I would not like to bo a United States Senator and have to go back to the peoj^le and say that we were vrilling to sacrifice all the agriculture of this country upon this little matter. I don't think I Avould like to do that. Thank you, gentlemen. ilr. Hull. Briefly. I want you gentlemen to feel that we are not here to represent the Xational Grange in an argument on protec- tion or free trade, but we do, as an organization, feel that if all other industries are to be protected we should be protected; that if we are to stay in comeptition in the matter of free trade, if v.'e are to have free trade, it is no more than plain justice and fairness and righteous- ness that the other fellows should have free trade, too. Senator McCumber. Eight at this point, in relation to introducing your new witnesses, I think a suggestion would be perfectly fair to them. What the committee wants in all instances are facts. AVhat we want, too, is to see wherein the farmer will be injured by this reciprocity agreement; not that he dislikes it; not that the farmers are so much opposed to it, but why are they opposed to it; and not the question so much whether there is too much tarilf upon this and upon that article at the present time, as it is wherein will the farmer be injured by this reciprocity agreement. Senator Kern. That is what we want to hear. 38 EECIPEOCITy WITH CANADA. Senator Bailey. I do not agree that you are required to stop there. I am perfectly willing to hear what tlie sentiment of the farmer is, even if he be mistaken about it. [Applause.] Senator McCumber. The suggestion was not that we should cut out any sentiment on the matter, but that we should have more facts. There are facts. I repeat there are facts and facts that can be given to show that they will be injured, and we want them here. Mr. Hull. The fact that we want to prove is that the cost of protection on our side is actually higher than on the other side, and we want to bring witnesses here to prove that. "We take it, too, as suggested by Senator Bailey, that you consider yourselves servants of the people, in a way at least, and it is fair that we should come from the West and tell what the farmers of the West think about this as the Senator suggested. Senator Clark. If you will pardon the suggestion, Senator McCumber, I think in the presentation of the matter it is quite proper that they go into the detail as to how they would be affected by the duties upon other items in the bill, as well as upon their own items. Mr. Hull. We have a fair understanding that Senator Williasis. Yes ; because that is a part of the cost of pro- duction. Senator Clark. You, perhaps, do not get the idea. They propose under this theory to have the duty on their products and the duty on what they purchase bear a corresponding reduction. Senator Williams. That is all because what they purchase is an integral part of their cost of production. Mr. Hull. From our viewpoint, it may be well to say, here, that as an organization we are not a political organization. We do not pro- pose, representing this organization, to discuss the merits or demerits of free trade or protection. If you wish to get at the individual ideas, that is all right ; but the committee representing the grange are composed of both Democrats and Republicans, free traders and pro- tectionists, and we want you to understand that we are not here repre- senting the Republican Party in the matter of protection or the Democratic Party in the matter of free trade. Senator Gallinger. You just seem to exclude protection. Mr. Hull. We do ; if we are to have free trade we think that the other felloAvs deserve free trade, and that e^'erv reason that can be given for free trade for the farm products can be given for manu- factured products; and every reason upon this earth that can be given for high protective tariff upon manufactured articles can be brought just as forcibly to apply to the farm products; and if that is true then it is a plain, palpable injustice to force upon us free selling in free-trade markets and buying in protected markets, and the thought of Mr. Bachelder in bringing this list is not an argument that you should do away with that, but an argument that if we have to have free trade on all products, that we should then have reason- able protection upon the other hand ; that if we are to compete with the felloAvs who buy upon a lower basis, then we should buy upon a lower basis; and it is up to you to know wliether protection protects or not. I would likeMr. Raine, of Missouri, master of the Missouri State Grange, to testify before this committee. KECIPfiOCIIY WITH CANADA. 39 STATEMENT OF MR. OSCAR RAINE, MASTER OF MISSOURI STATE GRANGE, AND MEMBER OF THE EXECUTIVE COMMITTEE OF THE NATIONAL GRANGE. Mr. Eaine. Mr. Chairman and gentlemen, I come before you rep- resenting a State from which the expression goes out that " You will have to show me." Last year we held a convention and changed that saying— and probably it has not yet reached Washington, and I am not here to introduce that to you this morning — but it is " Show you." This expression " Show me " came from Missouri, and we changed it to " Show you." I am not here to introduce that to you this morning, but to loring to you some ideas that we have on the question we have before us. I am not here to give you statistics and a detailed account of why we are not in favor of that question. I am here to give you some of the reasons, as given out by the farmers in our State, both the unorganized and the organized farm- ers ; and we wish to speak for both because I have evidence from both sides. In our grange organization work we have been endeavoring for years to induce the boys and girls to stay on the farm. We "have lost in the last 10 years over 6,000 farmers from the farms in Mis- souri, and we are trying to induce that population to return. Our progress will be slow if you do not reduce the price of manufactured articles, or the things the farmer has to buy, in the same ratio or bj' the process as you reduce the things he has to sell. By way of illus- tration, our farmers do not favor the bringing of wheat into this country free and as soon as it goes through the mills to put on a tax of 50 cents a barrel. We think that if there is reason for a change that you should see that the farmer is not discriminated against in its adjustment. Our organization for years has advocated an equitable adjustment of our tariff laws. There are two questions uppermost in the minds of our farmers. One has been agitated for years, and that is, good roads; and had you been there in the month of February you would have realized that it is timely. The other is the question of Canadian reciprocity. If you have not been among the farmers in the last 10 or 15 years, you will find that quite a change has taken place in the general make-up of the farmer's business. He is studying improved agri- culture, and by reading the daily papers is being posted upon the events of the day; and, as has been said, it is well and timely for you to listen to public sentiment and so modify this measure in its final adjustment to the extent that no class or set of individuals shall have special favors over any other class. Now, where I go and talk this question with our people the strictly party man is opposed or in favor of the bill as his party opposes or favors it. But when I talk to the people, to the farmers, that are studying, unbiased, without an excep- tion I find them opposed to it in its present form. Our organization has sent to your honorable body resolutions stating our position upon this question, and I am now going to present to you a preamble and resolution that was passed at a mass meeting down in the southeast- em part of our State. The chairman of this convention is a man who has been a very active farmer during his time in that section, 40 RECIPROCITY WITH CANADA. and a large wheat grower as well as a large cattle raiser in the past. I will read you their resolutions. This meeting was 'called on last Wednesday and this was issued on the 17th of April, and this was the Saturday previous to this meeting called against the adoption of the Canadian reciprocity. A. J. Matthews was elected chairman and A. A. Ebert was chosen secretary; Senator John E. INIarshall, B. ilalcolm, and Green B. Greer were appointed to the committee on resolutions. The resolutions adopted were as follows : We, the citizens of Siljeston, Mo., and vicinity, in convention assembled, view with much alarm a measure now before Coiitrress, known as the Canadian reciprocity treaty, whereby the products of the farm will be placed on the free list, the object and intent of which is to reduce the price of farm products. We condemn the action of our I'resident, V,'illiam H. Taft, in unmeasured terms for his action in bringing before Congroi^s a measure whereby the products of the farm are assaulted and the profits of the farmer are destroyed. We are painfully aware of the fact that, owing to such favorable conditions, Canada has in the past been able to pay the duty and make large shipments of cattle and wheat to this country, and we can not but believe, were the tariff barriers withdrawn, the effect would be ruinous to many of our agricultural sections. It has been only the last few years the farmer has been able to keep his head above water and make ends meet, and now, when the farmer is prosperous, when the products of the farm have advanced and the man who went half starved and lived on bacon and beans and wore for his clothing a suit of over- alls, like the good soldier he is, stayed with the greatest arms of the world — the farm — and when the battle has been won the farmer is able to have for his sustenance and for the little ones (iod gave him to support and protect, decent clothing to wear and sutHcient and wholesome food to eat. we find ourselves face to face with a condition which says in effect, if not in words, " Tou farm- ers are making money and we do not like for you to prosper : " Therefore be it Resolved, That we now warn our Representative in Congress, J. J. Russell, that, in this hour of distress when the farmer needs his help, if you turn your back on this vast and important industry you need not be surprised if they turn their backs to you when you are most in need of help. Though we may be ignorant, may be trustful and confiding, it does not take a philosopher to see that if, by some treaty or agreement, you take from 10 to 20 cents per bushel from the price of our wheat it will surely destroy our profits. No amount of sophistry, no matter from what high source it may come, can con- vince us to the contrary. AVe appeal to our United States Senators, Messrs. Stone and Reed, to oppose the reciprocity treaty when that measure comes before that body to the end that the farmers may not be discriminated against, and that their profit, though meager it may be, will not be destroyed. Gentlemen, as I said to you, I am only here to give you, in my feeble way, the expression of the farmers of our v'^tate. The question is with you gentlemen as to the future, and we hope and trust that you gentlemen will look into the matter fairly and squarely. Our farmers also believe that we should be friendly and cordial in this matter, and if ^^ew York, if Michigan, and those States along the border line stand up and say that it is going to injure us, the time may come when the question will rest on Missouri and on the Cen- tral West, and we will want those people to help us ; so that it will not injure us to the extent it does those people in their dairy prod- ucts, and such as that. We feel we ought to stand together as a band of farmers, and be one among this number to protest against this measure. Senator McCuaiBER. As a matter of fact, if it injures the farmers of New York, Wisconsin, and Minnesota, will it not indirectly injure your farmers, and injure them more in future years? Mr. Eainey. Certainly so. We feel that wav. KECIPKOCITY WITH CANADA. 41 Senator Williams. You feel that the Canadian reciprocity^ will reduce the price of wheat? Mr. Eainet. "Will reduce the price of wheat? Well, I might say that ; I might think that way, and yet I am not prepared to say, be- cause I have not studied these statistics, but our people believe it will. Senator Willia:ms. Do you think it will reduce the price of oats? Mr. Eai^ey. Yes, sir. Senator Williajis. Do you think it will reduce the price of barley? jMr. Eainet. Yes, sir. Senator Williams. Do you think it will reduce the price of cattle ? Mr. Eainey. We think it will have a tendency to do so. Senator Williams. Do you think it will reduce the price of horses ? Mr. Eainey. Yes, sir; Canada certainly thinks so. A few years ago we had apparently a fair example of what Canada would do had she an opportunity. I happened to be at the head of our agri- cultural department there at the State fair, and they sent down there a gentleman, who was a very courteous gentleman, to present the ex- hibits from all that Manitoba country, and our exhibitors from the State of Missouri raised such a howl about it in about two years we had to exclude him from the building. We have hundreds of our young people, young men that have gone to Canada and bought homes, bought lands there — right from my own town — they have gone there and bought that cheap land ; so that is the way our people feel. Those people are scattered all over our State and are not from any one section. Senator I&;rn. What is your principal wheat market ? Mr. Eainey. Most everything is shipped to St. Louis from my section of the State — Kansas City and St. Louis are the principal markets. Senator Kjien. Is it true that the price of wheat for the past three months has uniformly been from 5 to 10 cents higher in Winnipeg than at Kansas City ? Mr. Eainey. I am not posted on that; 1 am not prepared to answer. Senator Ejern. I call your attention to it, and on April 20, 1911, that wheat in Winnipeg was 92f cents and in Chicago 89 and Kan- sas City 84. Senator McCdmber. What grade was that ? Senator Keen. The same grade — I am not certain about that. Senator McCumber. I do not think Canada raises the same kind of wheat. Mr. Eainey. They raise harder wheat than we do; I understand that. Senator McCumber. The only fair way would b* to compare it with Minneapolis. Senator Kern. I am asking him. This was taken from a Chicago paper. I just ask him if he knows. He says he don't know what the price of wheat is. Senator Bailey. Do you know whether Canada raises harder wheat ? Senator Kern. I know some parts of Canada raise harder wheat. Senator McCumber. Is it not equally true that the price in Minne- apolis is considerably above St. Louis ? Senator Kern. Yes, sir; unquestionably. 42 KEGIPEOCITY WITH CANADA. Mr. Hull. Gentlemen, if it be your pleasure I would like to intro- duce Prof. T. C. Atkinson, of West Virginia, a member of the legisla- tive committee of the National Grange and master of the "West Vir- ginia State Grange and connected with the Agricultural University. STATEMENT OF T. C. ATKINSON, MEMBER OF THE LEGISLATIVE COMMITTEE OF THE NATIONAL GRANGE, AND MASTER OF THE WEST VIRGINIA STATE GRANGE. Mr. Atkinson. I appeared before this committee a few weeks ago, and I notice by the present personnel of the committee that this com- mittee, like all other human, changes somewhat. When I was pre- sented just now as a professor of agTiculture, it was hardly a fair presentation of my personal interests, having been all the years of my life a practical farmer, and for 16 years master of the State Grange of West Virginia. I am first and foremost a farmer, and yet nine months in the year I try to teach to the farmer boys of our State some of the scientific principles of agriculture, and I have tried to induce the farm boys of my State and of the country to go back to the farm; and during recent years we have heard a great many things said through the press and in various ways, all of it carrying the burden of thought that it is calamitous to our country's welfare — the statistics show it — that the farm population in the best agri- cultural section of the country is actually decreasing. Somehow or other the farmers of this country have come to believe — it may be sentiment, but a universal belief in a Democratic country' means something — and it is almost unanimously the belief of the farmers of this country that this Canadian reciprocity is not reciprocity; that somehow or other the farmers of the country are not getting a square deal in that matter; that behind this proposition there was a cause, and in all probability in that cause was the great demand from our city people for cheaper food products. There has been going up from the congested centers of population for a good ma,ny months a great howl. I would like to say, about the cost of living, and somebody conceived the idea that that clamor was the '' voice of God " demanding that Isaac, the son of Abraham, the creator of protection, should be sacrificed, and so somebodv, the father of this special privilege, this protected interest, these" great corporations, heard the voice of the people— they conceived it to be the "voice of God "—somebody conceived the 'idea that Abraham must sacrifice his son Isaac; and he sent out into the byways to sacrifice this protected son. Then another voice was heard, which they conceived to be the "voice of God; " perhaps they said "No; do not sacrifice that protected son." But out there with his horns hung in the brambles was this American farmer, and they said " Go out and sacrifice him." [Laughter.] That same old rain has been sacrificed ever since the proposition of protection was conceived, and is now proposed to be sacrificed to the glorv and mao-nitude and majesty of one of King George's chief sections'. This scriptural illustration is not an overdrawn matter. The far- mers in this country have never received much benefit at the hands of protection for a number of reasons, largely because of the fact that we had a great country that was unoccupied, and all we had to do was to move westward still farther, and the West was con- EECIPROGITY WITH CANADA. 43 stantly in competition with the higher-priced land nearer the centers of consumption, and we farmers were patriotic enough to say that that was all right, to develop this great country, and then as the land was mainly occupied there came upon the country the spirit of irrigation, and so the great American desert was brought into competition with the farm lands of the country, and we were patri- otic enough to say that that was all right ; and then we heard about the abandoned farms in New York and New England, and the price of farm lands in the East went down because this magnificent Gov- ernment is willing to spend millions to irrigate the barren lands of the West. Now, we hear a proposition to drain the swamp lands of the whole country at the Government expense, and bring those lands into competition with the lands of the East and the high-priced agricultural lands of the country; and maybe that is all right. We are willing that they should be brought into competition because of the general weal and the common welfare of our country. But when the proposition comes to bring in competition with the farm lands of the United States all the farm lands of Canada and all the farm lands of South America and the balance of the world, then we begin to get interested. We believe that our patriotism is not called upon to make that sacrifice. Some things are happening in this country that are interesting. Take my own State — not an agricultural State largely, but 11 of the best agricultural counties in that State — to show the decided falling off in the population in the last 10 years. The great States like Iowa and Missouri and others of the Central Western States show that agriculture is losing part of its citizenship. There must be a reason for that. There is another thing Senator Claek. Before you pass from that, would it annoy you if 1 asked a question? I have been thinking for some information on that very subject. I have been informed, of course, that the States of Missouri and Iowa have lost in their agricultural population of the last 10 years, and yet, if I have got the right notion of it, there never has been a 10 years wlien the agricultural interests were so universally prosperous in those States as during the past 10 years. I would like to get that straight in my own mind as to what was the cause, or whether I am correct as to my notion of the status of the farmers in the last 10 years. Mr. Atkinson. I was going to answer that in the next sentence — the Senator's question. There is no objection to the interruption. Senator Clakk. You will pardon the interruption. Mr. Atkinson. Of course, there was a reason for this fact that the last census has brought out, and it is brought out right alongside of another fact — that is, that the farm lands of the United States have largely increased in value. In many places they have doubled in value. The State of Indiana shows an increase of 94 per cent, I believe, and my own State nearly double in the value of farm lands. Those values may be fictitious to some extent. The cost of labor has more than doubled in my own State — all farm labor — the cost of labor in nearly all of the agricultural States has practically doubled. Most of our lands have been depleted in fertility to some extent, and we are buying fertilizer to the extent of millions of dollars annually ; and the cost of production to this country has more than doubled when we take into account all the essential elements of production, 44 EECIPKOCITY WITH CANADA. tlio, price of land, the cost of machinery, of buildings, of fertilizers, and of labor. Senator Williabis. Professor, I want to ask you a question. You mean the cost of the ordinary farm hands in "West Virginia has doubled in 10 years? Mr. Atkinson. Yes, sir. Senator Williajis. "Went up from about what? Mr. Atkinson. Went up from about 50 or 75 cents to $1.50. Senator Williams. To $1.50? Mr. Atkinson. Yes, sir. Senator Williams. That is in harvest time? How about the hands hired by the year? Mr. Atkinson. Hands hired by the year get about a dollar a day where they formerly got about 60 cents. The Chairman. With their board ? Mr. Williams. With their board ; yes, sir. Mr. Atkinson. Statistics show that farm lands — any of you can refer to the statistics, but for my own State it will show just about double for the farm labor. I refer to the census. But to complete the answer. The increased price of farm products in this country have nothing like doubled. The lowest that wheat has ever sold anywhere east of the Mississippi Eiver was about 50 cents, along in 1890, " the good old Cleveland days," as we used to call them. The price of wheat during the Civil War will average around about 90 cents, but taking 75 cents as a fair average for the price of wheat, we now find it about 90 cents, an increase of something like 15 cents per bushel the present 10 years over the last, and they were a calamitous 10 years — I mean the preceding ten. There has been an increase of about 15 cents a bushel on wheat. It has nothing like doubled, and yet the cost, taking into consideration all these elements of cost of production, have more than doubled, and the only reason that farmers seem to be jarosperous to-day is because the men who procured the lands when they were cheaper — maybe their grandfathers procured them when they were worth Sl.4rj an acre — and where they have inherited them they have continued to go up until they have reached in many places, like Illinois and some other agri- cultural sections, at least $200 per acre, and the farmers are finding when they try to pay dividends on their lands at the price they can now get for them that they are worse off than they have ever been before, and that is the reason why thej^ are leaving the farms They are selling those lands at present ]Drices and moving into town and living off the price they got for the land because it was absolutely impossible to make 2 per cent on the present price of the land after working 14 hours a day for about 365 days in a year. Senator Sjioot. Hundreds of thousands have gone to Canada to buy cheaper lands. Mr. Atkinson. Hundreds of thousands have gone to Canada to buy cheajier land, and remove this tariff awhile and more of them will sell these lands, and the inevitable result will be a surprising reduc- tion in the price of farm lands in the United States, I firmly believe. Senator Suoions. You mean to say that the farmer is making that onthe present value of his invested capital in the lands at current prices ? jMr. Atkinson. I did not quite hear you. RECIPROCITY WITH CANADA. 45 Senator SiJtMONS. About 2 per cent upon his investment. Is that what I understood you to say ? Sir. Atki^'son. Tlie farmers on their investment at current prices are not making 2 per cent. We have made some investigations in the Department of Agriculture in connection witli the College of Agri- culture of Minnesota, which went into that matter much in detail. Senator McCumber. You mean to say that they are making 2 per cent if they will estimate their own wages, as well as the wages of their family at the current rate? jNIr. Atkinson. I do not believe they are making 1 per cent on that basis. I do not believe that the agricultural United States to-day^ on a fair basis of value for the service of the farmers themselves and their families, are making 1 per cent on the land values of the country. Senator McCxtjibee. Is it not true, if I may just ask a cjuestion here, that if you paid as much — allowed as much for the farmer's son as the son would receive working in a dry goods store — and if you would allow as much for the wages of the housekeeper as your colored cook would get in the city that every farmer would be run- ning behind? Senator Bailey. Did you ever know of a farmer who accumulated enough to give any of it away like a certain gentleman who made a great future out of the steel industry ? [Laughter.] ilr. Atkinson. No, sir. Senator Heybuen. I would like to ask you what the tendencies are under the conditions you have stated to substitute tenants for land owners on the farms? ■ Mt. Atkinson. Statistics show a decided increase during the last 10 years of tenant farmers. Senator Clakk. Do j^ou think that is because of the fact you have stated, or is it not because the land has grown so in value that the farmer, the man who owns the farm, can live without work ? Mr. Atkinson. He can afford to sell the land and live on the interest. Senator Heybi en. Live on the interest? Mr. xVtkinson. Yes. I would like to cite an illustration to show the point. We have a gentleman connected with our agricultural college who came to us from Colorado about three years ago. His father-in-law is a large land owner a few miles out from Denver, and he sold a piece of land and received half the price, with deferred payments for the other half, and the interest on the deferred pay- ments paid him more than he had ever been able to make out of the land; that is. the interest on half of the land paid him better than he had ever been able to make out of all the land. So he moved into Denver and is living off of the interest of one-half and had the other half of his money invested. It was a considerable distance out from the city, in Arapahoe County. Senator Bailey. That would be practically the experience of every man who has owned farm lands and tried to manage them. He can sell them and take a partial payment, and the interest on the deferred payments will exceed what the land yields him ; and I speak from a personal experience. 46 EECIPEOCITY WITH CANADA. Senator Clahk. What becomes of the poor devil that buys the land. There is a demand for this land; somebody evidently thinks they can make something out of it. Senator Bailey. No, Senator; you go to that section where is the highest-priced land in America, which is the blue-grass region in Kentucky. Senator Clark. Except the fruit region of Idaho. Senator Bailey. There are only four counties there, and in places the value of the land is $250. There is not a man that buys a farm in the blue-grass region that does not know that he has no chance of making 4 per cent, and they are bought by men who largely use them as playgrounds. Senator Clark. That are bought for that purpose; but the great bulk of farm lands are not ; they are bought for agricultural purposes. Senator Bailey. But there is no man that owns them that makes the current rate of interest out of them. You can go to the corn lands of Illinois, the finest corn region in the world, and there will not a landowner there tell you that, leaving out of the calculation the deterioration of his land, its diminishing productive capacity, it would pay him the current rate of interest. Senator Clark. I have no doubt but that there is something wrong. I am trying to find out where the difficulty is. Senator Bailey. The professor has just come back to the idea that the farmer is getting the fat of the land. Senator Williasis. It is largely a question of the character of the labor. A man can take the swamp lands of the Yazoo Delta and lie can make 10 or 12 or 15 per cent of what they cost if he is a careful cotton planter and knows how to do it. It is because the lands have never gone up in value to what they have elsewhere. I mean the lands of equal fertility, as in Illinois or Iowa, owing to the charac- ter of the labor in the country, which is altogether colored. The land values have been kept down, and as the land value is kept down, of course, you can buy those lands at from $25 to $50 an acre. You can go out m some of the best farming lancls of the South, in the hilly parts of Alabama and Mississippi, and what is called the prairie country, and buy that land from $12 to $25, and until the character of population changes it will probably never be very much more, be- cause the white men will not come down and settle with the negro labor in the negTo neighborhood. There are about as manv condi- tions in land in the United States as there are in all Europe put together, with all its different peoples, and about as many different statements as to what farm labor is and what it gets. In my State farm labor has increased 50 per cent in the last 10 years; in your State it has doubled. That is owing to the fact that you have a very much more efficient farm labor, and your farm help is much better worth what you are paying for it than ours is worth for what wc are paying for it. Mr. Atkinson. We have a competitive demand for our labor that you probably have not in our coal and oil and gas fields. Senator Heyburn. There is a clear distinction between the land- owner and the class of men who do not own the land, but who are just as o()(id farmers as the land<.)wners would be. Is it not just as important to consider the renter as it is the owner of the land? Mr. Atkinson. Undoubtedly. RECIPEOCITY WITH CANADA. 47 Senator Bailey. There is no renter that does not hope to become an owner. Senator Hetbukn. And none that realize Senator Bailey. Plenty of them. Although it is true that the tenant as a rule suffers rises in value, in our country we give one- third and one-fourth — one-fourth cotton and one-fourth grain. When this land is worth $150 or $-200 they give half, and they must pay a higher rent ; so the price of land is no benefit to the tenant. Senator Ctjllom. The rise in the price of land that has gone on in the last three or four years, it is falling now instead of rising. Mr. Atkinson. Falling? Senator Cullom. Growing cheaper. Mr. Atkinson. Yes, I think it is. Senator McCujibee. A-NTien did it begin to get cheaper, and where ?' Mr. Atkinson. In the last six months there seems to be a tendency for lands to gravitate downward. I don't know why this is. My only figures are the census figures. Senator Cullom. The farmers find that they can not make any- thing out of it at $200 an acre, for instance. Senator Bailey. There will always be somebody to buy; it won't go down on that account. It is something I have never been able to understand, myself. However, I am subject to that same infirmity. A man will not give up his land because it will not pay, as long as he can hold it; I do not care whether he lives off of it or on it. Senator Kerx. One reason was given me by an Illinois farmer. Land is selling in Illinois exorbitant in prices, and they are coming into our State and paying very exorbitant prices, and I asked one farmer why he could afford to pay that sort of price for that sort of land. That was a year or two ago. He said : " Well, we are not sure about banks and trust companies, but if we have our money planted in good, black land over in Indiana and Illinois, we know it is abso- lutely safe." That was the reason he gave. I do not know but what there is a good deal in that. Senator Bailey. Every man likes to be a landowner. Mr. Atkinson. I expect I have occupied time enough. I just want to call to your attention one fact in conclusion. I think I stated awhile ago that up to this time the farmers had not received much benefit from protection. They have been patriotic enough to be pro- tectionists very largely because of the idea that the building up of manufacturing plants and things of that kind gave us a home market, and so, indirectly, we have assumed that we have received some bene- fit; but as long as we had unlimited free land the farmers could be protected. We have been deluded a good deal with the claim of farmer protection, but when the land is all taken up and occupied by farmers as it is now the farmers of this country are coming into a condition when protection from now on will mean something to them. If the statistics are true that in 15 years we are going to catch up with our present production, then within the next 10 or 15 years we will be an importing Nation of food products, and then we get in a position where protection begins to protect; but just at the moment when it seems to begin to protect, that son out " in the bushes " is sup- posed to be sacrificed. Senator Bailey. Whether a question of protection or not, it must be true that if those duties do not increase the prices which the 48 RECIPEOCITY WITH CANADA. farmers receive for their products, then they can not possibly increase the prices which tlie consumers pay. Mr. Atkikson. Undoubtedly not. Senator McCumber. I might add also if the farmer is getting no benefit now from this protection, then the public can get no benefit from having it removed. Mr. Atkinson. Certainly not. That question is so absurd in my mind that it does not enter into the problem at all. Senator Heybuen. Is it not a very important thing to the farmer that he should have his market protected against the invasion from the outside? ilr. Atkinson. Undoubtedly; and now, as I said, with the pres- ent conditions that are developing, he begins to have his market at home, and then he begins to be interested in keeping out the other fellows from the market. Senator McCumbek. Just before you close — you just touched on one point here — and I would like to get at the practical side of every question — and that is the matter of fertilizing. What is the cost of fertilizing an acre down in your State? Mr. Atkinson. Well, that is susceptible of many answers. It depends what the fertilizer is and how much of it you put on. Senator McCumber. But I suppose you can give us a general idea. Mr. Atkinson. Yes; I can give you something like an average; it will run about $2 an acre. Senator McCdmbee. About $2 an acre. Senator Clark. 'What do 3'ou use? ilr. Atkinson. Take acid phosphate, for instance, 16 per cent — 14 or 10 per cent, Mhich is high grade jjhosphate fertilizer, and it can be bought in carload lots at about $1 for each 1 per cent. Senator McCujibee. Follow it out. ilr. Atkinson. About 200 pounds to the acre. Senator .McCumbee. How about Canada. How much does it cost her for fertilizer? ilr. Atkinson. They do not buy it. Senator jMcCi^mber. Very well; then we are laboring to that dis- advantage, as compared with Canada, of $2 an acre for fertilizer. Mr. Atkinson. We are producing less wheat annually, notwith- standing our purchase of fertilizer, than we did formerly, and the best information I have about the wheat production of Canada is that they are producing just about 75 per cent more per acre without fertilizer than we are, taking our wheat section, with the use of fertilizer. Senator McCumber. It is true, then, that the Canadian farmer has the advantage over you of $2 an acre in the matter of fertilizer alone? Mr. Atkinson. I think so. Senator Claek. From where do you get this fertilizer, Professor? Mr. Atkinson. It comes mainly, acid phosphate fertilizer, from Tennessee and South Carolina and Florida. Senator Clark. Do we import any of it ? Mr. Atkinson (continuing). And through the fertilizer trust. By the way, it is a protected trust. If I hadlime I would like to talk fertilizer, but it would take a week to do that. KECIPROCITY WITH CANADA. 49 Senator Clark. I would like to have you take a week. Senator Kern. Tell us something about that. Mr. Atkinson. There is no question but what the fertilizer supply in this country is controlled by corporations that are essentially trusts. We buy our potash — that is, the potash that is used as a fer- tilizer, practically all, outside of what little comes from wood ashes — - from the German potash fields, and it is controlled by the German potash manufacturers, who have their headquarters in New York. The nitrogen that goes into the fertilizer comes almost exclusively from the nitrate beds of Chile and South America, and is controlled by the Nitrate Trust, and the American Fertilizer Co. practically con-- trols all the acid phosphate supply ; and the farmers of this country are at the mercy of the fertilizer trusts and corporations in this country to the extent that there is no other source of supply. The entire source of supply of fertilizers used in this country is controlled by corporations. Senator Cilark. Professor, right there, are you aware of the vari- ous deposits of phosphate in Senator Heyburn's country, Idaho, and other parts in that section of our country? Do they find their waj^ east? ]Mr. Atkinson. From what country? Senator Clark. From Idaho. Mr. Atkinson. I think not, to any extent yet. Senator Heyburn. I think the transportation question precludes that I do not think they reach the Eastern States. They are being held idle by the Government under Executive order. Mr. Atkinson. And are not much developed and, as has just been suggested, transportation charges would probably exclude it from the East. Senator La Follette. If it had not been retained by the Govern- ment, it would have been operated by the trust before this. Senator Heyburn. The trust that controls this phosphate is the Executive order. [Laughter.] Senator La Follette. That is a very good trust, and I think the farmers are very well satisfied to have that trust control it for awhile yet. Mr. Atkinson. I want to make this statement as a closing remark : Taking into account — and the last census figures will bear out this statement — all the cost of production, which I stated a while ago, to pay interest on the present land values in this country, the American farmer is worse off than he has ever been in the history of the American Eepublic. That is a strong statement. Senator Williams. Professor, you mean by that that he is making a lower dividend upon the value of his land ? Mr. Atkinson. That is it. Senator WiLLiA^ts. But you do not mean he is worse off in any other sense, do you ? Mr. Atkinson. That is what I mean. Senator Williams. Let me ask you a question in order to illustrate. Mr. Atkinson. All right. Senator Williams. If the man were raising a bale of cotton to the acre, I will say — I instance that, because I know more about it — and his land was worth a thousand dollars an acre, and he was cultivating, 93285— No, 1—11 4 50 EECIPEOCITY WITH CANADA. say, 25 acres in cotton and he was raising 50 bushels of corn to the acre; on the balance that he was cultivating in corn, as a matter of practical common sense, he would be making just as much money as when he got a bale of cotton per acre as for 45 acres of corn and the land valued at $20. Mr. Atkins(jn. Xo; you lose si^ht of some important matters. Senator Williams. Of course, his dividend from the cotton land would be all gone, but the man would be making a better living if he were making more profit. Let us say, formerly he made $30, but now he would be making $45 — he is 50 per cent better off, whether the land has gone up or down in value. Mr. Atkinson. There are some other elements — the question of fertilizer, the question of wages, the question of cost of teams and of machinery ; and all those things enter into the cost of production. Now, then, he wants to see whether this thing pays or not, and that is the basis of the statement I have just made ; and I don't want this committee to get away from the notion that the American farmer, to-day, basing his income on the cost of production, is worse off than he has ever been in the history of the country. Senator Williams. I do not want to get away from this statement of mine, either. Mr. Atkinson. Do not get away from my point — the statement about the price of land values. Let him go out and buy the land on credit and give a deed of trust or mortgage on it, for which he must pay C per cent, and then let him make ends meet, and if he does not have the hardest job he has ever had in the history of American agriculture, just on the present price of land, I should be greatly surprised. Senator Williams. And yet, Professor, as a matter of fact, so far as you know, taking your own knowledge, is not the farmer to-day nearer out of debt, and has he not got more monev in bank than he had from, say, 1890 to 1900? Mr. Atkinson. That is, possibly, true. Senator Williajis. And more than he had from 1880 to 1890? Mr. Atkinson. Because he is not paying dividends on the price of his land. Senator Williams. Never mind why; but he is practically better off, whether his investments are paying better dividends or not. Mr. Atkinson. The man whose grandfather boucrht land at $1/25 an acre, and his father inherited it, and he inherited it. and he does not go m debt, he is probably better off than he has ever been before. But we are confronted with a condition, and not with what the man inherited, as a business proposition Senator Williams. I am not talking about that, either Mr. Atkinson (continuing). Compelling him to go out and pay a dividend. " Senator Williams. I am not talking about payino- a dividend My man did not inherit anything. ^ Mr. Atkinson. Unfortunately. Senator Williams. In my country, and I think in your country, the farmer is better off than he was in 1890 to 1900 or" from 1880 to 1 890, Mr. Atkinson. I am in a way a pretty extensive farmer It hap- pens I own pretty nearly a thousand acres of Alabama land. We EECIPKOCITY WITH CANADA. 51 are growing cotton, and my son, a graduate of the State university, is in charge of it. We bought that land and we know what it cost, and it has practically doubled in value since we purchased it. We have not lost anything on that proposition, but we find it to be im- possible to pay dividends on the price of that land. We are making ends meet. We are getting along the best we can, but I could realize three times as much on the money which I could sell that land for; and if it was not for the want of a home for my son I would sell. Senator Williams. Is not the man working the land better off now than he was before: has he not got more money, less debt, and better clothes ? Mr. Atkinson. I don't know just what you mean by the man working the land. Do you mean the renter ? Senator Williams. Whether a tenant or whether he works for day wage or whether a yearly wage or whether he be a farmer work- ing his own land. Mr. Atkinson. He may get more money for his own labor, but when he goes out and hires somebody else it is very questionable whether he is or not. Senator AVilliams. We are all a great deal better off than we were 20 or 30 years aso. Senator Smoot. It is now approaching 2 o'clock, the hour of the convening of the Senate, and I move that we adjourn until 10.30 o'clock to-morrow morning. Mr. Hull. May I have just a word? I want to say that this will probably come out satisfactorily the way it is being arranged here, but when we were here before we were somewhat criticized for not going and telling the President of the United States our case, and we do not want "to have to meet that criticism again. So we have arranged to meet the President at the White House at 2.30 o'clock this afternoon. The Chairman. The committee will stand adjourned until 10.30 o'clock to-morrow forenoon. Mr. Hull. Will we meet at that time ? The Chairman. Come at that time and be here on time. (Thereupon, at 1.20 o'clock p. m., the committee took an adjourn- ment until 10.30 o'clock to-morrow morning.) RECIPROCITY AMTH CANADA HEARINGS BEFORE THE COMMITTEE ON FINANCE OF THE '^ UNITED STATES SENATE SIXTY-SECOND CONGEESS ON H. R. 4412 AX ACT TO PROMOTE RECIPEOCAL TRADE RELA- TIONS WITH THE DOMINION OF CANADA AND FOR OTHER PURPOSES SECOND PRINT No. 2 TUESDAY, MAY 9, 1911 TVASHINGTUJS GOVEENJIENT PRINTINGf OPI'ICE 1911 . COMMITTEE ON FINANCE. UNITED STATES SENATE. BOIES PENROSE, Chairman. SHELBY M. CULLOII. JOSEPH W. BAILEY. HENRY CABOT LODGE. F. M. SIMMONS. PORTER J. McCTJMBER. WILLIAM J. STONE. EEED SMOOT. JOHN SHARP WILLIAMS. JACOB H. GALLINGER. JOHN W. KEEN. CLARENCE D. CLARK, of Wyoming. CHARi.ES F. JOHNSON, of Maine. WELDON B. HBYBDEN. ROBERT M. LA FOLLETTE. 341 RECIPROCITY WITH CAiNADA. Committee on Financ:e. United States Senate, Washington, D. C, Tuesday, May 9, 1911. The committee met at 10.30 o'clock a. m., Hon. Boies Penrose (chairman) presiding. Present: Senators Penrose (chairman), Cullom, McCumber, Smoot, Gallinger, Clark of Wyoming, Heybnrn, La Follette, Bailey, Sim- mons. Williams, Kern, and Johnson of Maine. The committee thereupon proceeded to the consideration of H. R. 4412, an act to promote reciprocal trade relations with the Dominion of Canada, and for other purposes. The Chairman. The committee will come to order. Do you desire a hearing this morning, Mr. McSparran? Mr. McSpaeran. Yes, sir. The Chairman. The committee will proceed to hear you. There is a stenographer here, and your testimony can be taken down. STATEMENT OF MR. JOHN A. McSPARRAN, OF LANCASTER, PA., REPRESENTING THE GRANGERS OF PENNSYLVANIA. MAINE, KENTUCKY. COLORADO, OREGON. AND WASHINGTON. The Chairbian. Will you state your full name to the committee? Mr. McSparran. John A. McSparran. The Chairman. Where do you reside? Mr. McSparran. Lancaster, Pa. The Chair3iian. Whom do you represent? ^Ir. McSparran. I represent the grangers of Pennsylvania;, Maine, Kentucky, Colorado, Oregon, and Washington. The Chairman. What is your occupation ? Mr. McSparran. Farming. The Chairman. What ? Mr. McSparran. A farmer. The Chairman. Will you proceed ? Mr. McSparran. Mr. Chairman and gentlemen of the com- mittee Senator Smoot. Has the State Grange of Colorado a representative ? Mr. McSparran. Yes, sir; the State grange. The Chairman. Go on, Mr. McSparran. Mr. McSparran. There are four points I want to make here before this committee. Senator Cullom. Four what? Mr. McSparran. Four points. The first is that the treaty did not come from a necessity for a wider field for the production of food products. There has been in the last several years an appar- 53 54 EECIPROCiTY WITH CANADA. ently concerted attempt to make it appear that we were running short of food products in this country; that the American farmers were no longer able to meet the demand of our people. No less a man than James J. Plill, a large railroad manipulator and manager, has gone into the magazines with an extensive argument to show that it is simply a question of a short time until we will cease to be pro- ducers to the extent of our consumption. Gentlemen, I want to bring to you what I think is conclusive argument to show that there is absolutel)^ no reason whatever to suppose that we will, even in the distant future, reach a point in which that statement Avill be substantiated by the facts of history. If it is true that the United States, with all her latent powers of production, heralded the world over as one of the most naturally rich countries of the world, and capable of one of the most extensive productions of the world, that if this country, with a poioulation in 1900 of 26 people to the square mile and a poi^ulation in 1910 of 31 people to the square mile, is approaching a condition in which they can not any longer feed their people, then it is a self-evident fact to this committee that the rest of the world is just about to starve to death. You will find, if you look at the populations of the rest of the world per square mile, that, for instance, England has a population of 367 to the square mile; France has a population of 189 to the square mile; Germany has a population of 301 to the square mile; Bel- gium has a population of G49 to the square mile ; Netherlands has a population of 457 to the square mile ; Italy, a population of 309 to the square mile — and I do not think it is necessary to go further. You can add on this the 20 or more countries, along the same line, and prove the same thing. Senator Smoot. What is the population per square mile of this country ? ISlv. jMcSparrax. In 1900, 2G, and in 1910 it has crawled up to the immense figure of 31 to the square mile. Senator ^IcCu^ibek. Plas not Mr. Hill, himself, demonstrated in his figures that this country can produce, intensively farmed, enough to support 800,000,000 people? Was not that his own calculation? ]\fr. IMf'SPAKRAN. I think that is practically his conclusion, if he reached any. Then there is another point, and that is, if you will consult the report of the Department of the Interior of this country, a little pamphlet issued July 1, 1910, you will find that there "is in this country to-day public vacant lands, to say nothing of the immense tracts of land that through bad farming have been abandoned, and Avhere the farmers have left them in private ownership — but of these public vacant lands, what are listed as public vacant lands, there is still in this country 712,000,000 acres of land not yet occupied. Gentlemen, I think I have said enough on that point to show you conclusively that it is absolutely absiird to discuss any proposition in this country for the relief of our food products. Give the United States farmer assurance of a living price for his crops and he will produce manj^ times the present output. Senator Heyburn. Let me ask you, Did you include the lands with- drawn and reserved in that area ? Mr. McSpaeean. I can not just remember. Do you wish me to refer to the pamphlet? EECIPEOCITY WITH CANADA. 55 Senator Heybuen. I do not want to divert you from your state- ment. I thought you would know whether they were inckided. Mr. McSpaeean. I can not just remember that. Senator Claek. Have you that pamphlet with you? If so, just let me take it while you are going on. Mr. jNIcSpaeean. The second point I want to make is that this treaty is not a treaty for the benefit of the consumer; the treaty Itself IS the most direct evidence of the truth of that fact. You will notice, if you will take that treaty, that what you might call the raw food products, as they come from the farmer, such as the cattle on the hoof, the sheep or hogs, the wheat and the buckwheat, the oats and the corn, and other food products have been listed in this treaty as on the free list. Xow you can not eat those things. You can not benefit the consumer by placing before him a 1,000-pound steer or a 150-pound sheep. He can not eat that. You can not expect him to eat Avheat, or oats, or corn, or barley, or buckwheat. Those grains are raw materials that enter into the food products when thev are manu- factured. The statement was made that this treaty would benefit the consumers of the United States in that it would reduce the prices of these food products, but there is not a single point in that treaty in which those products are prepared for the consumer on the free "list. The wheat is introduced free, but the flour has 50 cents a barrel upon it; oats introduced free, but oatmeal and rolled oats has $10 a ton upon it; cattle are admitted free, dressed meats come in at $2.") a ton. Can you not see, gentlemen, that there is not one single point in that whole line in which those food jiroducts are carried down free of duty to a point at which the consumer can use them? And, as a consequence, the consumer is up against the same tariff proposition that he has been heretofore, and consequently, in the natural order of things, .can not possibly gain the benefit that has been promised. I can easily see why such men as James J. Hill, who will gain the benefit of hauling these products of Canada over American railroad lines to Xew York City for export — I can easily see why the great flour mills of the Northwest could benefit in having the free raw material, but I can not possibly find any logical sequence Ijy means of which you can arrive at the conclusion that the introduction into this country of the raw material free, so long as you maintain the tariff upon the article before it reaches the consumer, will, of necessity, benefit the consumer. You seem to depend upon the manufacture of those products that he is willing to give to the consumer the differ- ence between what he would have to pay to-day if he were bujdng Canadian raw materials and what he would have to pa^^ were the treaty the law of the United States. If he is so minded to give to the consumer the benefit of that reduction, he can do it. But, also, by the natural laws of business, he can take advantage of that tariif that has been placed by this treaty upon the products before it comes into the hands of the consumer. And that is invariably the case, if there had been certain points in which that is true and other schedules had been the opposite, then you might reason that it would have been done because of particular reasons in particular cases; but there is not a single point, as far as I have been able to see, in the whole reciprocity scheme in which tliere has been a carrying of the product 66 KECIPEOCITY WITH CANADA. from the producer down to the consumer that has not had the inter- mediate tariff duty. Then, the third point that I want to make is that it will hurt the American farmer. The assertion has been very broadly made that it won't hurt the American farmer, and that has been assiduously cir- culated through the press of this country that it won't hurt the Amer- ican farmer. We will admit that it is true when you raise a per- ishable product and raise a surplus of it you have got to take the world's price for the surplus and that surplus fixes the price for the balance of the crop. I recognize the fact that the American producer of wheat has been selling his wheat through all the years, 3'ou might say, on the basis of the Liverpool price for wheat, be- cause England has been the great buyer of our surplus in the years that are gone. But it is also true that you can have other conditions that affect the prices of products besides the simple question of the tariff, and I propose to dwell not so much this morning upon the protective idea as I do upon the development idea. We farmers of the East havci been for the last 40 or 50 j'ears up against a great proposition that has been hurting us, and that proposition is the virgin land, the pioneer li^'ing of the West. As long as there was wide stretches of country in these United States of ours that were not occupied and that were rich and fertile, our people would farm out a farm here in the East and then they would go West to that virgin soil and to that simiDler life, and they would take up the rais- ing of the products that had been raised here in the East; and it has compelled the eastern farmer to so arrange his business year by year as to meet the necessities of that condition. He has done it and he has not made a kick. He has done it all these years, because he had patriotism enough to recognize the fact that it was the development of his country, and that it was the cul- ture of lands that would be for the benefit and prosperity of this country as a Nation. But the proposition that is before us to-day is to submit the whole American farming community, the East and the West, to that same competition of virgin soil and primitive pioneer life for the benefit of a foreign country. Gentlemen, we can make the argument under the protective line. As long as you are going to hold to the idea of protection as a policy of this Govern- ment, we have a right to whatever is coming or whatever is possible along that same line. It ought to be uniform. But we do not have to make it along that line. There is a question of simple decency and simple patriotism that comes in when you subject the American farmer, with his home that is equipped with the things that belong to the twentieth century, to this kind of competition and you compel him to raise these food products and place them upon the"markets of the world at the same price as the man who gives up and leaves all those associations of culture and refinement and goes out into the wild territory simply because the land is fertile and because he can there get^ a new start in life. I say as long as that was true, for the benefit of our own people, there was no kick ; but there is a kick going up from the Atlantic to the Pacific to-day against this outrage that is attempted to be perpetrated upon the farmers of this country by this bill. EECIPROCITY WITH CANADA. 57 We are not responsible for the development of Canada. I submit it would be a grand thing for her development; and I admit this, also, that Mr. Taft was not fair to the people of the United States when he compared its corn crops to show that the Canadian farmer could not hurt in competition the American farmer. He was very careful to stay oS the wheat crop ; he was very careful to stay off the oat crop or the barley crop, or even the potato crop or the hay crop. We all know that corn is naturally a lover of warm weather, and that if you grow it in those latitudes you have to take a particular type of corn that will stand the climate of those places. While I believe firmly that the day will come when Canada will find that quality of corn which will meet those requirements and which will make the yield up to date, it has not been done to any large extent, and, as a consequence, when he made the comparison and based his argument upon the fact that the Canadian only raised 1 per cent of the corn crop of the United States he was unfair, and that when you take it down through the list of food products you will find that not only can she to-day produce practically along with the virgin soils of the United States, but that she is so situated and has a capacity that she will continue to do much better than we if you give her the advantage that you propose to give her in this reci- procity treaty. I say that is an absolutely unjust advantage to give any foreign country at the expense and detriment of the greatest wealth-producing class of our own country. Senator Williams. One question. Is it the law that is giving that advantage or is it nature? jNIr. McSpaeean. Xo ; it is the law, because of the fact that Canada is strategically situated. If there was an ocean between the United States and Canada, it would be different, but Canada is closer to some of our extensive markets than we are ourselves. It only takes a building of comparatively short railroads to draw the wheat and the other cereals of Canada to the great mills of the Northwest that manufacture so much of our own cereals. Senator Williams. I understood you to say that the chief advan- tage that Canada had was the freshness and the fertility of the soil. Mr. McSpabkan. Yes, sir. Senator Williams. Yes. Mr. McSpaeran. I think that is true Senator Williams. If that is true Mr. McSpaerax (continuing). But of course she can not get_ the benefit of that until you remove the tariff barrier, because, as it is now, she has to put her products yonder in London with her unde- veloped railroads. Senator Williams. You admit, then, that the tariff barrier is an artificial and legal barrier, do you not ? Mr. McSpaeean. Yes, sir. Senator Williams. Which has been constituted by law ? Mr. McSpaeran. Yes. Senator Williams. That could not exist without law ? Mr. McSpaeran. No. Senator Williams. That being the case, it is the case of law and acquired advantage. Do you think it is quite fair to the American 58 BECIPKOGITY WITH CANADA. laboring man, who has to buy his bread and wheat, that he should be taxed to make up for the inequalities between the fertility ot my soil or yours and the fertility of Canadian soil? , Mr. McSparean. That would be true— your statement would be all righ<^if it was a statement of fact ; but the facts are to-day that we are not selling our products at an artificial price. We are prac- tically selling these products to-day at the world's price. But we do kick upon a man that is just across the fence, with yirgm soil and with pioneer conditions, that is right up close against our mills, having the opportunity to come in there with the raw material and crowd us down on the little difference that we now hold because we have a developed country. Senator Heybukn. And a man that pays taxes m some other country than ours ? Mr. McSpARiiAx. Certainly. Senator Williams. The laboring man does not pay his taxes in some other country than ours. Mr. ilcSpARRAN. The laboring man to-day does pay more. Senator Williams. If he does not Mr. iMrSPARRAX (interrupting). The laboring man does not. Senator Williams. Now, then, let us come to that. The laboring man does not pay any more for his bread or for his flour on account of the tariff, then where would the farmer be hurt ? Mr. McSparrax. There again you are wrong. You say he does not, and the point I make is that he does. Senator Williams. I understand he does. Mr. ^IcSparrax. T said we do not sell on an artificial market. Senator Willia::ms. But you mean by that that the tariff at present does not add to the farmers' prices ? i\fr. ]M('Spai!i;ax. It adds to it in sn far as he doe? not produce a surplus. Wherever you have a commodity without a surplus it might work. Senator Williams. So far as it does add, Avhatever that may be, is not that jn'o tanto artificial, law-created? ]\rr. ]\1('Spai;rax. Yes. sir. Senator HEyBURx. I would like to ask you this: When you spoke of the farmer, you included the man who worked on the farm as well as the man who owns it? Mr. JMc^Sparran. Yes, sir; certainly. Senator Hetkixrn. You included farm labor? Mr. ]Mf;SrAin!AN. Yes, sir. Senator McCumber. He has an advantage ovei' the American laboring man far in excess of what the American laboring man has over the London laboring man. ]\rr. ]\fcSPARRAN. Oh, yes. Senator Williams. Let me ask j^ou another question. The chief product down in my country is cotton, which clothes the world — the poor people of the world — the poor man's covering. Do you think it would l)e right, because we can raise more cotton, better cotton, to the acre than you can, that the American laboring man should be taxed in order to make up that inequality between j^ou and me? Mr. McSparran. I do not understand your question. Senator Williams. Five hundred thousand bales of Egyptian cot- ton are imported into the United States a year, I believe. Do yon EECIPEOCITY WITH CANADA. 59 think it would be a fair argument for me, as a cotton planter, to make that a tariff should be put on cotton because the Egyptian labor costs less and the Egy^jtian lands raise more cotton to the acre? Mr. jMcSpaeean. Well, it would be Senator Willia:»is. Do you think it would be right for me to want to tax the Americans more for cotton clothes because nature had not put me upon an equality with the Egyptian cotton planter? jMr. ]\IcSpaeeax. It depends upon what kind of system you are working under. If you are compelled as a cotton raiser to buy what 3'^ou need under a protective system, you certainly have a right to expect the laboring man to do the same. Senator Williams. I am compelled to pay a tax upon my ties; I am compelled to pay a tax upon my cotton gin. I am compelled to pay a tax upon the plow that I work with ; I am compelled to pay a tax upon the cultivator that I work with — everything under the sun. Senator Smoot. You must admit that the Egyptian cotton does not come in competition with the great bulk of Southern cotton. Senator Williams. It does come in competition with the cotton which I raise upon my place. Senator Smoot. No ; EgyjDtian cotton is longer staple and is im- IDorted at a higher price than you get for your cotton. Senator Williams. There you are mistaken. Egyptian cotton is imported at a higher price than ordinary upland cotton, but I had one tenant last year who raised 100 bales of cotton and sold it at 27-| cents a pound. It was If inch staple, which competes with the best Egyptian cotton. Senator Smoot. If he gets 27| cents a pound for it he is not suffer- ing. Senator Gallingee. Suppose you transfer Egypt to Canada, and Canada is raising as much or more than j^ou are in the Southern States, what then? Senator Williams. It would be my duty to make my living with- out any aid of the law. Senator Gallingee. Then, are you against protection under all circumstances? Senator Heybuen. Protection, as such, under all circumstances? Senator Williams. Absolutely. I am not upon the witness stand, but I do not think there is a right in any government under the sun to take a nickel out of my pocket for any such reasons. Senator Gallingee. I did not intend to interrogate you offensively, but you raised the question. Senator Williams. I am just trying to put the shoe on the other foot to see if it would fit just as well. Senator McCujibee. You assume that one nation has a right to send all of its articles into the other country, no matter what it is? Senator Williajis. What ? Senator McCuiWBEE. You assume that one nation has the right to send all of its articles into the other country, no matter what it is? Senator Williams. I did not say that. I said, in so far as neces- sary for a country to tax products in order to raise money for the government or public purposes. In other words, the public has no right to take a nickel out of my pocket for any purpose except public purposes — governmental purposes. 60 EECIPEOCETV WITH CANADA. Senator McCdmbee. Is it not equally right to allow them to bring in labor— the people of China, for example, or any other country, who want to make a living? ^^Iiy hold up a law barrier against them? . . Senator Williams. That is a totally different proposition. Senator McCumbee. It is a question whether the man uses the labor in China and produces the thing and sends it over or comes over here and produces it. It seems to me practically the same thing,. Senator Claek. We are far apart on the fundamental principles. I just want to say that if you were a cotton grower who were injured by the competition with Egypt, I, as a protectionist, would be in favor of protecting your home-grown cotton. Senator Williams. I would be absolutely opposed to accepting the protection. [Laughter.] It is shown by the fact that we are not getting it right now. Senator Claek. You are not injured so much but what you can rent out your farm to the tenant farmers. Senator Williams. The white man is not injured so much but what he is making more out of his grain than does the cotton planter out of the cotton. Agriculture in the North is much more prosperous than it has been in the South. However, I do not mean to say it is on account of that; it is on account of the fact that you have white labor and we have not. Senator Bailey. The argument here is not necessarily that protec- tion is favored, but it is that as long as you must sell in a free-trade market you ought to buy in a free-trade market; or as long as you sell in a protected market you ought to buy in a protected market; or if you sell in a revenue-tariff market you ought to buy in the same kind of a market. In other words, that the farmer is entitled to exactly the same rule as is applied to everybody else. [Apjplause.] Mr. Hull. Is there anybody here who wants to controvert that principle ? Mr. McSpaeean. You are absolutely right. Senator Bailey. And that among you gentlemen there are Pro- tectionists and revenue-tariff Democrats — not as numerous as I wish they were [laughter] , and probably there are some free traders among you, and that you are simply contending that the same rule shall \x applied to you as is applied to the manufacturers. Mr. Hull. That we shall have the same right to protect ourselves and our families and educate our children that other citizens of this Eepublic have — just exactly that and no more. Senator Williams. You have the same right to tax the country for your benefit as the manufacturer. Mr. Hull. You give us free trade all along the line, and we will go home. Senator Williams. I did not admit that either of you has any right at all. [Laughter.] Mr. McSpaeean. Just in this connection I Avill say this : There is a difference between the farmer's position as related to the whole pro- tective system and the manufacturer's, because of the fact that you never heard of anybody eating year-before-last's potatoes; you never KBCIPEOGITY WITH CANADA. 61 heardof am'body eating wheat five years old; and in consequence there is a natural protection to the price of the commodity, and there- fore a natural protection to the laboring man against unjust food prices because of the fact that our crop is practically marketed and consumed,_no matter what the price is, within a given length of time,, and that it is almost an impossible proposition to organize it in a form that it would maintain a consistent monopoly and thus influence those natural conditions under which we produce these food products and under which Ave market them, and that acts as a protection' against any unjust price that the manufacturer of steel, for instance,, does not meet, where we can shut down our mill and get rid of the surplus, and then you are in a position to take advantage of any pro-' tection that may be accorded him by law, no matter whether it is 2 cents or $10. But when you have to put your product on the market or lose it entirely, as the farmer does, then, you see, no matter if we had $10 a bushel on wheat, and it was absolutely unjust, or no matter if we had absolute free trade, and that in turn was unjust, we would,' after all, have to market that wheat, that corn, and those oats, and those potatoes, etc., within a given time, at whatever price we could' get_; and that simple, natural condition forms a barrier against im- posing upon the poor people who have to have food products day in and day out. So I think that the point is not properly raised, if you hold the farm- ers' products up as along exactly the same lines or capable of receiv- ing the same protection as the manufacturer of a commodity that is' not perishable and of which he can control the output. Now that, you see, is another point where there is a natural difference. We can not control the output. If I am a raiser of wheat to-day, I will be a raiser of wheat next year, because the Almighty has so arranged it that the only way to scientifically handle land is to follow one crop with another particular crop — what we call the " routine " of crops, and we can not change that routine. I can not raise wheat this year and jump out next year and back in the year after. If I should undertake that I should have my fields so balled up that I could not do anything with them. I have got to get a sequence of crops. I must either change that routine and get out of the wheat business altogether, and possibly not get in again for five or six years, or I have to go on raising wheat, even if it does not bring me any- thing but the straw. You see those are natural conditions that act as a protection against unjust food prices and they have always acted so, and when prices have been high in this country the farmer has not received the benefit because he is like the fellow that was told that just around the corner he could get a splendid meal for 25 cents, and the fellow replied, "Yes, but where is the 25 cents?" When wheat is away up high, we farmers do not get the benefit of it, because we have not the wheat, or the same of any other of the cereal products. Whenever we get those tremendous, what we call almost unjust prices, you will find that it goes hand in hand with the world's short- age, and as a consequence we farmers do not get the_ benefit of it unless we just happen to be in some little section in which the short- age does not fall in the year in which the general shortage falls. I turned aside because I think there is a difference there that ought to be noted. 62 EECIPEOGITY WITH CANADA. The fourth and last point I want to make is that this is absolutely a special-interest measure, unless you couple it or amend it with a free-list measure. You can not honestly put any other construction upon the manipulation of a commodity. When you let in free every- thing which is the product of the farmer — one producer in this coun- try — and immediately upon the handing of that commodity oyer into another man's hands, Mho works upon it — the miller — you give him the protection: you can come to no othei- conclusion than that it acts as sj^ecial cla.'!^s legislation in favor of that second man. And when you see these schedules one after another follow exactly that line of argument and that line of procedure you can arrive at no other con- clusion than that it will absolutely — I do not care what the intention of the measure is ; I do not wish to impute the honesty of the men who negotiated it — but I say you can not get at any other conclusion than that that is what it will do. It will be a special-interest measure for the benefit of the great mills of this country, the j^acking houses of this country, and the lumber interests of this country, excepting in so far as the lumber is a little different in that they calculate on mak- ing their m()ne_y by the control of the stumpage, and of course this would have a tendency to release that. But tlie principle is there and you can arrive at no other conclusion unless, as I say. put it right into the same bill so that one can not be vetoed and the other passed — make it so that one has to pass alongside and in absolute contact with the other, so that this great wealth-producing class of our country shall be enabled to buy the things that they need in their business upon the same basis as they are compelled by this treaty to sell the products of their farms. And, gentlemen, I do not think that the free list that you have. pro- posed goes far enough. You put farm machinery upon the free list, out you do not put the materials that make that farm machinery Upon the free list. You do not put the coal that the Almighty has placed in our hills and that is placed in different spots in the earth, that is not the property of any individual to use as a monopoly for the oppression of his fellow men. The coal oil that lies in the bowels of the earth— that is another gift of the Almighty to his children throughout the wide Avorld— and you would not "hold those things as yours, but you have a right to hold them as the legitimate property of mankind, to be conserved by those in whose district it is, but never to be used as a monopoly with' which to oppress their fellow men. That IS the condition in which those things lie to-day, and because of that fact the free list ought to go further until it reaches those products that go mto the manufacture of this farm machinery, and that fur- nish the heat and the fuel for the manipulation of "those thino-s, in order that we might have an absolutely clear and definite and "equal condition. And, further, since we liave to sell our products in the open market without monojiolv. in justice to us as well as to all con- sumers the tariff should be taken otf w!iere\er it tends to produce monopoly. ^ I thank you, gentlemen, for your attention, f Applause in the audience.] " l 1 1 Mr. Hull. I now take i^leasure in introducing Mv Charles M. Winer, a master of the Wr.ssachusetts State Gran-e and chairman ot the .Massacliusetts Dairy Bureau. EECIPEOCITY WITH CANADA. 63 STATEMENT OF MR. CHARLES M. GARDNER, MASTER OF THE MASSACHUSETTS STATE GRANGE AND CHAIRMAN OF THE MASSACHUSETTS DAIRY BUREAU. Mr. Gardner. It was my privilege to speak to you briefly several weeks ago, and at that time we told you. speaking for Massachusetts, what we believed was the feeling of our people m that State. You asked us if we were absolutely sure, and because it was entirely a new proposition and there had been no adequate opportunity for dis- cussion, we had to say to you that we were not absolutely sure, but we believed that the sentiment was as we expressed it. I am not going to take the time of this committee to repeat or in any way to reiterate the arguments that have been used, because it has been my observation that the committee soon tires of cumulative evidence. But I want to bring to you, sir, the voice of Massachusetts, the voice that now we know ; and it is absolutely correct, gentlemen, what we told you several weeks ago we believed it to be, and I think perhaps j'ou will be more interested in the few minutes if I devote that time to telling you just the fair, candid, honest feeling of the people of Massachusetts. Massachusetts is not a' great agricultural State like the commonwealths of the middle West, but we do raise some agri- cultural products and their quality is pretty good. We raise perhaps as much to the acre as is raised in a good many of the States. Inten- sive agriculture has been coming to the front, and we have been developing along specialized lines in Massachusetts agriculture in the last 10 years with great leaps and bounds. Mr. Chairman and gen- tlemen, speaking to you very candidly and frankly of the sentiment in Massachusetts, I want to say to you that, though I am here repre- senting the State grange of our Commonwealth, I am speaking not only for the members of the grange but for all farmers throughout the Commonwealth as they have expressed their opinion to me. Yet, as I am speaking for the farmers, I am speaking also for the people in general of the country towns of Massachusetts, and for those larger towuis which, themselves centers of rural communities, depend in large measure for their prosperity upon the prosperity of that surrounding rural territory; and I believe, gentlemen, I may say to you very truthfully and frankly that the sentiment of a great number of the people in Massachusetts is absolutely against the rati- fication of this treaty of Canadian reciprocity. Gentlemen, in the last few years the prospects of our rural sections have been lookmg up in Massachusetts. We have heard a great deal about the decline of the rural towns and country conditions, and it was true ; but in the last 15 years there has been a striking swing of the pendulum toward our country towns. They have been getting, to some extent, better lines of transportation ; they have been getting a better market_ as the larger towns and cities near them have increased in population and in consuming things. . Our agricultural college, into which we are putting a quarter ot a million of dollars of the Commonwealth's money every year, has been developing our bright young men and sending them back to the farm with this promise : If you will stay on the farm, if you will cultivate that land intelligently and efficiently, there is a future for you there as good as anywhere. We have been telhng them that thing as a i64 EECIPEOCITY WITH CANADA. State and have been backing it up by an appropriation o£ a quarter of a million dollars every year for that college ; and there are there to-day nearly 500 young men from our Massachusetts farms. Although a li'ttle State, and, as you might think, not an agricultural State, there are nearly 500 young men in that college who are going back, for the most part, to our rural towns to cultivate our soil on that promise that there is a good future there for them, and they are going back without a great deal of money. Gentlemen, a great many of them are buying farms, and they are putting mortgages on those farms, and they are scraping every cent of money they can get and buying machinery, because they believe that the watchword of that operation must be " eiRciency." And so the whole outlook has been more hopeful them in the last 10 years — for these country towns and for our agriculture — than in a generation or two before. Now, then, gentlemen, we believe in Massachusetts that the rati- fication of this treaty will be a distinct blow to that advance in our rural conditions and promise. We believe it because we are seeing results, regardless of what you may think or I may think the result is going to be. Our agricultural people in Massachusetts believe it is going to be disastrous, and I can bring you, gentlemen, instances— a good many of them — where negotiations that were in progress for the purchase of farms in the last few months have stopped, and where proposed extensions on our farms, in the increase of buildings and in the purchase of machinery, have stopped, because our wide- awake farmers are fearful that the future prospects do not warrant this expenditure. We believe it is going to be a blow to the rural progress of Massachusetts, and that is why we come here and express our feeling to you as man to man, where our living, our bread and butter, and our life is involved. Gentlemen, we are interested in the production of milk, and we have been finding for the last few years one of the most difficult phases of that problem — the incoming of Canadian milk. You would be surprised if you knew how many thousand cans of Canadian-produced milk are sold in the city of Boston every week of the year. The railroads have discriminated against our Massachusetts production of milk, and we have been fighting along that line, and we believe that if you remove even the slight tariff that now exists on Canadian milk you have struck us another blow and that you have made it just so much harder for us to encourage the dairy industry of Massachusetts. One of the things that we have been advocating in our college, and for which we have been spending money, has been the encouraging of orcharding, and we have got towns 10 or 15 or 18 miles from any market and we have encouraged them to go to setting out apple orchards and the raising of fruit, and they have gone into it and thousands and tens of thousands of trees have been set out in the little rural sections of Massachusetts in the last five years, and they are 2 years old, and 3 years, and 4 years, and 5 years old, and all of those bright young men have got for the future their stake in that apple orchard, and perchance they are looking forward to it, and I do not believe that we can afford in Massachusetts to do anything else than to come to you and protest against the removal of the tariff on apples or on hay and those things which are the hope of these young men who are on our farms in Massachusetts. EECIPEOCITY WITH CANADA. 65 Gentlemen of the committee, I want to say to you that we have in our Commonwealth about 250 granges. There arc 30,000 mem- bers in those granges, scattered over all rural Massachusetts. They hold 5,600 meetings every year, and last year the total audiences at those meetings was a little over 300,000 people— not different people. of course, but the total audience was a little over 300,000 people! In almost every one of those granges during the past two or three months this question has been discussed, not because we urged them to discuss it entirely, not because their leaders in Massachusetts said to them : •' You have to take this up," but because they realized it touches their bread and butter, their life, and their living, and 7 have on my desk at home letters and resolutions, dozens and scores of them, that have been passed in these meetings after thorough discussion. I went up into the market-garden district of Essex County, not over 40 miles from the city of Boston ; in that great city district, if you please, that would not be termed an agricultural section of New England; and there with an audience of 500 people, without any suggestion of mine or of any other State officer or representative, in a State sense, of the grange, that they should discuss it or that they should pass any resolutions whatsoever, they introduced and passed by a unanimous standing vote of 500 people in that section, which is not distinctly, as you would look at it, the agricultural section of Massachusetts or New England, and unanimously protested against the ratification of this treaty. And it has been so all over our State, and joining in that evidence have been not simply our grange people, not simply our farmers, but our merchants and our business men in our towns and in some of our cities who realized that their prosperity is conditional upon the prosperity of those towns round about them. And I tell you, gentlemen, the sentiment is widespread in our State of Massachusetts, for which alone I am speaking just now, that a distinct blow at the prosperity of our whole State is involved in a blow that strikes injury to the rural sections and agriculture of that State. I talked last week with a large number of members of our State board of agriculture, and I found every one of them taking the same position, absolutely, and every member of the dairy com- mission standing absolutely in that position, and I want to say to you, gentlemen, as master of the State Grange, that in the last two months, without any initiative of mine or any of us, I have had more calls for men to come out and present this question of Canadian reciprocity in our meetings of the State tenfold more times than could be supplied. The people are interested to a tremendous degree, and those calls, gentlemen, have come from our towns of 10,000 and our cities of 15,000 and 20,000 and upward, and many of those resolutions and protests have come from those cities. Now, Mr. Chairman and gentlemen, just this final word. The gathering of these representatives of agriculture in this city at the present time has a good deal of significance, because behind every one is the almost united voice of the agricultural people of the State from which we come, and it has just this significance, and I am not going to take your time further except to state it. It means, gentlemen, that we are here, in all candor and fairness and honesty, to say to you that we are going to use our best endeavors, so far as 66 KECIPEOCITY WITH CANADA. we have any influence and so far as we can present the matter to you in fairness and candor, against the ratification of this treaty. We are lionest and square with you in that statement; we are here for that purpose, and we plead with you along that line, and if that fails then we have got to try something else; and we say to you then, in all candor and fairness, that, looking at it from our point of interest, in all honor and justice, we are going to turn to the other side and say that if we sell on the free basis, then in all fairness and justice we have got to have a chance to buy that way, and that is what this means. I do not know whom it is going to hit ; I do not know what protected interests might suffer if that proposition were successful, but I tell you, Mr. Chairman and gentlemen, that is just what this gathering now in the city of Washington means. We arc not pressing this point, because we are saying we do not want this treaty ratified, but if it has got to be ratified, then we have got to look to the other side, gentlemen, and we have got to do something to help ourselves out on the other side. I think that is a fair proposition. I do not believe you can say that it is altogether selfish. I believe you must say, as we feel, that it is just, but we ask you. first of all, to give us a chance. We are building up our agriculture through building up our rural towns. Throiigh hu.il;(:rP.. There seems to have been a great many from Iowa ? Mr. HuTCiiiNS. Yes, sir. Senator Gallinger. And one or two other States? Mr. HuTCHiNS. Yes, sir; there have been some from my section. Senator Bailet. A good many from some sections? Mr. HuTCHiNS. Not from my immediate vicinity. Senator Heyburn. Can you give us any data relative to the differ- ence in the cost of production of the commodities on the Canadian side of the line, you being from a State abutting on Canada— can you give us any data as to certain articles ? Mr. HuTCHiNS. Not particularly, except that I know that the price of wheat has varied quite considerably, something like 8_or 10 cents, as I remember it. The price of butter has been something like 21 cents or 22 cents, I think, in Canada, and 29 or 30 cents in our State. Senator Clark. May I ask right there a question? I notice a statement in the paper this morning that some of our citizens make the assertion that while one commodity may be a higher price on this side of the line, other commodities are a higher price on the other side of the line. Now, having had no opportunity to make the inquiry, I would like your Iniowledge, if you have any, as to what commodities which the farmer raises are higher on the Canadian side of the line ? Mr. HuTCHiNS. I can not give you figures on this question. I have heard the statement made. Perhaps Mr. Hull may be able to. Mr. Hull. It has been my pleasure Senator Clark (interposing). I understand this: For instance, choice beef cattle of Canada bring a very high price for export, but I mean the article that ordinarily the farmer has. "Mr. Hfll. I was a guest of the Canadian Government for two weeks in January to lecture to tlie farmers over there. I made in- quiries in regard to this. In "Windsor at one time this winter you found eggs were higher than they were across in Detroit. That was just a matter of local conditions. Trade stays in certain channels, and there may be in just a locality a little undersupply in Canada RECIPEOCITY WITH CANADA. 75 or in the United States and there will be that difference. Now, as the general rule upon the great commodities in the market centers you will find they are considerably higher in this country than they were in Canada. Just let me give you this illustration, which I think I gave to a part of this committee when I was here before : Mr. Duff, who is minister of agriculture of Ontario, made a stirring ap- peal to the Canadian farmers of Stratford at a meeting of theirs that it was beneath the dignity of Canada to go across the border and ask for reciprocal trade relations with the United States, because, while we were of the same common piirentage, we had fought against the good old British flag. One of the leading farmers of that section got up and said : Mr. Duff, I hitched my lambs on behind a carload of Michigan lambs, and when they crossed the border I had to pay 75 cents on every one of those lambs. The American lambs from Michigan went across free. Had we had this relation I would have had 75 cents more for those lambs. I have been market- ing many of my. products over there. Had it not been for that I would have had the money. Could 'I sell over there in New York, in Ohio, or Michigan my butter which I am producing this year, I could get 8 cents a pound more on the average th.an I have gotten. I could have gotten 3i to 4 cents a bushel more for my oats; I could have gotten 30 cents more for my btirley; 1 could have 40 cents more a bushel for my beans. Mr. Secretary of Agriculture, you and your dignity be hanged. I am in this for the money there is in it. Xow, there can be no question that if this committee and the United States Congress want to do a thing that will benefit the Canadian farmer all they have got to do is to pass this reciprocity measure. Senator Williams. One question right there. I understand how this Canadian farmer would get that 75 cents, but would he get it hj the American farmer getting 75 cents less '? Mr. Hull. I do not quite catch your question. Senator Williams. He paid the duty of 75 cents. I understand if he had not paid the duty of 75 cents he would have had the 75 cents, but if he had had the 75 cents and had not paid the duty, would the American farmer pay it? ^Vould the American farmer have sold at 75 cents less? Mr. Hull. Now j^ou want to open up this great question of whether the foreigner pays the tax or not. Senator Williams. I do not want to open up any such question. I want to ask you that plain, practical question. He is getting the 75 cents more. Was that by taking it away from the other man, or was it by cutting it out of the hands of the Government ? Mr. Hull. As I understand, there is just one question that is the pivot around which the matter revolves. If there were enough lambs to be put into this market from Canada to drive them down that much lower, it would not have helped the Canadian farmer any. It would not make any difference to him. It would have taken 75 cents off from the American farmer and reduced it to the consumer. If there were not enough lambs in Canada to influence that market to an appreciable extent, then the American farmer would not be dam- aged and the American producer would not be benefited, but the Canadian farmer would be. Senator Williams. Your answer is absolutely sound. It is abso- lutely correct. Then it all goes back to this, does it not, as to why the Canadians can flood, as you call it— I never understood why adding 76 EEGIPROCITY WITH CANADA. to what the people had should be designated as a flood, a great devas- tation — and whether Canada could or could not flood the American market with enough valuable things to reduce the price of valuable things to the people who need them ; if Canada's proportion of agri- cultural products is insignificant in comparison with ours, it could not do it, and if it is not insignificant in comparison with ours, it could, so the question, after all, is the question of comparative pro- ductions. . . ^ Mr. Hull. Let us take a few of those things. 1 ou will grant that is true in wheat. That this great agricultural Northwest— now, let me clinch one argument of my previous statement right here— if you want to approach this from a protective standpoint, the tenets of protectionism for years have been that there should be a duty equal to the difference of the cost of production in this country and foreign countries. Take the statistics of Canada and you Avill find that these Provinces of the Northwest are producing an average of 20 bushels of wheat to the acre. You take the statistics of the United States and you will find that we are producing an average of 13 bushels to an acre. Is there any question that the land upon which they produce it is worth less per acre than our land ? Is there any question about a difference in the cost of production at all? You get 20 bushels of wheat on an average there and 13 down here, and you get 13 bushels upon the higher price land. Senator Williams. You have picked out in Canada land that raises a great deal of wheat and some land in the United States that does not raise so much. Why don't you go to the Province of Quebec and tell us how much they raise ? Mr. Hull. They are not a wheat-producing section. Senator AYilliajis. Is it not a matter of fact that in these great 3,000 miles of imaginary boundary that stretch between the two countries there are sections where the Canadian lands are poor on the one side and the American lands richer on the other, and other sections where exactly the reverse exists? Mr. Hull. There is no question but that you will find that in the same State. That is neither here nor there, as far as this argument is concerned. Senator Williams. I think not. Senator Bailey. I just want to get this record straight historically. You said awhile ago that for years it had been the doctrine of pro- tectionism that the duty should represent the difference in the cost of production, but you are mistaken about that ; that is a modern Republican doctrine. Mr. Hull. I understand that; at least that is good protection doc- trine to-day. Senator; it is supposed to be. It has not been good according to your estimation. Senator Bailey. I hold no commission to keep these Republicans correct on that. But that is not the old doctrine; that is the new Republican doctrine. But, of course, bad as it is, it is better than the old. Mr. Hull. Well, at least, Ave are presenting this thing as I hav« repeated time and again. If we are to have protection, let us have it; and if we are to have free trade, we will take it with the others. Senator McCumbek. The Senator from Mississippi, I think, has traveled over the Canadian Northwest a great deal, or he wouk EEOIPKOGITY WITH CANADA. 77 not arrive at the conclusion that the possibilities of northwestern Canada are enormous possibilities and capable not only of producing a little to come into this market, but Saskatchewan and eastern Alberta and Manitoba could furnish enough wheat, according to their own estimate, on the tillable lands in 10 years to produce easily a billion bushels of wheat, or almost double what they produce now. Senator Williams. Does not that wheat come into competition with you now ? Mr. Hull. You may talk theory all you are a mind to. Senator McCumbek. It comes in competition with us to-day, to some extent. Mr. Hull. But the facts of the case are that our wheat market here has been higher, on the average, than theirs, and it has helped us. The Chairman. I would suggest that our Michigan friend be permitted to proceed. Mr. Hull. Pardon me. Mr. HuTCHixs (continuing). Mr. Chairman and gentlemen, there was just one more point I wanted to make, and only one. If this matter is so uncertain in its effect, if it is impossible to tell what the results are going to be, should we not studj' this matter longer? If I read aright in the matter of the discussion of the corn laws in England, it took 10 years of discussion and more before the matter was finally passed. Here, within less than that many months, we are asked to sit down and let this measure go through without making any protest. If this is a good thing, why this haste? "Wliy the special session and Executive pressure that would be brought to bring about the passage of the measure of this great importance in a short time? It seems to me that the American farmer has been loyal enough so that his rights should be considered ; so that he should be convinced, if possible ; so that he may be shown the error of his ways ; so he may have time to adjust himself to the conditions that are possibly for his benefit, and he does not know it. I want to say one word in rep;ard to the sentiment in Michigan. I am among the farmers, and I am a farmer myself. I came from my farm because I was hastily called to come with my friend to this meeting for this purpose, and I will go back among those farmers. I know what their sentiment is. I know what their talk is. To-day they stand unanimously against this measure. It does not make any difference about party. Party lines have fallen to pieces, and we are standing united as farmers against this measure. We believe thai it will be injurious to the farmers. We are not here alone representing the Michigan State Grange, with its 900 organizations and 70,000 members. We are here voicing the emphatic opinion of the farmers of Michigan. A farmer not many miles from where I am located, and who is not a member of our organization at all, called on me a short time ago and said: "Are not you people going to get busy about this? Are you going to let this go through without any protest?" He said: " We who are outside of the organization will lose faith in it unless you take up this measure and protest against it." I told him we were doing all we could to call a halt in this matter ; to enter our protest at least to show where we stood ; and entering that protest, would be heard. 78 EECIPEOCITi WITH CANADA. I want to say for the American farmer that he has been loyal in the past, and he will be loyal to this country and its flag in the luture. We believe that Old Glory waves for us. The farmer has been _ the man behind the gun " in every struggle in this country, ^^^^^f^^g" ton, at Concord, where the " embattl'd farmers stood, and fared the shot heard round the world," all down through that struggle for in- dependence, from Bunker Hill to Yorktown, and later on from Lundys Lane to New Orleans, and in that later struggle with brother against brother, the farmer in blue and the farmer in gray fought for what they thought was right, and when the fight was over, victor and vanquished accepted the result manfully and went to their work. That is what we have been doing, developing this country and mak- ing it one of the greatest in the world. We believe that we have rights, and all we ask, gentlemen, is a square deal and an equal opportunity, and we believe we have a right to this. [Applause.] I thank you for your kindness. Mr. Hull. I take great pleasure in introducing to this commit- tee Mr. C. H. Potter, one of the leading farmers of the State of Connecticut. STATEMENT OF ME. C. H. POTTER. Mr. PoTTEE. Mr. Chairman and gentlemen of the committee, when my friend introduced me as farmer he was speaking the truth. I am not a public orator, and there is very little that I could add to what has been said here this morning, and it seems to me that what I add would have ver}' little influence with you as members of this committee. Yet I want to say to you that I come here from Con- necticut representing, practically, a manufacturing State, but yet we have some of the best small tilled farms in the State of Connecticut that there are in the United States to-day, and I am here reiDresent- ing that class of laborers. We have, and our ancestors have, labored on those farms for years in the past, and we are looking forward into the future when we trust that our children and grandchildren will still continue to till those farms. I was interested the other evening in an article that I saw in one of our leading magazines, and it was this — that 9'2 per cent of our Presidents have come from the farms; 90.2 per cent of our govern- ors of this United States have come from the farms. 8-3.0 per cent of the Cabinet Members of this United States have come from the farms; 56.4 per cent of the railroad presidents, 60 per cent of the Representatives in Congress, and 70.6 per cent of the Senators of the United States have come from the farms. Now, gentlemen, when we see that large percentage of those who have had the molding of this United States, a Nation that has grown from infancy to be one of the most powerful nations to-day, honored and respected by every known nation of the world, as com- ing from our farms, is not it a fact that we should stand by these peojDle and the descendants of these people who have reared these sons who have had so much to do in molding this Nation. We do not ask for any special legislation, but we ask that you will deal with us just as you would do with any other class of people; RECIPEOCITY WITH CANADA. 79 give us just the same privileges and just the same protection. We do not ask for any class legislation. We are a quiet, peaceful class of people laboring, some of us, from 12 to IT hours a day. Now. it has been said, and it has gone out in our papers, that this is to benefit the laboring class of people. Allow me to give you this illustration: A few days ago I had a young man doing some paint- ing for me. I did not object to him. He was a good painter; he was an expert workman; I paid him $3 a day for eight hours' labor, and he was complaining of the high cost of living. Now, I said to him : " Look here, my friend, I want to tell you what I have had to do to pay you this $3 a day. I have had to go out and gather 12 quarts of milk, one-half bushel of potatoes, 12 quarts of onions, 2 dozen of eggs, 1| pounds of butter, 1^ quarts of cream, 5 pounds of pork, and 6 pounds of beef." Why, it began to open that young man's eyes. [Laughter and applause.] I do not believe, gentlemen, that man ought to complain of the high cost of living when he can get enough for $3 to supply the family that Roosevelt calls for. [Laughter.] The other day I was talking with a friend of mine whose eloquence you have heard over here in the congressional halls many a time, and he was telling about the conditions which existed when he and I were boys. I said, "Charlie, you remember we used to be glad to get a day off without our fish poles, with one gallus hanging over our shoulder to hold up our pants." He said, '" The boys don't have such conditions to-da}'." I said, "Well, Charlie, it was just those very conditions that made you what yen are; that has helped you to develop yourself and your constitution, that you have been able to bear all these public strains that have been brought on yon ;" and to-da3- he is one of the most successful lawyers in the State of Massachusetts. Now, gentlemen, it is for these boys and girls, these boys we are rearing on these farms, that we are asking you to consider in your decision upon this question. We do not want this country to pass into alien hands; to be tilled by an ignorant class of people who will never develop a boy who will be able to govern us in the man- ner that we have been governed in the past. V\^e ask you to care- fully consider these conditions and give us protection, so that we can educate and bring up our children so that they will take the places that you are occupying to-day, and this Nation will go on and prosper in the future as it has in the past. I thank you. [Applause.] Senator Heybttrn. I understand that the aggregate price of these commodities that you have mentioned represents $3 ? Mr. PoT-rEE. Yes, sir; that is what I would get for them at the market price in town. Senator Simmons. Do you know what the retailer would get for those things ? Mr. PoTTEE. We are not considering the retailer. They can charge what they are a mind to. This reciprocity would not help that mat- ter at all. Mr. Hull. I want to call next upon Mr. S. H. Messick, master ot the Delaware State Grange, for just a word. 80 EECIPEOCITY WITH CANADA. STATEMENT OF ME. S. H. MESSICK. Mr. Messick. Mr. Chairman and gentlemen of the committee. As you know, I come from a very short State, and I shall make a very short talk. I have listened very attentively to all that has been stated yesterday and to-day, and I heartily coincide with all that has been said. It seems to me that the arguments have been very exhaustive, and it is unnecessary for me to repeat them. My presence here to-day as a farmer — as a very busy farmer at this very busy season of the year — must be my strongest protest against the proposed treaty. Our people in Delaware, in common with the farmers of other rural States, as ours is, purely, almost a rural State, are in hearty accord in opposition to the proposed treaty. They can not understand how this proposed treaty is fair and equi- table. They all seem to understand that it is unfair and discrimina- tive throughout. I believe it is said that it promises on the one hand to make low cost of living to the consumer, and yet. on the other hand, it is not to damage the farmer. "We can not understand how this can be, and we regard it as a very dangerous experiment, and we do not think that anj'body else is very sure of this condition. The high cost of living : I have noticed for several weeks the re- 23orts of the census upon the number of farms and farmers of the different States, and I ha-\'e been surprised that in most of those States the census reports indicate a falling off of both the farmers and farms, and I think that pretty near every State that is repre- sented here, yesterday? and to-day, has had a shrinkage of both farms and farmers. Why is this? That question has already been dis- cussed here. To my mind it simply showi that ambitious youths have decided that city and farm life offer more of happiness and prosperity than country life, and they have acted upon this decision and they have gone to the great centers and they have built them up at the expense of the country. If farm life afforded as good condi- tions, as much prosperity, as much happiness, the intelligent young man raised on the farm would be most likely to stay where he was surrounded by conditions with which he was acquainted, but they have not felt it so. Consequently, the trend has been and is to-day, as I see it, toward the city life. There has been much said about " back to the farm." I think that is about as great a blunder on the part of the State as you can con- ceive of. I have noticed that these folks that have come back to the farm feeling that they have learned a great deal and can compete pretty well with the " hayseed,'" who knoAvs nothing, generally speak- ing, are a failure, and they go back with heavy hearts and" greatly lightened pocketbooks. You will never make cheap living for the consumer by the " back to the farm "' movement. The thing to do is to encourage the man, the ambitious youth, the intelligent boy, to stay where he is. I can not conceive of a condition or any act of legis- lation which will discourage agriculturists which in the'end will make cheaper living. My judgment is that the reverse must be true. Senator Kern. Is it not true that the movement toward the -cities is an incident of the density of population? Has it not been the history of all nations for a thousand years that as the population EECIPEOCITY WITH CANADA. 81 becomes dense and as the agriculturists multiply and the lands become occupied there is a natural drift toward the cities? Mr. Potter. I should think the movement to the city is because the man has deliberately decided that he can li^•e better in the city than in the country. That may be the history of the country ; but if it is, it is the history that, in the judgment of your people, who are aspir- ing to better things, they can live better and do better in the city. it has already been shown to my mind very conclusively that the products of the farm can be purchased cheaper in Canada than in our country. I am told that they buy no fertilizers, and they cer- tainly have cheaper lands. I am told that wages are lower. All these conspire to give the Canadian farmer an advantage over the American farmer. He buys in the cheaper market, and^if you put him alongside of the American farmer to sell in our markets he will have yet a greater advantage over us. As to the question of fertilizers, I am told that they purchase no fertilizers. In our State that is the great expense. Some one testi- fied yesterday that it was about $2 or $3 an acre. AVhy, we go as high as $10 to $15 an acre on some of our products. If those Canadians can, on their Canadian land, produce anything like equal crops with no fertilizer, they have a tremendous advantage over our farmers. Xow, farmers may not be a unit on the policy of national pro- tection, as has already been stated here, but this I think they will be a unit on, and that is that they shall, before the law, have equal advantages with other vocations. X tariff for all or a tariff for none. If other vocations assume to fix the tariff for the farmer, the farmer should, in turn, help to fix the rate for the other man. I thank you. [Applause.] Mr. Hull. I will now introduce Mr. L. H. Healey, master of the Connecticut State Grange. STATEMENT OF MR. L. H. HEALEY. Mr. Healey. Mr. Chairman and gentlemen of the committee, I assure you I will take but a minute of your time. I had the pleasure of appearing before part of this committee at the last hearing upon this subject when the granger members were present, and at that time I was also asked if my action was in accord with the general action of the membership in the State of Connecti- cut. At that time I was unable to state, for no concerted action had been taken, but since that time, I want to say to you gentlemen, that this reciprocity bill has been discussed and the more it has been dis- cussed the more it has been " cussed " from a farmer's standpoint. [Laughter.] I have received since my return home at that time numerous letters from our membership, saying that they aj^preciated the stand which was taken by the executive committee in sending the master of the State grange here to signify our opposition to the proposed treaty. I have received numerous letters along that line, but I have only re- ceived one letter saying that I was on the wrong track, so that you can see that the consensus of opinion, as far as the grange member- ship is concerned, is in opposition to the proposed treaty. 82 EECIPKOCIIY WITH CANADA. Our pomological society, which is an organization of people en- gaged in the fruit indiiKtry; our dairymen's association, and ail our agricultural associations, have adopted re!^:olutions along that line, saying that they congratulated us upon the stand which we were taking. A s-reat deal has been said in regard to the resolution which was passed through our State legislature. It has been made so promi- nent, gentlemen, I wish to explain to you just how that came to be passed: Just after the reciprocity measure came l^efore the public I have been told that a resolution— I know that the resolution was put in— and I have been told that it was put in by request before our legislature, asking the indorsement of the treaty. The people of our State, almost for every vear, for a number of years, have been Ee- publican, and a Kepublican majority elected a Eepublican governor and legislature. ancVthe members felt that it was an indorsement of a Republican administration. Therefore the resolution was indorsed, but the sentiment ar.ionost the legislators of our State at the present time, I can assure you, is anything but unanimous as regards the Ijroposeil treaty. Now, gentlemen, we arc n^t up here from Connecticut either for fun or iileasure. We are up here because we are interested in a question which we believe is of the most vital importance to the farm- ing industries in our State. It is true that we are called a manufac- turing State, yet it is true that we are not a nonentity in agriculture. As has already liyen said, ours is an intensive agriculture. The statement has been made that some years ago a laboring man could go to the market with his vest pocket full of change and bring the products which he bought hom.e in a market basket, but at the present time he goes to market with his money in the market basket and brings the products he buys home in his vest pocket. [Laughter.] Now, gentlemen, the first thing, as I under.stand it, the prime rea- son for the introduction of this treaty has been the cheapening of the IDroducts to the laboring man. Gentlemen, we feel that the laboring man is not discriminated against in proportion to the wage which he gets. In the last report of our iS'^ational Secretary of Agriculture, after he had thoroughly investigated the conditions as relating to the high cost of living, you will find that this statement is made: That while the cost — I can not give it in his exact words — but while the cost of living is higher to the workingman and consumer, the farmer is not to blame in any sense of the word. The farmer is not receiving any more for his products than will give him a small compensaticVn upon the amount of funds invested in the plant. Xow, that, gentlemen, is the testimony of our Commissioner of Agriculture. In closing, gentlemen, I simply want to say this to you, that we only ask for a fair deal, as has already been stated, but we do feel, the farmers in Connecticut, irrespective of party, that if the tariff is to be removed from our goods it must be removed from the goods which we have to buy. I thank you, gentlemen. [Applause.] Senator ITeyburn. You count your farmers laboring men, also, don't yon ? Mr. Healey. I count as farmers every man who performs farm labor. RECIPKOCITY WITH CANADA. 83 Mr. Hull. I take great plesiire in introducing to this committee Mr. Richard Pattee, master of the Xew Hampshire State Grange. STATEMENT OF MR. RICHARD PATTEE. Mr. Pattee. INIr. Chairman and gentlemen of the committee, I want to qualify by saying that up in New Hampshire we have a little more than '27,000 farms in about the space of one of your western counties. We have on those farms and in the smaller towns and villages an organization which comprises in its membership 30,000, and 20,000 of them, at least, live and draw their support from the operations of the farms. Our organization is a typical farm organi- zation in Xew Hampshire. I. in my official duties, as the head of that organization, am required to travel from place to place visiting almost altogether small countrj' communities. Being entertained in the homes of the country people, I come directly in contact with them, and I very much doubt if there is any other way or any other means by which a person can come in such close contact with the average of the people, geographically scattered all over our State, as can be done through our organization. I want to say to you that since this proposition has been before Congress, the last Congress and this Congress, I have been in every county and in a great many of the towns all over the little State of New Hampshire, and I find just three classes of thought, three classes of people, views, and opinions in respect to this proposition. The first is colloquially the "stand pat" attitude: the attitude of the old-line Republicans, who hold the tarifi' in itself as a sacred proposi- tion and who do not want to see it reduced at all on anything, any time, ever. The second is the square-deal man. He is opposed to it because he does not believe it is treating his class in the way in which they deserve to be treated. He calls for the square-deal proposition. lie does not care to retain the tariif upon everything. But the talk that you have heard here this morning — those are the two classes who are opposed to each of these propositions in our State. There is a class of people in our State, and some of them are farmers, who call for the acceptance of this proposition by Congress, and that class of people are — I think I speak advisedly when I say it— almost altogether made up— so far as I know absolutely made up— of the men who call for a revision of the tariff laws of the country and regard this as an entering wedge. That is the frame of mind of the people of New Hampshire. Senator Gallinger. Transportation interests, are they not, Mr. Pattee ? Mr. Pattee. I understand so. I am speaking of the people. I am not testifying for the transportation interests. Senator Gallingee. No; but as a class? Mr. Pattee. Perhaps the Senator would know better than I. I traveled in the country places mostly. Now, that as I regard it, is the frame of mmd of the people ot the State of New Hampshire. The sacred tariff opposed to it ; the square- deal opposed to it; and tlie call for it presumably from those who want other things to follow. 93285— No. 2—11 .3 84 EEUIPKOCITY WITH CANADA. Senator La Folletie. What d5,970 23. 67 1.324.600 60. 23 1.420 1,881,000 CiO, 100 27.00 1.243.000 59. 18 1.590 1,988,000 1909 3,52,. 570 .54. 62 19,2.58.000 57. SO .663 12,700,000 1908 :;iiii,20o 62. 45 22,s72.0OO 59.59 . 520 11,8:37,000 1909 5h3, 5ll,s 192. 96 99,ns7,200 . 36i 36,399.000 190S 5i;:i,iini) 132.00 73,790,000 .470 :i4. 819,000 1909 24,s,0.t7 271,443 434. 29 373. 00 107,724.600 101, MS. 000 .169 .170 18.197,500 1908 17,632,000 Ti,ns. Tons. 1909 8,210.3110 1.44 11.877.100 11. 140 132,287,700 8,210.900 2i:!),li,50 2,59 ,770 111,111111 10,S(I(1 1.39 10. 30 11.27 ,s. (;o 10.07 11,450.000 2.77'.l.500 2,92S,(X)0 ,s6,000 109,000 ■ 9. 960 5. 430 4.030 5.810 5. 310 121,884,000 19119 15,116,500 19 IKS 11.782,000 19119 500,000 19II,S 578,000 The table shows that an nv.'a nt :i(),(m.\.^).^(i a.'res of field crop.s violded in 1909 a harvest y,-hK-h, cduipnlcl al 1(h';iI iiuivkrl iiriees, have a value of ii.5:« 992 LOO, ascom- pa,.'d with si:!2,r,:i4,uu() |V,,m 27,:5((.-,,(i(;:-! arro.^ in I90S. In 1909 th^> value of all field crops in I ruu-c Rdwiml Island ^^^s ,s!I,l>i;!,:)()0; in Noy.^ Si-,-tia, .■=;lw 319 300' in New 1>74,42U,.j00; in Sa.skot.-hrwiiu, ,S!)7,(i77,.'^i00; and in Alberta, S;20 711 000 EECIPEOCITY WITH CANADA. 101 "At the end of December statistics -were collected from correspondents as to the value of occupied farm lands per acre, the ^-alue of farni animals and wool, and the ■wages of farm and domestic help. The a\ erase value of occupied farm land in Canada is placed at S38.60 i)or acre, as agaiust Siio.VO last year. For the Provinces the similar values are: Prince Edward Island, So2. 07; X(,va" Scotia, $30.50; New Bruns- wick, $23.77; Quebec, $43.37; Ontario, S5().22; Manitoba, J2S. 94; Saskatchewan, $21.54; Alberta, $20.46; British Columbia, $73.44. All the Provinces except Prince Edward Island and British Columbia show increased \alues as compared with last year, the upward tendency being attributable to the increased value of farm products. The values are relatively high in British Columbia, owing. to the large extent of farm land planted with orchard? and .small fruits. "Data as to the numbers of livestock in Canada were collected from correspondents on June 15, and the following table gives the estimated numbers of horses, cattle, fiheep, and swine for each of the three years, 1907, 190S, and 1909: Live stock. 1908 I 1909 Horses ' 1.923,090^ 2,118,165 i 2,132,489 Milchcows 1 2.737,462 1 2,917,746' 2.849,306 Other homed cattle , 4.394,354 4,629,838 i 4,384,779 Sheep I 2,783,219 2.831,404 , 2.705,390 Swine ! 3,445,282 1 3,:369,858 ! 2.912,609 "The total value of farm animals * * * was $558,789,000 as against $531 ,000,000 in 1908. The value of horses is put down at $278,789,000, of milch cows at $103, 001,000, of other horned cattle at $120,326,000,' of .swine at $34,368,000, and of sheep at $15.73.3.000, and the average value as $130.72 for horses, $36.36 for milch cows, $2.S.81 for other horned cattle, $11.80 for swine, and $5.89 for sheep." Value of Canadian farm property and farm products, and quantities of lire stock and fruits, 1901. Farm property: Value. Land and buildings $1, 403, 269, 501 Implements and machinery 108, 665, 502 Horses 118, 279, 419 Milch cows 69, 237, 970 Other homed cattle : ' 54, 197, 341 Sheep 10, 490, 594 Swine 16, 445, 702 Poultry 5, 723, 890 Bees 792,711 Total 1, 7 87, 102, 630 Farm products; Field crops 194, 953, 420 Fruits and vegetables 12, 994, 900 Nursery stock sold in j^ear ^ 469, 501 Live stock sold in year 52, 755, 375 Meats, etc., of aninials slaughtered on farm 22, 951, 527 Dairv products 60, 470, 953 "VVooI 1,887,064 Eo-ra 10, 286, 828 Honey and wax '"^ "^ °^° Maple sugar 1,780,482 Total • 364, 906, 866 Livestock: Number. Horses o^'er 3 years 1, 'J^l, 910 Horses under 3 years „ "' "' °„^ Milch cows "• -JO^' •'" Other horned cattle ^-.'.''VJ. Sheep 2, olO, 239 Swine .. 2,3.5:;,82S Poultry 17,922,658 Hives of bees 189,986 102 EECIPBOCITY WITH CANADA. Value of farm property and farm products, etc. — Continued. Fruits: Q"^°«"'- Apples bushels. . 18, 626, 186 Peaches do 545, 415 Pears do.... 531,837 Plums do.... 557,875 Cherries do ... . 336, 751 Other fruits do ... . 70, 396 Grapes pounds.. 24,302,634 Small fruits quarts. . 21, 707, 791 Exports of Canada to all countries in quantities and values, hy classes of home produce, , in the fiscal years 1908-9. Principal articles, by classe?. Quantities. Values. 190,S 1909 1908 1909 Agricultural produce: .?2,.374 11,100 103, 077 •S8, 216 65. 298 i:!,j, 224 1 1 . SS9 27,953 Flax Fruits- Apples- Dried lbs 0.939,0,'^s; I 4, 97:1,, 102 1,(:29,130 1 1 Oil'. 001) 481,900 4, 822, .594 201 . 287 3 15 307 bhls 2 S04 0S7 Berries, all kinds 178,960 Carmod or preserved. All othfT 2S0.O72 203.182 13o,33lJ 107.2tH:> Total fruits Grain and products of— Barley bush. Beans do... Buckwheat do... Indian corn do. ,. Oats do.. . Peas, ^vhole do. . . Peas, split do.. . Rye.. do... ^\'heat - do . . . Other grains do. . . do. Total (Trains Bran cwt. CerCLd foods Flonr of wheat bbls. Indian meal do... Oatmeal do. . . Meal, all other do... Malt bush. 1,990,444 2.:j50,3:'5 1.2:23,270 1.744,1S7 61.l:i5 ,S3,033 S5.010 !:i2,7M 377,9:ir, 609. 2. :o 245 003 398,198 20.542 27,443 14.469 20,921 7,123.291 5.2,-,5.010 3,171,509 2,175,765 50i;,:}so ii,-,4,05'' 571. 3S-' 695,925 161,238 i 201:. 057 200, 090 272.093 .W,716 2n:i.379 45. .507 193, 5CS 43.054.008 t 49,137,449 40,004,723 48,147,942 :^,20i', i,iii; 1.329 7Hli 59,204,510 i 45.562.994 1.021.36; 1,42s. ^1:8 1,962.740 1.7,!.s.o:i8 8.454.9.54 ."iSB 1,218 1,6,5! 104,864 119,448 7'^1 , .552 16,308 18,:5.S9 41 , 040 7.892 7,157 Total nour, meal, and malt J. . . . i 9.' Ha5'. -tons. Hemp cwt . Hops lbs. Maple sugar do Maple sirup calls. Seeds- Clover busli. Flaxseed do Grass do . All other Total seeds 63, 472 18 210,623 2,,S::i0,451 3,1.85 102, 075 10, 997 100. 247 55.,S.84 70.200 1.. 507. 129 3,581 63,035 09:!, 779 ,50, 412 3.072 .829. 771 15,098 115.208 IS. 846 Straw tons. Tobacco leaf ll^s Trees, shrubs, and plants Vegetables — Canned or preserved Potatoes ; ; ; juish! Turnips do. . . Another 125,251 lUX.y),8 Total vrge AH other :iKTieull iil.Ies lu-nl products. 707.0:!7 1.219.405 1.560,0:!2 1,020,770 .500,318 188. 432 80, 967 799, 149 51,526 53,782,029 .^88,990 l,:i72,312 7,991,413 4,897 5:!5,9f,2 58.104 8., 597. 563 643,779 13.043 116,427 3,477 519.515 855,908 67,497 28,116 978,923 , 1,461,036 8.414 ' 12,584 57.780 , 37,046 10.962 15,748 30,796 919,189 150.448 122,393 1,222,826 74,347 71,997.207 RECIPROCITY WITH CANADA. Exports of Canada to all countries in quantities and values, by in the fiscal years 190S-9 — Continued. 103 of home produce, Principal articles, by classes. jlnimsls and theii' nroduce Animals, living- Cattle, 1 year old or less No Cattle over 1 year old clo.. Horses 1 year old or less do.. Horses over 1 year old do.. Hogs do.. Slieep 1 year old or less do. . Sheep over 1 year old do.. Poultry and otiier, n. e. s do. . Total animals, living. Animal products — Meats: Bacon lbs. Beef do. . . Hams do... Mutton do. . . Pork. Poultry, dressed or undressed. Game, dressed or undressed . . . Tongues Canned All others, n. e. s .do. -do. -do. .do.... .do.... .do.... Quantities. 190S 4,806 146, 187 37 2,2.33 942 160,095 66,906 46, ,3119,! '. 203, 1 Total meats. . Other animal products- Bones Butter Cheese Furs- Dressed Undressed Grease and grease scraps . Glue stock Hair. - .cwt. . ...lbs., .do.... . .doz. . 73,a34 4,7.S(i,9.54 189, Tin. 463 1 , 36.3. .s;in 3,077 159,868 30 1,998 360 82,303 36,693 173, 3SS 571,583 2KS, 189 39, 030 573, 091 45,310 , 054, 5K(I :,008. 0S7 Values. 1908 66,101,260 55,795 9,245,389 2,340 513,794 13,551 696,102 500,522 102,9.39 11,130,432 1,790,496 148,290 371,132 42,536 63,251 116,334 2,739 5, 096 1.52, 239 670,212 .lbs- Hair and skins, other than fur Horns and hoofs Honey lbs. Lard do... Mil;- and cream, condensed do. . . Sheep pelts No. TaUow lbs . Wool do. . . All other 5.079 1,. 304, 945 403,650 106, 3S2 343,482 1,848,318 Total other animal products. Grand total 106,042 6. ,326, 3.55 164,907.139 5.52, 8,50 61,349,646 37,036 10,734,336 2,608 304,648 4,063 314,093 255,265 85,979 11,798.028 8,414,049 128,644 421,395 4,357 51,628 50, 3.59 3,289 3,324 195,843 711,627 1, 984, 425 11,390 3,57,447 l,275.lr,3 38,. 594 .543,281 1,080.824 1,068.703 22, ,887, 237 301,818 2. 461,, 820 149,148 .53,i;oo 160,601 3,593,228 9,749 745 1.30,971 42,757 39, 162 17,029 456,215 132,242 31, 60S,. 503 55,101,260 85, 799 1,. 521, 436 20,384,666 124,315 .59,967 2. 443, 444 197,268 6,685 146,461 4,029,670 5,449 1,188 35, .521 90, 528 24,657 28,785 202, 176 179,188 29, 567, 193 51,349,646 N"EW YORK STATE AND THE UNITED STATES Acreage, production, and value of important farm crops of ,Vf "■ Yorl State and the United States in 1910 and 1909, as estimated by the United States Department of Agriculture. Year. Acreage. Yield per acre. Production. Price, Dec. 1. Total farm value, Dec. 1. Wheat: New York State 1910 1909 1910 1909 1910 1909 1910 1909 Acres. 444,000 420,000 49,205,000 46.723,000 1,338,1X10 l,:i25,000 35.2.88,IKX1 .33,204,000 Busliels. 23.7 21.0 14.1 16.8 34.5 28.2 31.9 30. 3 Busliels. ■ 10,. 523, 000 8,820,000 695,443,000 737,189,000 46,101,000 37,365,000 l,12i;, 765,000 1,007,363,000 Per bu. JO. 96 1.11 .89 .99 ,42 .49 .34 .40 810,102,000 United States 9,790,000 621,443,000 Oats: New York State 730,046,000 19,388,000 United States 18,309,000 384,716,000 408,174,000 93285— No. 3—11- 104 RECIPEOCITY WITH CANADA. Acreaqe, production, and value of impoHant farm crops New York State and the United ' States in 1910 and 1909, as estimated by the United States Deparlment of Agriculture- Continued. Year. Acres. Yield per acre. Production, Price, Dec. 1. Total farm value, Dec. 1. BarJey: New York State 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 Acres. 78, 000 77,000 7,257,000 7,011,000 170,000 160,000 2,028,000 2, 000, 000 313,000 313, 000 826, 000 834, 000 Bushels. 28.3 24.8 22.4 24.3 18.3 17.0 16.3 16.1 23.0 24.0 20.9 20.9 Bushels. 2,207,000 1,910,000 102,227,000 170,284,000 3,111,000 2,720,0(10 33,039,00- 32, 239, 000 7, 199, 000 7, 512, 000 17,239,000 17,438,000 Per bu. .70 .69 .67 .65 .74 .80 .72 .73 .66 .69 .66 .69 $1,645,000 1 m,m 93,785,000 Rye: 93,971.000 2,302,000 United States 2,176,000 23,840,000 Buckwheat: 23,809,000 4,679,000 United States 5,183,000 11,321.000 Flaxseed: 12,188,000 2,916,000 2,742,000 680,000 670,000 114,002,000 108,771,000 438,000 438,000 3,691,000 3,626,000 4,811,000 4,764,000 45,891,000 45, 744, 000 4.8 9.4 38.3 36.0 27.4 25.6 102 120 04.4 106.8 1.32 1.06 1.33 1.42 14,116,000 25,856,000 26,044,000 24,120,000 3,125,713,000 2,772,376,000 44,i;7i;."00 .52. .3' .11. 000 :US.,M 1.000 37i;,537,000 Tons. 6,351,000 5,002,000 60,978,000 64,938,000 2.30 1.62 .63 .74 .48 .69 .48 . 50 .bo .M Per ton. 13.70 14.20 12.26 10.62 32,654,000 Corn: New York State . ... 39,466,000 16,408,000 United States 17,849,000 1,623,968,000 Potatoes: 1,662,822,000 21,444,000 United States 26,280,000 187,985,000 Hay: 206,645,000 87,009,000 United States 71,028,000 747,709,000 689,345,000 Number, average price, and farm value of live stoet on farms in Xeiv Yorl: State and in tM United States, .fan. 1, 1910, and 1909, as estimated by the United Slates Department of Agriculture. Horses: New York State United States . . . Mules: New York State. United States . . . Milcli cows: New York State United States . . . Other cattle: New York State United States . . . Sheep: New Yorlc State United States . . . Swine: New York State United States... 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 1910 1909 717,000 710,000 21,040.000 20,040,000 4,000 4,000 4,123,000 4,0.53,000 1,771.000 1,780,000 21,801,000 21,720,000 sso.ooo S',i.s,000 47, 2711, {100 49. 370, 000 Price per head Jan. 1. Farm value Jan. 1. S125.00 $89,625,000 114.00 80.940,000 108.19 2.270,363,000 95.64 : 1,974,052,000 1,177.000 1,166,000 57,216,000 56,084,000 666,000 669,000 47,782,000 54,147,000' 132. 00 1 127. 00 119. S4 107. S4 39.60 34.26 36.79 32.36 18.20 16.60 19.41 17.49 5.00 4.30 4.08 3.43 11.60 8.60 9.14 6,66 528,000 508,000 494,095,000 437,082,000 69,964,000 61,273,000 780,308,000 702,945,000 16,180,000 14,817,000 917,453,000 863,754,000 6,885,000 6,010,000 233,664,000 292,632,000 7,544,000 6,686,000 436,603,000 354,794,000 RECIPROCITY WITH CANADA. 105 Farm property, farm products, live stock, and fruits on hand June 1, 1900, or produced in lS99y as reported by the United States Census. Farm property, Juw 1. 1900. Land and improvements (except buildings). Buildings. Implements and machinery. Live stock Total of farm proi)erty Farm products, lfi99. All crops Field crops (cereals, hay and foragi Cereals Hay and forage crop Fruits and vegetables Vegetables Fruits Dairy products Wool Eggs... Honey and wax. Maple sugar Live stocl:, June 1, 1900. Horses . Mules.. Dairy cows, 2 years and over. All neat cattle Sheep Swine Fowls, 3 months and over Swarms of bees Apples Peaches Pears Plums and prunes. C'herries Grapes .bushels. ...-ran,etc lbs.. All otlier Total - Cotton and manufactures of: Unmanufactured Manufactured Eggs.. .doz. Fruits; Apples, dried lbs. Apples, green or ripe bljls. Peaches, dried lbs . Pears, green or ripe Hops lbs . Meat and dairy products: Beef- Canned do... Fresh do. . . Other do... Oleo oil do. . - Oleomargarine, etc do. . . Tallow do... Bacon do. .. Hams and shoulders do.. . Pork- Quantities. 5.3,. 597 7.3,007 24, 170, .369 49,005 14,:381',140 4, 948, 435 29. 195. 971 2,843i9liS 5, 683, 208 22,642,549 1, 670, 295 4,946,406 8, 955, 533 16,649,712 9:;. 742, 451 43,94:3,209 111:";. 273, 364 3. 104., 541 .50,113,0:12 212,551,671 195, 765, 704 Values. 1909 $1,462,383 1,779,142 220, 756 916, 599 139, 779, 080 Canned do.... 5. 628, 928 Fresh do.... 2.417. Ls,-, Pickled do.... 46.742,815 Lard do.... 4.58,261,434 do-... Lard compound do.... 7,3.245,815 Mutton do.... 1.640,. 572 Poultry and game do. Sausages do. Sausages cases do. All other meat, canned do. AH other do. Dairy products: Butter do. Cheese " do. Milk, condensed do. Total meat and dairy products. 2,925,7.30 3,501,214 Nursery stock . , Cottonseed meal lbs. . . Linseed meal do. . . Seeds: Clover do... Timothy do... Other grass seeds do. .. Onions hush. Potatoes do. . . Wood and manufactures of Wool and manufactures of 814,433,733 623.406,320 14.110,171 26,, 342,842 U, .503, 037 55, ,538,924 35,335,923 104.. 884. 236 3,6.54.li70 16.262.289 128,269.744 13I,181.li42 3,715.803 907.229 41. 4,88., 829 368,S:il.6Sl 10.276.79.S 71.993.6:!8 1,997,099 3,947,900 35,467,821 3,104,175 2,768,681 12.6.87,937 461,919,568 34,414,860 1,183,942 2, 262, ,508 2,,86i2,035 164,464 309, 813 1,421,000 1,843,705 9, .592. 176 3.:-W8.947 17,437.772 312. 287 2.856,390 23,318,162 21.937.171 623.2,80 238. 553 4.494.002 48.770.370 "6.1 40! 922 16.2.929 .827.324 892.549 4,367,133 1,081,678 1.564.243 699,460 4Si:,,8.35 1.012.1:29 1910 $1,428,037 1,742,128 129,497 691,258 109,096,306 .530,824,222 35,678,065 1,328,992 1,847,548 5,466,450 316,361 679,218 2,306,795 1,330,048 5,911,108 3,071,975 11,798,783 387,497 1,119,033 17,880,082 17,881,237 428.396 120.623 4., 806.246 45.9.3.5.897 1,264,424 7.2,58.758 220.104 658.531 .501,669 4,552.691 1,081.383 1,092,088 7,88,71" 435,629 994,216 151, 91 ,4,. 5:37 129. .522.085 357,806 882, 137 739,437,015 I 655,808,089 4,7.5S,40li 18.045,088 223, 642 1.632,081 10,6,60.760 8.877,640 1,471,092 1,103,801 633,785 299, 928 740,097 72,313,280 2,123,165 309,932 10,122,274 9,806,771 620,272 826,252 293,319 201,542 1,028,288 85,789,033 2,359,932 BECIPBOCITY WITH CANADA. 107 Schedule A.— Articles the growth, product, or manujacture of the United States, to be admitted into Canada free of duty when imported from the United States, and recipro- cally articles the growth, product, or manufacture of Canada to be admitted into the United States free of duty when imported from Canada. [From special message of the President of the United States transmitted to Congress Jan, 26, 1911.] Articles. Cattle: Less than 1 year Other, worth not over S14 Other, worth S14 or over Horses; Over 1 year, worth S50 or less. Other, worth $150 or less Other, worth over S150 Hogs Sheep: 1 year or over Less than 1 year All other live animals Poultrv: Dead Live Wheat Rye Oats Barley Buckwheat Edible dried peas Edible dried beans Maize, not for distillation Hay Straw Cowpeas Potatoes Sweet potatoes and yams Onions. Tomatoes, fresh All other fresh vegetables Apples, fresh Cherries, fresh Peaches, fresh Edible berries, fresh Grapes Cranberries Plmns, fresh Currants, fresh Quinces, apricots, pears, and nectarines All other fresh fruit Melons Dried fruits Butter Cheese Fresh milk Fresh cream Honey Cottonseed oil Flaxseed Clover and timothy seed Seed of beet, carrot, parsnip, turnip, etc — Seed of cabbage, kale, kohl-rabi All other seeds and field seeds ( garden ) Timber, hewn or sawn, squared or sided, or creosoted. Planks and deab, not further manufactured than sawed: Of cherry, chestnut, gumwood, hickory, and whitewood. Of oak Of pitch pine Of redwood Of walnut Of white ash Pine and spruce clapboards Fence posts and railroad ties Telephone and telegraph poles, etc Staves, not further manufactured than listed or join ted. Stave bolts (shingle bolts, etc. ) Pickets and palings United States rates. S2 each S:i. 7.5 each... 27^. per cent . $30 each do 25 percent. SI. 50 each.. ....do 75 cents each. 20 per cent . . . 5 cents per poimd 3 cents per pound 2.3 cents per bushel 10 cents per bushel 15 cents per bushel 30 cents per bushel 15 cents per pound 25 cents per pound 45 cents per pound 15 cents per pound .34 per ton .51 .50 per ton 25 cents per bushel do do 2 cents each 40 cents per bushel 25 percent do 25 cents per bushel — do do 1 cent per quart 25 cents per cubic foot 25 percent 25 cents per bushel — 1 cent per quart 25 cents per bushel Iree do 2 cents per pound cents per pound do 2 cents per crallon 5 cents iier gallon 5 cents ]ier dozen 20 cents per gallon Canadian general rates. ree. cents per bushel — (■ ree - 4 cents per pound for free). 5 cents per pound 10 cents per pound ■i cent per cubic foot... ai.25, or .50 cents per M feet. >^1.25 per .M feet do do do do ....do 10 per cent ....do ....do 25 per cent . do do $12.50 each 25 per cent do 1^ cents per poimd . 25 percent. do do 20 per cent. 10 per cent . 20 per cent do 12 cents per bushel . . . . 10 cents per bushel do 15 cents per Imshel do do 25 cents per bushel Free $2 per ton do 15 cents per liushel 20 cents per 1 lusliel 10 cents per bushel 30 percent do do do 40 cents per liarrel 2 cents per pound SI per 100 pounds 2 cents per pound do 25 per cent 30 cents per bushel 2 cents per pound 50 cents per 100 pounds 25 per cent 3 cents C-rch 25 per ce;Tt 4 cents per pound 3 cents per pound 3} cents per pound do 3 cents per dozen 3 cents per pound 17i per cent lo'cents per bushel — 10 per cent 1 ree 10 per cent. do Free .do. .do. .do. .do- .do. .do. .do- .do. .do. .do. 20 per cent. Free Proposed rates. Free. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. Do. 108 EECIPBOCITY WITH CANADA. Senator Williams. What is this table made up from ; what are the sources of it? Mr. Godfrey. It is made from the agricultural statistics in Canada and also in New York. These are New York and Ontario statistics. Senator Willia:ms. The State agricultural statistics of New York and the provincial agricultural statistics of the Province of Ontario? Mr. Godfrey. Yes, sir. Senator Simmoks. I want to ask you about those potatoes you spoke of. I live in a trucking section, and we raise potatoes and cab- bage. We have spring potatoes and spring cabbage. "What time do you market your potatoes? Mr. Godfrey. What time do we market? Senator SniMoxs. Yes, sir. Mr. Godfrey. Throughout the jear a great many of the potatoes are marketed as they dig them from the fields. Senator Si:MiioisS. I should have said is it a summer crop or a spring crop. We dig our potatoes in North Carolina in June. Mr. Godfrey. Yes ; you are about putting your crop onto the mar- ket when we are planting. Senator Simmons. When you are planting, Mr. Godfrey? Mr. Godfrey. Yes, sir. Senator Simmons. You and Canada come in competition; the Canada crop comes along about the same time as yours, does it ? Mr. Godfrey, lou misunderstood me. Senator Sijimons. How is that? Mr. Godfrey. Do I understand you to say that yours and ours come in competition? Senator Simmons. In Canada. I mean you and Canada come in competition ? Mr. Godfrey. Oh, yes. Senator Simmons. Your potatoes and the potatoes from Canada come into the market about the same time? Mr. Godfrey. Yes. Senator Simmons. Do you know what the Canadian potato sells for on the other side of the line? Mr. Godfrey. I understand that unless potatoes are worth more than 50 cents a bushel in New York, on the markets in New York State, Canada can not, or does not, export any potatoes, but when they go above 50 cents a bushel they are able to pay the duty and put potatoes into our markets. That has been done. Senator Sijimons. With a profit? Mr. Godfrey. I do not know whether it is with a profit or not, but they do do it. Senator Simmons. You assume it is at a profit ? Mr. Godfrey. They must get rid of potatoes. You understand these crops are crops that can not be held, and many farmers sacrifice their crops. Last year in New York State potatoes were selling as low as 15 cents a bushel, while they were sold in New York City at anywhere from $1.25 to $2 a bushel. I suggested to the railroad com- panies at a conference that we had with the presidents and managers of the railroad companies, the principal trunk lines in New York, that they make a sliding scale of freight rates if they wanted to help the agriculture of New York, so when potatoes were low back in the RECIPROCITY WITH CANADA. lOQ Country, selling below a reasonable price, that they might be able to help the consumers by reducing the freight rate into New York, and thus help us get rid of our crops. Senator Keen. They received that with a great deal of enthusiasm? Mr. Godfrey. Very largely ; yes. Oiie president of one of the rail- roads said that we would have to change the laws to permit them to do that. Senator_ Simmons. Is there any difference in the soil just on the opposite side of the boundary line between Canada and New York? Mr. Godfrey. I think that was answered by Mr. Hull saying that there was a difference, or I answered it. There is some ditterence. Senator Simmons. It is only a difference in the length of time the land has been cultivated ; that is about the only difference there is, is it not ? Mr. Godfrey. You all know soil varies in every town and on every farm, so we have to select our iields for potato growing or wheat growing or corn growing. Senator Simmons. I do not mean identically the same, but I mean the soil on the Canadian side and on the American side, as between New York and Ontario, is very nearly the same, or substantially the same. Mr. Godfrey. I should judge they were. I do not know. Senator Simmons. But the difference is that our soil, you say, is very much more worn by use than the Canadian soil ? Mr. Godfrey. I think it is. Senator Simmons. That makes the Canadian soil very productive and less expensive, because they have to use less fertilizer ? Mr. Godfrey. Yes, sir. Senator Simmons. That is your position with reference to the land? Mr. Godfrey. I do not know about that. Senator. It is something that I am not acquainted with — that situation. Senator Heyburn. I want to ask you a question. You say you represent in your organization 100,000 farmers. Do you include in that the hired help on the farm ? Mr. Godfrey. No, sir; occasionally we have tenant farmers mem- bers of our organization. They are eligible to membership. Senator Heyburn. Not the laborers? Mr. Godfrey. The laborers sometimes; yes, sir; young men and women who are engaged on the farms are often initiated into our order, and they become valuable members. I might say, just in conclusion, that out of this organization — I have been in correspondence with every subordinate grange, and we have 770 subordinate granges, and out of all this correspondence there have only been two of those granges that have adopted resolu- tions in favor of the treaty. Nearly every one out of the 770 have adopted resolutions and written letters against the proposed treaty. _ Senator McCtjmber. Do you know what actuated those who did pass resolutions favoring it— were there special interests Mr. Godfrey. They had read the proposed treaty and looked upon it as an unjust measure. Senator McCumber. No; I mean those that passed resolutions in favor of it. IIQ KECIPKOCITY WITH CANADA. Mr GoorREY. No, sir; one of them was in the soft fruit section, where they thought they would make a market. They answered that Sey were in the soft fruit section and they thought it would help them in marketing their fruit to be able to send some of it over to Mr Hull. Just at this time, Mr. Chairman, I would like to caU the attention of the committee to these petitions. I do not care to ■ file these petitions with this committee. I want to file them in the Senate- but it has been stated that we, as an organization, have been working with our members to get them to protest against this treaty. As a reply to that I want to say that the Michigan State Grange is behind the movement of sending them out, but we sent them to the highway commissioners of each township. We sent them before elec- tion to the highway commissioners calling attention to the provisions of this bill. It was sent with each petition, and this is just the peti- tion that was sent out. It reads: To the honorable Members of the Senate and PIouse of Representatives, Washington, D. C: We the undersigned citizens of Michigan, residents of County, do hereby petition vour honorable body protesting against the adoption of tlie reciprocity agreement with Canada, and hereby agree that we will never sup- port any man for office who works or votes for its passage. [Laughter and applause.] This was the original petition. In this voting precinct they had the rest of this [indicating], and here are two columns of names. This petition bears 133 names. The next petition bears 153. The next petition bears 306, and here is a petition bearing 88. That says that there were 88 out of 90 voting. Understand that these are not grangers. Some of them are, undoubtedly, but they are farmers from our State, in all the granges, and we have more granges in Michigan than in any other State in the Union — about 900 — and I am free to say to you that I have not heard of a grange in the State of Michigan that is favorable to this measure. There are two grangers that I know of in favor if it — there are probably more Senato)' Williajis. How manj' members have you? Mr. Hull. About C0,000. Senator Williams. Have thej' all filed petitions? Mr. Hull. No; they have not all filed them; but they nearly all will, with the excejjtion of one or two. Let me finish my answering of this question and I will be glad to answer yours. There are two members that I have talked with, and they say, '' Mr. Hull, this matter of protection is a farce, and if we can get this far the farmers are all going to turn around and help us to take the tariff off froitt every other man's product.'" That is the reason those two men are in favor of this bill. What is the question ? Senator Williajis. These gentlemen seem to have signed these petitions in consequence of a letter which you sent around to them. Would you mind reading that letter, so we may see what the repre- sentation made to them was? Mr. Hull. I wish I had that. I would like to have read it here. Senator Williams. The fellows signing petitions are very largely influenced by the letters they receive, sometimes. Senator La Follette. It is a good letter ? RECIPROCITY WITH CANADA. HI Mr. Hull. Yes. You understand that that letter was addressed to the highway commissioner. Whether he handed it to these people or not, I do not know. Senator Williams. I wanted to see what representations were made in that letter. Mr. Hull. It was very similar to the representations that have been made here, and you would recognize it as good antireciprocity doctrine. Senator Williams. Have you that letter in your possession, or can you get one and send it to us? I would like to have one. Mr. Hull. I will send you one as soon as I get home. Senator Williams. Send it to the chairman of the committee. Mr. Hull. I would be glad to do that, and another one that goes with it, if you will read it. Understand, Senator, in a little further reply, that our farmers have liked the word " reciprocity " as defined in the past on non- competing articles, and when this matter of reciprocity was first mentioned our farmers said, " That is all right " ; but you understand that the large papers of the State of Michigan have dinged this re- peatedly in almost every issue: If there was an argument sent against this reciprocity, they picked out some one thing there and held it up to ridicule, and that is the stuff our farmers have been reading, and despite the fact that we have to get it from one farmer to an- other by word of mouth, largely, these farmers of Michigan are aroused almost to a unit to-day, Senator, and there has never been any other bill before Congress or been advocted anywhere that has aroused people to the point of indignation that this matter has aroused many of the farmers of Michigan — that they should go on for years and be called upon to go on and support protection for everybody else, and that little protection should be taken from them. Now, Senator Senator Kern. I was going to ask whether or not you read the body of that petition to the President of the United States the other day when you were visiting him ? Mr. Hull. I did not ; but we said enough to the President. Senator Simmons. According to the newspapers, he said more to you than you said to him. Mr. Hull. The newspapers never gave an argument that we made to the President. Senator Simmons. That is what I supposed. Mr. Hull. I want to say to you that when the President of this United States looks out and finds that the majority of his own party in the lower House repudiated this proposition of his and that it was taken up and passed by the opposition, and that opposition says — it has sounded it around — that they have done it, and done it espe- cially, for the purpose of putting this President of the United States in a hole, he naturally has some galled spots on him. [Laughter.] Now, I am going to call on Mr. Andrew L. Felker, of New Hamp- shire, lecturer of the New Hampshire State Grange. 112 BECIPKOGITY WITH CANADA. STATEMENT OF MK. ANDREW L. FELKER. Mr. Felker. Mr. Cli:iirman, and gentlemen of the committee,' it seems a sorry pity to caJl on a little fish at this stage of the game. It seems like wagging the small tail. of a big dog, but I come down ■here from my New Hampshire home in the interest of the boys and girls np there, especially the boys whom we are trying to interest in getting them back onto the old New Hampshire farms. Being a fellow with not very much experience in Washington, to say the least, but fortunate enough to be along with the majority in a part of our Congress at least, pleading the part of the Democrat — although we do not come here as a Democrat or Republican to plead our cause — I would say that I want to confirm the remarks made by my worthy brother yesterday, Mr. Ilichard Pattee, in the argument he put up against this measure. Not being able to make a speech such as you heard, I would like to ask the loermission of the chairman to refer for a few moments to the notes I have made as to my line of argument against this measure. It seems to me, as my candid opinion, that if those who are advo- cating the passage of this proposed measure could or would stop long enough with their funeral procession to see what a hole they are intending to put the farmer into, they would order a stay in the pro- ceedings at once. [Laughter.] Has this proposition of developing that wonderful country lying along our northern border at the fearful cost of sacrificing the Ameri- can farmer on the alter of his home been considered as it should be considered, and viewed from as many angles as it ought to be viewed from ? "When Kipling called Canada " Our Lady of the Snows " he gave us a very erroneous idea of what Canada is. I would like to read this because I have failed to hear any evidence put before the com- mittee as to what we are up against at the present time over the border line. We have proved the statement that Voltaire made that " North America was but a few acres of snow, not worth fighting for," dead, long, long years ago. The fact is, gentlemen, Canada is a wonderful country, extending from the latitude of Rome on the south to that of the North Cape in Norway, exceeding the United States in area, with Alaska included. You can deduct "that part lying north of the Arctic Circle, and a considerable south of it, and have a" farm remain- ing available for profitable agricultural development with an area of 1,700,000 square miles, a territory, a large part of which is already developed, as large as the United States east of the Rocky Mountains. With the long hours of sunshine in the summer days, mixed with the warm winds of the Pacific, the limit of growing grain and pota- toes and fruit is reached not until we have passed "a "thousand miles beyond our northern border line in western Canada. Thus nature's god has preserved those great plains to the use and for the use of the human family. Canada can easily support a population of at least 50,000,000 people. This shows ns something of what the future of Canada may mean to us. Let us understand clearly that Canada is by virtue of her location, by the quality and quantity of her people, and the development of her RECIPEOCITY WITH CANADA. Hg natural resources eminently able to put herself in a position wherfe she may, yes, and she will, be the one great rival of the United States on this western continent of ours as far as agricultural interests are concerned. Now, I want to read just two paragraphs from this book that I took, a commercial geography which we are studying in the schools in the State where I live. This book was loaned to me by my oldest boy. He said he would let it go for the good of the cause, if I would read this. I want to read one paragraph relating to the farming in eastern Canada, and it says: Agriculture i^ now the leading industry of Canada, furnishing by far the largest share of her exports. The eastern Provinces, south of the St. Lawrence, reproduce the soil and climate of New England, though the part of Nova Scotia along the Bay of Fundy, being shielded from north and east winds, is 6° F. warmer than Boston. And let me say, Mr. Chairman and gentlemen, it gets pretty warm up in Boston when there is a gubernatorial contest on, when there is a Democrat up for election, at least. Besides this district, now a famous apple country, and Prince Edwards Island, which has a very fertile soil, there is little iirst-class farming land in the maritime Provinces. Grain fields have, therefore, largely given way to dairy pastures since railways reached the prairies of Manitoba. That is because of the increased railroad facilities that have opened up that wonderful country in our great Xorthwest. Southern Ontario, especially the peninsular portion, is the garden spot of Canada. It is a great fruit and dairy country, exporting quantities of apples and cheese. Canada is the greatest cheese-making and cheese-exporting country in the world. Senator Simmons. Is not that a great vegetable-growing section, too? Mr. Felker. I could not tell you. Senator. There are some other items here in relation to the Canadian fisheries and the forest prod- ucts, also the fur trade ; but as I was speaking along the line of the greatest interest to me I was reading just those parts. I did not want to bore you any longer than you were willing to be bored. Xow, I have a paragraph in relation to farming in western Canada : The prairie region west of Lake Winnipeg, extending north to the Peace River Valley, is estimated to contain four times as much fine wheat laud as the Dnited States. Moreover, the soil is so fertile, when first won to the plough, that the average yield to the acre is a fourth greater than is the yield in the United States. It is undeniably cold there in winter; but summer crops are not dependent on the winter temperature. Spring is said to be as early, and summer nearly as hot, at Dunvegan on the Peace River as at Winnipeg. Spring wheat is, consequently, a reliable crop at Dunvegan, latitude 56°, while pota- toes ripen as for north as Fort Good Hope, almost on the Arctic Circle. It is thus apparent that Minneapolis is about in the center of the wheat-growing area of North America, measured from north to south. Now, gentlemen, in the face of these facts, for they are facts, is it not easy for us to conceive of a competition fast coming our Avay, if this measure becomes law, that will prove to be another trig to the wheels of agricultural progress in our country, and one that will cause our boys to continue to stumble away from the old farm houses, and abandoned farms in old New England shall continue to 114 RECIPEOCITY WITH CANADA. be the cry of the country side. It is for the boys that I wish to ring out my appeal. The cry came to our ears long ago, that if agriculture was to succeed in New England, we would have to apply the science of agriculture to the soil. And we got busy teaching this truth to the boj's that the future Avas full of promise, of success, if they Avould mix brain and brawn with the soil, and we have been teaching this in our granges, and we are teaching it in our high schools, and we are teaching it in our agricultural colleges, and we have been watching results and they are successful. For the last few years we have been hammering these truths home. The result of this educational work has been to turn the boys' faces back toward the farms; and in New Hampshire we* have got out there on her hillsides and in her valleys, young men. New Hampshire boys, Mr. Chairman, who are meeting new conditions in agricultural life, and they are making good. Eighty-two per cent of the boys who graduated in the shorter courses of agriculture at our college have gone back to the old ancestral home farm, there to wring out of our soil a livelihood and to help make New Hampshire's share of farm production enough to be noticed. But to-day, if you will go through my State and meet these young men and talk with them of their fu- ture, you will find a hesitancy and a fear on their part, and they will tell you that this plan to inject this reciprocity treaty into our system of government to them spells failure in their business, coming as it does, or to some, at least. Others will add, " if it comes this way." No interest getting the loiife but the farmer's interest. We have been telling the farmers in New Hampshire that there is good money in fruit raising, but they are coming back to us and asking how is it going to work out if the duty of 55 cents per barrel on the fruit raised in eastern Canada is removed, and yet we be obliged to pay tribute to the lumber interests for the manufactured lumber that enters into the crates, boxes, and barrels that we pack our fruit in, and also pay toll to the Steel Trust for the iron that is wrapped around the barrels to hold the barrels together. We have been told that we have some exceedinglv good land in New Hampshire on which to raise sugar beets, and I presume we have. They also have some of the best land in the world on which to raise sugar beets over in Canada. I ask you, gentlemen, is it a very encouraging proposition for the New Hampshire voung men, the farmer, to raise sugar beets and be compelled to meet the Canadian farmer in a free market and at the same time pay an 80 per cent toll to the Sugar Trust for the sugar he puts on his table for himself and his family? We might carry this line of thought further, but we will forbear. Have you ever considered the farmer as a manufacturer ? It is true that the Almighty made the machine from which our finished prod- ucts are turned off ; but, gentlemen, some one somewhere has to stand pretty close to the old machine— and it is usually more than eight hours a day— and work the levers to get that finished product. Now, tell me, if you will, why this manufacturer— if we may so term him— the farmer, should be singled out, the first of them all, and told to his face, " I know your business better than you I am right and you are wrong; go home and jirepare for the sacrifice " SECIPBOCITY WITH CANADA. 115 Now, I want to ask you, gentlemen, if we do not get this coming our way, because we farmers happen to stand in the line of least resistance. It seems to me that is the reason for it. Mr. Chairman, many people have got the idea that we farmers are getting the lion's share. Is it true? We have heard testimony in regard to it for the last two days. I would like to ask if 35 cents out of every dollar spent by the consumer for the farmer's products is too much for the poor farmer to receive. I know of one farmer, for he told me this in my own State, that is now selling milk in open competition with the milk from Canada, and receiving for the same 19 cents per can of 8i quarts after the transportation is paid. He told me that he had to pa}^ the transportation on his milk. And yet this reciprocity is going to be the panacea that will cure the illness of the consumer and at the same stroke of the pen give the farmer a better market, better prices, more comforts, and more pleasures. Gentlemen, if you will pardon us, we do not believe it. Again we are told that we are facing a new condition in our agricultural life entirely difl'erent from any we ha^'e ever faced in the historj' of our country; that the consumer is rapidly overtaking the producer, and w-e ha^e got to expand our power of production. I would like to ask, gentlemen, if it would not be better for us to plan some scheme whereb}^ production may be increased in our own country rather than to play the part of the philanthropist, and while Ave are toddling along with the farmers of our own country, carrying the milk and honey up to the Canadian farmers? It seems to me, gentlemen, that we should look to the American farmer first, and then if we have the part of the philanthropist to play, we can go over and play it later on. Gentlemen, we can do this and we are doing it. Remember that the American farmer has never failed you, and we are not going to now. The seeds of a new era in agricultural progress are being shown to-day North, South, East, and West, the fruits of which will ripen into a harvest sufficient for the needs of our consumers for 100 years to come, and by that time we will know how to handle reciprocity better, I hope. It will not be necessary for us to go over the Canadian line for one earthly thing. Neither is it, nor will it be, necessary to break the back of the American farmer with a club of reciprocity while he is struggling to solve the problem that will bring about this desired result. Have you noticed the wonderful record made in the increased production per acre of some of our foreign products? Look at the story of the boys of some of our Southern States, and let them tell you what records they made in raising corn one year and two years ago. Go out to Iowa and have the story repeated ; go to Michigan and get a little child, a girl of 12 years, to teach you what the farm- ers are on the eve of doing, and then judge us and punish, if you must, by forcing down our throats this obno.xious dose of reciprocity injustice; but let me say, gentlemen, if it goes down, if we have to take the medicine, it will be like the Irishman's oyster— it will come back again, aven the thray times. Now, gentlemen, I plead with you to pave the farmer boys from this one-sided, uncalled-for, reckless experiment. 116 EECIPEOCITY WITH CANADA. I thank you. [Applause.] Senator Williams. You said something about apples a moment ago. Does your State raise many apples? Mr. Felker. I could not tell you, Senator, how many barrels of apples we ship. . . Senator Williams. I do not want to know the number, but is it a large quantity? Mr. Felker. We raise quite a large percentage of apples. I do not remember how much it is without looking up those statistics. Senator Williams. Do you know where those apples are chiefly sold? Mr. Felker. A great many of them go to New Yoik and some to Boston for shipment across the water, and some years, when the western country or the central western country is short of apples, some of our fruit has gone there. Senator Williams. Some of them go to Boston and Xew York for export ? Mr. Felker. I presume that is what they go for. I have no doubt but that they are exported largely. I know we raise as good apples as they raise in the country. Senator Williams. I was trying to get at this fact, to know whether they are exported or not ? Mr. Felker. Some years they are. I know of one young man who bought 8,000 barrels of apples this last season, and a large percentage of those apples were exported. They went to London or Liverpool, I think he told me. Senator Gallingee. Our orchards have been sadty neglected of late years, and our farmers are now adopting the spraying methods with a view of improving the apples and the products of the soil. Mr. Felker. Senator, they certainly have been, and I would like to say that in the grange work, one of the features of this work we are doing, we are sending lecturers all over our State, about 300 of them this year, and on the list of experts is an apple expert from Massa- chusetts, Mr. E. Cyrus Miller, who has spent several weeks in our State. I have sent him from one place to another among our people, from the central part of the State to the southern part. He has been pleading the cause of better fruit and the better caring for the old orchards to our farmers, and as a result in one place where that man went he found one granger who had bought something like 25 or 30 Baldwin apple trees to set out. The lecturer went out with him the next morning after the lecture, and went to his farm, and he told him about the soil and the fertilizer and the care he should give the trees and the man set out 100 trees instead of one-fourth of that amount. Senator Johnson. Do you raise Baldwins chiefly? Mr. Felker. Very few. Senator. Senator Johnson. I mean in the State at large. Mr. Felker. Yes, sir; that is the principal apple in our State, the Baldwin apple. Mr. Hull. There is just one thing I want to say to you, gentlemen, before I introduce the next speaker, and that is I want to present a detailed list or a detail record of the actual cost of production of one crop. Now, you will wonder right away how I can sit down and give you the detailed cost, but I have had the advantage of an agri- EECIPEOCITY WITH CANADA. 117 cultural college education and was taught that there was no one thing of more value to a farmer than to know the business end of his business. I have kept such records upon my farm for years. For 10 or 12 years I have been a farmer's institute lecturer, and presume in a hundred audiences I have gone over that in the last two or three years, with an audience of farmers, not to prepare to prove to this committee anything, but to satisfy ourselves what it actually costs to produce a crop. I want to draw a lesson here, that we must produce above the aver- age if we want to get any profit. Now, I am going to present, Avith your consent, the cost of producing an acre of wheat, with just a few words of explanation that may enlighten you. We will take the interest on the investment. Now, I have taken 6 per cent, not because we get 6 per cent, but because if we had the money out of that land we could put it out at interest at 6 per cent, and I can tell you another thing, that there are a hundred tricks whereby a man who has money out at interest may escape taxation, whereas. the farmer who has it invested in land does not know one trick. [Applause.] The interest on that acre of land, valued at $75, at 6 per cent, would be $4.50, the first legitimate charge against that crop of wheat. The next — and this varies with different conditions, whether it is farm manure that is hauled out there with high-joriced labor or whether fertilizer that is bought and jjut on, and I have charged nothing for putting it on, but simpljr took the figures given yesterday by the professor of agriculture of the College of West Virginia of $2 an acre — that was the cost of fertilizer, as given by Prof. Atkeson. Then there is the plowing, with a charge at the rate of $3 a day for a man with team and plow or harrow. Now, if there is any man here who wants to Avork for less than that I would like to knoAv it. Then harrowing three times would cost 90 cents an acre. Senator Clark. What do you have for the plowing? Mr. Hull. Two dollars an acre. Seeding, $1.50. I have credited him with 90 cents an acre. I am only charging 75 cents at the farm Senator Hetburn. You mean a bushel? Mr. Hull. A bushel. I may say Ave are putting on now a little less than 2 bushels. That is the ordinary rule, but Ave have found that upon good farm land less than 2 bushels are just about as satis- factory as 2 bushels, and I am giving credit here, you will find for this Avheat, at 90 cents a bushel, or to be sure to be inside of the figures I have only charged for the acre $1.50 for the seed. Then drilling 40 cents — that is the man's and team's time and the drill- ing. Harvesting and the hauling to the stacks, or Avherever we may haul it, 50 cents an acre ; and if anybody Avants to take a contract_ for doing it on my farm for that I will give them the contract right aAvay. Thrashing, 52 cents; that is, taking an average production of 13 bushels of wheat, at 2 cents for the machine, charging the same for the 13 men that it takes to operate that machine and the board and all that sort of thing that comes in, that other 26 cents above Avhat we actually pay to the thrasher— and I will say to you that if anybody will take a contract for doing that on my farm I Avill let him have 118 RECIPROCITY WITH CANADA. the contract. Then marketing, 39 cents for the acre for 20 bushels of wheat. Now, that makes a sum total of $12.71 ; and you will under- stand in this, gentlemen, that I have made no cost of deterioration of farm fences, farm buildings, and these incidental expenses that must come in in running any business. That is so uncertain that I do not care to put an estimate upon it. Senator Clark. Have you allowed for taxation ? Mr. Hull. In the 6 per cent, you understand. Senator, I have allowed for the taxes. We would have to pay taxes on the money if it were not in the farm unless we knew some of the tricks by which we could avoid it. Senator McCujiber. Have 3'ou allowed for any loss of crops? Mr. Hull. The Senator asked me for the actual cost of producing an acre. Now, your statistics will show you that the average produc- tion of the United States is 13 bushels to the acre. That allows for loss of crop, Senator IMcCumber. I figure this at 90 cents, which is about the average of what it is worth now, and the average for the last 10 years was below that; but that brings us a total cost of $12.71, and the wheat would sell for $11.70. Now, there is no question about that. You see, farmers could not go on doing that. Let me tell you. There are some times that a farmer raises a crop of wheat for less cost than that. In the State of Michigan we put in a crop of beans in the spring, thoroughly cul- tivate that land and harvest the beans, and then will recultivate it and sow it to wheat. You understand that, by good farm practices, we are able to lower the cost at times so it will let us out with some profit, and then the farmer may live and engage in such work. Being the president of the American Dairy and Farmers' Associa- tion, I have lectured to farmers of 13 different States, and I know the farm conditions, and I want to say to you gentlemen that I will stake my reputation that the farmers in this country are not making anything like 6 per cent on their investment. I lectured in Illinois upon the dairy proposition a few years ago, and I talked to those farmers who were living upon that high-priced land. Senator Kern, and they said this last winter — and any of the farmers would tell you that they were not there to testify; it was not something that was being fixed up for testimony before this committee, but it was a fact, as one farmer would say to another farmer— that upon this high-priced land they are very often unable to make 2 per cent upon their investment. Senator Smoot. "Rliat was the average yield? Mr. Hull. I too"- the average yield of 13 bushels per acre because that is according to the report of the Secretary of Agriculture. Senator Smoot. What was the amount you gave for the market price ? Mr. Hull. Ninety cents a bushel. I would like to say that in regard to this petition there are 30,000 signers. Senator Williams. Are they all of the one State « Mr. Hull. All of the State of Michigan. I want to call upon Mr. F. E. Duffy, chairman of the legislative committee of the State Grange of Connecticut. We only have iust one more gentleman to be heard after Mr. Duffy. EEOIPBOCITY WITH CANADA. 119 STATEMENT OF MR. F. E. DUFFY, OF CONNECTICUT. Mr. DuTFY. Mr. Chairman and gentlemen of the committee, ex- cuse me for coming down here, after speaking here two months ago. Since that we have had some speeches which were claimed to repre- sent the farmers of Connecticut made in the halls of Congress by two of our legislators. In those speeches they stated that the Con- necticut farmer Avished this reciprocity treaty ratified, wished this bill to pass, and that we wished to sell on a free-trade market. If they had stopped there — that is bad enough. In that event we would not have been interested enough to come down here, although we should have thought the measure as bad as it could be made. But they went further, and they said that not only we were so stupid that we wanted to sell on a free-trade market, but we were so stupid and so lacking in intelligence that we Avanted to be highly protected ; that we did not want any tariff duties lowered. Gentlemen, I believe a great deal in the Eepublican Party and I have always been a Eepub- hcan— and voted it all my life — voted the Republican ticket. I be- lieve it is because since the tariff of 1909 — but I am not going to talk about that just now. I want to say that we must take issue with the people who are putting foith these statements that I have mentioned. Irepeat, we wish to say in regard to the cost of production, that the difference between the price of labor on this side of the line and in Canada is much greater than the difference between the same kind of labor — not than any kind of labor you may select — but the same kind of labor than in any two States that you may select in the United States. I do not believe that statement can be successfully contradicted. There is a much greater difference. I protest against all labor in the United States — all agricultural labor — being grouped in one bunch, and you telling me that the labor of the South and the labor of the Northwest and the labor of the Northeast — all agricultural la- borers — and then compare the price paid to those men. Noav, sirs, in the business I am in — I am a dairy farmer, and we have to have a very good quality of product to put on the market, and I can not hire all the nationalities that come into this country. We haA'e to hire the men that come from countries where education is general and is of a high character and where they haA^e had a good, thorough, common-school education, and who are intelligent and teachable and who are willing to do things and do them right and be clean. I ask this committee if they are still not convinced — for I believe they are not — that conditions in the Province of Quebec among the two million and a half French-Canadian farmers are equal in any way to the labor conditions, the farmer conditions on this side of the line, they have only got to investigate or send any unprejudiced committee over there to change their minds entirely on this subject. I know what I am talking about on this line, Ijecause I haA'e been through that country, and you know that. You knoAv that one other point with regard to the cost of labor is going to be this, Avhen it is studied : The women in the home manufactures of the French-Canadiafl people — wives and the daughters and the children do the labor that we pay men $30 a month on our farms to do. Now, what is the cost? '.)^2m—yo. 3—11 3 120 EECIPEOCITY WITH CANADA. How are you going to get at the cost of labor under these kind of conditions, and with that statement I will leave you. Senator La Follette. Is that general? Mr. Duffy. Very general, indeed. Senator Keen. You refer to the Province of Quebec? Mr. Duffy. That is more or less true. Senator Clakk. How many are there in there ? Mr. Duffy. I won't say all farmers, but the great portion of her farmers. Senator Clark. Two million and a half people, I think you said. Mr. Duffy. Yes, sir. The point I want to make, the point I want to get clear is this: That the cost of labor of the same quality varies much more be- tween the United States and Quebec than it does between any of the States of this Union, and that is the jDoint that I do not believe can be successfully controveiied, and that is a very important point. Senator Williams. Could you give us the figures of what labor costs ? Mr. Duffy. It has already been filed here with the committee, in the report of the Department of Commerce and Labor. Senator Williams. You saj^ labor in Connecticut costs you $30. Does that include board? Mr. Duffy. Yes, sir; about $30. Senator Williams. Do you know what it costs for labor in Ala- bama and board them? Mr. Duffy. No, sir; I do not. Senator Williams. Do you know what they pay in Mississippi and board them? Mr. Duffy. I know it is very low compared with ours. Senator Williams. Do you know what they pay for labor in any of the States where the African is the chief laborer ? Mr. Duffy. The point is you can not compare that kind of labor with the kind I employ. Senator Williams. I know ; but you just made a statement that the difference between the labor in your State Mr. Duffy. Of the same quality. Senator Williams. I understand that. You did not say that. Mr. Duffy. I tried to make that clear. Senator Williams. You did not say that. Now, if you refer to labor of the same quality, is the Quebec labor of the same quality as yours ? Mr. Duffy. The Quebec laborer has not had a good education, but he is naturally — he has got very good native intelligence. Senator Williams. AVould you just as soon have a French Canadian from Quebec to attend to your dairy cows as a Dane, a Belgian, a Hollander, or an American. Mr. Duffy. I have had them which were just as good ; but, as a rule, no. Senator Williams. No. So that, as a matter of quality for your purpose, they are not the same quality, are they? Mr. Duffy. As a rule, they are iiot quite" so good, but they are better than many of the nationalities that we are compelled to hire. Senator Clark. They are engaged in making a product that comes in competition with your product? KECIPEOCITY WITH CANADA. 121 Mr. DurFY. That comes in competition with our product. Millc from over there is sent doAvn to our city of Hartford. That millf is brought m there and sold in competition, especially every time the fixed price soars a little bit ; then we have to meet this competition from Canada from this milk and cream. Then, again, we must not forget that the land values in Canada are very much lower than they are on our side. In the matter of fertilizers, instead of $2 an acre that Brother Hull puts out on his farm, we have to put it on at a cost of from $8 to $10. All those things enter into the cost of production. It has been told—our representatives from Connecticut made one statement particularly — they said that oats — I have heard it made here, which carried the idea Senator Williams (interposing). Just one thing before you go from that, because it will finish uj) the previous paragraph. Mr. DuFFT. All right. Senator "Williajis. Will you undertake to say that the lands on the whole in the Province of Quebec are as good as those of the State of Connecticut ? Mr. Duffy. Yes, sir ; better. Senator Williams. You say they are? Mr. Duffy. ^Nluch better. I know they are. There is no question about it. Eeacl what Sir — excuse me for using that expression. I would like to have you read an article, written by Sir John McDonald, in regard to the agricultural value of the lands of Quebec. Senator Williajis. I have traveled through the States of New Eng- land, and they do not look like it to me. Mr. Duffy. The standard of living is very low. You went right up the Connecticut Valley, did you not ; passed right along beside the river ? Senator Williams. Do you know of any lands in the Province of Quebec like those ? Mr. Duffy. Thousands and millions of acres. I guess the other Senator here can bear me out in that statement. For the purpose of producing grass and cereals, there is no land anywhere in the world better than the land of Quebec. Senator Williams. One other question in that connection — the general question of agriculture. Can they raise as large a diversity of crops on the lands of Quebec as they can on the lands of Con- necticut ? Mr. Duffy. No, sir ; they can not. Senator Williams. They can not raise as many different crops on the same land so as to reduce the cost of production upon an acre? Mr. Duffy. We can not raise much more than one crop in a season in Connecticut. I can think of but one, and that is the product of the market gardens. Senator Williams. Can you raise anything else after you have cleared off the corn crop ? Mr. Duffy. No, sir; we can not raise anything else upon land where we have had corn, because we have to hurry the operations in the spring in order to get out of the way of the frost in the fall. Senator Williams. Is your land idle in the winter? Mr. Duffy. Yes, sir. Senator Willl\ms. There is nothing on it? Mr. Duffy. We put in some cover crop to conserve the fertility; that is all. 122 EECIPEOOITY WITH CANADA. Serfator Williams. Is the land upon which you cultivate tobacco idle in the winter time? Mr. Duffy. I am not a tobacco grower ; but they usually grow rye or else crimson clover and try to get a cover crop, and that is simply to store the fertility for the next year. Senator Williams. Do you sow any cover, crop after com ? Mr. Duffy. Yes ; we do. I always plant a cover crop in the corn- fields. Senator Williams. That is what I thought. What do you plant for a cover crop ? Mr. Duffy. Eye. Senator Williams. You plow it in ? Mr. Duffy. Yes, sir ; it is not harvested. Senator Williams. I just wanted to get those facts as near as we could get at them ; that is all. Senator Gallinger. With regard to one crop of corn, you are in danger of frost every year? Mr. Duffy. If we get the crop in early enough in the spring we are all right. Senator Gallingee. The spring may be very late. Mr. Duffy. Yes, sir. Senator Williams. One other question. I am asking this simply and 23urely for information. I do not know myself. Does the Prov- ince of Quebec raise any amount of corn to speak of — maize, Indian corn, I mean ? Ml-. Duffy. The dairy farmers near the towns do ; they raise it up near Montreal. Senator Williams. I did not hear you. Mr. Duffy. They raise it up near Montreal. I visited the dairy farms where they had silos. They raise it through all the Provinces. You will find any dairy farmer will be familiar with the fact, be- cause we get correspondence from the different Provinces in our dairy papers. Senator Williams. How does the production of corn per acre com- pare with yours? Mr. Duffy. Not so much, but they raise flint corn, which has a very high nutritive value. Senator Williams. How much value ? Mr. Duffy. It has a very high nutritive value. Senator Gallinger. One point that you made, I think, ought to be emphasized, and that is about the French-Canadian working his children. We found that in our own Kew England factories where they put them in the factory. We have legislated against it, and we are keeping out the young children, but even with our present legis- lation m New England it is not unusual to find three or four of the family in one factory working, boys and girls. Mr. Hull. We Americans want to educate our boys and you want us to. Senator Gallinger. Exactly. Mr. Duffy. These things affect the cost of production. In regard to the buying in Connecticut; in regard to the tariff question, we come back to the point. We do not wish to buy in a too highly protected market. There is not any question about that. You can buy nearly everything that you have a mind to buy cheaper in EECIPEOCITY WITH CANADA. 123 Canada, in my experience, cheaper than you can on this side. I wish to relate a httle experience in regard to oats, one of the things they say you can not buy any cheaper. I think I can make it clear that you can. One of the first experiences after I moved down to within 3 miles of the border Ime of northern New York— it was in the fall, late in 1887, and there was a Democratic collector of customs there! and he was also a member of the school board, and occupied a higher position than I did. He drove up about the second morning I'^was in town and wanted me to take a ride with him, and I was glad to do it, and I jumped in with him and he went out— did not tell me about his business, but brought up some other subject right away, and I asked him. "^Vhat are you going to do? " finally, and he would not tell me. " Oh," he says, " you will see." By and by he drove out about 2 miles toward the line, and drove into an excellent, good farmyard, and he drove up to the barn, and he asked me to hold the horses, and the first thing I knew he had the hired man on the place bringing out the harnesses and throwing them into the wagon, and then he made the man go in and bring out the horses and hitch the horses behind, and then I knew what he was after, and did not need to ask any further questions, and when he came away he says : " This fellow, if I had left him alone a while longer, he would have paid for his farm. He is getting all his oats in Canada." Anybody that lives along the line knows that same thing, and that nearly every woman who crosses the line coiiies back in one way or another with something she has purchased in Canada, because she could get it cheaper up there, because we are not old fools in that section. They know they are buying goods, and they are buying them a good deal cheaper than they can here. Senator Keex. What kind of goods? Jlr. DijFrY. Everything that you can think of, except kerosene oil and a few things like that. I have knoAvn of 28 pounds of sugar being sold in Canada for a dollar; agricultural implements, every- thing you can think of almost, cheaper. Senator "Williaims. Can you buy your bags for grain over on the other side cheaper? Mr. DuFfv. I do not know, because we buy all our grain by the carload ; and we have the bags left with us, and we do not buy them. An amusing incident in this line occurred. I remember being once in Eouse Point and just stepping off from the train, when I hap- pened to see a pair of very handsome lace curtains dropped, which seemed to come from very near a lady's clothing. She gave just one swift glance behind her and went on. I knew her to be one of the wealthiest women in that neighborhood. She never glanced around, because the customhouse officer was right behind her, and he claimed it. I think he knew where the property came from, but nothing was said because they were neighbors, and it would have brought up a very unpleasant subject. [Laughter.] The Connecticut farmer does protest against a tariff; that is, unless he receives reasojiablp. protection himself — for instance, pay- ing a tariff of 45 per cent on tinware. Now, in a Ijiisiness such as I am in that is a much more important item than any of you realize. Senator Williajis. Can it be bought cheaper in Canada? Mr. DurFY. Yes, sir; much cheaper, the admission into Canada being free from other countries. Not only that, but the price is 124 EECIPEOCITY WITH CANADA. exorbitant on all kinds of tinware, over double what it was 12 years ago, and not only that but the quality is very poor. Senator La P'ollette. Do you happen to have any line on the difference in cost or the prices at which tinware sells, such as you would use in your dairy business, in Canada? Mr. Durrr. I can not tell you that for the reason that I did not engage in the dairy business while near the line. I was not inter- ested, or I might have found out. Senator Gallinger. Can you give us the relative costs of the tin- ware now compared to what we paid for it when Wales supplied us? Mr. Duffy. The price of good tinware has doubled in the last 12 years. Senator Gallinger. How does it compare now with what we paid for it before we put the duty on it ? Mr. Duffy. It is very high now. I can not tell you as to the duty — that is 20 years — the duty was laid, if I remember. Senator Williams. Do you know how the price in this country compares with what it was 20 years ago? Mr. DuiTY. It is very much higher, in my opinion. On accoimt of the quality we can not go into the market and buy what we could 10 or 15 or 20 years ago. Senator Williams. Can you tell us how the price in Great Britain to-day compares with what it was in Great Britain 20 years ago. Mr. Duffy. I could not tell you that. I could not undertake to do that. I know in Canada they can buy it from anywhere in the world free, and we have to pay 45 per cent duty on it. Senator Willi.'^.ms. Ho^' about lead ? Mr. Duffy. As to lead, the Canadian farmer can buy his lead that enters into his paints free, and we have to pay 80 per cent for it when we go to paint our buildings. Senator Kern. You say " we " ; whom do you mean ? Mr. Duffy. I mean the American farmers. I might speak of agri- cultural implements, but this has all been testified in regard to before this same committee, and we must not take too much of your time. I believe you have in your records the fact that the mowing machines have been laid down in the Continent of Africa at $12 cheaper than to us ; and not only that, but the quality of our machines is very poor. If you use them and have to buy them over and over again, buying a plow costing $50, and not having it last — actually breakdown at the end of a year or at the end of one and a half years — you would appreciate the situation. We say we want something stronger that will do the work and stand up ; that is all we like. The quality, we understand, is poorer and the price of mowing machines, say, $12; rakes, $5 ; reapers, $33. We are not hungry for that sort of conditions. Senator La Follette. You are speaking now of the prices for which those articles are sold abroad? Mr. Duffy. They have been sold abroad under contract, which lias been testified to before this committee, if I remember right. Senator La Follette. This is a different committee. Mr. Duffy. It was before the former committee. Senator La Follette. Give us this information as fully as you can. Mr. Duffy. I will simply say that mowing machines, it has been testified here, were delivered for $12 each less than they were sold to EECIPEOCITY WITH CANADA. 125 the American consumer, and that the quality was low. This was given by an agent of the International Harvester Co. Senator La Fou,ette._ The quality was inferior ? Mr. DuTFT. The quality was inferior. Senator La Follette. To the machines sold abroad ? Mr. DuFTT. Yes; the machines sold here. Senator La Follette. To the machines sold here? Mr. Duffy. The quality was inferior. Senator Smoot. How was that testimony given ? Mr. Duffy. I would have to look it up. It was given before this former committee. I can get it for you. Senator Smoot. Before this committee? I don't remember any such testimony. Mr. Duffy. I will get it for you, if you Avill allow me the same privilege that has been accorded to Mr. Hull, the master of the New York State Grange. The Chairman. Before the Ways and Means Committee of the House ? Mr. Duffy. It is on record here before the committee and can be obtained. Senator La Follette. I would be glad, sir, if you would send as complete a statement of the various prices at which things are sold to the consumers here — agricultural implements — and abroad. Senator SutMoxs. It would be mighty valuable if we had knowl- edge of it, if it was testified to before the "Ways and Means Com- mittee or some former committee. Senator Heybuen. It would not appear in our reports unless produced before this committee, either by reference or otherwise. Senator La Folustte. I understood the gentleman to say that this statement had been made before some other committee only a few months ago, and is the information I should like to have. Senator Simmons. That is also the information I should like very much to have. Senator La Follette. Make it a part of your remarks. Senator Simmons. I would like very much to have the gentleman get it, if he can. Mr. Duffy. I will try to do so. Senator Simmons. So we will have the whole thing and not just bits of scraps of it. Mr. Duffy. I do not wish to take your time, because I think perhaps all of these points have been thrashed out very thoroughly by other farmers who have appeared before you, but I wish to say that the farmers of Connecticut are not going to stand for reciprocity without the other fellow having the same kind of medicine that we have. That is not a threat ; that is the only reason I repeat that. It has been heralded throughout the papers that we have made threats. That is not a threat. Senator Bailey. It is a simple business condition. Mr. Duffy. A simple business condition; that is the point. We are thrown out of our father's house bodily ; we are thrown through the window, and if this treaty passes— and, by the way, I am not going to say that it can pass until the votes of the United States Senate are on record, for we have faith that you are going to give us 126 BECIPROCITY WITH CANADA. justice, and we do not believe if yon pass this measure we will get justice. Senator Summons. Have you discussed this with the Connecticut Senators? Mr. Duffy. Yes. Senator Clark. May I ask this question in regard to the situation in Connecticut? Did not your legislature there recently pass some sort of resolution with reference to this reciprocity bill ? Mr. Duffy. The history of that was simply this. I j^robably would have been just as ignorant as many of the members of that legislature, because I was in favor of reciprocity. Would you like to have me explain that? Senator La Follettb. Yes. Mr. Duffy. Well, it is just like this: The man that stands at the head of the Republican machine — and there is a machine — is an editor, and he wants free print paper. That is the point. [Laughter and applause by the audience.] Senator Clark. Allow me to say that I am not disappointed in the explanation. [Applause.] Mr. Duffy. He has got one of the ablest and most skillful leaders in the lower house that there is in the United States, and that is saying something. He got hold of this thing just as soon as the public got hold of it. He got the resolution into that house and laid it right on the table, and the public just got what was sifted through this newspaper that I speak of. Xow, when the fact came up and when this came up in the house for a vote, there was not a farmer but what thought that the men who stood back of this treaty and negotiated it had certainly taken care of them, because they were back of those men — sup]:)iised they were — had alwaj'S been trying to uphold their hands. There was nothing in the national Republican platform, nothing in the tenets of the RepulDlican Party to make them believe we were being betrayed, because we were betrayed. Senator Williajis. You thought you were getting iDolitical reci- procity ? Mr. Duffy. We thought we were getting political reciprocity, jus- tice, and fairness. No one knew what it was, and I went downto the senators, and one or two of them went down and dug it up, and there was some opposition in the senate. I can not tell you the number of votes. Then, Mr. Healy got hold of it and called me, and we had just 15 minutes before the legislature was to be called in session. In that 15 minutes we went to two or three farmers in the legislature, and we got one of them to introduce a resolution to recall that iFrom the senate, and so see if we could not get it passed, and I believe that the majority of that legislature voted to recall it, but the leader, who had appointed the speaker— that is, the speaker appointed by this leader to whom I refer — that leader ruled, and there was not any- body there quick enough and who was onto the job quick enough to stand up and fight, and the thing went through that way. That does not represent the farmers, and the legislature of Connecticut is going to be more careful in the future. Senator Bailey. Are you able to say whether or not the provisions or details of the agreement were discussed at all? Mr. Duffy. Not in the house. Senator Bailey. Probably they did not have a copy of the bill before them. KECIPKOGITY WITH CANADA. 127 Mr. Duffy. Not even a copy of the bill. In the first place, that shut off discussion under the rules of the assembly. Senator Baiij3T. I thinlv I know some Senators that indorsed it before reading it. [Applause and laughter.] Mr. Duffy. We are not uttering any threats. It is a business prop- osition that this should be passed, and I say I believe it never will. But suppose it is passed, and we find ourselves bodily thrown out, the only weapon left to us to fight with is the same weapon that is left to other mterests, and that is our ballot, and of course we are going to use that ballot. Now. that is not a threat, but conmion busi- ness sense applied to our line of business; that is just what the manufacturer would do ; that is just what any interest in this country would do; and the farnier has got enough intelligence and he is man enough to use it, and he is pretty thoroughly aroused on this question. I believe the farmers in this country are more thoroughly aroused on this question than anything that has happened since the time of the Civil War. They have studied it thoroughly. Our members over there, when I talked to them, tried to tell me this: They said, " You won't make anything out of the Eepublicans ; go over to the Democrats." What a position you will be in then. If you will pardon me for repeating a story, it will clear the situa- tion perhaps; it may be an old one — perhaps it is — but if we will just review it, it will clear the situation. They tell this little story on our good Democratic mayor down at Hartford, Mayor Smith. He is a good speaker, and he is called on to speak throughout the State of Connecticut, even before Republican assemblies, and he goes out and discusses various topics, and he has got it into his head, so a minister friend of his said the other night at one of our banquets, that he can tell a Democrat whenever he sees one. He can go right down through a crowd and pick them out, and this minister friend tried to test him the other night, and they went down, and the ma}'or walked up to a man, and he says, " You are a Democrat." The man replied, " Yes, sir." He walked down to a second citizen and said, " You are a Democrat." " Yes, sir." He walked down to a third gentleman there, who was a Swede, and he asked him, "Are you a Democrat? " The man began to look very puzzled and very queer and a little indignant, and he said, " Yes, Mister, I know I look like hell, but I just got out of the hospital." [Laughter.] Now, the Republican farmer, who has always voted the Republican ticket and whose fathers before him have always voted the Eepub- hcan ticket, is going to be queered a little in his principle; but re- member that before they get ready, as they must get ready if this thing passes, to vote the Democratic ticket, they have passed through terrible tribulation. Senator Smoot. Just a minute. In your remarks you stated that tinware in Canada was free, did you not? Mr. Duffy. Yes, sir; as I stated, yes. Senator Smoot. I want to correct tliat statement. It is not free. Mr. Duffy. How much is it ? Senator Smoot. 15, 22-J, and 25. Mr. Duffy. Under reciprocity? Senator Smoot. No, no. 128 RECIPBOCITY WITH CANADA. Mr. DoFFY. I intended to make clear in regard to reciprocity, that if this reciprocitj' bill passes^ — I am glad to have you correct me— I think it is to be 'made free, unless I have made a very serious mis- take — under the reciprocity bill. Senator Smoot. Another thing. Did you mean in relation to free lead that Canada had the advantage over you, or the dairymen of Canada, because of the fact that Canada had free lead? Mr. Duffy. I understand that she has free lead. Senator Smoot. Canada has not free lead. Senator Gallingek. Canada pays a bonus on the production Senator Williams. I understand the facts are that tin in Canada pays 25 per cent; in the United States 45, or a difference of 20 per cent. Senator Bailey. I am a little interested in this last suggestion about the political end of it, and I want to promise you this, that if you will come over to the Democratic Party we will at least not treat you any worse than they did. Mr. Duffy. We are realizing that the Republican Party Mr. Hull. I may say that the Democratic Party has looked that way, and I do not know what the Republicans are going to look like to us if they put that over on us. Senator I3ailey. You have got to make them understand that when they mistreat you, you will punish them ; you have got to make both parties understand that. Mr. Hull. It is simply a matter of plain self-defense. Senator Bailey. I say, when they mistreat you, you must punish them. If you submit to this sort of mistreatment, you will encourage them to mistreat you. Mr. Hull. I think it is going to be that the farmer of this coun- try is going to occupy the same position that, relatively, the farmers of the old country occupy, if we submit to this thing. Senator Clark. I might make this suggestion, that before the vote is cast it might be well to scan the vote of the two Houses of Congress. Senator Bailey. If I can have all the farmers to help me, I will beat all these raw-material men in the Democratic Party, certainly. Senator Smoot. The only way that can be done is to appeal to the Republicans. Senator Bailey. You Republicans negotiated this treaty. Senator Smoot. And depended upon the Democrats to carry it out. Mr. Hull. The British tin that comes into Canada from Great Britain is free. There is one other farmer we would like to hear, if you are willing to do so. Now, I, as the representative of these 14 States that have very kindly thanked this committee for the courtesy they have shown us. Although the part of the Govern- ment at the other end of the Avenue did not seem very well pleased to see us, and our arguments did not seem to be especially pleasing either, we are glad to go back and say that the Senate Finance Com- mittee treated us as well as any man "or any set of men ever dare ask to be treated. Senator Bailey. And the Senate is not such a bad body after all. Mr. Hull. I think not ; and God knows we hope you can prove it to us. [Laughter and applause.] RECIPROCITY WITH CANADA. 129 Senator Williams. It needs proof yet? Noav, this other gentle- man, while not a member of our order— and I have not been elected spokesman for him — you understand I know nothing about his line of argument ; he is not one of us ; but we would like you to hear him if you are willing to listen to him. Mr. Ferguson, a farmer from the State of Wisconsin, who has been a farmer in, I think, the Province of Saskatchewan. Senator La Follette. That is what we are here for. Mr. Hull. Then, I would be glad to introduce to this committee a farmer from the State of Wisconsin. STATEMENT OF MR. FERGUSON, OF WISCONSIN. Mr. Ferguson. Mr. Chairman and gentlemen of the committee, I have a typewritten address. I presume that is all you will see of it. [Eeturning manuscript to portfolio.] The points that I had intended to mention, many of them, have been very ablj' covered, and it is get- ting late and I do not wish to impose upon your time. I can not claim the honor of being the master of any grange or of occupying any official position other than the manager of my own farming operations. I have just begun to open up a farm over in Wisconsin of a couple of thousand acres. I have been a farmer in Saskatchewan for seven years. I don't know whether it is just to say that I am a Canadian farmer or not. In approaching this question I always like to clear away ground to stand upon before I undertake the job, and I would like to arrive at a definition of reciprocity and what reci- procity is, if we can. As I understand it, our President in one of his early addresses on this subject referred to I\Ir. McKinley as being an advocate of reciprocity. We would infer from that that the Presi- dent is in favor of some kind of reciprocity that McKinlej'- advo- cated, and if he is, I think we can all enforce that kind of reciprocity. Let us examine a minute and see. Mr. McKinley advocated a reciprocity that provided that we should ship to a foreign country products that that country did Jiot produce free of duty, and then, in return, that country should ship to us their products that we did not produce free of duty. By looking at the schedule — at the pro- posed agreement — we readily observe that it is not in harmony with the present pact, because the first proposition in this treaty or agree- ment provides that Canada shall have the right to export to us free of duty all the farm products that she produces. Senator Williams. In that connection, if you don't mind my asking you a question, because it comes in here, is there anything in the world that Canada does produce that we do not produce Mr. Fee&usox. May I state this? Senator Williams (continuing). Except icebergs. Mr. Febguson. The Eastern Provinces, gentlemen, I know noth- ing about. I am only acquainted with the Northwestern Provinces of Manitoba, Saskatchewan, Alberta, and so on, and do not know what they produce in the eastern part. They do not produce any- thing in the Western Provinces, so far as I know, that I do not pro- duce on my farm. Senator Williams. I think it is an actual fact that Canada is the nearest to America I ever heard of. ]^30 EECIPEOCITY WITH CANADA. Mr Ferguson. Not so far as the western Provinces are concerned. But the point I wish to make right here, gentlemen, is that this is not McKinley reciprocity, and what object the author of this agree- ment has in quoting President McKinley as being m favor of reci- procity, unless he favored McKinley reciprocity, I do not know. Gentlemen, there can only be two, only two, horns to this dilemma, according to my idea. The first one that I will mention is the igno- rance of what McKinley believed concerning reciprocity, ihe other is a desire to mislead the American people. Now, that is my opinion, gentlemen. I am not here to say which horn of this dilemma we will take hold of, but I can not see how you can escape one horn or the other. That kind of business does not appeal to me very well. Now, in regard to what the treaty provides, I want to say, gentle- men, that I am an optimist. I would rather be a booster any time than a " knocker " ; I would rather take the affirmative side of a ques- tion any time than to take the negative, and I am on the negative side of this question by force of circumstances. This agreement provides, or the arguments— the arg-uments that are offered m favor of it state that it will be a good thing for the Associated Press. Well, I have not any questions to ask or any criticisms to make concerning that argument. I believe it will, inasmuch as it costs the Associated Press now about $3,000,000 duty on pulp and paper that they get from Canada— I think it would be a good thing, therefore, for the Asso- ciated Press. Senator Sjmoot. You mean the publishers — the publishers' associa- tions? Mr. Feeguson. Well, I understand that the Associated Press and the publishers — to me it all means the same thing. I am not ac- quainted well enough to make any differentiation there. Senator Sjioot. They are both in favjr of the reciprocity bill. Mr. Ferguson. Well," I won't question that they are — I think they are. Senator Smoot. The publishers' associations are the ones that use the paper and the Associated Press is the one that distributes the information, the news. Mr. Ferguson. Yes. Senator Smoot. The only reason I interrupted 3'ou was to correct your statement and get it right. Mr. Ferguson. I would not have thought of making am' distinction there. I am not going to undertake, although I have the arguments in my gTip here that have been advanced by two of the leading repre- sentatives of this pact, to go over all those arguments, although I would like to, but I -want to select a few. I would like for you to explain to me, gentlemen, how this proposition is going to help the consumer, by the admission of dairy products and vegetables fi'ee from Canada, and at the same time to benefit the farmer of the United States by giving him a market for his dairy products and vegetables, which both of these gentlemen who have argued on this subject have stated. I do not know how many horns there are to that dilemma, but I do not see how that can hold good. I think in logic thej^ would tell you that that argument is invalidated by contradiction. Again, they will tell you that the farmers are going to be benefited. This is a long-drawn-out subject, and I simply won't attempt to go over the arguments here eithei' ; only simply to note this: That the EECIPEOCITY WITH CANADA. 131 farmers will lose at lenst 10 cents per bushel — I believe I am con- servative in that statement — on the entire production, the wheat pro- duction of the United States, which is about 750,000,000 bushels, l^ow, you will note, that is about $75,000,000. We produced last year about 200,000,000 bushels of barley. The difference in price in the two countries is about i^5 or 27 cents. Figuring that we lose 20 cents a bushel, that would make us about $40,000,000. About $115,000,000 so far they have got taxed up to the farmer on that proposition. It seems to me that is a pretty good bill for him to pay. That is not all. Here is the point that is overlooked by the majority of the people who are discussing this subject at this "time, that is. that there will be another difference in addition to this 10 cents per bushel, on the ground that the Canadian wheat is a better grade than American Avheat: that Canadian barley is better quality than American barley; that Canadian oats is a better quality than American oats, and if you want a concrete example of that, I can inform you that I have been selling for the last four years oats that I grew on my farm in Saskatchewan at about an average of 70 bushels per acre — I have been selling them to the farmers in the United States, in Michigan and in practically every State in the Union — some of these gentlemen may have sown some of my oats for aught I know — at $1.50 or $2 a bushel, f. o. b. Minneapolis. Senator Williams. Did you sell them for consumption or seed ? Mr. Feegusox. Seed. Senator Williajis. Oh. Mr. Ferguson. Seed ; yes, sir. I am glad you asked that question, Senator. I happened to have, last year, one carload of oats left over. The season was a little earlier — extraordinarily early last year — and I was not able to dispose of quite all of my crop. I sold the Standard Oil Co. some of those oats to feed; I sold the Merchants' Package Co., who use a great many delivery horses, some of those oats for feed ; I sold the Pittsburg Coal Co. some of those oats for feed at 65 cents a bushel. Senator Kern. Where ? Mr. Ferguson. Minneapolis. Senator Kern. What did you say ? Mr. Ferguson. Minneapolis; and oats at that time on the mar- ket — now, mind you, gentlemen, those oats were for feed, not for seed. Of course I regretted to sell them at that price, but I had to. If you want the exact price that was paid, the Pittsburg Coal Co. paid me 05 cents; the Standard Oil Co. came along a little later and they paid me 50 cents ; between the two the Merchants' Package Co. came along and they paid 60. Senator Kern. That was on account of the superior quality of the oats? Mr. Ferguson. Yes, sir; those oats weighed 45 pounds to the bushel. Senator Kern. Did that have any effect on the oats market of the Qnited States? Mr. Ferguson. I should think that it would ; and the same thing holds good with wheat— Canadian wheat is a better quality. Senator Williams. Forty-five pounds per bushel ? Mr. Ferguson. I beg your pardon. Senator Williams. Forty-five pounds per bushel ? 1^2 EECIPEOCITY WITH CANADA. Mr. Ferguson. Yes, sir. , , „ ^ ■ oo j » Senator Williams. In commerce a bushel of oats is o2 pounds' Mr. Ferguson. Yes, sir. » „„ i +1, u j Senator Williams. Did you get more for 32 pounds than anybody else 2 Mr Ferguson. I sold my oats for 32 pounds, only I would sell them— but you understand when I say 46 pounds that means stroke Senator Williams. I understand that ; but did you sell your oats by weight or by Mr. Ferguson (interrupting). By weight. Senator Williajis. By quantity— how much did you get tor 32 pounds? Mr. Ferguson. I got 50 cents, 60 cents, and 65 cents. Senator Williams. Those are the prices you just quoted ? Mr. Ferguson. Yes, sir. And I got $1.50 and $2 for seed purposes. Senator Smoot. Are you still running that farm in Canada? Mr. Ferguson. I am. Senator Smoot. Do you intend to continue running it ? Mr. Ferguson. I had not intended to [laughter] ; I had it listed with a gentleman for sale. I had sold out one farm. I am only farming 2-iO acres Senator Smoot. In Canada ? Mr. Ferguson. Yes, sir. In Saskatchewan. Senator Smoot. When did you go there? Mr. Ferguson. I went there seven years ago. Senator Smoot. What did you pay an acre ? Mr. Ferguson. I paid $12,' $12.50, and $10. Senator Smoot. What did you sell that part you have sold at? Mr. Ferguson. I sold it at $31.25. Senator Ssioot. That is about the way the improved land in western Canada, in Alberta, and through that part of Canada is selling for to-day. Mr. Ferguson. Improved? Senator Sjioot. Yes; plowed land. Mr. Ferguson. Oh, yes; but raw land, you understand, is very much cheaper. Of course, you can get raw land — go out from the railroad and get land at from $12 Senator Smoot. In Alberta seven 5'ears ago land sold for $2.50 au acre, and now it is about $10 or $12 an acre. Mr. Ferguson. Yes. Here is another point I will mention, since you suggested it : With regard to the productiveness of that land, the first year that I went to Canada I bought a little farm of 1,280 acres, and I bought a Reeves outfit, a 32-horsepower plowing engine, manufactured at Columbus. Ind., which pulled ten 14-inch plows. I plowed up the first year 760 acres, and I produced on that land the first year enough to more than pay me for all the land I had bought. Senator Smoot. I have seen that same feat accomplished in Al- berta time and time again. Mr. Ferguson. Yes. But, to take up the thread of the point I wanted to make, Mr. Taft and Mr. Hill inform us that this imagi- nary line and those iron posts do not cut any figure with us, for the simple reason that Liverpool over there controls the world's markets, EECIPEOCITY WITH CANADA. 133 and it would not make any difference in the price. A gentleman last night, discussing this matter, suggested a happj^ thought, and won- dered on which side of the line Liverpool controlled the price, when it is about from 10 or 12 — from 7 to 12 cents higher on this side than it is on the other. If Liverpool controls the world's markets, on which side of that boimdar}^ line does Liverpool control the market? Senator Kern. At what point on this side of the line is it 7 to 12 cents higher ? Mr. Ferguson. At Minneapolis. Senator IvJERN. Minneapolis? Mr. Ferguson. Yes, sir. Senator Keen. Is the wheat bought there bought mostly for grind- ing into flour for export? Mr. Ferguson. Minneapolis? Senator Kern. Yes. Mr. Ferguson. That would be my opinion — that that is Irue. Senator Kern. That pays no tariff at all now, does it — compara- tively none — that is, wheat brought there from Canada ? Mr. Ferguson. No — you are talking about from Canada? Senator Ivern. Yes. Mr. Ferguson. That is brought in in bond. Senator Kern. And they get the rebate in effect, so that they only pay a tariff of about 1 per cent, or 25 cents a bushel ? Mr. Ferguson. There is no Senator Kern (interposing). Practically no tariff. Mr. Ferguson. Xo price on wheat in bond; none at all; that is out of the market. Senator Ivern. How does the price at Winnipeg and the price at Chicago compare? Mr. Ferguson. Well, I should say that the price at Chicago is considerably higher. Senator Kern. Higher than Winnipeg? Mr. Ferguson. The price in Chicago or Winnipeg? Senator Kern. Yes. Senator La Fot.t.ette. You can not make that comparison, because the grades are not the same. Senator McCumber. I suppose he means the same grade of wheat. Senator Kern. Oh, yes; the same grade of wheat. Mr. Ferguson. I am very willing to answer any question that I am able to. Senator La Follette. The same grade? Senator Kj:rn. That is what I am asking him. Mr. Ferguson. I would not say what the price of wheat in Chi- cago is, because I have not looked it up. Senator Kern. Is not there a difference of from 5 to 7 cents a ' bushel on wheat between Chicago and Minneapolis ? Mr. Ferguson. No ; I did not know there was. Senator Kern. And is there not about 8 cents per bushel, or 4 cents difference per bushel, between Chicago and Kansas City? Mr. Ferguson. Between Chicago and Kansas City? Senator Keen. Yes. Mr. Ferguson. I do not know. Senator I^en. And about 3 cents a bushel between St. Louis and Chicago. Now, how do you account for that difference in the price? 134 BECIPEOCITY WITH CANADA. Mr. Ferguson. I would say that that difference in price was regu- lated by su^Dply and demand. Senator Kern. Would the transportation problem figure in it any ? Mr. Ferguson. Not very much, 1 would figure, for this reason, that you have to mill more in Minnesota than you have in Kansas City or St. Louis. Senator Kern. I am not talking about St. Louis; I am talking about Chicago and Kansas City. Plow do you account for the differ- ence in price of wheat between Chicago and Kansas City — the same grade of American wheat? Mr. Ferguson. I would say that transportation and the expense of handling would figure in that ; but let me call your attention, Senator, to one thing ; that arg-ument has been made often. Senator Kern. It is not an argument. I am asking you for the facts. Mr. Ferguson. Excuse me. The comparison has been drawn be- tween Winnipeg and Minneapolis and the other cities to the effect that it is on account of the difference in freight rates and handling. Let me remind you Senator Kern. I did not say that. Mr. Ferguson. No: but Mr. Hill and Mr. Taft both have. Let me remind you, gentlemen, that the Winnipeg price indicates the price at the Fort William market, which is practically equal to Duluth or Minneapolis, so that does not hold good. Senator Williams. One question right there. Wherever Canadian wheat sells at a higher price than American wheat Mr. Ferguson. I beg your pardon. Senator Williams. Wherever Canadian wheat sells at a higher price than across the border, is it not owing to difference in the quality of the wheat ? Mr. Ferguson. A difference in the quality ? Senator Williams. Yes. Mr. Ferguson. No ; I think not. Senator Williams. Is there any difference in the quality ? Mr. Ferguson. There is. Senator Williaims. It is superior wheat? Mr. Ferguson. The Canadian ? Senator Williams. The Canadian wheat. Mr. Ferguson. Yes, sir. Senator Williams. So that you say now the quality of the wheat has nothing to do with the price? Mr. Ferguson. I should not say anything, but it does not— it is not the controlling factor. May I illustrate? ^ Senator Williams. Wait a minute. I have heard a great deal about No. 1 hard wheat. I do not know what it is. I do not know any- thing about wheat, but I suppose it indicates something definite to everybody in the market, just like middling grade of cotton. Does No. 1 hard wheat sell at any different price on" one side of the border and on the other, and, if so, what is the difference, and give me the markets m which it sells for the different prices. Mr. Ferguson. Would you kindlv state that question, the last part of it? Senator Williams. Does No. 1 hard wheat sell at one time at a different price on one side of the border from what it does on the EECIPEOCITY WITH CANADA. 135 other side of the border, and, if it does, what is the difference in the price, and where do you get the figures; where did tiie sales take place ? Mr. Ferguson. Well, you can refer— I think I would refer you to Senator jMcCuniber's report on that. I think that would furnish you the information very definitely and accurately. Senator AVilliajis. AA'ell, I can find that, you know, myself. You do not know that ? Mr. Ferguson. I do know, but then I would not be able to give vou the definite dates. ^ I knoT\' that No. 1 hard wheat sells at a hig'her price in Minneapolis than it does in Canada. Senator AVilliams. Yes. Mr. Ferguson. I know that. Senator AYilliajis. And middling cotton will sell at a higher price in Yew Orleans than it will in Yazoo City, Miss., will it not? Mr. Ferguson. You will have to excuse me. Senator Williams. Minneapolis is the point of consumption of the wheat — it goes there to be ground into flour? Mr. Ferguson. Yes. sir. Senator AYilliajis. That is the ultimate point of consumption, and, of course, it is higher there than where it started from. Mr. Fergx-son. I could hardly agree with you. if you will excuse me. Senator ^McCumber. Let me call your attention right here to the fact that there are about 20 lines of railways on the Great Northern, and brunch lines that reacli up to Canada. :'.ii(l the town on one side of the line sells it wheat of the same grade all along from 10 to ir, cents a bushel less than on the American side, the freight being exactly the same. Senator Williams. Where did you get that? Senator ^^IrCi'MnKK. We got that from the repcrts of the two towns right ;\long. dav in and day out. Senator AA^illiams. AA^hat are the two towns? Senator 3IfCx'?.n;ER. I will give you tAvo toAvns. I will give you Xitchie on one side and give you Emerson on the other side, and give you Pembina, compared with Emerson on the other side. AVe will take Portal and North Portal on the other side of the line. Senator AA'illiams. AA^ill you file that as part of the testimony in this matter? Senator McCumber. All right. Senator Sim^ions. You meant Senator McCumber's speech? Senator McCumber. It was a good speech, because it was correct. ilr. Ferguson. With regard to the point, the difference in Liver- pool does not control. It controls the world's market, but does not control the domestic market. Allow me to refer you to the market reports on the 4th day of March last for that information — for a concrete example of that. The market value of wheat decreased on that date 2^ cents a bushel in Liverpool and on the same day it ad- vanced 2} cents a bushel in Minneapolis. Senator Kern. How much is it in Chicago ? Mr. Ferguson. Where? Senator Kern. Chicago. Mr. Ferguson. I did not notice Chicago, but it did in Minneapolis. \t:i2^r,—y„. 3—11 4 136 EECIPEOCITY WITH CANADA. Senator Williasis. In other words, the price of wheatin various marlvets fluctuates automatically with the fluctuation in another place. Mr. Ferguson. The fluctuation in wheat marlvets— the wheat market in the United States is reported to tlie hei.ifht that it is sup- ported bj' the consumption. We produce in this country, according to Secretary Wilson's report, about S bushels— about that much per capita — while we consume about 7 bushels per capita. That would leave us, gentlemen, you see, not on an export basis. We come within 1 bushel of consuming our product. Now, then, Canada, while they consume as much per capita as we do, I believe they produce about 24 bushels per capita. I would not state that definitely, but I believe it is about 24 bushels, and if you deduct 7 bushels from that you see you have about 17 bushels for export. Canada is on an export basis ; the United States is not. That IS, gentleman, the point that makes the difference or one of the differences. Senator WiLLiA!\ts. The United States does not export wheat? Mr. Ferguson. Yes; the United States does export wheat, but only a very small amount. We only exported about 62,000,000 bushels last year, ground into flour, and that would not put us on an export basis". Mr. Daniel Eankin, in Tarkio, Mo., is a great cattle feeder; he uses large quantities of corn, and corn in his county is higher — if any of you happen to be acquainted with that situation — than in other counties, because Mr. Rankin is a feeder and not a seller. And for that simple reason we have a good market for our farmers' products here, and we are not on an export basis, and for the adverse reason Canada is on an export basis and does not have so good a market and demand for wheat ; and consequently Liver- pool does control the price of the wheat in Canada, but not for the United States. There is a more serious matter, to my mind, gentlemen, than the actual cash loss to the farmer, which is the loss in the value of his lands; and if any of you have thought that this is only a momentary injury that we will receive from Canada I want to call your attention to some of these facts concerning the area of the Provinces of the Northwest. In the first place, Saskatchewan has 162,000,000 acres of land, and 86,000,000 acres are good, tillable land to produce 20 bush- els of wheat per acre. Alberta has about 160,000,000 acres of land, and 100,000,000 acres of good, arable land — good, tillable land that will produce 20 bushels of wheat per acre; and 3»Ianitoba has about 47,000,000. You can readily see that Saskatchewan has more tillable land than the entire acreage of Wisconsin and INIinnesota — we think that those are pretty good States — to say nothing about Alberta. We have been sending to Canada in the past few years, since 1900, I think we have been averaging about 45,000 farmers a vear up there, and this year the statistician in Winnipeg estimated that he would get 200,000. That is only an estimate, but they are basing Senator Hetburn. Men ? Mr. Ferguson. Emigrants — people from the United States. I could not say that they would be — I do not know that that would mean that those are all male. I do not understand that. "NAIiat does that mean? That means that every year and every year and every year, for years to come, Canada will pour down the hordes of grain EECIPEOCITY WITH CANADA. 137 on us. And why do we want to undertake a proposition of turning out from our factory, undertaking to market from our own factory all our own product and then contract to market the products of some- body else's factory at our expense? What would you think of a fellow who was buildmg carriages and could find a market among the dealers for all of his carriages, we will say, about five carloads, and that five carloads he would sell to the jobber? "Wliat would you think of his management, his business acumen, if he would go to an- other factory and agree to take the output of this factory and load it on and sell it through his sales agency when he had all he could sell before. Wliat effect would that have on his business? Gentlemen, it seems to me that is what they propose to make us farmers do. But the most serious injury to the farmer and to the country at large is the loss of his farm and his money. We will send our money to Canada by the millions; we will send our fanners to Canada. Wliere we have sent them by the thousands before we will send them by the tens of thousands if this law goes into effect; and what will the effect of that be on our country ? It will mean that farmers will be shoved back into the condition from which they have just so recently painfully emerged- It means that our land values will be decreased; it means that our unimproved land will remain unim- proved ; it means that our factories will not have so much to do then as they have to-day. Let me call your attention to a message that seems to me a much more practical solution of the proposition as to how to increase the demand for our manufactured articles. We have to-day in Minnesota about 52,000,000 acres of land; we only have about two-fifths, or 19,000,000, under cultivation. Suppose we put that two-fifths under more cultivation. The value of the farm machinery in Minnesota to-day is estimated by the United States at $52,000,000. Suppose we put two more fifths, double the cultivated lands, improvements, etc.. in Minnesota. There are fifty-two millions more demand for manufactured articles of all kinds. "What would that mean to Minnesota, in the twin cities? Well, what would obtain in Minnesota would obtain in the Dakotas and would obtain in Michigan and in Wisconsin. Wisconsin is not half under cultivation, and yet they have some good land over there, just as good as anywhere. We want to improve our own country. Canada is friendly with us, but I do not see any use in abandoning the arguments that we do not slap Canada in the face. "Who has been talking about slapping Canada in the face? I do not know of anybody who has. I am about as friendly to Canada as anybody I know of, but I am not in favor of throwing awaj^ my own welfare to a questionable advantage to Canada, and I seriously question myself whether this would be of any permanent value to Canada, and I seriously question it when it comes to prices. Now, when it comes to the improvement of our land, it will be unquestionably, but when it comes to prices there is a question in my mind about it. There is one more question I want to mention, and call the attention of the farmers to especially, and that is the manner in which this proposition came before 'the country and the source of its origin. Legislation of this character generally is inaugurated through popu- lar demand. Well, if there was any popular demand for this before it was sprung on the public I have not heard of it and I did not know anything about it, and I do not believe anybody else did. Where did 138 KECIPROCITY WITH CANADA. it eome from? The Pix'sident poses us the author of this proposi- tion. Well, I am not here to say that he is not the author of this proposition, but there are a few events that have occurred that are wonderfully suggestive to me in regard t(j this matter. How does it come that Mr. Hill and JNIr. Taft came before the public so soon after that proposition was launched, with twin arguments and so near the same that you can hardly tell them apart, and the argu- ments were made very soon after this proposition appeared and was proposed to the public ; and how does it come that the Associated Press was the first to take the matter up, and continued to take it up, although the chambers of commerce in the Northwest have gotten a little bit shy on the proposition, and Duluth, and Minneapolis, and St. Paul, and Chicago, and Omalia ])ropose to hold a mass meeting— their chambers of commerce and their millers, etc. — to create enthu- siasm in support of this thing? For some unexpressed reason or other they have abandoned that idea, but the President was the hon- ored guest of the ^Vssociated Press the other night, and they still seemed to be somewhat in favor of it. [Laughter and applause.] Gentlemen, I will tell you what I believe. I will tell you this: I believe in su]iporting the dignity of every officer of our Govern- ment by defending the honor of the official, wherever it is possible, and I have no words to-day to utter directly against ]Mr. Taft, but it seems to me that this measure had its origin souiewhere else than with the administration. Pdse why are these peculiar circum- stances? I l)elie\e that we farmers have good grounds for deciding and believing that the origin of this pact came from a source outside of tlse White Plouse. The arguments were the same, and it has been supported by the people who woidd be most benefited. How does it come that the people who would be most benefited by this propo- sition — the miller-^ and manufacturers and the Associated Press. i\Ir. Hill's railroad — how dues it come that these people apparently knew about this liefdre any of the rest of us? Does not that suggest something? It snggcsts something to jne. I had the jDrivilege of discussing this question for two hours with Mr. Hill. I maintain that I did not have any more information when I came awnv than I had when I read his address, but I could not find out where :^ir. Hill had any arguments that were any defense whate^•er to the proposition. Gentlemen, I believe that this will work serious injurv on our manufacturers. It will make the manufacturers in five vears work an injury to the farmers, although it will hurt the farmers bad enough, and you may have many soup houses inside of five years, and we have good grounds for believing vou will have. We will afl be injured. There is no doubt about that : if this goes through, the farmer will be injured, the manufacturer will be in'jured, the travel- ing man will be injured; because when you reduce the farmer's pur- chasmg abdity, what happens? The jobber is put out of business; there is no use for traveling men; the factories have to run on partial time. Consequently their men are turned out of employment, and then what happens? The agricultural industry is by common con- sent the source and basis of all other industries in this country ; and when we either ignorantly, maliciously, or for personal gains, or any purpose whatsoever, injure the farmer, you injure everybody else; and if the tariff needs regulating it seems to me like a very poor policy to begin at the foundation. ^Yllat would you think of a fellow EECIPROCITY WITH CANADA. 139 who was going to remodel his house, if he would begin to tear the foundation out. You would certainly think at least he was unwise. It seems to me they have undertaken to remodel the tariff by begin- ning at the foundation. It will injure our farmers most, because the farmers will not have the money to buy with, they will not make their improvements. I will tell you another thing ; they will repair their old machinery. I was raised on an 80-acre farm in Iowa. My folks were poor. I started out for myself when I was 12 j'ears old. The first farming I did was when I was 1-2 years old. I farmed out 20 acres of corn and 1 raised about 900 bushels. Three of my brothers rented the other two-thirds of two of the eighties. We shelled our corn and hauled it to Clearfield, Iowa, and sold it at 20 cents a bushel ; we paid for the shelling out of that. We did the entire year's work, and how much money did we have on 900 bushels for a year's work? We sold the cobs at $1 a load. I know, I am not very old, but, gentlemen, I know just exactly what farm life is : I know what it is to get up at 4 o'clock in the morning and work until 7 or 8 o'clock at night ; I know what it is to get up in the morning and go out and husk corn Avhen the frost is on the ears, get $1 a day for it and furnish my own team. I have done it many times. I know what it is to bind my station along with the other men when we used to have the old McCormick reaper and the dropper. I know how we used to economize. It happened that I was the j^oungest member in the family where there were six boys, and the other boys all had a chance at the clothes before they got around to me. I know what it is. gentlemen. I have come up through this thing, thought I am not very old, and I realize — and it affects me keenly to think that when we have just got to the brow of the hill there is a dastardly attempt made to shove us back down ; but I want to tell you this, gentlemen — I do not mean to make a threat — it will be inevit- able, it will not be the fault of the farmer either ; it will be an inevi- table result and natural consequence of a condition that will be brought upon us if this condition is inaiTgurated. Everybody else will slide down the hill with us; everybodj' will. There is no getting around it. Gentlemen, the farmers will not stand for this proposi- tion very long. In addition to the natural consequence, if the farm- ers are made — are forced to sell in an open market, they will exert their utmost efforts, you can depend upon it, to see that everybody else sells in an open market in order that they may have an oppor- tunity to buy in an open market. I thank you, gentlemen. [Ap- plause.] The Chaieimax. The delegations are present representing the farm- ers of Minnesota and North Dalcota. but the Chair is advised that they had not expected to be heard to-day or are not prepared. Is that correct? A Voice. That is correct. The Chaiemax. We will hear from Minnesota to-morrow morn- ing, and we will hear some gentleman now who promised to take only 5 or 10 minutes and who represents the wire industry. Mr. Cabell and his associates will proceed, and the committee will hear them for 10 minutes. Mr. Cabell. Mr. Chairman and gentlemen The Chairman. W^hat is your full name ? 140 EECIPEOCITY WITH CANADA. Mr. Cabell. Frank F. W. Cabell. We are Fourdrinier wire manu- facturers. The Chairman. Where do you reside, Mr. Cabell ? Mr. Cabell. In New York City. The Chairman. Will you proceed, Mr. Cabell ? Mr. Cabell. With pleasure. STATEMENT OF F. W. CABEIL, CHAIRMAN OF THE FOURDRINIER WIRE MANUFACTURING COMPANIES. Mr. Cabell. I do not propose to take more than a few minutes of your valuable time. I have been appointed chairman of the com- mittee of the Fourdrinier wire manufacturers who are present here to-day to submit a few facts and figures Senator Kern. What is that? Mr. Cabell. Fourdrinier — I will explain it afterwards — of our industry, and respectfully protest against the passage of the Cana- dian agreement as detrimental and partially disastrous to our in- dustry. Fourdrinier wire is a brass wire cloth made into an endless belt, ranging in size from a cloth 33 feet long by 43 inches wide to a cloth 76 feet long by 184 inches wide. This wire cloth is used exclusively and without exception in the manufacture of paper. It follows, therefore, that the paper trade is the sole consumer and customer of the Fourdrinier wire industry. There is no other outlet or demand for Fourdrinier wires. The Fourdrinier wire industry is represented by about 16 inde- pendent manufactuerers in the United States, doing business in six different States: The William Cabbie Excelsior Wire Manufacturing Co., New York City; The Eastwood Wire and Chemical Co., Belleville, N. J.; Cheney Biglow Wire Works, Springfield, Mass.; Buchanan & Bolt Wire Co., Holyoke, Mass. ; the W. S. Tvler Co., Cleveland, Ohio; the Lindsay Wire Weaving Co., Cleveland, Ohio; De Witt Wire Cloth Co., New York City ; Federal Wire Cloth Co., Harrison, N. J. ; Globe Wire Co., Harrison. N. J. ; The Thistle Wire Cloth Co., Lee, Mass. ; the Appleton Wire Cloth Co., Appleton, Wis.; Wisconsin Wire Works Co., Appleton, Wis.; Thomas E. Gleeson, East Newark, N. J.; H. T. McClusky & Sons, New Haven, Conn.; J. Walter Perry, Southport, Conn. ; A. H. Workman & Son. Kear- ney, N. J. The total output of this industry in the United States is of the value of about $3,000,000. The entire product of this American in- dustry is sold solely in the United States. It has no material foreign market, as the same wires are made more cheaplv in Great Britain, Germany, France, and other countries abroad. "For the last men- tioned reason there is no export possibility, and on the basis of cost of manufacturing in the United States it is impossible for the manu- facturers in this country to export wires to foreig-n countries in com- petition with those made in England, Scotland, France, Germany, or, in fact, any foreign country. Canada has a duty of 25 per cent on Fourdrinier wires imported from the United States, but even were this duty removed and were American manufacturers allowed to sell their wires in Canada free of duty, they could not, as above stated, compete with other foreign EECIPHOCITY WITH CANADA. 141 manufacturers. The truth of this is evidenced by the fact that American labor used in the manufacture of Fourdrinier wires is 2i times as much as in Scotland and 3-^- to -1 times as much as in Germany, France, and other foreign countries where these wires are manufactured. The capital invested in this industry (exclusively in the United States) is about $5,000,000. The plants above mentioned furnish employment to about 3,000 employees at rates of wages, as above stated, from 2J to 4 times higher than foreign manufacturers pay their labor. Senator La Follette. May I inquire where you got those figiires? Mr. Cabell. I got those figures — we have had a party on the other side of the water investigating this matter and reporting to us. Senator Keen. Who was that party? Mr. Cabell. It was shown by some information we got quite some time ago. Senator Keen. How long ago ? Mr. Cabell. Two or three weeks ago. Senator Keen. Did he make a written report? Mr. Cabell. No, he did not; although we can base our calcula- tions on the cost of the products we purchase from the other side. I have some correspondence here — I have also a letter at the hotel — in which it is shown that we can purchase a certain grade of our goods on the other side and pay 40 per cent, and sell thera in this countiy cheaper than we could abroad. Senator La Follette. You understand that if you expect us to be guided we want to know the source of them and their reliability. Mr. Cabell. I can give you the facts with reference to what they pay on the other side. Senator La Follette. Will you be kind enouph to cive these facts? Mr. Cabell. I can not do that, sir. I am unprepared to do it. Senator La Folletit.. Go on with your statement. ilr. Cabell. Most of it is hearsay. We are controlled to a certain extent. It is very skilled labor, in which it requires about four years of apprenticeship in order to become proficient. They are paid upon the piecework schedule, and they do not consider that from $3.75 to $5 is anything exorbitant to be paid to skilled labor in this country. It is Avell known in Germany that the same class of labor is only receiving 75 cents to $1 a clay. Now, of course, we can not expect our men to bring up families in the city of New York and live on $0 a week. Senator La Follette. Now one moment, right here. I did not know that there was that difference in the wages, and if you do know it and have an authority, I would like to ha^e you submit your authority. Mr. Cabell. I have not got it with me, but I can easily get it for you. Senator La Follette. I think you had better get it. Senator Smoot. Can you get affidavits from some workingmen who have come from Germany within the last few years stating what their wage was in Germany and what they receive here in America? Mr. Cabell. They can not work in our mill until they join the union ; there are very few of them here. 142 KECIPKOCITT WITH CANADA. Senator Smoot. You have men working in your mill, have you, who have worked in Germany ? Mr. Cabell. Not from Germany. We have from Scotland. There are very few German wiremakers over here because lots of that work on the other side is being done by girls. Mr. C. H. Nealley arose. The Chairman. State your full name. Mr. Neallet. C. H. Nealley. The Chairman. Whom do you represent ? Mr. Nealley. The Eastwood Wire Manufacturing Co. of Belle- ville, N. J. We will collect that data and furnish all proof and have it submitted at once. Senator La Follette. In doing that will you please supplement that with a statement in detail of the amount of capital actuall)- invested in your business? Mr. Nealley. Yes, sir. Senator La Follette (continuing). And a detailed statement of the cost of each kind of wire cloth -which yoii manufacture, if you manufacture more than one kind. Iilr. Nealley. And give also the proofs that you asked for. Senator La Follette. And, if you can. also furnish in connection with that same statement detailed information and all the authority of the cost of foreign manufacture. Mr. Ne-vlley. That is what I refer to. Senator La Follette. Parallel it. It will be a great help to us. Mr. Nealley. I will see that that is done. Senator Smoot. Are you going to make a statement before the committee ? Mr. Nealley. No statement; just put in the briefs before the com- mittee. I won't take up an}' time at all. Mr. Caf.ell (continuing). The Fourdrinier wires industry is not protected by patent or patent monopoly and is an open trade. 8. Congress has recognized in the successive tariff laAvs the pro- priety and justice of giving reasonable protection to this industry, which could not exist without such protection ; and no complaint is made by the wire manufacturers upon that score, although they seriousl}' feel the growing competition of foreign importations of Fourdrinier wires constantly imported into this country from foreign countries where cheap labor enables them to manufacture at less cost, pay the duties, and successfully meet our prices. 9. There is no combination, trust, or agreement of any description between the American manufactiu-ers nor any concerted method of sale or of maintaining prices for the goods of American manufac- ture, and there is now, and there has always been, the sharpest com- petition between the American manufacturers. The American pub- lic has received the benefit of this active, independent, and genuine competition. 10. The margin of jorofit in this industry has always been so small that the American consumer has found no cause for complaint and has never sought to interfere M'ith the continuance of the manufacture of these goods in this country; in other words, the American con' sumer is satisfied with the product nnd the jDrices. 11. The industry was established in this country more than 50 years ago, and has continuously furnished employment for Ameri- can labor at high rates of wage. KEOIPEOCITY WITH CANADA. 143 12. As the sole consumers of the product of this wire industry are the manufacturers of paper in the United States, the successful continuance of paper manufacturing is vital to the maintenance of the Fourdrinier wires industry and the latter is absolutely dependent upon the former. 13. We beg leave to call special attention to the fact that the Fourdrinier wires industry is distinctively American; that its entire force is American; that its rates of wages are from two and one- half to four times higher than those paid in foreign countries where similar product is made; that thousands of American laborers are dependent for their livelihood upon the continuance of this business in which they have become skilled. The proposed reciprocity agreement would practically wipe out the Fourdrinier wires industry and build up Canadian, French, German, and other foreign competition at the cost of the life of a worthy American industry; that in consequence the large invested capital which has become enlisted in this industry, in unquestioning reliance upon reasonable American protection against foreign cheap labor, would be practically wiped out, except, of course, such of it as remained in the form of factory property, which even then would have diminished value for any other purpose. AVe freely proffer the fullest investigation of our business and the conditions herein briefly stated, and respectfully urge that this inde- pendent and competitive American industry, which lias for ."lO years served the American public to its complete satisfaction at reasonable prices and most moderate profit upon the in\-ested capital, is" entitled to the just consideration of Congress and to protection against prac- tical annihilation which would follow the passage of the proposed agreement with respect to the paper and wcod-pulp industry upon which the Fourdrinier wires manufacture is solely dependent. Thank you. gentlemen. Senator Sjioot. Do you sell wire to-day in Canada ? 3Ir. Cabell. Verj^ little. Not 2 per cent of our production. Senator Heybuhk. Has the Canadian manufacturer this wne? Mr. C.\JiELL. Tliere is one manufacturer, to the best of my knowl- edge, and he is a rather small one, in Canada. They import all theirs from England and Germany. They get it right straight from German}', also from England. There is a surtax on it from Ger- many, and consequently ihej get most of it from England. Senator S?,i!)ot. Then your business will be injured in an indirect way rather than a direct way, will it n(it — or in other words, if the paper manufactiu-er cease- to exist, of cf)nrse your market would cease to exist ? ilr. Cauell. It certainly would. AVe can not compete with Canada or any other countrv. Senator S^noT. The basis of your complaint wotdd be then that your market would be taken away from you by closing the manu- facturers of paper? 3.1r. CAjjEr.L. Partiallv closing them. It will not take it all away from us. Of course, vou can not drive :dl the paper manufacturers to Canada : we realize"that, but the margin of profit to-day is so small that if you should diminish our production to any extent we could not continue to do business. 144 EECIPKOCITY WITH CANADA. Senator Heybur^'. AVhat character of jDaper is this wire cloth used in making? Mr. Cabell. Exot}' kind of paper we make. They use the different meshes for the different Icinds of j^aper. We make various meshes, and of course sell them to the various manufacturers, depending upon the kind of paper they wish to ijroduce. The finer mesh is the more expensive. The Chairman. The chair would like to state for the information of the committee that representatives of the paper industry, the labor unions, and the people running the mills, and some people from Massachusetts are quite anxious to be heard to-day, if possible, and if the committee could sit a short time this afternoon, beginning, say, at half past 2 Senator Sjiout. I move that we adjourn until half past .3. Senator Hetbuen. Make it 2. The Chairman. I think some of us might want to get lunch. Senator Smoot. Make it 3 o'clock. The Chairman. If there is no objection, the committee will adjourn until 3 o'clock this afternoon. (Thereupon, at 1.35 p. m., the committee took a recess until 3 o'clock p. m.) AFTER recess. At the expiration of the recess the committee resumed its session. The Chairman. The hour of 3 o'clock having arrived, the commit- tee will come to order. There are present some gentlemen represent- ing the fisheries of Xew England, and they say they will not take much time. If they are ready, the committee will hear what they have to say. ' Senator Stone. Mr. Chairman, before you do thait, is ^Ir. Payne here? (No response.) Senator StOne. I will have to wait until he comes. He wants to make some corrections in his paper. The Chairjian. This is just the first print of the hearing, and the corrections can be made. If you will furnish the corrected proof to the secretary of the committee, he will have the corrections made in the second print. STATEMENT OF MR. GUY CUNNINGHAM. The Chairman. Will you state your full name to the committee? Mr. CITNNINGHA:^r. Guy Cunningham. The Chaie:man. Where do you reside? ]\Tr. Ci'NNiNGiTAM. Gloucester, IMass. The CiiAiK.UAN. Who do you represent? , Mr. CnNNiNGiiAM. I am president of the Cunningham-Thompson Co.. which is owner of fishing vessels and engaged in followina: that business in Gloucester. I, toefether with Mr.Thomas J. Carroll, the President of the Gloucester Board of Trade, also connected with the fish business, am here to give any information the committee may require about this matter. We do not think, however, that we ought to waste the time of the committee with going over matters that have alreadv been gone into KECIPEOCITY WITH CANADA. 145 carefully. Before the previous Congress we had a large delegation from Gloucester and the case was presented as carefully as could be, and is preserved in the House documents which are accessible to the committee. The Chairman. Your people also had a hearing before this com- mittee in the last Congress, did they not ? Mr. Cunningham. I am not sure. The Chairman. Congressman Gardner appeared and made a statement ? Mr. Cunningham. Yes. I wish to present therefore, simply a brief which was used also before the Ways and Means Committee of the present Congress for the consideration of this committee, and to answer any questions, if any are asked. I should like to leave this brief with you. The Chairman. Just leave it with the committee. Perhaps that brief had better be printed with the notes of these hearings. It had better be put in the record. The stenographer will insert the brief in the record so that it will be accessible to all members of the com- mittee. (The brief ordered printed by the conmiittee is as follows:) Canadian Eecipeocity — Brief in Opposition to the Proposed Taeipf Aekange- MENT with Canada, Filed on Behalf of the Xew England Fisheries. [Filed by Gloucester Board of Trade and Master Mariners' Association, Gloucester, Mass.] Gloucester, April 3. 1911. To the Couittee on T\'ats and Means, HorsE oe Representatives, Wasliington, D. G. Gentlemen : This brief is filed in opposition to the particular arriingenient with Canada proposed by President Taft. We shall not discuss whether recijirocity with Can.ada is or is not desirable. We reco.gnize that if the tariff walls between Canada and the United States were absolutely reniored the benefits to some American industries might far exceed the damage to our industry. The proposed arrangement, however. Is of little or no value to any American industry, and will delay, if not perma- nently ijrevent. any true reciprocity, because the President has granted to the Canadians their heart's desire and all they want from us, the Atlantic fisheries, and we have nothing to offer for further concessions. Accordingly we ask all persons, whether or not in favor of reciprocity with Canada, to re.iect the present arrangement as one lacking entirely the element of reciprocity, in that our industries gain nothing from Canada. Furthermore, we do not intend to argue whetlier or not absolute free trade with all countries is desirable. We are protectionists, but when the country is ready for absolute free trade we are ready to take our chance with the rest. Inasmnch, however, as our industry is the oldest in New England and has less than the average protection, we protest against the removal of our little pro- tection while we are unable to compete on equal terms because of the tariff on everything we use. The proposed arrangement conduces neither to free trade nor to a customs union with Canada by removing the tariff wall. In fact, we' think the present arrangement was deliberately planned to prevent either result. It would seem that the President hoped that by sacrificing the fishermen and depriving the farmers of what little help they get from the tariff he could gain for himself a reputation as a tariff reducer and yet preserve the protection on Pennsylvania steel, on Ohio wool, and on manufactured articles. At any rate, whatever his purpose, the present arrangement is neither free trade nor true reciprocity, and we ask Congress to view the question simply on its merits without any preju dices for or against it by reason of their opinions in favor of or against a gen- eral removal of tariff walls. 146 BECIPEOCITY WITH CANADA. QUESTIONS IN ISSUE. Wo cunip, tlieu. to the exact questions in issue: First, wbetlier the propusecl arrangement is^ advantageous to the United States. We deny that the arrangement is advantageous to the United States. .Secoiul. whether it is so unjust to any American industry that it ought not to be passed in its present form even if on the whole advantageous. We eon- lend that the proposed arrangement takes away the living of the New England fishermen without compensation and deprives them of the equal protection of the laws, and that Conjircss has no moral right to violate these cardinal prin- ciples of justice, even if some other industries may receive a greater money benefit from the arrangement than the value of the fishing industry which is to be sacrificed. Accordingly, we say the plan should be rejected on the ground that its benefits, if any, furnish no justification for taking away the living of the fishermen. Third, whether it can be amended in any reasonable way to remove the objec- tions to it. As to possible amendments, we contend that on the plainest prin- ciples of justice the plan should be amended so that, first, the Canadians should not be .-illowed the freedom of our markets without giving our vessels the free- dom of their inshore waters, as they did under the last reciprocity treaty; second, the act should be so worded that the duties shall be restored auto- matically if Canada restores the duties; third, no part of the agreement should take elfect until the exjiort duties on wood pulp are removed; fourth, the act should not take effect until Canada shall secure to Americans the same right to import into Canada jiateuted articles without destroying their Canadian patents that Canadians have to import into the I'Uited Staters articles covered by I'nited States patents without destroying their United States patents. TLiese amendments would not make the arrangement truly reciprocal, but they would make it a little less of a continuous joker. NEW ENGL.iND FISHERIES. About 1623 the Dorcliestcr Co. began the codtishery at wlint ;s i;ow Glou- cester, and cured their salt fish there. Gloucester has been the center of the salt-fish industry ever since, while at i)resent Boston is the center of the fresh codfish business. Other cities and towns from Eastport to Provincetown take a prominent part in the business, however, Portland, Jle,, and Provincetown being cli chief importance after Gloucester and Boston. The business consists in fitting out .schooners .and steamers for the catching of cod and similar fish, such as haddock, hake, pollock, and cusk (which we shall refer to as the cod- fishery, as the fish are not easily distinguished except by an expert), and also for the catching of halil)ut. mackerel, herring, and swordfish. The range of the fleet is from Cape Hatteras, for mackerel, to Greenland, for halibut. The greater part of the codfish is caught between Georges Banks off Cape Cod and the Grand Banks of Newfoundland, these fish being plentiful off the shores of New p:ngland, Canada, and Newfoundland. The principal herring fishery is carried on close in to the shores of Newfoundland, where the American fleet has the right to resort under the treaty of ISls, The mackerel follow the shore rather closely from Cape Hatteras to the Magdalen Islands off the mouth of the Gulf of St. Lawrence, but the American fleet can not follow them inside the 3-mile limit of Canadian waters, except at the Magdalen Islands, which the treaty of ISIS throws open to them. All of this fishing comes into sharp competition with Canada and Newfound- land, and this competition has been very bitter for many years, with the Amer- ican fleet fully holding its own in comparison with Canada, in spite of the fact that Canada does everything it can to help its flshenuen, and the United States does not even give them the same protection it gives other industries, TONNAGE ANn NUMIUCR OF JIEN, At the present time, as Mr. McCall states (Itept., p. 26). the aggregate fishing tonnage of Gloucester is 21.000. and they are manned bv 4, ."^^00 men. '"rhe report might lead one fo think that the above represents the (Mitire industry so far as shipping is concerned, but that is far from the fact. The fleet of c'loucester is about half the combined fleet of the New l^ngland fishing parts as is shown bv the table annexed. All of this fleet is rheerfnlly consigned to extinction by Mr. JlcCall, who says: "The aggregate tonnage of the Gloucester fishing vessels is now 21000, and they are manned by 4,500 men. The ' lay,' or share, of the men yields them EECIPEOCITY WITH CANADA. 147 hnrdly ns much as the commonest labor is paid ashore, and the calling is full of danger. The vessels are small, averaging but 7r) tons ; they fish in dangerous waters, shut in by fogs; they have none of the modern safety equipments, such as are found upon merchant steamships ; they are no longer nurseries t(ir our ships of war, upon which conditions have so radically changed; and they are a survival of an order which has almost disaptieared. If it should not be a con- sequence of this bill to stop the decline which clearly aijpears in the fishing part of the industry as at present con.lucted, and if stinie of the sailoi-s shonld be turned from a perilous and wretchedly paid calling into safer and more prosperous pursuits, the result would not be wholly evil." Mr. McCal! does not state from what figures he deterniiiics th;it the "lay" of a fisherman yields him hardly ns much ,is the eonuuduest laborer is paid ashore, so that, on the whole, he thinks it is a kindly act to take away their living. The fact is that the fishing business as carried on in (iloucester is one which gives every man a chance to make just what there is in him and to develop him into a self-respecting man, doing his utmost to succeed, and which yields him a coniiietence. and more if he is skillful, and at least good food and a healthy occnp.ation. The dangers are considerable, but not a vessel \i-as lost from the Gloucester fleet in lOlO, and the dangers of an occasional death liy drowning are far less to be dreaded by healthy-minded men li;an the maiming which is daily occurring on our railroads and in our factniies. A ma'.i with skill, courage, and determin,-ition may start as hand, risi- to connr.a.id, own his vessel, and start in business on shore, acquiring not wealth, but a capital of well over $100. (XiO. There .are many instances of this in (iloucester. (In the other hand, the intemiierate, the lazy, and the incoiii|)eteDt will surely fail, as they shiiuld. to got more than an existence, bec:uisc of tlie system on which the business is rtni. EVKKY MAN ,.\ PARTXlil:. This system is that every man is a partner. At least onc-lialf of the entire catch giies to the crew, a;Kl the jiroceeds arc divided lictween tliem, some- times equally, as in mackerel seining, where mi man's slcire c;ni be cx.-M-ily foinid, and S(nnetinies strictly according to his personal catch, as in hand-line fishing. The result of this system is that a good captain and a gocd (-row will make a substantial sum annuall.v. while a imor captain and a jiuor crew will get only a small sum besides their lodging and gond tniu!. For example, a Ghnicestcr concern owning l.j vessels gi\es the following figures for I'.HO: ".An ordinary hand on tlie schooner Inrjoiiiur. whicli was engMged in fresh fishing for the entire year JlOlO, earned l^^T.^i.'l.TO, the captain enrning about $1,S00 for the year plus certain other commissions, n-hicli would bring his earnings up to about •*2.(1flO f(ir the year, not including his dividend for the part of the vessel owned by him, which was a snbshintial fraction. "The schooner Arctliiisn engaged in salt fishing from febniary 21. 1010. to Xovember IS. ItnO. and such of the crew as desired to, and many of them did. CflukI earn money at either fishing or other occujiations during the period when the vessel was not engaged in salt fisliing. The crew of this vessel shared $.542.91 for the eight or nine uaniths. ind the caiitain's share would be over $1,500, not including his dividend for the part of the vessel owned by him, which was a substantial fraction. "The schooner CaraJiei- engaged in fresh halibut fishing. Each of the crew shared $646.20, and the captain's earnings were about .'?2.00f) for the year, not including his dividend for the part of the vessel owned by him, which was a substantial fraction. "As the vessel supplies lodging and board, nearly all the money earned by the crew can be saved by an unman led man." These figures do not represent the best earnings for the entire Gloucester fleet, but (io represent earnings abo-\e the average. "The schooner Tlionins: .S. (lorlfni, owned .almost entirely by ('apt. Themas. who was a witness before the Ways and Jieans Committee at the previous Congress, paid .$1,042 to each of its crew for the year 1010, and the captain's share was over $2,100, not including his dividend for the seven-eighths of the ressel owned by him, which was large." The share of the Thomas S. Gorton, whose crew incidentally were practically all, if not entirely, citizens of the United States, was probably the best share per man of any vessel for 1910, but the shares of other vessels named, though 148 KECIPKOCITY WITH CANADA. above the average, are not extraordinary. If the captain and crew are less sljillful and energetic, they will share much less, and, if the fishery fails, as the mackerel fishery did in 1910, the crew may share very little, but even in that case they will have had comfortable lodging and good food, and have had little or nothing to do except handle the vessel, child's play for these large crews of experienced men, so that the " commonest laborer " would look upon them with envy. In our opinion, even the crew of a mackerel seiner, which has caught no fish, would be far from thanking j\lr. JlcCall for an opportunity of exchanging a trip from Cape Hatteras to Nova Scotia in the summer, with board and clothes paid, for an opportunity to do the " commonest kind of labor," say, in a pro- tected Pennsylvania coal mine, for pay which will not secure comfortable lodg- ing and board. In short, there is no average pay on a fisherman. He is a business man, a partner, not a wage earner. The good man gets pay which is enough to enable him to rise in his own lifetime to a position of comfort, and the poor ones have to sink to the low level which all unskilled labor brings. These crews, like all other laborers in American communities, are constantly recruited from the most skilled class in other countries in this line, attracted here by the increased wages paid to the better class of men. These men are largely, but by no means entirely, American citizens. Every captain must be an American citizen, and all the men who succeed become citizens and settle down here ultimately, while thos6 who fail drift back. If this arrangement goes through, these men will be forced to leave the country just as the farmer will be forced to emigrate in constantly increasing numbers to the Canadian Northwest. FISH CUKINQ AND PACKING. Closely allied to the fish-producing business is the business of curing and packing fish for market. This business has many branches — the curing of the cod, consisting of the picking and drying of the fish, the skinning of the flsh, and the putting of the fish in packages, either whole or in pieces, from which the bones have been removed, or in shredded packages. All of this work re- quires extensive plants and a large force of skilled workmen. In addition to this is the preparation of salt halibut and herring for smoking, requiring exten- sive smoke houses, the packing and preparation of boneless herring and of salt mackerel. These branches of the business are closely allied to the producing end of the business and absolutely dependent on it. Suitable plants for carrying on the work have been built at considerable expense, and a force of competent workmen trained in the business. All of this has taken years of careful hard work. NUMBER OF MEN EMPLOYED. It is estimated that over 20,000 men are employed in these branches of the fish business. These men are workmen of the highest skill in their line and fitted for no other employment. If the business leaves us, they must follow it, for they have been trained in it and can not earn a livelihood in other lines except as unskilled laborers. The number of skilled workmen fitted for this end of the business is restricted, and the same is true with reference to the number of men available to man the vessels. Once gone away, it is not possible to secure men in any numbers to fill their places. SIZE OF PLANTS. It would astonish tb(> members of this committee to visit an up-to-date American fishing port such a:-- Gloucester, and see the size of the plant required for the handling, curing, smokiuff. and packing of the flsh catch. Extensive wharves, smolv-ehouses, warehouses, sheds, and fish yards are required, and the plant of a modern fish company compares favorably in size and cost with the plant of ,iny manufacturing enterprise with an equivalent output. In fact, 1here is absolutely no differpnce between the conditions that exist in the fish business to-day and those existing in any manufacturing business. DEPENDENT INDUSTRIES. Other long-established industries of considerable size are dependent directly on the New England fisheries for their prosperitv, and in most cases for their v(>ry existence— the shipbuilders of Essex, Boston, and Gloucester who are KECIPEOGITY WITIt CANADA. 149 constantly building new vessels to rep'^'^e the old ones as tliey become out of date or .ire lost; the dory builders of Amesbury, Swiuupscott, and elsewbere, wlio supply the boats for the vessels; the sail-uuikers and duck factories, anchor foundry, net and twine factory, box makers, label makers, and the farmers, who produce the supplies for the fleet. If the Gloucester fleet is destroyed, their business goes with it, for Canada does not and will not buy these things from us. The treaty will deprive the New England fisheries of the protection that is essential to their existence. PROPOSED PL.\N IS UNTAIR. The argument is made that the proposed bill is fair in that it affects duties only on producing lines, sucli as farmers and fishermen, where conditions in the two countries are substantially alike as distinguished from manufacturing lines. This is not true. Conditions in the fishing business in the two countries are not similar. The fishing business does not differ from any manufacturing business. In fact, it has more need of protection. This is equally true of both branches of the business, both the catching of the fish and the curing and pack- ing of them ashore when they are landed. Neither branch of the business can survive the present agreement. There are many reasons that clearly demonstrate why we can not compete with the Canadiaus without protection. rXEQUAL CONDITIONS IN THE CASE' OF THE CATCHING OF THE FISH. First. Y'e are prohibited by the Canadian law to fish in many of the best fishin,g waters which are close to the Canadian shore. By previous reciprocity treaties it was always stipulated that this right should be given us, but this plan gives us no such privileges. Second. The Canadian Government pays to the Canadian vessels, boats, and men engaged in deep-sea fishing an annual bounty of .$160,000. (Rev. Stat. Can., 1906, chap. 46.) Third. The Canadian Government pays one-third of the cost of building cold- storage warehouses at points where they will be useful to their fishermen, and •exempts Canadian fishing vessels from wharfage at Government breakwaters. Fourth. By the laws of the United States (and this we heartily approve) we must use American-built vessels in our fisheries, and these vessels cost fully 40 per cent more than Canadian vessels. (Testimony, p. 31.) Fifth. Our crews live in this country and are fed from American markets. The cost and standards of living are higher here, and their earnings must be greater, and the cost of taking care of them on the vessels is greater than in Canada. For this very reason we have no merchant marine engaged in foreign commerce at the present time. Sixth. Our vessels must be outfitted here, and the cost of everything in con- nection with them is fully 40 per cent greater here. Seventh. The Canadian ports are in much closer proximity to most of the fishing grounds. If this bfll is passed, the fish will of necessity be caught in Canadian vessels by Canadian crews and with Canadian capital, and the bulk of the business will he done by the Canadian Fish Trust, which has alredy been formed with this very prospect in view. Is it likely that the price of fish to the consumer in this country wUl be reduced by taking away our competition from this trust? UNEQUAL CONDITIONS IN THE CURING, PACKING, AND SHIPPING BUSINESS. Protection is even more essential for the curing, packing, and shipping busi- ness, and this is true for many reasons : First. The fundamental reason is that this business must be doue where the fish are landed. If the fish are caught in Canadian vessels, they will be landed in Canada, and there they will of necessity bo handled, mired, and prepared for shipment. The only green fish brought to the United States will be fresh fish for the Boston market, and even they will be brought in Canadian vessels. Second. The Canadian Government allows 1o the product of (J.inaduin fish- eries concessions in the matter of freight rates that will enable the Canadians to place their fish in our western markets at prices under ours. At the same time the Canadians assess a duty on our price lists, when mailed, and either hold them up at the border or force the recipient to open them in the presence •of a post-office oflicial 150 RECIPROCITY WITH CANADA. Tliird. Taxes iu the ('iin.idian maritime provinces are trivial, while we must bear our share of the burden of the lar^e tax rate that exists throughout Xew England. Fourth. The ruM of jilaut and uiniiitenanco is far greater here than in Canada. Fifth. The i-.ist of labfir for the work on shore Is far greater here than in Cau;-,d:i, and it is eslini^ited that this dilfercnce is as gieat as no per cent in man.v cases. Labor is a big clement in the cost of handling the lish after they are landCLl. It should he borne in mind that the a\erage profit on a pound oi fish ro-Oay Is far less than the present duty, which averages about thiee-fourths of a cent a pound. That the protection is essential is clearly shown from the f.ict alone that the imports of fish from Canada last year auiounled to approximately $5,000,(100 as against a tolal production from the Xew England fisheries of les.s th.-m .$1,5.000.000. This fact alone shows that the duties are at iiresent correctly arranged on a competitive basis, so that any shortage iu our sujiply is met by imports from Canad.a, and yet our market is kept alive to suppl;,' emi)liiyuieiit to over 20,000 laborers and yet i)revent any Canadian trust from co.ntrolling the business. As soon :;s the supply from the Unite-l Slates fisheries is kilk-il olt to please the Canadians, the Canadian trust will have no difficulty iu putting prices to ;i much higher level than at i)resent. We do not ask any special fa\ors. \\'e ask only the present ])rotecti(in. that is far loss than ti.e average protection giien to other American industry's, a jiro- tection that will enable us to c(nnpete with our fcuegn c(aniiel!tois with their tio\crnmeut assistanee, cheaper \essels, cheaper labor, antl che'per main- tenance. EECU'EOCITY HAS NOT BEEN AX ADVAXTACE TO OUR EISHERIi:S I.N' THE P.\ST. The claim has been made that the former reciprocity arrangement, abrogated iu 1SN.">. was a .good thing for tl.e fisheries. The facts shi-«- the contrary, and this treaty oftered certain advantages t" the American fisheries that are denied by this treaty. It apjiears from the figures given to the committee of the pre- vious Congress that the fieet from 1870 to iss."> in Gloucester barely held its own, being 2;;,07S tons iu ISTG and 24,:l.'ll) tons in Is.S.'i, and this notwithstanding the fact that mackerel were so plentiful on our shores tliat the catch of the Xew England fieet was nmre than 2UO,000 liarrels a year for that iieriod. Immediately after the treaty was abrogated, the Gloucester tonnage increased from 24,330 in l.s,s,j to 30,104 in 1S03, and this notwithstanding the fact that the m.-ickerel catch for that [leriod dmiiped off two-thirds, the catch for IsSii being 70 OOS barrels in place of 32[i.043 barrels in l.ss5. and the 1S1.I3 catcl) being .5.~>.037 barrels. This failure of the mackerel fishery would naturally have caused a serious diminution of the fleet, but the advantage of a moderate pro- tection more than offst't this loss, and the business increased rapiilly. Eighteen hundred and ninety-three was a panic year, and Gloni.ester shared in the depression. Jloreover, the mackerel fishery has grown stil! worse, and the arrival of halibut from the .\merican fleet in the Pacific, at prices lu'cventing temporarily any competition on the jiart of our halibut catches, tended tn cause the fleet to decrease: but the combined fishing fieet of Gloucester and Bo.ston for 1910 was over 20.000 tons as against less than 27.4.SG tons for IS.S.". showing, what we know, that the business is ahead of what it was during the reciprocity period. The most serious handicap to the growth of the fish industry has been these threats of tariff changes. There has not been a time since the previous reciiirocity treaty was ahro.gated that we have felt confident that we would not be left with a fleet of vessels on our hands costing 40 per cent more than those of our competitors, and which we were forced to buy at an enhanced price as a part of the protective policy of the Government, and which we would be ex- pected to run without the benefit of any protection. The merchants' service has not been able to get along with this handicap, and we can not get along with such a handicap. When the last tariff bill was passed, we supposed that the tariff question would remain settled for a number of years, and the more pros- perous companies have been planning to increase their fleets. Boston has built four steam tr.-iwlers and is planning to build more, and the more lu-osperous Gloucester companies have been building with some freedom and have been planning other extensions. The mere threat of the present bill has stopped completely the building of new fishing vessels, but. if this bill is defeated and there is a reasonable probability that v,e are to be allowed a moderate part of the iirotection which other industries enjoy, we see no reason whv the CtIou- cester and Boston fleet should not increase as rapidly as during the years be- tween 18S5 and 1803 under the protection then granted. RECIPROCITY WITH CANADA. 151 BILL OFFERS NO SUBSTANTIAL BENEFITS TO ANY AMERICAN INDUSTRY. We deuy that tbe proposed arrangement is advantageous to the United States. It throws open to the Canadians the enormous American marl^et of 90,000,000 people in exchange for American entry for similar products into the Canadian market of 9.000,000. A dozen articles of the entire number mentioned in the bill constituted 50 per cent of the exports of enumerated articles last year to Canada, and of these 50 per cent are already free. Our exports to Canada of most of the balance were negligible, and will always be so. The bill does not give us what we desire — the free entry of American manufactures. In fact, manufactured arti- cles were specifically excluded from consideration. Finance Minister Fielding, of Canada, stated in the Canadian Parliament : " No proposals for general free trade between Canada and the United States were made to Canada by the American commissioners in the recent negotiations. If the American commissioners had authority to make such proposals, they were not given the opportunity, because at the very outset of negotiations we gave them to understand that, speaking generally, we were not prepared to have manufactured articles included in-the list for reciprocity." On the few manufactured articles that are mentioned, such as automobiles ands farm implements, the bill is intentionally ineffective ; for, should the American, manufacturer take advantage of it, under the Canadian law he would forfeit his Canadian patents. In fact, it is impossible to point out in what particulars; the proposed bill will be a material benefit to any American industry. Abso- lutely the only argument that can be made in its favor is that it may possibly- reduce slightly the cost of living in the United States by taking away from the farmer and fisherman some, if not all, of their present earnings. It is a fact that can be proved that the only possible difference to the consumer that this bill could make in the cost of fish would be an average of 1 cent per person aimually. On the Canadian side, what is the object to be attained? One thing above all, the free entry of Canadian fish. Farm products were but incidental. Contrary to the apparent American policy, the Canadians have always cherished their fisheries and tried to secure for them every advantage. We assert with absolute confidence that the free entry of Canadian fish is the one great desire of the Canadians in this bill. By referring to the table of imports into this country from Canada last year of the articles covered by this bill, this fact is manifest. That table shows that of the articles enumerated, over 150, totaling $47,333,158, lumber and pulp constituted over 50 per cent, and, excepting flax- seed and asbestos, fish to the amount of $4,920,386 was the only other item of any size. We all know the Canadian attitude on lumber and pulp. Nothing In the proposed bill will prevent an export duty on lumber and on pulp. There already is an existing export duty in the most important Canadian Provinces, which they have indicated their unwillingness to remove. These figures show clearly what Canada desires and the ease with which the Canadians have, after trying ineffectually for years, accomplished their purpose without an adequate (in fact, any) quid pro quo except the empty word "reciprocity" is apparent. ESSENTIAL AMENDMENTS. Should the Congress of the United States determine to disregard the rights or wrongs of the fishermen and pass the bill, there are, nevertheless, certain essential amendments that should be. made in order to prevent the gravest injustice to this country. KIGHT TO FISH IN CANADIAN WATEKS. The Canadians should not be allowed the freedom of our markets without giving our vessels the freedom of their inshore waters. If we are to be forced to compete without any protection with bounty-fed and Government-favored Canadians and cheaper Canadian vessels, labor, and production costs, at least we ought to have substantially equal rights in the fishing grounds and riot be excluded, as we are to-day, from all Canadian grounds. This right was a con- dition of the last reciprocity treaty. Had the statesmen who uegotinted the present arrangement on behalf of the United States cared one jot Jihout our fish- ing interests, they could have had the same provision in this bill. We are entitled to this right, and our Government owes it to us to insist upon its being granted. Any other course would be the greatest injustice. 93285— .\o. 3—11 5 152 KECIPIiOCITY WITH CANADA. AUTOMATIC resioi;atiom of duties. Anyone familiar with cuiKlitioiis in CaiiiMla and liiis ci^unti y is aware of the celerity A-sith wliicli the C.nuidiau (iovernment, eaj^'er as tlie fox, seizes upon the aclVantage of the moment .-lucl of tlie i/oiiderou.s and deliberate movements of our Government under simiiar conditions. Xothini; in this act prevents Canada from restoring the duties without any notice whatsoever to this country and at any time after the bill is put in force. Clearly, then, the act should provide for some automatic restoration of the United States duties under such circumstances. Otherwise, should the CanMliaiis choose a strategic moment for the restoring of the duties, we might, nevertheless, be forced to continue allowing the free entry of their products for years. The bill works almost automatically for the reduction in duties, and the same should be true for their restoration. WOOD-PULP QUESTION. Certain Canadian Provinces have already loudly proclaimed their unwilling- ness to remove any of their export restrictions on wood pulp. Thus we will lose the benefit of this most important featui't of the liill. No other result could have been expected from a bill in the form submitted. No other intention or expectation ever existed in the Canadian mind. This clause was put in as additional bait for the unwary, but it is not too late to cure this. The bill should be amended so as to provide that the reduced rates should not go into effect until these provincial restrictions are removed and we are given the advantage of this provision. ^Ye shall never get it otherwise. CHAHACT.rcRISTIC JOKEK IN THE BILL. The bill holds out to a certain few — very few indeed it is — of our manu- facturers inducements of the Canadian marlvet (though in most crises it is only a slight reduction that is offered), but there is a joker concealed here, and every time the ('anadian holds out such n])iiarent inducements this is sure to be true. We have already shown that Mr. Fielding has clearly stated that he does not intend any competition with Canadian manufacturers on the part of the United States. Any apparent exception to this rule will be found to be illusory. No iirinciple is more firmly established in Canada than that of pro- tection to Canadian manufactiires. It is true that a.gricultural implements and a few other manufactured goods from the United States are mentioned in the bill, but the Canadian patent act (not mentioned in the bill) provides, if the holder of a Canadian patent " imports or causes to be imported into Canada the invention for which the patent is granted, such patent shall be void." (2 Kev. Stat, chap. 01. sec. 38.) It is, of course, a fai-t beyond dispute that mrist American manufacturers hold Canadian patents, aud it is not likely that they will be willing to invalidate their Canadian patents, even though the duty is reduced. Certainly, this bill should not be passed till Canada secures to Americans the same right to import into Canada patented articles without destroying their Canadian pat- ents that Canadians have to import into the United States articles covered by United States patents without destroying their United States ijatents. CANADA MUST INCEEASE DUTIES ON OTHER ARTICLES TO JIAEE OF THE LOSS IN BEVENUE OCCASIONED BY THIS BILL. There is not a word in the arrangement to prevent Canada doubling the duties on any articles not included in its terms the dav after the agreement takes effect without in any way violating the terms of the agreement. The arrangement attempts only to fix duties on certain articles, and it is no viola- tion of the arrangement in letter or in spirit if Canada increases its tariff on other articles to make up for the duties here remitted. In fact, it is obvious that Canada must do something of the kind, for the amount remitted in duties on goods Canada does not produce which form tlie stajile of the Canadian con- cession must be made up some way, and the natural w.tv will be by an increase in the duty on manufactured articles. Can you say that there is an implied agreement in the arrangement that other duties shall not be changed? If so, the like rule applies to the United States, and we are iniiilicdly agreeing not to change our tariff in any respect. EECIPEOCITY WITI-I CANADA. 153 ABE FOKEIGX COMrLICATlONS AVOIDI'D BY THE PItOl'OSED TLA?-, V The President says : "Slae" (CiUiacia) "has cost us notbhi- in the way of in-cpai-ations for Jefense against her possible assault, and she nexer will. She has sought to igree with us quickly when differences have disturbed our relations." The contrary is true. So far as controversies are coneerneil, we have bad more serious controversies with the Dominion of Canada than any other country The American claim of " Fifty-four. Forty or Fight," and the corresponding Cana- iian claim to a large part of what is now Washington. Oregon, and Maine, and the Alaska boundary dispute are only instances of this that will readily be recalled by anyone familiar with American history. "We men of Gloucester know only too well the bitter animosity that has always existed toward us and toward the United States on the part of all Canadians that we have encountered. If up to the present time Canada has cost ns nothing by way of preparation for defense against possible assaults, it is only her weakness that is to be credited with our safety, together with the conciliatory attitude of the United States and Great Britain. It is to be noted that the present plan, so far as the fish- eries are concerned, does not remove any difHcnlties. The question whether American vessels when fishing are within 3 miles of shore is a fruitful source of trouble, as no act will so quickly raise a war spirit as a violent seizure of an American citizen or vessel. When we consider that scarcely more than a re- quest on the part of the President was necessary to remove the source of dispute by a provision in the present plan that the Americans should enjoy equally with the Canadians, as under previous treaties, the inshore fisheries, it will be seen what a golden opportunity the President has let slip. PASSING OF THE BILL WOULD BE A WOR.iL WEOXi;. We require every bit of the protection that we now have. If this bill passes, it win mean the gradual extermination of the New England flsheries. both the business of catching the fish and of curing, packing, and shipping them on shore. The only reason that can be ad\auced for duing this is a possible benefit to other industries. We contend that it is a monstrous thing to take away the living of one producing and manufacturing class in order possilily (o benefit other classes, and particularly is this true when the beneht is to be conferred on other classes now fully protected. jMornlly, though perhaps not legally, this is a taking of property without compensalion and deprivation of the equal protection of the laws. Congress has no nnu-nl right to violate these consti- tutional principles, which are cardinal principles of justice firmly established in our country. The fact that some other industries may receive a greater money benefit than the value of the fishing industry whicli is to be sacrificed loes not justify it. We ask if there is any occasion to violate these principles and deprive the fisherman of his living and Injure the farmer for the benefit of the Steel and Woolen Trusts? PKESIDENT'S MESS-AOE self-conteadictoey. In his message transmitting the bill to the last Congress the President said : "A far-sighted policy requires that if we can enlarge our supply of natural resources, and especially of food products and the necessities of life, without substantial Injury to any of our producing and manufacturing classes, we should take steps to do so now." Obviously, the President's plan was either based in ignorance of the condi- tions existing, which is possible, because he got his Information solely from the Canadians and did not consult any industry of the United States which ms affected, or else the whole plan is a skillful attempt by certain protected nterests to get through a mock reciprocity plan which will injure only the farmer or the fisherman without affecting any of the trust-protected articles. The proposed bill would not only be a substantial injury to one of our oldest ind most deserving Industries and producing classes, but would. In fact, mean he absolute extermination of the industry. PLAN SHOULD BE REJECTED. For the foregoing reasons the President's plan should be rejected. Respectfully submitted. Gloucester P>OAnD of Trade, Master Maeinees' Association, Of Gloucester, Mass. 154 EECIPEOCITY WITH CANADA. Numhci- and tonnage of vckwU in Neio England engaged in the fisheries. Vessels. fi7 i'l 42 i:i ir, 3 Tonnage, Total ve.ssels. Total tonnage. Maine: Portland 1 . .592 8i)l .321 3au 204 18f, 70 31 246 1 538 28 42 Belfast Kennebunk Bath -.-..-. 3,891 New Hampshire: 1 32 Massachusetts: 2'".7 114 .38 14 14 13 3 75 21.212 9,242 307 489 273 416 21 4,000 35,960 Bristol 19 « 3 3f34 166 37 557 Connecticut: 28 14 803 634 1,437 855 41,877 1 Boston has four beam trawlers. and some smaller ports. The above figures do not include Nantucket, Barnstable, Castine, The Chairman. Have you any further statement to make? Mr. Cunningham. No. I should be glad to answer any questions if any are asked, and if the committee does not desire to ask any questions we think we have presented our case as fully as we can. The Chairman. Does any member of the committee desire to ad- dress any inquiries to Mr. Cunningham ? Senator Smoot. Does this brief cover the question of bounties paid by Canada? Mr. Cunningham. That refers to the fact that the Canadian fisher- men receive bounties amounting to $160,000 annually, those bounties being paid to the vessels and the crews and even to the small boats engaged in fisheries, and the cold-storage warehouses in Canada receive subsidy from the Government amounting to one-third of their cost, and we American vessels are absolutely excluded from fishing within the Canadian borders; an American fisherman, if he were able to compete and sell fish in Canada, is not allowed to send a price list into Canada without its being held up on the border, and thus every American who tries to do business in Canada has his price list held up on the border. Senator Smoot. I simply wished to ask the question, because I wanted to know whether it w;is covered by your brief, as I have not had time to examine it. Mr. Cunningham. Yes. The CiiAiRiMAN. Mr. Carroll, do you desire to be heard? Mr. Cakkoi.l. Just one word. EECIPEOCITY WITH CANADA. 155 STATEMENT OF ME. THOMAS J. CAREOIL. The Chairmax. Will you state your full name? Mr. Caeeoll. Thomas J. Carroll. The Chaiejuax. Wliere do you reside? Mr. Caeeoll. Gloucester, Mass. The Ciiaiejian. Whom do you represent? ilr. Carroll. I represent the Gordon-Pew Fish Co., and I am also president of the Gloucester Board of Trade. The Chairman. You may proceed. Mr. Carroll. I have not much to say, except that time has not softened the blow with us down our way. It Avas a shock at first. The further we go along, the longer the time that ensues between the proposal of this treaty and its final enactment, the more the people are convinced that, as far as the fishermen are concerned, it is a verj^ bad arrangement. Mr. Cunningham has pointed out in his brief all those matters, so I will not go over them. But there are one or two important points I want to bring home to the ininds of you gentlemen just to em- phasize the bounty question and the question of subsidies to cold storage and the question of assisting in paying part of the transpor- tation or express rates on fish up through Canada. We are not going to ask the removal of the duty at all. We simply say that when you take it away you do a greater injustice to us, we think, than to any other industry, on account of the bounties being paid our competitors. That is all I have to say, gentlemen. I would be glad to answer any questions that the committee may desire to ask. I have been in the fish business all my life. The Chairman. The committee will have your brief printed with the proceedings. Judge Moore is here, and Mr. N. H. Stewart and Mr. Arthur P. Hastings, representing the paper industry. Will you. Mr. Hastings, have your people take that table over there and address the committee from there ? Mr. Hastixgs. If it is satisfactory to you, we would like to have you hear Judge Moore first. The Chairman. That is satisfactory. Mr. Hastings. He is thoroughly familiar with the business and also editor of one of our trade papers. The Chairman. The committee will hear Judge i^Ioore. Senator Stone. Is this Mr. Hastings ? Mr. Hastings. Yes. Senator Stone. Do you reprcj^ent the manufacturers of paper ? Mr. H.nstings. The association of manufacturers, the American Paper & Pulp Association. Senator Stone. Did you appear before this committee or the Ways and Means Committee 'on this reciprocity measure? Mr. Hastings. Yes, sir ; both of them. Senator Stone. Were you jjefore both of the committees? Mr. Hastings. Yes, sir. Senator Stone. When did you appear before the Ways and Means Committee? ,., Mr Hastings. Xot on the reciprocity measure, because theydid act give us any heariniis. but before the Ways and Means Committee at the last Congress, at the time of the proposed change m the duty. 156 EECIPEOCITY WITH CANADA. Senator Joiinsox. 1909? Mr. Hastings. 1909. Senator Stone. You did not have a hearing before the Ways and Means Committee of the hist Congress on the reciprocity bill? Mr. Hastings. Kf) : we did not. Senator Stone. Xor this Congress? Mr. Hastings. No, sir. Senator Stone. You did before the Finance Coinmittee of the last Congress, though ? Mr. Hastings. Yes, sir. Senator Stone. You addressed the committee then? Mr. I-Iastings. Yes, sir. Senator Stone. Did the otiier gentlemen whom you have here ad- dress the committee then ? Mr. Hastings. Some of them, and some of them did not. Judge Moore did not address the committee. The gentleman who is to ad- dress you did not address the Finance Committee. Senator Stone. Is it your intention to have the same gentlemen repeat the arguments which they made then ? Mr. E[astings. No, not necessarily; no, sir. Senator Stone. It seemed to me that if that were the intent it would be rather a waste of time. Mr. Hastings. You understand, Senator, we are very deeply inter- ested in tliis matter. Senator Stone. I Imow; but an argument was made by you, for example, a month and a half ago. Senator Gallinger. There are a good manj^ of us here who are not on the committee that heard that before. Senator Stone. That is true ; but nevertheless those who are not on the committee have access to the arguments made. Senator Gallinger. I would rather hear the oral arguments myself . Tlie Chairman. Tliere were people who were heard this morning wlio were heard a few weeks ago. Senator Stone. It seems to me there will be a useless waste of time and expense. Mr. Hastings. I would like to introduce to you Judge Moore. STATEMENT OF JUDGE C. F. MOOEE. The Chairman. Will you state where you reside, Mr. Moore? Mr. MooEE. I reside in New York. The CnAimtAN. Wiom do you represent ? Mr. Moore. I am associated with the West Virginia Pulp & Paper Co.. manufacturers of book paper, and in a general way represent all the manufacturers of book paper on this occasion. I want to say, however, that my association with the West Virginia Pulp & Paper Co.. while it has extended over a period of about li2 vears, has par- tially been of a i>rofossional nature, lint more particularly a business one. I am not lawyer enough to disqualify me, and. while I have been its s])('riul counsel in many of its matters, my attention has been directed more particularly to the conduct of some of its business affairs. I am, personally, decidedly in favor of reciprocity. But I favor that kind of vr^ciprocity which reciprocates; not a sterilized variety. EECIPKOCITV ^VITH CANADA. 157 I have been taught ahvays that reciprocity means a jDrinciple to be applied to the interehani;e of our commodities and our productions, of mutual benefit, and no honest, fair-minded man can object to the extension of commercial relations which are mutually beneficial. But I do not believe in supporting- everything which parades itself under the name of reciprocity, and we do' not think that this measure is a reciprocal measure. In other words, it is a misnomer to speak of it as recii^rocity. I want to say. first of all — it was referred to this morning — that considerable importance had been attached to the fact that reciprocity was advocated by President McKinley. We have also heard of the reciprocity which ]Mr. Blaine stood for; but that, too. was an entirely different thing than the reciprocity which is before us here. At the time Mr. Blaine vras called to the head of the Department of State by Mr. Harrison there were some 20 or more distinct and independent countries lying to the south of us that were producing and sending to us those things which we did not produce, and we were sending to them the staples which they did not produce. The fact developed that some of those countries were assessing a tariff against us, wliile we were admitting their exports here free of duty. • Mr. Blaine said that such relations were not reciprocal, and that if they insisted upon a continuance of that practice we must have the kind of reciprocity which would protect our people, and levy a duty against them; so that the reciprocity for which Mr. Blaine stood was a protective reciprocity. Xow, the excuse which is made for this commercial agreement between the United States and Canada is that it is intended to reduce the cost of living to our peoj^le. I think that excuse all along the line has been overworked and overtalked. To-day what concerns many people most is not so much the high cost of living as the cost of living high, and. after all, living is regulated in price, like every- thing else, by the law of supply and demand ; and one trouble in this country is that we have too few people producing living in com- parison with the great number who are consuming, so that we are brought to face a condition which requires us to increase the pro- ductive energy of the people or else have a downward revisitiu of the vital statistics. The people in this country have always indulged in wid<'ly diver- gent opinions in regard to the treatment we should a^'cord im- portations, and, in fact, it is those differences of opinion which largely form our political parties and political factions; but what- ever attitude we may have toward the general proposition, we are of like accord at this time in regard to this proposed impending treaty. We can not claim that it is being urged as a protective measure, because it is proposed to take off the protection. We can not urge that it is a Democratic doctrine of tariff' for revenue that is backing it, because it does not propose to afford any re^-enue. It can not be regarded as a free-trade measure, because the trade is not to be free, but the advantage is to be given to our Canadian neighbors. _ We can not claim that it is in accord with the views of those who insist upon a downward re^-ision of the tariff in lioth parties, because, as I understand it, the position of these nicji is that there shall l)i' a general leveling or downward revision of all duties, and not that the burden 158 EECIPRUrlTY WITH CAXADA. shall fall upon a few people; an equitable distriloution of that bur- den. There is a vast difference between taking a rail off of the fence and knocking out a panel, and here it is proposed to raze the tariff wall to its foundation at one point and leave it absolutely untouched at everj' other point of the compass. Now, from what source does Un-re come any demand for this par- ticular action in so far as the paper industry is concerned, and I speak only with authority ccuicerning the majiufactu.rers of book paper — I have no connection whate^ er with any '.ther l;'anch of that industry? I have not heard it suggested from any source that it is proposed to reduce the price of books or news];ai)ers to the dear consuming people. Therefore, the argument that it is fijr the benefit of the consumer does not apply to paper. I want to call your attention to a few jjarticular facts relating to advantages which are enjoyed by the Canadian manufacturer of paper — that the American does not have, even under a continuance of our present policy — and in doing that I will refer to the state- ment of INIr. Sullivan before this committee, tb.t- day before yester- day, I think it was. I agree, in the main, with his statement her.e as to'the facts ami figures, and sliall not take up your time l^y reiterat- ing those things. I want to say that on page 4 of his statement he refers to 30.000 'people being engaged as employees in this particular branch of the industry. I know 'Sir. Sulli^-an ^ery well, and I talked with him after this statement was made, and he gave me to understand, as I was vei'v sure was true when I saw his figures, that the 30,000 people referred to there meant to include only those who were actively engaged in the mills and the operative use of those mills, and not to include any who were engaged in the work of construction and main- tenance, and the incidental work of cutting and preparing wood, and other manners in which they might be engaged, but the 30.000 were employees actually in the mills. The next statement which he made was one which I wish to correct for him. Mr. .SuHivan was not able to remain here. lie made this statement which I will read, and which he asked me to explain to the committee in as much as he did not wish to undertake to mislead anyone in any way, and those of us who knmv [Mr. Sidlivan know that he is iiicapabie of any such efforts. In this paragraph he says : It simply means our s<'hv^ out of bnsiii.'ss. ns wp il.i net n.^ly l;nve to c-'iniiete with Ciuiada ^yh()se natural arlvanlni^es -av,; ^iieat ;is ifvj.iids" w.-iti-r imwer O'.id wood, but wi- have the addltinnal liioidicaj) of iMrinsj; to \r.\y duties on otber materials that at the present tinie i;n in iice to Canada, which .■imoiint to about $7 per ton. He asked me to say to this committee that that amount, $7, was inadvertently stated, because he confused the figures, which were based on li:! months' operation, believing them to Inive been made for months. He Avishes to have this corrected, revising that statement to $3.,-.G instead of $7. Now, bearing out that particular i)oint, aiid it is one which I wish to refer to ;noiv especially, the great advantage which the Canadian manufacturer of paper now has over the .Vmerican. on account of the difference in duty paid in Canada and in the United States on sup- plies and materials necessarily imported in the manufacture of paper, EECIPBOCITY WITH CANADA. 159 I want to state that I have some concrete figures here which I thinli will throw considerable light upon the subject and which are correct. I asked the president of the West Virginia Pulp & Paper Co., which I represent, to give me some information, and I have this letter in reply, which I will read with your permission : Replyiug to yom- Inquiry of recent date, eouceruing the disadvantage of the American manufacturer of pulp and paper, I have conferred with those operating on the Canadian side, on account of tlie amount we are required to pay in duties levied against supplies and materials imported from the other side, from which the Canadians are exempt, or practically so, I submit herewith the following table, which you will observe gives the name of the imported article, the Canadian tariff item number, the duty paid, if any, by the Canadian importer, the United States tariff item number, and the duty charged when imported into the United States. These items are as follows : The first table show's the difference in these duties, and then he has prepared a second table which is taken from the books of his com- pany showing what amount their company actually paid last year into the customhouse on account of these importations which they would not have had to pay had they been operating in Canada. The first item is china clay, which is admitted free of duty into Canada and upon which there is a duty of $2.50 per ton wdien brought into the United States. Chloride of lime, admitted free of duty into Canada, upon which a duty of one-fifth of 1 per cent per pound is levied when it is im- ported into the United States. Feltings, admitted into Canada when from Great Britain 30 per cent ad valorem, when from other countries 35 per cent, upon which a charge of i4 per cent is paid when imported into the United States from Great Britain and 55 per cent when imported to the United States from other foreign countries. Alum, admitted into Canada free when from Great Britain, and from other countries 10 per cent ad valorem; upon which a specific duty of one-quarter of a cent per pound is assessed when brought into the United States. Copper wire cloth, admitted into Canada from Great Britain, 17^ per cent: from France, 22-; per cent, and other countries, 25 per cent: upon which a duty of 45 per cent is assessed from any and ail countries when brought into the United States. Aniline dyes, admitted free into Canada, upon which a duty of 30 per cent is charged into the United States. Ultramarine, free in Canada, and 3 cents per pound into the United States. Soda ash, free into Canada, and one-fourth of a cent per pound into the United States. "I have likewise prepared a statement." the letter goes on to say, "taken from the books of our company, showing the amount we were obliged to pay during our last year's operations," that is, one fiscal year, "on account of these tariff charges over and above what the duties would have been on the same items if brought into Canada instead of the I'nited States.'"— tliat is to say, this table does not show the actual amount paid, but allows what the excess amounts to on these importations over and aliove what it would have been into 160 RECIPBOCITY WITH CANADA. Canada, taking into consideration the tariff where any existed on the importations into Canada. This company paid hist year in excess duty on English china clay $75,000; on bleaching powder, $70,000; on alum, $21,000; on copper- wire cloth, $18,000 ; on aniline dyes and ultramarine and other color- ing matters, $5,000; on paper-maker's feltings and jacketings, $35,000 ; soda ash, $40,000 ; making a total of $264,000 paid in duties which would not have been paid or any portion of it would not have been paid had this same companA' been conducting the same operation on the same scale in Canada last j^ear. Senator Stone. What was the value of the product? Mr. Moore. I really could not say. Senator, just what that is. I could ascertain that and let you know, but I have not those figures here. Senator Simmons. Now, the paper manufacturer of this country does not import these different articles which you have mentioned. Mr. Moore. He usually hujs through an importer. Senator Sijemons. He usually buys Mr. Moore. Yes ; but he very frequently imjoorts directh^ Senator Simmons. As a rule the pajDer manufacturers are not im- porters ? Mr. Moore. I could not say whether they are as a rule or not. Senator Simmons. I am asking you. Mr. MooRB. I taJie it as a rule they do not import directly the most of these items, but I am not sure of that. Senator Simmons. I suppose the same thing is true of the Canadian paper manufacturer; he goes into the open market and buj^s these articles which you have just enumerated? Mr. JMooRE. I suppose that is true. Senator Summons. Now, can you tell the committee what these sev- eral articles which you enumerated sell for in the open market of Canada and what they sell for in the open market of the United States? Mr. Moore. I am very sure that those facts will be fully supplied by others who will follow me. Senator Simmons. I was asking that so we might see whether the tariff does have the effect which you have been as'suming that it does have. Mr. MooRE. In order not to repeat in the introduction of these statements, I have purposely refrained from indulging in figures which I am sure will be supplied from other sources. Senator Simmons. If somebody else is going to supply them, all right. Mr. MooRE. If not, and if there is anything that may be lacking that I can furnish, I will be glad to do so. Senator Simmons. I think it would help the committee a good deal to know exactly what these various constituent elements sell for in the markets of this country, and what thev sell for in the markets of Canada. Then we could tell exactly the 'difference between them. Mr. MooRE. FolloAving that line of argTiment Senator La FollIstte. Before you lea^-e that, if you please, I under- stand from this statement that these amounts were' paid in duties by the company 5'ou represent? Mr. Moo RE. They were paid. KECIPEOCITY WITB; CANADA. 161 Senator La Follette. So your company did import to tliis extent? Mr. MooEE. Yes; that is right. Senator La Follette. That i<, to the extent represented by these duties ? Mr. MooKE. Yes; but I can not speak as to the trade in general. Senator La Follette. I understand. Mr. MoouE. "As vou are aware, the capitalization of the West Vir- ginia Pulp & Paper Co. is $10,000,000." Senator La Follette. jNIight I ask you, before you leave that, Are the products that are represented in that table produced in this country ? Mr. Moore. Some of them are, but not identically. Senator La Follette. Xot identically, not of the same quality and character. Mr. MooEE. Not identical in quality and character. Of course if an article of the same quality that would answer the same purpose could be procured here without paying that duty on it. it would be bought here. As you are aware, the capitalization of the West Virginia Pulp & Paper Co. is $10,000,000. The amount of this excess tariff charge — namely, ?2G4,(inO— is therefore approximately 2.6 per cent of onr entire cajiitalization, which we are annually penalized for conducting onr business in the United States instead of over the Canadian border. That is under present conditions. It is perfectly apparent that the passage of the pending reciprocity measure, without amendment, giving the Canadian manufacturer free access to our American markets, while at the same time no provision is offered or proposed in the way of granting a reduction of the tariff on the articles which we import from European countries, has the effect of compelling us to buy in a " pro- tected " market and sell our products in a "free-trade" market. We have never understood that any political party, or for that matter any fair-minded American, has advocated the justice of such doctrine. Senator Clark. Except that in case, in buying, as you do, in the markets, as j'ou do, and in selling in the markets, vrhich you do, you still are able to make a good profit on 3' our operations ? Mr. Moore. Under present conditions? Senator Clark. Yes. ^Ir. I\Iooi:i;. Yes; some mills. Senator Clark. But under the proposed conditions? Mr. MooRE. Some are able to make a fair profit, and some make absolutely nothing; and others, I think, are running behind. It is like every other business. It depends, of course, a good deal upon the local conditions and how far ahead the men have looked and how hard they have worked and how skillfully they have applied them- selves. 1Ve have not inade any juofit for which we are indebted to the Government, eitlier as a bounty or a Iwuevolent contribution. Senator Clark. Of course, I was merely speaking as to the gen- eral proposition, that a tariil upon one article must of necessity depend upon a related tariff upon another. Mr. Moore. Naturally so. In addition to the foregoing, as yon already know, this same disadvantage in tariff regulations attaches to the American manufacturer in the construc- tion of his plant as well as in its opor;ition. The duties assessed liy the United States on imported construction materials and machinery essential to the building of a pulp or paper mill are re!Mti\f;]y as much gi-ejter than the tariff levied by the f'anndian Government as those enumerated in the fore- 162 EECIPKOCITY WITH CAKADA. going table. IJeiice we are liandicnpiiGd in our initial investment as well as by an annual assessment tlirongbout tbe iieriod of operation. Tbis, of course, is uoi our loily (ibjectiou to tlie [laper and pulp provision in tbe Canadian trealy. Tbe euoi-mons (inference in tbe cost of wood is well known, as is also Ibe Can.-idian advantage in ujannfacture on account of tbe abundance of water pcnver, as well as otber differences, any one of wbicb sbould be snilicient argument a;,'ainst tbe pulp and paper clause. Inasmuch as the other features relating to the manufacture, the relative advantages on the Canadian side and in the United States, 'will be fully covered by others, I shall not go into any detail as to that except to state that the three distinct advantages which the Canadian has is, first of all, his cheap wood, his abundant water power and this great difference in the tariff assessed against the United States and relatively none against the Canadian manufac- turers. We therefore leave this statement just where we are, without going over items which will be testified to by others. Personally I feel, and I am ^'oicing the sentiments of all of the manufacturers of pulp paper when I say that it is a great hardship upon the industry, so great a hardship that some of them will be utterly put out of business, and all of them will be crippled, and inci- dentally all the allied interests must proportionately suffer, that we believe that you gentlemen will consider all of these facts before reaching your conclusion and making your report. I thank j^ott very much. Senator Claek. Jlay I ask you one question if you are informed: What dividend did the West Virginia Co. pay during the 1-2 months, ^he fiscal year, of which you have spoken? ]\Ir. MooEE. I will state, Senator, that I am not a stockholder, but my impression is that it has been paying 6 per cent. I am not posi- tive as to that. But I think so, for'the entire time, as I know that has been paid time and again. I am very sure that there has never been any greater dividend. Senator Clark. ]\Iy particular inquiry was directed to this par- ticular year in which they paid 2.G per cent duty. :Mi;. ]\Iooee. I can state positively that the $10,000,000 capitaliza- tion is not based on any water in that stock. Senator Sm(;(it. Do they work their own timber? Mv. ^LiMRE. In some of their operations. Senator Smoot. they do. Senator Smoot. Do they own any timber lands in Canada? Mr. MooEE. Not Canada. They own timber lands in West Vir- ginia, and they have mills in AV'est Virginia, Virginia, Maryland, Pennsylvania, and New York. In West Virginia thev own timber lands; not elsewhere. Senator Smoot. Do they own any interest in the sulphite mills in the South? ^ iMr. MooKE. They have sulphite mills in A^iroinia and West Vir- ginia; no other interests. They have no conne'ction whatever with any other company. Senator Clakk. No connection with the North Carolina interests? Mr. Moore. No connection whatever in any way. Senator Si:MJroxs. Whtit sort of wood do they use pine? Mr. MooEE. That depends, Senator. In some of their mills they use the spruce practically altogetlier when the sulphite process is used, as it IS m the Covington mills, in Virginia, and the Davis mills, in \A est A irginia, and ])art of the plant at ^.lechanicsville, X. Y. ; where EECIPROCIXY WITH CANADA. 163, they use the scula proots, for reilucing the wood, they use pophir largely and a mixture of other tmrbers. but prineipully spruce and poplar in the manufacture of book papers. Senator Simmon's. >«'ow, in \'irginia and AA'est Virginia you get your woods from the near-by forests ? Mr. MooiiE. Not near by, Senator. Our mill at Covington is located about 140 miles from our wood supply. At the time that timber land was purchased it was not on any railroad. The Chesapeake & Ohio built a branch line up the Green Briar River to within striking dis- tance of this, and then our own company constructed a branch road of some 35 miles running into the timber, so that, while it is on the railroad, we have put it there, and then we i^aid taxes for putting the road in, and after we got the road in they said because the timber is on the road it is worth more, and we paid more taxes on the timber. Senator Simmons. I suppose there is no doubt that the Canadian wood is much cheaper than the spruce of New England? Mr. MooEE. Very much. Senator Sijimons. I want to ask you if you think that the Cana- dian woods, pulp woods, are cheaper than your woods in A'irginia and West Virginia ? Mr. MooEE. Very much cheaper. Senator Simmons. AVithin a radius of 140 miles? Mr. MooiiE. Very much cheaper. Senator I^een. What does your timber land cost you in W'est Vir- ginia 'i Mr. MooEE. At the time of the purchase of most of our lands, which was back, I think, in 1898, they ranged in price from $8 to $15 an acre. That includes large boundaries in which there is barren territory and streams and rocky tracts, which, of course, reduces the actual timber acreage. Senator Keen. I suppose you located there, largely, on account of the timber supply and coal supply ? ]Mr. MooEE. That is correct. Senator Keen. And for the water power? Mr. MooEE. No water power. Of course we have the coal fields more or less convenient there, but no water power. Senator Keen. That is the Green Briar River, or the Jackson River ? Mr. Moore. The Jackson River, a branch of the James River, on the Chesapeake & Ohio Railroad. Senator Kern. The Jackson River and the James River are a few miles below ? Mr. Moore. A few miles below Clifton Forge ; about 16 miles. Senator Smoot. At this season of the year are you compelled to buy tim"ber from Canada ? .Air. MoonE. I am pretty sure that the :MiMhanicsvdle mill has at times and may now be Ijiiymt!- some wood froin Canada, is now buying some wood from Canada occasionally. Senator Smoot. Do vou have to pay a higher price for it? Mr. Moore. Yes, it costs us more than the wood at the other mills, where we own our own timber, some of the other mills, when we haxe to bring it anv distance, on account of the transportation. We have an abundance of wood, I want to say. There is no scarcity of wood. 164 EECIPBOCITY WITH CANADA. Sometimes it does happen that for a brief period we may have to get wood from places whicli are not our normal source of supply, but we have wood enough in sight to last for many years to come. Senator Smoot. During the hearings on the Payne-Aldrich bill I secured about a thousand invoices from different mills in the country that had purchased wood in America and also compelled to purchase wood in Canada. I sorted the in\f)ices. and they were actual in- voices. I made the mill attach to the invoices the expense bills, and in analyzing the Avhcle thousand invoices, as I remember it, the wood in Canada cost the mills in America about A4.20 a cord less in Canada than woods purchased in the United States. Mr. MooRE. That is about it; my recollection bears that out. Senator Simmons. Those are about the figures of the tariff. Senator Smoot. I had the invoices with the railroad expense bills attached to every invoice. Mr. MooEE. You understand when I speak of buying occasionally in Canada, where you are forced to go out on account of a shortage and just pick up a little wood for the time being, you will pay more than if you have regular contracts from a regular source of supply. We do not huj enough from Canada to really be considered as a factor in that particular, because we have sufficient wood in sight at home. Senator Kerx. TVliere is your market? Mr. MooEE. The paper markets? Senator Kern. Yes. _ Mr. MooRE. Principally in New York, Chicago, and the larger cities. Senator Kern. Do you export it? Mr. JNIoORE. We are not Senator SarooT. Do not forget the Government. Mr. MooRE. We are not furnishing the Government much at this time. We have supplied some because we got less for it than any- b(_Kly else was willing to take. Senator Kern. Do you export any of your product? ^Ir. Moore. Very little; only some of particular grades at tunes are called for. The bulk of our paper is sold here. The most of it goes into the manufacture of magazines and books. Senator Stjijions. When did vour companv acquire their holdings? Mr. MooRE. The timber lands? Senator Simmons. The timber lands. ]Mr. MooEE. I think that was in 1S08. I am sure the bulk of the purchases were jnade then. It has from time to time been picking up tracts here and there, but the bulk of its lioldings were acquired in 1898. '^ ^ Senator Simmons. Now, the most of vour timber is not merchant- able for purposes of manufacturing lumber, is it; it is too small for that, is it not? Air. Moore. The West Virginia spruce grows larger than the spruce m the extreme North. The most of it is available for the manu- facture of lumber. Senator Sim:\ions. That is not true of the Virginia timber? Mr. Moore. Yes ; of the Virginia timber _ Senator SiMaroNS. I am speaking of this Virginia timber as dis- tinguished from the West 'N'irginia "timber. EECIPROCITY WITH CANADA. 165 Mr. Moore. We have no timber in Virginia at all. The I'lill is supplied from the West Virginia timber fields. Senator Kern. Your mill is near the line^ Mr. MooEE. Very near the line. AVe use at the pulp mills a great deal of the waste from the sawmills throughout the country. Of course, in that way we can convert to pulp a large quantity of timber that otherwise would be absolutely Avasted. Senator Stone. Would the adoption of this agreement result in the reduction of the selling price of such paper as your company manufactures — I mean at the mills? Mr. JMooKE. That depends upon what logic is correct. Some people have been telling us that reciprocity will not reduce the price of what the farmer has to sell, but will reduce it to the consumer. Now, from my standpoint, I am of the opinion that it will very materially reduce it, and have to do it until Canada controls the industry; then the price will go up again. Senator Stoke. I understood you to say early in your remarks that the adoption of this agreement would not benefit the consumers of paper ? Mr. Moore. Xo ; I did not say that. Senator Stone. ^A-liat was it 3'ou said about the consumers? Mr. Moore. I said that I had not heard of the publisher proposing to reduce the price of his paper to the consumer; that it necessarily will reduce the price at which we sell it, but that reduction will not extend down the line so that the man who reads the paper will get the benefit of it. Senator Stone. You do not sell the publishers jDaper ? Mr. MooRE. No; we do not manufacture any paper that is used in the publication of the newspapers. We manufacture Senator Stone. AA^iat is your j^ajoer used for? Mr. MooEE. Magazines and books. Senator Smoot. You do not think they will be reduced ? Mr. Moore. I have not heard of any move of that kind to give the reader the benefit of that. Senator Stone. Newspapers selling at a cent a copj^, as they do generally, are about as low as they can be sold at — that is about the lowest coin that can be made. Mr. Moore. I do not imagine there will be any material reduction below that. You would waste more time in making change than you would save in price. Senator Stone. We would have to make some lower coin to make the change. Mr. MooRE. I Avant to again state that so far as that branch of the industry is concerned, I have no personal knowledge, except the gen- eral information which comes to me, being directly interested in the book-paper end of it. Senator SarooT. Canada would be in this position, would it not, being able to make paper chraioer on account of cheaper wood than the American manufacturer, even if she did not at times sell the paper at less than the American manufacturers, she could, at any time she desired, take the American market away, and thus virtually drive the American manufacturer out of business ? Mr. MooRE. Absolutely. I want to say furthermore in that con- nection that a plant constructed for the manufacturing of pulp and paper is peculiar in this respect, that you can not convert it into 166 RECIPROCITY WITH CANADA. anything else. If we are put out of that business, we have an expen- sive piece of junk on our hands. I Imow now of a gentleman who is contemplating the construction of a mill, who is waiting to deter- mine whether he shall put it in Canada or the United States, depend- ent upon the action of Congress in this matter. Senator Kern. Is this product manufactured in Canada to any extent ? Mr. MooEE. PaTdon me? Senator Kern. Is this product, such as you produce at your mills, manufactured to any great extent in Canada now? Mr. Moore. Not so much as the newspaper. There is some manu- factured there, but not to such an extent as among us. Senator Sjioot. Some is imported from this country into Canada? Mr. Moore. Some, I suijpose; but very little. I am not advised as to that at all. But I know we are not selling any there. There may be some special grades that are called for which can not be had there and which can be had from the other side, and they are very apt to bring them from some country' that is akin to them. Senator Kern. $554,000 of wood puljj and paper was exported. Mr. ^Ioore. I am not advised as to that. I thank you very much, gentlemen. Senator La Follette. Just let me inquire, if you jDlease: Are you familiar with the processes of manufacture of the various mills? Mr. Moore. In a very general way. I have been around it so much that I can always explain it to some one who does not know any- thing more about it than I do. Senator La Follette. You could make it perfectly clear to me? Mr. Moore. I hesitate to explain it to an expert. Senator La Follette. Is there an^'one here representing your com- pany besides yourself? Mr. ^looRK. Xot my particular company, but there are others who are just as thoroughly competent as the men connected with my com- pany who are here, or who can be' here to explain the processes if it is desired. Senator La Follette. How many different plants has the West Virginia Paper Co.? Mr. Moore. It has, I believe, six — it has five phmts at which paper is manufactured, one of which manufactures pulp only and ships it to the other plants. Senator La Follette. And distributes it? ]Mr. Moore. Yes; to its own plants largely. Senator Kern. Where is the pulp manufactured? Mr. Moore. There is a pulp mill at Davis, W. Va. Senator La Follette. That is exclusively a pulp mill ? Mr. MooRE. Exclusively a pidp-manufacturing mill : no paper there at all. Senator La Follette. Where are the five mills that manufacture paper located? Mr. MooRE. One at Covington, W. Va., and the other at Luke, Md.. which is upon the Potomac Kiver; the office is really Piedmont, W. Va., across the river; one at Williamsburg, Pa., one at Tyrone, Pa., and the other at Mechanicsville, N. Y., on the Hudson River. Senator La Follette. How are those five mills located in refer- ence to the raw material which they use, particularly j^our wood? RECIPEOCITY WITH CANADA. 167 Mr. MooEE. The Covington and Piedmont and Davis mills — that is, the mills in Virginia, West Virginia, and Maryland — are all in reach of our own timber supply to a great extent. We buy some wood on the outside, as I said awhile ago. ^Ye have contracts with a large number of lumber operators for refuse, and the other mills are dependent upon the local market when not supplied from our own timber lands. Senator La Follette. Are your mills all modern in construction? Mr. MooEE. They are. We try to keep them so. Senator La Follette. You regard them, do j'ou, as thoroughly up to date in equipment? Mr. Mooee. We do not think there are any better mills, and we are spending money continuously trying to keep them up to date. Senator La Follette. I know nothing about it; I am just asking for information. Mr. MooEE. Li fact, the Piedmont Mill has been practically rebuilt in the last few years. The processes have changed some, and the mill was out of date, and it was practically rebuilt. Senator La Follette. Is there any considerable difference in the cost of production in the different mills manufacturing the same product ? Mr. MooEE. I could not say as to that, Senator. I am not familiar with that part of our operation. Senator La Follette. Would you supjDly the committee. Judge Moore, with a statement of the cost of production ? Mr. Moore. The revenue? Senator La Follette. No; of each mill on each quality of paper manufactured. Mr. MooEE. So as to get a comparison between the localities? Senator La Follette. So as to get the facts. Mr. Mooee. You want the mills separate? Senator La Follette. Yes, sir; so as to make a comparison with other mills. jMr. ]\IooEE. Yes, sir. I shall try to do as you suggest. Senator La Folustte. And also for your pulp mill and ground Mr. Mooee. We make no ground wood. That is used exclusively in the manufacture of newspaper — not exclusively, but that is the prac- tical use. Senator La Follette. We have been supplied with a report from the Tariff Board, and my attention was arrested in looking over a table on page 26 of that report. The note over the table is as follows : Table in. — Total cost, raiige of cost, and average cost of specific items per ton of product used in the manufacture of ground wood, sulphite, fiber, and news-print paper, for all mills in the United States reporting data. The lowest total cost peV ton of product is given as $25.38, and the highest $39. .57. I was curious to know if that wide range of cost did not represent old equipment and lack of efTiciency. Mr. MooEE. That, of course. Senator, is an element that enters materially into it. In addition to that, of course, there, are very many different grades of book paper, and I do not know how that table is made up. It may be that the high cost would represent some of the higher grades and the low cost some of the lower grades. Mills do not always make the same grades. 03285— No. 3—11 6 168 HECIPKOCITY WITI-I CANADA. Senator La Follette. I do not understand that this table is exclu- sively for any ])articuhir paper. I think this table covers all papers. Mr. Hastings. Might I say that that is nothing but newspaper, common newsprint. They have not investigated or made any report on any other kind of paper. Senator La Follette. The wide range shown in this table here for whatever is reported indicates to my mind, or raises a question in my mind, as to whether we might not be asked to impose a tariff for mills that are very poorly equipped and not up to date — in other words, to offer protection for lack of efficiency; and I would like to get the range of the cost of production in your mills. Mr. Moore. If we do not keep our mills up, of course we will have to pay the penalty. Senator La Follette. You might not have to, if an ample tariff was given you for not keeping up your mills. Mr. MooRE. Our competitors are doing it, and we could not afford to lag behind. Senator Smoot. Can you tell, me the range of cost of the papers which you make? i\Ir. Moore. I can not except in a very general way. I can get that for you. Senator S:vrooT. A^Hiat I wanted to get at is this : That in the treaty it provides for the pajoers of less than 4 cents a pound. Do you know what percentage of your production would fall within 4 cents? Mr. Mooee. Practically all of it. The Cha)k:\ia?v-. The committee Avill hear the next gentleman. Mr. HASTiKCis. Mr. Chairman, I would like to introduce ex-Gov. John Stianiie, of A\"iHc<)nsin, who has betn requested to appear rep- resenting manufactui-ers, and also requested to appear by the boards of trade of Nenno and ]\Ienasha. Wis. STATEMENT OF EX-GOV. JOHN STKANGE. Mr. STi;AN(iE. ^Ir. Chairman and gentlemen of the Finance Com- mittee. I tru^t that you will be as tolerant of what I have to say as lies within yon to be. l)ecause I perhaps may -tray over quite a wide range of pasture in the discussion of this question. I want at the outset, because of the fact that I was the only dele- gate from AVisconsin to the great International Dry Farming Con- gress in Spokane last fall— I want to say that I have somewhat of an mterest in the agricultural welfare of Wisconsin and the other sister States of the Union. I learned manv things which were of great interest to me in the discussion of which was the better way of farming, irrigation or the dry processes, and ultimatelv I learned a gxeat deal concerning the activity of the Canadian promoter to acquire the bram and the conscience and the wealth of the American farmer. I am advised that 75,000 of the best sons of American soil were persuaded to go over into Canadian }:)osscssions within the last 18 months, and that they took more than 300,000,000 American dollars. As an American citizen I protest against the continuance of that policy if it is Avithin my power to stop it. In the discussion held this week, or the week at Spokane, I listened very intently, and I became convinced that the United EECIPEOCITY WITH CANADA. 169 States of America offers incomparably greater advantages to the young man and the old man seeking new farms than does the Canadian Northwest. We lack the spirit; we lack the enterprise; Ave lack a realization of the possibilities which we have to offer as against those offered by the Canadians in cooperation with many proselyting members of our own Nation. I was very much pleased the other day to meet in Chicago a farmer form South Dakota, who had just sold 200 acres of land contiguous to a prominent city in South Dakota for $40,000, and he was on his way, with his college-bred wife, to take up his new home in Virginia ; and, passing through Wisconsin, he stopped at Orfordville and bought from the friend of the distinguished Senator from Wisconsin $20,000 worth of Jersey-bred cattle, and he comes to Virginia to imbue the farmers there with the possibilities of dairying scientifi- cally, as expounded by Wisconsin and her great agricultural insti- tutions. I am for Virginia, as against any alien land under the sun. I want to discuss this bill from the standpoint of a manufacturer and as an Ajnerican citizen. In the first place, the bill lacks one essential — ^the greatest power in all the world, the strongest thing in all the world, is love, and there is no love of country in this bill, and without it the nation is worse than nothing. The spirit of '76 is absent, and if the spirit controlling this bill were dominant in the days of 'Tfi there would have been no inspira- tion for the boys of "TO to establish this Nation, and I am against it because it lacks the spirit of patriotism and the spirit of love of country. I am against it because it is a cowardly bill, yielding to the de- mands of unrighteous men, mercenary men, men whose hands were so unclean that they should never be permitted to complain in any court of the United States of America ; a combination in restraint of legiti- mate rights, of trade, of commerce, and of decency. I refer to the American Publishers' Association and its associate — the American Press. [Applause.] Wby shall any man be privileged with an exalted office who will yield to the clemands through cowardice of such an unworthy complainant as it? I ask you that. That is the basis on which this whole special session of Congress rests, ancl it never would have been called except at the behest of this trust, acting in restraint of every spirit and letter of the Sherman Act. When a man occupying an exalted place in this United States fears for his own election rather than be concerned in the welfare of the Nation, then I say it is time for resignation. I am against this bill because it is conceived in cowardice and fear; it has no bravery in it ; it has not an element of character ; it has not a semblance of American patriotism ; not one. It is a bill which dis- criminates, a bill which at the behest of these unworthy men selects a great industry and expects to impose unrighteous burdens upon them, not with any truth as a justification. These men did not come out in the open and charge in a dignified manner the manufacturers of paper with a great wrong. Under cover of darkness and m cowardice and in fear of the light they appealed in secret to the powers that be, and compelled them, through cowardice and fear, to yield the dignity and the decency of American citizenship. 170 Bi;CIPEOCITY WITH CANADA. I am against this bill because it is revolutionary any way you measure it, from the standpoint of jurisprudence. There is not a logical thing in it. The uiily precedent of which I have any knowl- edge is taken from tliat m\'thical Irish judge, who says: "We will hang the prisoner iirst and try him afterwanJ.-."' [Laughter.] Why are not these men, charged with wrongdoing, cited to appear in a dignified manner in court, and, under the processes of law, justify their complaint or be condemned of a jury of their equals? Why should the President of the United States — why should the Secretary of State be influenced, even though innocently, to become auxiliaries to the purchasing department of a great trust, I ask you. We are assailed, and upon us rests the responsibility of justifying our course or being condemned. Senator Stoxe. AVhat trust are you referring to? Mr. Strange. I am talking about the Newspaper Trust, the most vicious in all the world. Senator. [Applause.] The man. Senator, who has introduced a resolution asking for the investigation of the wrongs imposed upon them by the manufacturers of paper owns a monopulv ""O miles square and a solid body of the most fertile soil in all the American Continent, and no other man dare encroacli upon that m acquiring the news of the world. He owns a 250 squaie mile monopoly, and is a member of the Associated Press and the American I'ress Club. Senator Sione. AVlio is that t ilr. SritAxoE. That is ilr. Kicks, of Wisconsin. Col. John Hicks, who introduced the first resolution for an in^'e3tigation of the so- called newspaper manufacturers and trust. Seiiatiir SroxE. I would like, really, to know what you mean by the Newspaper Trust. Mr. SiuA^aJE. The American Publishers' Association and the American Press Association are one and inseparable. They are just as near as they can get them. The stockholders of one are the stock- holders of the other. Senator Stoxe. You have a manufacturer's association? _ Mr. SrpaxGE. "\A'e do not belong to any manufacturer's associa- tion, or any body Senator Stoxe. There is one. Mr. Strange. It is a social one, just as the lawyers have a social club, and there is nothing beyond that. There is not any organiza- tion for the purpose of controlling prices or agreeing upon anything except in common defense. Allien Ave were charged with wrong- doing there was internal strife, bitter and determined hostility to- ward each other; but we were charged as a great industry with wrongdoing; then, by all the rules of defense, we were required to get together and make some sort of defense. That is why we get together. Senator Stone. ^Yhat is the purpose of this newspaper association? What do they seek to do ? Mr. Strange. They own the xVssociated Press Despatch, which con- trols the news of the world, practically. Senator Stone. Yes. Mr. St-rangb. They acquire news all over the world. It is an asso- ciation incorporated under the laws of the United States, and they have a monopoly upon furnishing the information to members of a RECIPEOOITY WITH CANADA. 171 newspaper syndicate, of which they are all members, and Col. Hicks, of whom I speak, is a member of the American Publishers' Associa- tion, and in his purchase of the stock of the American l*ress Asso- ciation there was a provision that he had permanent and exclnsive monopoly for 250 square miles of information given by the Asso- ciated Press to the people within that sphere. There is a monopoly absolutely protected under the law, and those are the dirty-handed men who come in here complaining of us. Senator Stone. This is a monopoly of news, as I understand you. Is it a monopoly also to control the prices of paper? ^Ir. Strange. This is a monopolizing privilege of getting the in- formation. It won"t give yon the news. Xo man can start a news- paper within this block of I'.X) square miles who does not have stock in the Associated Press and who is not given a monopoly through their privileges. Senator Sijijions. AVjiat you mean is this, go\ern(ir. The Asso- ciated Press will enter into a contract with a newspaper, we will say Mr. Steaxoe (interrupting). Xo; not with a newspaper, but with publishers. Senator Simmon's. With publishers, that they will furnish their paper with the Associated Press service, and that no ])aper within a radius of 50 miles shall be allowed to have that service. ilr. Strange. You can not get the news, because tliat is a monopolj of privilege, and no man can get the Associated evening report at any price or under any condition within that area. Senator Ct.n:.L0M. T^^iat is that? Mr. Strange. Oshkosh was the central point in the Fox Eiver Valley. And five years ago a bill was introduced against the manu- facturers of news paper by a man who is an active member of the National Press Association. Senator Clark. Are there other associations besides this? Mr. Strange. None of them that are recognized as strong and which have access to the information of the world. IMr. Hearst Senator Clark (interrupting). Is the Associated Press a stock company ? Mr. Strange. Yes, sir ; it is a stock company. Senator Siroo-r. Pardon me, I think yon had better correct that statement, because the Associated Press is not an incorporated company. Mr. Strange. Is it not? Senator Smoot. No. Mv. Strange. It is not? It enters into contracts for the furnishing of a monopoly. It has the power to contract. Senator Sjioot. I think you are mistaken again. I have no inter- est in this, and I think you would like to get the record straight. Mr. Strange. We want the record absolutely straight. Senator Smoot. The Associated Press does not enter into a con- tract. The Associated Press furnishes to its members, the news. but does not furnish it to any one outside of that membership. Mr. Strange. It assigns a monopoly of territory to its members. I do not know what the manipulations are. Senator Smoot. Get it right. 172 KECIPEOCITY WITH CANADA. Mr. Strange. That is right, Senator. I certainly want to do that. Senator Kken. I thinlc what you want to illustrate is this: In my city the morning newspaper has the right to the Associated Press news, and the evening paper has the right to it, but no other news- paper can get into that territory without the consent of those two. Mr. Strange. These franchise rights are sold to certain individuals. Senator Sjiooi'. No one can receive news from the association unless a member. Mr. Strange. Unless the Associated Press allows others to enter the association. Senator Stone. Are there not also other press associations ? Mr. Strange. There is the Hearst Press and the Scripps-McEae, if you want that kind of service. That is not regarded as standard. [Laughter.] Senator Stone. The United Press ? ]\Ir. Str^vnge. The United Press is hardly worth the name of a newsgatherer — news dispenser. Senator Stone. Is it not a fact that practically all the papers are in the Associated Press? Mr. Strange. No; the Plearst jDapers are not in the Associated Press. Senator Stone. Do they get the news? Mr. Strange. They do. Yes; they will furnish you; if you want Plearst news, you can get that. If you want to start a paper and go into conflict with others, you can get it. Senator Stone. They have about the same general run of daily news that you find in your paj:)ers? Mr. Strange. Yes; but if you arc going into competition with the other association, jou would be seriously handicapped. Senator Stone. The New York Sun does not, or did not a short time ago. use the Associated Press. Senator Clark. Is it not a fact that the efficiency of any news asso- ciation depends upon their efficiencj^ as newsgatherers ? Mr. Strange. AAHiat? Senator Ceark. Does not the efficiency of any of these associations depend upon their efficiency as newsgatherers? Mr. Strange. Yes, sir. Senator Clark. Is it not a fact that the Associated Press stands at the head of news distribution? Mr. Strange. Certainly; there is no question about that. They all conspire together, gentlemen of the Senate; they all conspire to- gether, however, in their complaint of our restraint against the manu- facturers of print paper. Mr. Plearst, as one of the most eminent men to man the dissolution of the General Paper Co., with head- quarters in Chicago. It was the only possible competition that he had in the purchase of his raw material. Through fear or something else they went into vohmtary liquidation when the Government began a prosecution against them; and from that da}^ there has not been any manufacturer of print paper great enough in the United States to offer a price to Mr. Hearst for his demands. He consumes practically 350 tons of paper to-day, and the only corporation in the Uniteii States with ability to supply that is the International Paper Co. The General Paper Co. of AA^'isconsin was a competitor, but under a decree of the court it was dissolved, and it made a positive monopoly KECTPKOCITY WITH CANADA. 173 at the behest of the Newspaper Trust— the International Paper Co.— as far as taking big contracts went. Senator Stone. "Wlij^ was that dissolved ? Mr. Strange. Well, complaint was made, as it was said to be a com- bination in restraint of trade; it was a selling agency. Senator Stone. A monopoly composed of paper manufacturers? Mr. Strange. A number of manufacturers, through a common sell- ing agency, disposed of their product. Senator Stone. Were some of the companies with which you were associated involved in that? Mr. Strange. Not directly myself, and yet the companies for whom I am appearing; yes. Senator Stone. Yes ? Mr. Strange. Yes, sir. I will say further. Senator, when Hearst and his people saw the mistake they made by demanding the dissolu- tion of the only competitive possibility, then an attempt was made to induce the same men holding the mills which were dissolved to pull together and bid upon his contracts, within the last GO days, restoring the only possible factor in competition that was existent at the time. So you see that the General Paper Co. — as a matter of fact, while I was not a member of it, I had something to do with its dissolution — was in fact the competitor to whom the newspaper publishers could go and get figures. And they organized solely to protect their terri- tory in the acquirement of a certain amount of privilege against the book bills of the East, and that is the only Avay they could take care of newspapers. There is not a mill in Wisconsin or Minnesota — not one mill which has cajDacity enough to figxire on tlie contract of the three leading dailies in Chicago individually. Only by a combination, under a selling process or something of that kind, could they enter the mar- ket and bid for the contract of the Chicago Daily Tribune, the Chi- cago Evening News, or the Hearst publications. And they sent into thfs court a complaint that the production of print paper in Wiscon- sin had been reduced 27.5 tons per day, and there was to be prima facie evidence that there was a conspiracy on the part of the manu- facturers in some inconceivable manner. The truth is that when the General Paper Co. was dissolved the cooperation of these mills dis- pelled the possibility of their competing for this big business, and they had to quit the field, and the men who have come and complained dissolved their only access to competition when they did that. Now, what I object to Senator Clark. What was the basis of the dissolution ? Mr. Strange. They claimed it was a combination in restraint of the Sherman law. Senator Clark. The courts so held? Mr. Strange. The courts so held. The court did not have time to pass upon it, but they became frightened and, under the advice of counsel, and so forth,' who advised them there was no danger, they went into dissolution, and the individual mills are only existmg. They lost the trade they had ; they lost these big contracts. The mills from the East came and took them. And then these men who caused this dissolution deprived themselves of competition and complained of conspiracy on the part of these mills, because they were not making paper. 174 KECIPEOGITY WITH CANADA. Senator Clark. What I was seeking to inquire about was that if there was no competition in restraint of trade the Sherman law was Mr. Strange (interrupting). My God! that is all silly bugbears. The Sherman law has frightened a whole lot of men into a frenzy, when there is nothing to it but silly bugbears. I would stand on my rights under the Sherman law and not be driven out of my rights as an American citizen. These newspaper publishers have a thousand times more to fear from a guilty conscience than any manufacturers of paper I have ever heard about, and they are cowardly and mean about it ; they are not manly and dignified. I want the truth to be known, because it has initiated this whole agitation. It has imposed millions and millions and millions of dol- lars upon the people of the United States. This very behest, made through our weak Chief Executive, has caused this unwarranted meeting of the people here, this great expense. Look at the hun- dreds of farmers who have left the tilling of their farms to come here and defend their rights as farmers in defense of their constitu- tional privileges. It is an outrage, as I said before. Senator Sto^e. Constitutional privileges are involved. Mr. Strange. You have a right to be tried by a jury under all the laws, and these farmers are willing to be tried, but not under secret cover. The Chairman. I suggest, Mr. Strange, that you confine yourself to the subject before the committee and give your specific objections to this bill. Mr. SiHANGE. In a little village of Guelph there was bcrn one of the greatest men who has ever lived, from the standpoint of industry and commercialism. I want to file, as a thing directly in point, a diagram of a part of the achievements of this great man. All of his affiliations, commercially, since his advent into the affairs of the United States have been with Canadian and English capitalists. James J. Hill is without a rival as a great empire builder, as a great creator of fortune for himself, and he is easily worth twenty times any estimate placed upon him of which I have ever taken notice. ^Ir. Hill has concerned himself very intimately and very recently in the election of Members of this great Senate body. Mr. Hill was chosen by somebody to represent, in common with the Secretary of State, the sentiment of the people of the United States in firing the first gim which was fired at Chicago in support of this unrighteous bill. Why should Mr. Hill, whose interests are associated entirely with Canadian allies, be so concerned in this recii^rocit}' ? "^^ly should he, of all men, go arm in arm with the great Secretary of State to ap- peal to the people of Chicago and other communities which they ex- jDected would follow, speaking for 3'on and for me? If you will take a chart of Mr. Hill's Great Northern Eailroad, you will find that it has more than 20 arms reaching well-nigh up into his great " promised land." Before Seattle became the great metropolis, it was Mr. Hill, with his masterful foresight, who saw the value that would ultimately result to the great tide lands, and he acquired a practical monopoly of them. Why is not the same prece- dent governing him now? Why should he, an alien, with no interest in the people of the United States at heart — why should he speak for tlie farmers and for the manufacturere and for the people of EECIPEOCITY WITH CANADA. 175 this country in the support of this bill? If it has virtue, it ought to be made manifest through the reasoning of ourselves. I want to file this and have you just notice the 20 projected branches, all touching the border line, as an inducement why ]Mr. Hill is inter- ested in this bill; and then I want you to go to Spokane and the other cities along the line of Mr. Hill's Great Northern Railroad, and you will find that there is such a prejudice against his methods of operation that not one shipper in 20 will give him a pound of freight if they can help it. I am an American citizen, and I believe that America is for the Ainericans, and I believe that this bill is un-American in every fiber of its nature; and I believe that this unrighteous persecution on the part of this newspaper trust should never have been given consiclera- tion by the statesmen of this country. If the news'paper trust has any complaint to make against the manufacturers of paper, they have every remedy at law; they have their remedy at law in a big court of justice. But I am against this bill because it is against righteousness, it is against the law; and if we are offenders I say we ought to be tried under the law by our equals, and if we are guilty we ought to be punished. I am not going to tire your patience any longer. I just want to say to you, in conclusion, that Minneapolis will not grind the wheat from the great fields of the British jDossessions. It is not logical that they should. Winnipeg and other cities along the great trans- portation lines are already erecting great manufacturing establish- ments to grind our flour. Minneapolis is not the logical wheat-grind- ing market of the world by any manner of means. She has simply proselyted by appealing to our own men and women and sons to for- sake their own land and take up the promotion of the industrial wealth of an alien land, and I am against it from A to Z. I stand here as the representative of the paper manufacturers to deny, and defy any publisher to prove, that I ever did a thing in restraint of my privileges or my duties as an American citizen. They have not any standing in any court in the world which has jurisdiction over the case at issue. I want them to come out openly in the light and prove their charges, if they have anything on which to base them. There is only one good thing possible to be said of this bill in its analysis: No man can find any virtue in it. The only power to see a good thing in the bill is within the gentlemen of the Senate, and the only thing that can be said of it, and I shall look with a good deal of interest as the days go by and I search in the daily press to have that said by you that it is dead; and that is the only good thing you can say for it. [Applause.] Just a moment, gentlemen. I will be brief. The principal part and the most important part of my argument — I am going to cut it very short — is with reference to the complaint made by these news- paper publishers when they said we do not have any wood with which to make the paper. I took the pains, and I trust that you gentlemen extended me the courtesy to read a little letter which I addressed to you, telling you that there stands to-day at least 150,000,000,000 feet of spruce in the United States of America, the growth of which is more than seven times enough to supply the print paper needed in the United States of America. The State 176 KECIPEOCITY WITH CANADA. represented by the Senator here [referring to Senator Johnston, of Maine] has 40,000,000,000 feet of standing pulp wood, the increase of which is twice as much as the entire consumption of print paper in all the States of the Union. If that is true, then this premise upon which this demand for Canadian free pulp and paper is made has no truth in it — no justification — and it is true. If you gentlemen will take the pains to ask the Government expert, employed at your ex- pense, Mr. Morrison, to come up here, a gentlemen of wide ability and great experience, he will corroborate, I think, fully my estimate of the standing spruce not only in Maine but in the other portions of the United States. Senator Gallingee. At the Department of Agriculture a few days ago the statement was made that experiments M'ei'e now being car- ried on, which are beyond a doubt to be successful, whereby other woods can be used for paper making than spruce. Mr. Stranger. Senator, in reply to that I will tell you that our very, very progressive agricultural college at Madison raised at their different stations about 25 or oO tons of hemp. They sent a carload of it to me to be put into paper as an experiment. The year before that they shipped another carload of it to the S. D. Warren Paper Co., a portion of it to be put into book paper. It is an ad- mirable substitute for any kind of wood which can be raised in Wisconsin to the extent of 6 or 7 tons per acre, and the rais- ing of it eliminates every offensive grass, Canadian thistle, mustard, or anything else; it improves the quality of the land; it enriches it, and at the same time jjrovides sufficient revenue to entitle the farmer to continue in its raising. Six or seven tons an acre of it can readily be raised, when sown broadcast. There is not any more fear of the exhaustion of products for paper manufacture, Senator [Senator Gallinger], than the scarcity of potatoes. The wood sup- ply is ample, but the growth of hemp — and our distinguished Sena- tor here is probably advised of it — which our Department of Agri- culture, our school, advises the growing of that for the purpose of ridding the farm of all these plagues and producing a revenue and increasing the supply of raw material for paper, if it is needed. Senator Gallinger. I was quite astounded at the statement made by the Secretary of Agriculture that experiments were being car- ded on and were demonstrating conclusively that we would not be dependent after a little while on spruce wood for paper. Mr. Strange. Spruce does not make the best paper. It is abso- lutely unnecessary to have spruce. We do not need anv spruce. The distinguished Senator from the South — the free-trade' Senator from Mississippi— you have within the confines of your own State nearly material enough to make all of the paper needed in the United States for the next 50 years. Grinding is not the best process by which to make paper. The process used by the clients of your- self. Judge Moore, is a better process by far, and j'ou do not need spruce wood for that. The print paper "ought to be made by a dif- ferent process than grinding wood. That is an old and will be an obsolete process. It was not up to the times, and the pine all through the South, and the poplar— any grade of wood grown in the South other than the oak— is just as Avell adapted for "print paper or any other paper as the spruce is. And yet this whole thing is premised upon our inadequate supply of the raw material as a basis for the EECIPEOCITY WITH CANADA. 177 demand for this treaty. Now, why not get the question of fact? Here the fact is that comphiint has been made to tlie President of the United States and the Department of Justice, and a great deal of expense has been gone to in the acquirement of a tariff board, experts, to malve these investigations for us. The court has ren- dered its findings. There are no facts to justify the findings. But I am against that Itind of jurisprudence, and I am not exaggerating the truth when I tell you that. The Chairman. Mr. Hastings, if you will present your next speaker. Mr. Hastings. It gives me pleasure to introduce Mr. John D. "Wheelwright, of Boston. STATEMENT OF MR. JOHN D. WHEELWRIGHT, OF BOSTON. The Chairman. Mr. "Wheelwright, who do you represent? j\Ir. "Wheelwright. George "W. Wheelwright Paper Co., of which I have been a director for 30 years. I am not, gentlemen, a practic;.U paper maker, but I have been in paper mills ever since a small boy, and have been a director in the company, as I say, for the jDast 30 years. My brother, who is the practical manager of the company, is abroad so that I am the only one who could apjDear. I have given this matter, however, a great deal of attention and study, particu- larly as applying to the present measure under consideration. All paper is not made out of wood pulp, though it may come from it originally, nowadays. Ours is a very old concern. One of the mills was constructed by our predecessor in tlie j'ear 1790, and our family has continued the paper-manufacturing business in that mill and other mills in Massachusetts since 1850. We make paper in the old-fashioned way — that is, we make it as we have to buy nowadays sulphite pulp and some soda pulp, but we make it bj' working over old pajjers. These jDajDers are packed abroad, and they are also packed in this country, and it is quite an interesting thing to know that the Salvation Army gathers up these pajiers along our seaboard cities, and we have the contract with the Salva- tion Army for all the papers that they pack. It is also interesting to know that these papers, packed by these derelicts, is the best paper that is packed in the market. A considerable part of the revenue of the Salvation Army is furnished l)y our company in the purchase of these papers. That would be furnished by some other company if we did not bid higher, because the quality is so good. I do not know how many mills there are conducting the paper business in this manner, but there are quite a number, and you will see we make it in the old States where we ha^•e no forests. By our proximity to the seaports where we can get in proximity to the great cities to get this old paper to work over we can make up for the lack of forests. The pulp which we make by this process takes the place of what is known as soda pulp, which is used in book papers, and I am now talking simply on the question of book papers, and in those papers soda pulp is the base, taking the part which used to be taken in the old days by rag-paper making by the use of different qualities of rags. Coarse linen rags is the aristocracy of paper making. Paper made out of rags stands at the head of everything in bond papers and tliat sort of papers. "We have found this in practical experience, and we 178 EECIPEOCITY WITH CANADA. think we can make this paper ovci' again, working the old papers over again, and malve the pulj^ whicli is the base of our manufactures quite as cheap as they can make soda pulp where they are close to forests and wdiere they have the modern methods of making the paper. Of course you know this, that in the communities which are farther away from forests the paper makers have to make specialties, and they have to make special kinds of paper to hold the market, but there is one great branch of the industry that is covered by the existing bill, that is the book-paper industry. I think that the bulk of the paper made in the United States costs at the mill less than 4 cents a pound. We have one mill which makes exclusively that kind of paper, and that is situated in a town in Massachusetts called Hardwoods. Then we have another mill which makes a finer and different grade of paper, what is known as bristol boards, and paper which is made for the lithographers to coat; and then we also make music paper, and we also make heavy roll papers for the lithogi-aphei's. The bulk of our papers, the cost at the mill, of book papers, the selling price, is less than 4 cents a pound. When this measure was first promulgated we looked it over very carefully indeed, and we found that there was a provision for reci- procity in it ; that is, there was a provision that when we gave Canada reciprocity that we should have the same entrance into the Canadian market. Senator Clark. That was the original agreement. Mr. Wheelwright. That was the original agreement. If you look at the bill carefullyj gentlemen, you will find that has dropped out — that there is no reciprocity. Certain mills making specialties, mak- ing things which are used in Canada — we export into Canada some considerable amount of paper every year — export certain grades of paper which is sold against the market of the world. Notwithstand- ing that, our company, which has been running since 1790 and which uses the pickings-up of the Salvation Army, we are entitled, it seems to us, to be recognized before the great Senate of the United States as a company which helps to bear the great burdens of the great nation. The gentleman preceding me. Judge ]Moore, has told of the bur- dens — of the amount which his great company pays into the Govern- ment of the United States. A few years ago, in consultation with the great firm of S. D. "Warren & Co. and other firms, they came to the conclusion that, taking the purcliases necessary for the manu- facture of paper — because the whole amount of the tariff, gentlemen, is not on any one article, is not paid by us when we buy that article. There is a competition in the United States on felts, on paper makers' wires, and all those things, which, of course, is the idea of the pro- tective tariff that there should be a comiDctition in the United States, and that we should make our own articles here and ultimately they should be cheaper. There is that keen competition going on, but we make the calculation that the burden with the paper trade, the book-paper trade, under the tariff — I mean so far as the tariff is a burden — amounted to $3 a ton. This was a figure got out by a careful examination of all things by the experts of those two firms. That has nothing whatever to do with wages or with those things which go into the material and plant. EECIPKOCITY WITH CANADA. 179 Of course, the plant Cdsls xi'vy iiuicli more to build in this country than it would in England, nor does it taki- into account the disad- vantages of taxation. In couiplicaled conununities such as ours in Massachusetts there is a vcr.y hca\'y hical taxation, and those in Canada have a very light taxation. I ani_ talking about the matter generally, but I simply wish to state this that we rest upon the old principle of Abraham Lincoln that " A house divided against itself can not stand." You can not have in this country half protection on a certain amount of articles and then take and establish any complicated industry and subject them to the burden of the tariti' and withhold them from all pro- tection, particularly when thei-e stands waiting the great Colossus of the North with its forests and streams and its intelligent popula- tion ready, not to send into us the pulp wood, because if you will look at this bill again you will see that it is shrewdly framed and devised so that the pulp wood grown in Canada shall be turned into paper and sent into the United States. We can not compete against the great Colossus of the Xorth alone. No one thinks an industry is going to die at once; but what is the eifect? Canada has got the electrical control of the situation, and Canada's hand is on the throttle. Canada can unloose restrictions about those mills ; Canada can arrange it so that the products of the forests about those mills are made into paper, and there will be at once a large competition in the book business. When the great firm represented by Judge Moore injected itself into the American mar- ket caused a tremendous flurrying among the large book manufac- turers, so that the smaller companies like ourselves have seen jDrofits diminish materially. That is interesting. This book-paper industry the last 20 or 25 years has constantly reduced its price, and has learned, by economies, by keen competition inside of the tarifJ, to make its paper cheaper. In order to make its paper cheaper it had to increase the volume of its product. In order to do that it had to put untold millions into its plant. Those millions have been used — T am speaking of the whole great in- dustry — not for the enrichment of the owners of those mills, but simply to retain and maintain their former rates of income. I ha^e been shown a table by a great book manufacturing company — the greatest in the world — which was exhibiting what their product was 25 years ago, then the product running up in scales of tons: on the one side they showed me what their profit was per pound 25 years ago. They were constantly diminishing while the other was con- stantly going up, and they made much more money 25 years ago — much more money on a pound of paper than with all the money they have been putting in since only served to maintain their in- come. Anybody who has had anything to do with manufacturing knows that is what is hap]3cning to inanufacturers in any place where there is a keen competition. I thirds that I have talked all I should for one who is not an expert paper maker. I simply want to say this, that if the reci- procity agreement is made between the two countries, at least those who are affected by the agreement should have the terms of the agreement Senator Lodge. At that point you speak of the terms of the agree- ment. Our paper and our products are going into Canada 180 EECIPEOCITY WITH CANADA. Mr. Wheelwright (interrupting). There is no provision for our product going into Canada. Senator Lodge. The agreement submitted to the Senate first has a provision that paper shall be free coming both ways, and, at least, the paper under certain limitations. Then come the tvpo provisos. The first proviso relates to paper coming into the United States which shall not come in if restrictions are placed on it in Canada, Mr. Wheelwright. Yes. Senator Lodge. That is on the material which makes that paper. Mr. Wheel ^^'EIGHT. Yes. Senator Lodge. Then comes the second proviso about our products going into Canada, and that provides that none of our firms can go into Canada — paper firms — unless the Canadian product is admitted from all parts of Canada. Mr. AA^heelavright. Yes. Senator Lodge. It can not be admitted fre^ from all parts of Can- ada unless the Provinces take off their restrictions ? Mr. Wheelwright. I am referring not now to the Senator Lodge. I thought you were referring to that point. Mr. Wheela\'eight. I am referring to the House bill, which, as I understand it, is the legislation which has been sent out. Senator Lodge. That is, the legislation sent over, but I thought you examined the original agreement between Canada and the United States. ^Ir. Wheelwright. I think, in the original agreement, their in- tention of it was to be reciprocity. Senator Lodge. With those two provisos. Mr. AViieelwright. With those two provisos. I think it might have been more aptly shown in the legislation, but it is absolutely clear on an examination of the speech made by Mr. Fielding and from the letter of Mr. Fielding's which accompanies the President's message to the Senate in the first legislation. Senator Lodge. Have you examined those provisos in the Presi- dent's message? Mr. Wheelaa right. I have ; yes, sir. Senator Lodge. And you noticed the distinction in it between the two provisos which I was trying to point out ? JNIr. Wheelwright. I did. It seems to mc that one of those pro- visos appeared to be legislating for Canada. It seemed to me there was that objection to it — it semed to be put in — the legislation for Canada rather than the United States, but as that has been dropped, it seemed to me that it was best for me to refer to the existing legis- lation. Senator Lodge. I only called your attention to those provisos. Mr. Wheelavright. Yes. Senator Keen. To what extent do you export to Canada? Mr. "Wheelaveight. We export a considerable amount of special- ties, like this bristol board that I Avas referring to and the music paper; l)iit there is a duty, you knoAv, in Canada, and Ave have to pay the duty. Just as you look at it the consumer pays the duty or the Canadians pay it — or Ave pay it. Senator Kern. You have to OA^ercome that duty ? JNIr. WiiEELH RuaiT. We have to overcome that duty, because you know the paper business is like making fancy cakes." If you make EECIPEOCITY \riTH CANADA. 181 successfully fancy paper it is like making fancy cakes — the people will want to have it, even if it costs more. Senator Keen. To what extent do you export to Canada ? Mr. Wheelwright. I can not tell you that, but I say that we re- gard the Canadian market as valuable. Senator Kebn. As valuable? Mr. Wheelwright. Yes. Senator Keen. Do you export to any other countries ? Mr. Wheelwright. We export to Great Britain. Senator Kern. To Great Britain. Mr. Wheelwright. Now, to export paper, for which we devise a special machine known as four-cylinder machine, and this is a sub- stitute — that is, we make it on a machine, what we call cardboard; but it is all made on the machine without pasting, and of that we send a considerable amount to England; and in order to get to the market we do not make much money on it, but it is useful to keep the machines going, for a large volume gives more paper, and there- fore the overhead charges are less. Senator Keen. More money? Mr. Wheelwright. Because we might make tons and not make much money, but it keeps the people employed and our mills going. Senator Ivern. You make a profit on it ? Mr. Wheelwkight. We make some profit on it; yes. Senator Keen. Can you give the commmittee some idea of the exports to Canada last year? Mr. Wheeleight. I can easily find it. Senator Keen. I do not care for the exact figures. Mr. "Wheel weight. But you see that I am under limitations in the matter, because I am not actively engaged. I am a lawyer and director of the company, and I Imow generally about — in fact I know a good deal about the business, but I have not o-ot those figures m my head. Senator Kern. What is the total output of your mill? Mr. \Vpieelweight. In money. Senator Keen. Yes. Mr. Wheelwright. It is about $1,200,000 a year. Senator La Follette. You make book paper as well as bristol board and those other fancy papers ? Mr. Wheelwright. We make what is known as English finish book. Senator Kern. Sometimes it is calendered, but the kind of paper you see in English books without high finish — smooth, velvety to the touch, as you see in English novels and English books. Senator La Follette. Do you make book paper in competition with the West Virginia Pulp & Paper Co. ? Mr. Wheelwright. We make book paper in competition with everybody who sells book paper in the United States. Senator La Follette. Do they make the same grade of paper that you make ? Mr. Wheelwright. I should say they do not, and that we could not compete with them unless we made something that was particu- larly nice; they make an enormous amount of paper. Our mill is perfectly modern, as far as that is concerned, but of course not favorably situated for wood, and where it comes down to the lower 182 RECIPROCITY WITH CANADA. stage of book paper we could not compete with them, and whether, they can compete with us in just these niceties in the trade I can not answer. Senator La Follette. In the product of your book paper, for in- stance, are you in direct competition with other manufacturers? Mr. Wheelwright. Oh, yes; of course. Senator La Follette. Have you any understanding as to prices? Mr. WiiEEL-\\'EiGHT. That is, the prices Senator La Follette. On any of your product? Mr. WtiKiiLWEiGHT. Not on any whatever, and that is a thing that should be emphasized. Senator La Follette. Do your prices vary under competition. Mr. Wheelwright. Our prices are constantly going down. Senator La Follette. Do they vary under the direct competition that you have ? IMr. Wheelwright. Oh, sometimes. Of course, now, for instance, when these new mills were built, these great mills developed, there was a period of time when the competition was intense, because when yon take a great big mill and set it going, and they have not got the business attached, you will then have to go out in the market to get the business, and in doing so you have got to cut prices, and while that is going on there is a disturbed condition of the market until demand adjusts itself to the new mills which have been built up. There has been a slight increase in the price of paper within the last year or two. One of our mills making book paper was making absolutely no money until about three years ago. It is now making a small sum of money. Senator La Follette. "\^^iat has been the increase in the price of book paper in the last year or two ? Mr. Wheelavright. It has been only a small fraction of a cent, I think. The other gentlemen who come after me can answer that better than I. I know, for instance, we make part of the paper used for Scribner's Magazine, and the contract price is less than 4 cents a pound. If you will look at Scribner's Magazine, j'ou will see a nice grade of book paper, not coated. Senator La Follette. Dull finish? Mr. Wheelwright. Dull finish where the advertising pages are. Senator La Follette. What is the capitalization of your com- pany? Mr. Wheelwright. We have adopted the policy in our company of paying in — not paying out — profits for a great many years and rolling up a capital, because we built these mills. We have acquired two mills in the last 30 years out of our profits. Our whole capi- talization, normally, is $300,000, but the book value of our property is much more than that. Senator La Follette. What dividends do you pay ? Mr. Wheelaveight. We pay 12 per cent dividends. Senator La Follette. Then vou are able to create a surplus beyond that? Mr. Wiieelmright. We found Senator La Follette (continuing). Out of which you have built two mills, as I understand you. Mr. Wheelwright. That gives the wrong impression of the thing. We started this business and it has been going on for a great while. RECIPROCITY WITH CANADA. 183 We incorporated it 30 years ■^ixo. ^\e lield oil' our liandH from \ydy- ing our profits and put it harlv into tlie mill. Senator La Follette. You mean you do not ]iay dividends? Jlr. AVheelweight. We ]-iay some. We first li:ier, the farmers are scattered over a wide expanse of territory. Senator Stone. (.)f course, they are not all in a bunch. Mr. Collins. That does not mean that the other SO per cent refused by any means. It means that e\ery farmer to whom that petition was offered signed it, with the exception of I'O or '?>() altogether. Senator Galungee. On that point, so that I may be sure of your position. You sent these to your subscriljcvs more particuhirly. Mr. Collins. Yes. Senator Gallinger. You did not send them .broadcast to all the farmers ? Mr. Collins. Only to secretaries of the farmers' organizations that we could reach. Senator La Follette. Yon did not have the name of every farmer in Minnesota? Mr. Collins. That would bankrupt us. We could not undertake to correspond with all the farmers. In the paper we have published every pn-o-reciprocity letter that ha^ come to us frDUi the fariuers of the Xorthwest. AYe have done diametrically opposite the policy of the city pajDcrs; we have published the other side. We have welcomed their arguments, or the data contained in them, in order that we might reply to them. E\ cry pro-reciprocity letter that has come to us we have published. In this little [indicating] bool: I have reproduced extracts of a few of the antireciprocity letters. "WTiy, if we should have undertaken to publish all the antireciprocity letters that come in, we would not have room for argiunents or any- thing else, because they would lia\-e flooded us. We have never struck so responsive a chord among the farmers of theXorthwest since I have been editing a farm paper, and jNIr. Lawrence will say the same thing. Senator Stone. I understood that your paper reached one out of every three of the farmers in ^linnesota ? Mr. Collins. Yes. Senator Stone. In other words, one-third of the farmers in ilinne- sota are readers of your paper ? Mr. Collins. Yes. sir. Senator Stone. They have been protesting very earnestly in your paper against this reciprocity agreement, and yet, under your guid- ance and direction, you are able to get only one-fifth. Mr. Collins. Practically one-half of our subscribers. Senator Stone. AYAe to get oiily one-fifth of the farmers of the State to sign that petition? Mr. Collins. One-sixth— between one-fifth and one-sixth. Senator Stone. Between one-fifth an or 4 per cent, and in contrast with that you see the increase of the city of St. Paul of 31.6 per cent and of the city of ^Minneapolis of 48.7 per cent. Gentlemen, I claim that the hoggishness of the cities will mean the ultimate ruin of the country, and it is time that we were putting a stop to that condition. Senator Cl.vek. What has been the increase of the acreage? Mr. Collins. One thousand one hundred farms represent about a quarter of a section apiece — represent something like .i.OOO or (i,000 acres. Senator Cl.vrk. My inquiry was rather directed to the expansion of farm lands. Mr. Collins. They have expanded. The farms are a little larser, but they are not materially larger. It would be almost splitting hairs. The wheat farms have contracted. They are breaking them up into more diversified farms. Just a word on the cost to the consumer, and I must not take up any more time on that. EEOIPROCITY WITH CANADA. 215 The Chairman. I do not desire to curtail your remarks, but there are quite a number of gentlemen here who wish to be heard also. Mr, Collins. I only want to remind the committee that some other people are waiting here to be heard. I feel selfish in the matter. Senator McCumbee. This gentleman represents one-third of the population of the United States and their industries, and we ought to give him all the time they want to have to hear all he has to say on this proposition. [Applause.] The Chairman. Go on, Mr. Collins, the committee is very much interested and will hear you. Mr. Collins. The greatest support of reciprocity comes from men who know least about agricultural matters. Senator Bailey. That is correct. Mr. Collins. And I have only to cite the fact, and we blush to say it, that in the official message of our worthy President he dis- plays a lack of touch with agriculture in the Northwest by speaking of the Province of Assiniboia. a region three times as large as his own State, but a province which does not exist, which never has existed, and which ceased even to be a territory in 190.5 ; and if his information and his statistics are no more up to date than his knowledge of geography, it is time we were checking up that information. [Laughter and applause.] Further than that, the worthy Senator from Indiana, taking his cue from that misinformation, talked about the Province of Assiniboia, and tells us that in Minnesota we will be benefited because the Province of Assiniboia, with its great plains, will jDroduce cattle which must be finished on Minnesota corn. Senator Bailey. You mean the former Senator, Mr. Beveridge. Mr. Collins. The former Senator, I should have said. Senator Beveridge has made himself, in his Saturday Evening Post article, the laughingstock of every farmer in the Northwest. [Applause.] He talks about finishing prairie-fed cattle on corn. Why, he does not know that such cattle fattened upon the buffalo grass would not eat corn if you gave it to them in a golden bin. [Laughter.] They have now no use for corn. Senator Smoot. The best cattle shipped out of Canada come right oil the grass. Mr. Collins. T\^y, of course they do. Senator Smoot. Shipped direct to England and a little to other countries. Mr. Collins. Of course, the fattest cattle fed on the wild grasses are better, as a rule, than the corn-fed cattle, and yet that is the kind of information we are having doped out to us to prove that the farmers ought to sacrifice $40,000,000 a year in Minnesota and the two Dakotas, or over $100,000 a day. Why this empirical legisla- tion? It reminds me of the case of the man who was asked if he could play the piano and then he said, " I don't know, but I might try." So, the man who is now tinkering with the tariff does not know the first thing about tariff, but he thinks he will have a try at it. Senator Stone. I think I understood you to say that the cattle from the range which have been fed on wild grass would not eat corn. Mr. Collins. They will eat it ; when they get really hungry they will. 216 KECIPEOCITY WITH CANADA. Senator Stone. I understood you to say Mr. Collins (interrupting) . They will eat it when they can not get grass. Senator Stone. In a golden trough? Mr. Collins. No ; they are not used to golden troughs on the farm. Senator Stone. But they eat it if fed in a wooden trough? Mr. Collins. I doubt it'; not if they could get the wild grass ; they have no use for it. I ^Yish I had 10 days just to talk on the subject, but I have not. There are so many other points I ought to touch here. Here is the dairy question. I heard a New Yorker talk yesterday, and they left out this point. Let me just read this, and then I am done, if the delegation behind me do not kill me. Here is a letter written by the West Chazy Creamery Co. : West Ciiazy Creamery Co., Wc>if Chn-ii. y. Y.. March 1, 1911. . Messrs. A. A. Ayek & Co., Montreal. P. Q. Gentlemen : The time is approadaing to malie a season's price for milk, and tliere is a possibility that we will have reciprocity with Canada, which woulil place oiu- batter and cheese markets on a parity with the markets of the world. If onr markets were higher we wonld have to absorb the entire dairy prodncts of Canada. As the Canadian Government at Ottawa will not furnish statistics to an American citizen, I now write to ask you what the Canadian exports were during the past year. An early reply will greatly oblige, Yours, respectfully, W. McGauli.ey. Mr. Collins. And here is a reply from the Montreal butter ex- porters, A. A. Ayer & Co. (Ltd.), the largest cheese and butter exporters in Canada : A. A. Ayer & Co. (Ltd.), Montreal, March 11, 1911. W. McGaulley, Esq., Tfcs? Oftocj/, W. Y. Dear Sir : We inclose you e.'i:port trade reports from Montreal from 1906 to 1909, inclusive. We are making more butter each year in Canada, but our population has so increased that the local trade has taken what otherwise would be shipped. The cream we shipped to the United States during the past year would make, say, 150,000 packages of butter, and we have had an extra trade with British Co- lumbia and the West amounting to fully 100,000 boxes over the usual demand from the West. Under ordinary conditions these 250,000 boxes would have been shipped to England. As far as the Canadian farmer is concerned, the greatest objection is that we can bring butter into Canada from the lowest markets of the world in sufficient quantity to supply all our needs and enable us to ship out any quantity, up to a million packages or more, which the United States might require. Prices paid to the farmer for creamery in Canada during 1910 varied from 22 to 24J cents per pound. These were considered satisfactory prices, but would average from 2 to 3 cents per pound above what we could buy at and bring into Canada from other markets of the world. Yours, truly, A. A. Ay'ek & Co. (Ltd.). Senator Bailey. Do you know what quantity of butter is imported into Canada? Mr. Collins. No butter goes into Canada, as I understand. Senator Bailey. The letter is misinformation, and that gentleman does not know what he is talking about. Mr. Collins. That is a Canadian importer. Senator Bailey. He is in error unless the public prints are inaccu- rate. BECIPEOCITY WITH CANADA. 2l7 Mr. Collins. If they are no more reliable than our daily papers, they are certainly in error. Senator Bailey. I mean by that the Government publications. The document before us shows that the duty on butter into the United States is 6 cents, and the duty on butter into Canada is 4 cents a pound. Mr. Colli xs. Expense. Senator Bailet. And the Canadian general duty on butter is 4 cents per pound. Mr. Collins. Possibly; even then this letter may be true. They may be able to get butter at 4 cents a pound cheaper than in iSTew Zealand. Senator Bailet. A difference of 2 cents. Mr. Collins. But the point is, Senator, that they might be able to get their supply so that they could afi'ord to pay the duty. Senator Bailet. But the only diiference in the price made by the tariif must be the ('> cents which the importer pays as duty. If you bring it into Canada from other countries and pay 4 cents, it makes a dinerence of 2 cents. Senator Claek. Do they pay that in the British colonies? Senator Bailey. The statement is that is just the general duty. Nearly all the British Provinces have, of course, a preferential rate. Senator S^ioot. The preferential rate from England to Canada is 3 cents a pound, and the next rate is 4 cents a pound, and the next rate is 5 cents. Our duty is 6 cents a pound on butter. The lowest grade of butter into Canada is 3 cents, and that comes from the British colonies. Senator Bailet. It does not seem possible to me that they could import it and pay the ocean freight and insurance and very greatly stimulate their dairy business there by sending into our markets, relieved of the 6 cents, and bringing it into our markets subject to an average duty of 4 cents. A letter was read here the other clay, and it struck me at the time that it was calculated to mislead. Mr. Collins. I can not understand the motive of the Canada but- ter exporters in wishing to mislead us. Senator Bailet. I did not mean to impute that motive to him, but T know many men to mislead people with their statements, made in the most innocent and honest way. I have known some of them in the Senate of the United States to do that. [Laughter.] Senator Smoot. I wish to call your attention to this, that perhaps the man writing the letter had this in view : That the sections of Canada that are a long way out from the border line of the United States could be furnished butter that was imported, and the country nearer to the line, or the border of the United States — the whole prod- uct of that country could be put into the United States. Mr. Collins. In regard to the details, there is no question but what a vast quantity of Canada butter will be dumped on the American market. Senator Bailey. My idea was that while this vast quantity would come into this country in consequence of the reduced price, they would supply any deficiency created in their home consumption by increasing that Mr. Collins. They may do that. Senator Bailey (continuing). Without importing butter from other countries. 218 EECIPEOCITY WITH CANADA, ilr. CoLLixs. This question, gentlemen, is not a party question, as Cliiiinuan Feig- lias already said. Party lines have been wiped out. I think most <>f us on the delegation ha^/e been Eepnblicans all our lives. T know I have never voted any other ticket, except once for governor. I am also an American citizen. I don't know what will be the future of the party with which I have been affiliated all my life. It goes on defying the good will and support of the farmers. I know that man after man who has been prominent in Republican councils has said he never again would vote the Republican ticket if this 23act goes through. Nor can they turn to the Democratic free- trade party or the Democratic tariff-for-revenue party — there is no Democratic free-trade party, except as to the farmers, perhaps. They can not turn to any existing party. "We are dismayed; we know not which way to turn. Senator Bailey. We will comfort you. [Laughter.] ]Mr. CoLniNS. Gentlemen, we have had in times past to suspect the Greeks as they come bearing gifts. [Renewed laughter and ap- plause.] But this is neither part}'; that has been well explained. Senator Bailey. I am not offering you any gift. I am simply try- ing to ]3rotect you against having something taken away from you. I can understand how an American farmer in this time could regard that as a sort of a gift, but we only propose to treat you fairly and not give you anything. There is nothing to give you unless we take it away from somebody else. ^Iv. Collins. Pos^iljly. Senator Bailey. But we will see that nobody takes anything away from you that you are entitled to. [Applause.] Mr. Collins. "Well do I remember the soup houses and the Coxey's army, when you gentlemen had your innings before. [Laughter.] 1 remember a time when we had those things. There is just one thing more, and then I am going to close. Senator Bailey. We have your statement that you are a Repub- lican, and I do not think you have any good excuse for it. Mr. Collins (interrupting). Excuse me for it, because you led me on. Senator Bailey (continuing). For you seem to be a man of great intelligence and ought to know better. Mr. Collins. In the House of Representatives, in the speech of Mr. Steenerson— may I quote just one paragraph from his speech, and then I am done: Now, there is -one remaiijable thing that I have noticed specifically, and that is that there is a dispnte between Rentlemen on that side and on this side as to whether this is a Republican or Democratic measure. Why, bless your soul, it is neither one nor the other. It has nil the faults of protection gone mad ami of destructive free trade. It is the Democratic donkey tail end first and the rear end of the Republican elephant. [Laughter and ap- plause.] That is what it is. It has all the faults of both sides and none of the merits. [Laughter.] That brings me to the point of the story. A little boy went to a circus and was feeding the elephants hot peanuts. The elephant caught hold of the little fellow's straw hat and threw it under his body, and the boy ran around the elephant several times trying to get his hat and wondering how he was going to get it. Finally he screwed up his courage and dodged under the elephant and grabbed the hat and ran out of the tent. He came back presently with a big RECIPEOCITY AVITH CANADA. 219 stick, and he marched around this big elephant several times and looked upon that big, powerful beast in dismay, just as we looked upon the G. O. P. in times past, and finally he said: " You ^reat, bio- Injin rubber, two-tailed beast, if I knew' at which end your brain's were I would lam you one." [Laughter and applause.] Senator SxoisE.If it is agreeable to you, Mr. Collins, I would like to ask you a question or two before you close. Mr. Collins. Perhaps some of the other delegates will answer. I feel as if I had taken more time than I should already. Senator Stone. I think statements have been made unchallenged which should be given notice. Mr. Collins. I am perfectly willing to answer, if I may be excused, to the best of my ability. I may be compelled to call upon others to verify what I don't know. Senator Stone. I would like to ask first. How many IMinnesota farmers came down with this delegation ? Mr. Collins. On this trip? Senator Stone. Yes. Mr. Collins. Nine. Mr. Feig. We are all farmers. Every man on our delegation is a farmer. I, as chairman, happen to occupy an official position. I went from my farm into that office. I have held it for nine years, and if I quit to-day or to-morrow I am going back to the farm. I am a farmer in every sense of the word. Senator Stone. I am not imputing that j-ou are a farmer. Mr. Feig. Every man on our delegation here is a farmer. Senator Stone. "Well, I understood that Mr. Collins was the editor of a newspaper. Mr. Feig. He also runs three farms. Does not that make him a farmer ? Senator Stone. I desire to address myself -to Mr. Collins, if he will give me his attention. I understood that you were the editor of an agricultural newspaper in Minnesota. Mr. Collins. Y''es, sir. Senator Stone. And you are managing a farm ? Mr. Collins. Yes. sir. Senator Stone. Well, you are then what Mr. Bryan calls himself — an " editor and agriculturist " rather than a farmer. Mr. Collins. An agriculturist is a man who conducts his farm with brains and a farmer is usually a tenant, according to Webster's dictionary. Senator Stone. Well, do you personally manage your farms? Mr. Collins. I occasionally go out and plow, but not every day — any more than I set type in my printing office, because I can hire it done cheaper than I can do it myself. Senator Stone. Are you one of the ten? Mr. Collins. Yes, sir. Senator Stone. Are there some bankers in your delegation? Mr. Collins. No. sir. Senator Stone. None? Mr. Collins. No, sir. Let me tell you, gentlemen, that the last gold brick sold in Minneapolis for $25,000 was sold to a country banker, and I mentioned this at a meeting of farmers in North Da- kota, when I found that in the audience that same country banker 220 EECIPKOCITY WITH CANADA. was siding in the capacity of being a banker and farmer also, so tliat it is hard to (listin<;nisli a farmer from a banker. Senator C'l'>kk. Was lie in fa\or of this bill? .Air. ('(iLLiNS. Not in favor of reciprocity; no, sir. .Senator Sni^i:. Take a seat; you need not stand up. Mr. Collins. Oh, yes. Senator Sk.ae. Is ^Ir. ^kleighan a member of the committee? ilr. C0LLIN.S. Yes. sir; let him speak for himself. Senator Stcikk. Is he a bank president? ]\Ir. Collins. He is a bank president. ]\Ir. ]MEA(iiiAN. I will have my inning on that question a little later. I am a bank president. Senator Sto>:e. Mr. Feii;- is chairman, and he is a State official. Is that a fact ? Mr. Collins. He is directly connected with agricultural adminis- tration — inspection of grain elevator. Senator Stone. J. E. ]\Ioreley and W. J. Shilling, are they members of j^our delegation? Mr. Collins. Mr. Moreley is ; Mr. Shilling is not here. Senator Stone. Is he also a State official? INIr. Collins. Xo. sir. Senator Stone. He is not connected officially with the dairy de- IDartment of ilinnesota ? INIr. Collins. No, sir; he is the president of the Creamery Associa- tion, an association of farjiiers, and a leading dairyman of the State. Senator Stone. Is ilr. E. A. Wilkinson, of Lake Elmo, a member of the delegation? Mr. Collins. Yes, sir; does he not look like a farmer. Senator Stone. I ask }'oii, is he a member of the delegation? JNIr. Collins. Yes, sir. Senator Stone. Is he not a lawy'er? Mr. Collins. He used to be counsel for the Great Northern Eail- road. He is a real farmer. Senator Bailey. Some lawyers have been using all they make as lawyers to run a farm ever since the world commenced. Mr. Wilkinson. I have got more gi\ay hairs running a farm than I ever did practicing law. Senator Stone. Mr. Collins, I understood j^ou to say that the farmers of ^Minnesota were very enthusiastic in opposition to this reciprocity agreement. Mr. Collins. More than that, they are vehement. Senator Stone. I did not understand you. Mr. Collins. They are more than that ; they are vehement in oppo- sition — they are bitter. Senator Stone. And practically unanimous? Mr. Collins. Yes, sir. Senator Stone. Enthusiastically vehement and unanimous. Senator Stone. And practically unanimous? Mr. Collins. Yes, sir. Senator Stone. Enthusiastic, vehement, and unanimous? Mr. Collins. And bitter. Senator Stone. And bitter. I have here before me a sheet taken from the Northwestern Agriculturist of May 6, 1911. The North- western Agriculturist is the paper you publish ? EECIPEOCITY WITH CAXADA. 221 Mr. CoLLiiv's. Yes. sii\ Senator Stone. (.)n page ."^153 I find a rather interesting statement showing tlie responses that were made on an appeal sent out liy you for contributions .to pay the expenses of this delegation down to "Washington to protest against this reciprocitj' agreement. It ap- pears from this statement that the total amount you were able to col- lect up to ]May the 6th was ^3S!i.2.">. and that you paid out $08.10 for collecting that. Mr. Collins. Yes, sir. Senator Stone. Leaving a net collection of $291.15. jMr. Collins. We divided the boodle last night, gentlemen, and each of us received $.50 out of the funds that had been collected sd far, that $98 that had not yet borne fruit. It takes a little time for fruit to ripen, especially on farms. The funds will come in. We have faith in the farmers behind us; but if they do not, we will pay our own bills. Senator Stone. It seems that $111 vpas contributed liy bankers- Mr. Collins. Bankers, country banks owned by farmers. Senator Stone. Bankers living in different towns. Ninety-seven dollars and twenty-five cents was contributed by creameries," $41.2.5 by elevators, and $50 by a fire insurance company. ilr. Collins. That is a farmers' fire insurance company. The Farmers' Cooperative Fire Insurance Co. Senator Stone. Ninety-eight dollars by individuals, running from $5 down to 25 cents each : $5 by a market company, and the ren-fainder by societies of equity. Now, the point I desire to call your attention to is that if the farm- ers of Minnesota who have been quite prosperous in recent years, at least, contributed practically nothing to this $200 and odd fund, the response from the farmers was not very liberal to send a delegation down here Mr. Collins. That is an unfair statement. Senator Stone (continuing). To protest against the reciprocity treaty. Mr. Collins. That is an unfair statement. Senator Stone. Neither enthusiastic, vehement, or unanimous. Mr. Collins. I want call the Senator's attention to the fact that all of that came from farmers. The farmers are the bankers; the farmers are behind the Cooperative Fire Insurance Co. ; the farmers are the men that run the creameries. Senator Stone. These 30,000 men, out of 156,000 who signed this petition, were willing to take their lead pencils and attach their names to a petition, but were not willing to contribute to pay the expenses of your delegation. Mr. Collins. They will be equally. willing to put their cross on the ballot. Senator Stone. I am not talking about the ballot. Mr. Collins. I am. Senator Stone. I heard yesterday a speech here by a distinguished gentleman from Wisconsin in which he took occasion to denounce the President of the United States and other officials, as cowards, because, forsooth, they happened to favor the reciprocity agreement, saying that they were influenced by fear of newspapers. _ I thought then, an-d I do now, that threats and denunciations might just as well 93285— No. 4—11 3 -_■-' liK('irj((J(;iXV WITH CANADA. i !)(' Icfl (.III : (li;i( i( (Idi's not :i(](l to the strength of the statement. Ido iicil call' iiiiich about (liu(. \(i\v, i( wniild M'l'iii to Mic, I submit to you, Mr. Collins, that if the fanners n( MiniK-ula witc so unanimously and vehemently opposed td liiis iiiiicciiicnl, tlial liify would have contributed something to- ward iiayinir tlic cxpnises of ;i delegation which they had appointed acrordinir to this ni'w.-papcr of yours, to send down here to represent tlicni in DpiMisin:^ it before the S'liate Finance Committee. Mr. ('(ii.ij.Ns. I lull' is not any i|iicstiiiii. Senator, but that every penny I have paid out will be reimbursed by the farmers by volun- tary suli>ciiptions; they are slow, but they are reliable, and this very situation, licntlemen, answers tlie report that was conveyed to me from the t'lliior of the American Economist. Senator Sn i.M;. It is a kind of slow enthusiasm. [Laughter.] Mr. ("iii.ijNs. The report was circulated here in "Washington that P. y. ('(illin- is lieiiiM- l.aeked by the robber Ijarons. whoever they are. Those are the robber barons. Seiialor Bailky. I want to ask you if it is a fair way to measure the enthusiasm of farmers by the size of their contributions? ^Ir. C'or.Lixs. It is absolutely ridiculous. Seiialor .S|iim;. You say that it is perfectly ridiculous, and yet you. as the >p(ike,-inau and head of this movement, prepared and sent out petitiiiii-- lo the farmers tn sign, and to make contributions to pay tlii.'-e expt n>e-. and urged them to do so in your newspaper? ^Ir. C'l'MiNs. ^e-, sir. .S|.ii;itiir Stum:. .Vnd yet you say you were urging them to do a ridiculous thiiiL;-^ Mr. Collins! No; the fact that they have not done it by return mail— tlie\- will get there, but they come by slow freight. They do not come by telegraph. Scii:itor SroNK. I am now referring to your answer to the question of the Senator from Texas. 31r. ('(a.Lixs. I say it is ridiculous to expect them to come by re- turn mail. AA'e know too much through getting subscriptions from farmers: time is no object to the farmer. SeiKitoi' Stone. Let me ask you to state to me in a word or two the exa(;( reason why the farmers of Minnesota are opposed to this recipro(;ity agreement. First: \Vhy? Xot a speech now, but just in concise form the reasons why they are opjiosed to it. Mr. Collins. P.eeause it robs them of $40,000,000 a year from their net profits. Senator "Williajls. Robs them by untaxing the people? ]\rr. Collins. It. does not untax the people. It does not reduce the cost of consumption. Senator Willl\ms. It does not reduce the cost of consumption if it does not reduce the cost of the product; how would it hurt the man who sells the product ? ]Mr. Collins. It does reduce the cost of the product. Senator AVilliams. If it does reduce the price of the product, then you snn]i]y untax the people for the benefit of the middleman; you say you are robbed by untaxing the people? Mr. Collins. It gives the Canadian farmer the advantage which you are taking away from the American farmer. EECIPBOCITY WITH CANADA. ^'I'S Senator Stone. How will it rob the farmers of JMiiinesota of $40,000,000? Mr. Collins. I have gone into that detail until I am ashamed to take up the time of the other delegates. Senator Stone. I will ask you to be a little more specific by askino' specific questions: Would it reduce the cost of wheat raised in Min"^ nesota ? JNIr. Collins. Yes, sir. Senator Stone. About how much per bushel do you think it would reduce the cost of your wheat below the market price current now? Mr. Collins. ^Ir. Wilkinson is the authority on the details of the wheat question. Senator Stone. You are the editor of that paper? JNIr. Collins. Ten and seven-tenths cents is the average of the past three or four years. Senator Stone. Approximately 10 cents a bushel ? Mr. Collins. Yes, sir. Senator Stone. I heard you a moment ago paying a high com- pliment to Senator Xelson of your State. Mr. Collins. I should say that even Senators are subject to Dar- win's evolution, and they sometimes change their views. Senator Stone. I desire to read to you a statement made by your senior Senator on the floor of the Senate on May 10, 1009. which can be found at page 1880 of the Congressional Eecord of that date. Mr. Xelson Avas asked by Senator Borah : How mucli wheat does your State produce? Senator Xelson answered : I do not recall the millions of Imshels jn'odui-eil in l_li(« State of Minnesntn, but I desire to tell the Senator that the tariff on wlieat wliieh is on the statute books has not done us a particle of yood. It would be like a tariff on cotiou goods. Up to this time we have been exportin- Sduie l.")* 1,000.000 to ii.'O.OOO.nOO bushels iif wheat a year. The jirice of our wheat is fixed by the Liverpnol price — the export price — and no duty up to this time has helped us. Xow, Senator Nelson states that the price of your wheat is fixed by the world's price, fixed at Liverpool. You say it is not. You say that the removal of the wheat tax would cause a reduction in the selling price of the Minnesota producer by about 10 cents per bushel. Senator Nelson said two years ago — almost exactly two years ago — that the tariff tax had never done the ^Minnesota farmers a particle of good. Mr. Collins. Up to that time; we were just beginning to feel Senator Stone (interrupting). Now, I will ask you if you still think that Senator Nelson is the wise statesman that you described him to be awhile ago? •Mr. Collins. Yes, sir; because it takes a wise man to change his mind. Senator Stone. Has he changed ? . Mr. Collins. I have no wish to speak for Senator Nelson. He is present in the room. The conditions have changed, especially m the last two or three years. Senator Stone. The conditions have not changed so tar as that tariff tax is concerned. 224 EECIPEOCITY WITH CANADA. ]\Ir. C(ii,[.i>,'S. But it has so far as the market is concerned. We were export in*;- wheat a few years ago, but not our hard wheat. We were exporting more soft wheat. We were not exporting hard wheat and have not for many years. Senator .Sioxe. One of the reasons tlien why the farmers of IMinne- sota oppose this reciprocity agreement is the fear that it will reduce the price of the wheat they raise? Mr. Collins. It is not only a fear, Senator; it is a realization. Senator Stone. It is not a realization. Mr. Collins. Yes, sir; I beg to differ. Senator Stone. It has not happened. Mr. Collins. It has already happened. These things are always discounted in the future. The very Aveek that reciprocity was an- nounced wheat went down 7 cents a bushel in Minneapolis, and did not budge in Winnipeg. When Congress adjourned without pass- ing the reciprocity tax, wheat went up in JMinneapolis 2 cents. [Applause.] When last week it was rejDorted that the Canadian Parliament had decided to submit this question to the will of the people, and have a campaign of two or three months, wheat jumped in Minneapolis 2 or 3 cents. Wheat is sensitive to the action on this question and we all suffer the loss which reciprocity will bring. We have already suffered about 7 or 8 or 10 cents depreciation per bushel in wheat. It means two or three million dollars actual loss to-day by this agitation in Congress. [Applause.] Senator Stone. I have statistics, not present at the moment, but I can very soon produce them, showing that wheat has gone down since this reciprocity agreement was submitted, on some days and times at Winnipeg and other Canadian markets, when it did not budge an inch, as you say, in the United States — at Minneapolis or anywhere else. Mr. Collins. Senator Stone, I do not care to go into a discus- sion Mr. Meaghen. Do not neglect to bring those figures into the record to show that it went down in Winnipeg when it did not budge in Minneapolis. Senator Stone. I will get them into the record. Mr. SIeaghen. I have never seen them. Senator Stone. Now, I wish to ask you this question: Do the farmers of Minnesota oppose the reciprocity agreement for the fear that it would reduce the price of farm labor in that State? Mr. Collins. Indirectly it will, by closing the mills all over the country. You will see farmers and laborers hungry for their jobs. Labor will be reduced, and the effect of this will be felt on the mills before it will be on the farmers. Senator Stone. I would like to ask you, ]Mr. Collins, if it is nota fact that farm labor in Saskatchewan, and I will say in Manitoba, where it is lower than it is in Saskatchewan ; that in Manitoba farm labor is higher than it is in Minnesota to-day? Mr. JIeaghen. Not higher. Senator Stone. Higher, I saj'. Mr. JNIeaghen. I say not. Senator Stone. I am asking Mr. Collins, not you. Let us have one at a time. EECIPEOCITY WITH CANADA. 225 Mr. Collins. I liave no personal knowledge, but it was testified here yesterday by a Saskatchewan farmer that it was not. That is, as far as I know Senator Stone. A Saskatcliewaii farmer ? Mr. Collins. Mr. Ferguson. Senator Stone. He is opposed to the reciprocity agreement ? Mr. Collins. Yes, sir; lie is an American farmer doing farming now temporarily in Saskatchewan, but he is familiar with Saskatche- wan conditions by reason of that. Senator Stone. I find it reported by the Tariif Board, which report I have here before me, that the average monthly wage in Manitoba is higher than that in Minnesota, and the monthly wage in Saskatchewan still higher than that in Manitoba, and the exact figures are given in the tariff report. Mr. Collins. Is it 50 per cent higher. Senator? Senator Stone. No, sir. Mr. Collins. But the yield of the acres there is 50 per cent greater than it is in the United States. Senator Stone. I am talking now about labor, not about jdeld. Mr. Collins. How many months in the year is it higher? Senator Stone. Forthe whole farming season; eight months. Mr. ]Meaghen. There is no whole year up north. They only pay for six months, and we pay them for the 12 months in Minnesota. Senator Stone. At page 86, I am referring to now ; and I will call the attention of Mr. Collins, if I can have his attention — I want to call his attention to this statement that in 1910 the wage per month on season hiring — running from 7 to 8 months, beginning April 1 — in Minnesota Avas $30 to $35, and in Saskatchewan $35. Mr. Collins. But in Minnesota during the harvest time the harvest hands are paid $2 and $3 a daj^ In Saskatchewan they are not. Senator Stone. I have it by the hands; also take it by the hands, the individual. Take spike pitchers, in Manitoba they receive $3 a day and in Saskatchewan $3 and in North Dakota $2.75. Field pitchers, in Manitoba $3 a day, Saskatchewan $3 a day, and in Minnesota $2.50. Separator men in Saskatchewan $5 to $7; Minnesota is not given there, but North Dakota is $5 to $6, and so on down the line. Now, if those figures are correct, I would like to ask what the danger is to the farm laborer as a result of this reciprocity agreement ? Mr. Collins. The danger to the American farm laborer ? Senator Stone. Yes. Mr. Collins. By the closing of the American mills. He will have millions more competitors after his job. Senator Stone. The closing of the American flouring mills? Mr. Collins. I mean factories all over the country, which means panic. Senator Williajis. Do you think the reciprocity bill will close the factories ? Mr. Collins. Yes, sir. If I had time I could prove it. Senator Stone. Do you mean woolen mills, cotton mills, and steel factories ? Mr. Collins. Yes, sir. If you look at the bank clearings to-day vou will find we are already in a state of panic by reason of this reciprocity. The mills are to-day on the verge of closing down. 22(5 liECIPEOCITY WITH CAKADA. Senator Willia:\is. I thought their complaint was that the Cana- dian reciprocity discriminated against the American farmer in favor of the manufacturer, and noAV you state that the American manufac- turer is going to close his mills. Mr. CoLLixs. He is going to cut off his own head. The C'hairman. Now, if you will introduce the other speakers of the Minnesota delegation, Jlr. Feig. Mv. Feig. ]Mr. Chairman and gentlemen of the committee, the second speaker whom we ha^■e with us is an old pioneer lawyer and farmer of ^Minnesota, residing at Lake Elmo, and representing, be- sides the farmers of his locality and of the State, the American Soci- ety of Equity of our State. I take great ])leasure in introducing Mv. Eandolj^h A. Wilkinson. STATEMENT OF MR. RANDOLPH A. "WILKINSON. Mr. Wilkinson. Mr. Chairman and gentlemen, I feel somewhat embarrassed at this time because some of the facts and figures which I wanted to present would take np some time, ;ind in order to do that I will h:\\Q to trench on the time that we have allowed other speakers in our delegation, in this argument that has been going forward about some of these details, but I hope that the committee Mdll bear in mind that we are occupying oidy the time that we are talking, and that we will go along as fast as we can, and we will try to cover the subjects which will give the committee information for the purpose of arriving at a fair decision with regard to this question. Now, it has been hinted here that I am a lawyer. I am a lawyer. It is true that I have jDracticed law for some years in the States of Minnesota and "Wisconsin, and during all those times I have farmed land, and farmed it myself, giving it my personal supervision to a large extent, and have engaged in raising wheat in Minnesota for nearly 30 years. I think that I can say that I have raised more wheat than some of you gentlemen may have raised something else, because I have raised over a million bushels. I naturally have been interested in the rais- ing of wheat in that country. I have naturally studied the markets of our country and the conditions under which we have raised that wheat in times gone by. Now, we have not apisroached this subject from a partisan stand- point, but we Republicans, who believed in protection of American industries — some can not help referring to our position, say, 15, 20, 25, and 30 years ago — the farmers of the Middle West, the ^Mississippi Valley States, assisted the manufacturing interests of the East in the establishment and maintenance of a system of protection which has built up the factories in the East as well as their extension over into the West. The Republican Party has been the political party under which this system of protection for American industries, American manufac- turing industries, was instituted and has been maintained. Without the assistance and votes of the farmers in the IMississippi Valley States and the Northwest at that time, that party never could have established that system of protection. They luid the balance of poAver between the two contending parties in those days, one con- tending for practically free trade, or tariff -for revenue, and the KECIPROCITY WITH CAXADA. 227 other a tariff for protection. Xow, wliat « as the reason tliat impelled those people in those States to ally theniseh'es with the Republican Party, joining with them in building up this system of protection for American manufacturers? 'i'he reason was that they believed that under the conditions which were jorevailing, as we were opening up our lands, that by building up home industries, thai by increasing our manufacturing capacity, we would f-urnish employment for large numbers of people, and therefore create a home market for the products of the farmer. AVe believed that, because in the first place we were told that by you people who came to us from the East and advocated that policy. 'We imbibed that principle away back in the times when Horace Greeley talked protection in his New York Tribune. We read it as our political gospel. Now, that is why this system has grown up, and we have felt, as Eepnblicans, that we were proud of our policy, because our countrj^ had increased and prospered under it such as it never had before. During all this time we realized that we, as farmers, were paying a bonus to the manufacturer; we were paying a greater price for our goods that we bought than we could have bought them for in some Other market ; that we were paying for the privilege of having a home market in the future. During all this time the free traders or the Democratic tariff for revenue men Senator Bailey (interrupting). ^Y[ly don't vou use one or the other? Mr. Wilkinson. I will try and do so. The tariff for revenue people. Senator Bailey. That is right. Mr. Wilkinson. The taritf' for revenue people told us that the price of wheat was regulated at Tiverpool in those days. The great apostles of i^rotection or the Republican side cfnitended that that was not so. and one of the great high protectionists came out and made a speech once in the West, in which he said that he could always tell whether a man was a Republican or a Democrat by asking him the question, where the price of wheat Avas regulated, and if he said it was regulated at Liverpool, he was a Democrat, and if he was a Republican he would say that it was regulated Iny the home market. Xow, without saying whether that was correct or not at that time, we have built up this protection for the benefit of the people who are living in the cities, so that we might have a market, and within the last three or four years we have ili-covered tliat our work has begun to bring us fruit iii the direction of a home market, and a good home market, an independent home market for our farm ])roducts. Xow, that being the case, we were satisfied, and we were satisfied with that system of protection, but we lii'lieved what they told us years ago when we were working with them to build up that home ifnarket. We believed that the American farmer was pursuing a pur- suit that was entitled to consideration, and that the American farm industry was a part of the industiy i)f the United States, worthy of consideration and wortl!\- of in'o^ection. Xow we find at this time something else. I do not want to cast any personal reflection upon anybodv. As thniifler onl of a 88i .96i(oiS »1.02| .9,3i@i 1.03 J Dulutli New Yorli 1.00 St. Louia . . 92i@i .89i .98J 242 BECIPROOITY WITH CANADA. Senator SiMMO>rs. Do you say that that appeared in a journal favorable to reciprocity? Mr. Wilkinson. The Minneapolis Journal is the organ of the Chamber of Commerce of Minneapolis. The Chamber of Commerce of Minneapolis is the backbone of the support of this treaty in the Northwest. Their market reports, sent out under their supervision and based upon the actual sales made there during the day — and this is the statement that it went down still further, still lower, on the late news from the capital that was favorable to reciprocity. I have in my possession here an editorial from the Minneapolis Journal, that just arrived here yesterday, which, if any one of you have any doubt about its position on reciprocity, I will give to you to read, or you can look it up, because the paper came yesterday, in which they belittle everything connected with the movement down here to head it oS, and they are sort of pluming themselves that the United States Senate is not going to be misled by the grangers of the Northwest. It is on a par with your cartoon that was published the other day about the grangers coming with tears from the White House when they had been there to plead their cause. Has anj' mem- ber of the Steel Trust, has any member of any manufacturing indus- try ever come from the White House with tears in his eyes ? Let us look it up and see what it is. Now, let me call your attention to one thing in connection with this market report of February, 1910. Senator Simmons. Do you think the Steel Trust is in favor of that agreement? Mr. Wilkinson. I have never found a manufacturing industry that the representatives of will come out and say they are in favor of the agreement, but there seems to be a movement somewhere — and the Lord knows where it is, if you will tell us where it is, so we can know where it emanates from, we can charge them with it and see Senator La Follette. If they were opposed to it, I venture they would be here. Senator Simmons. I think they are for it. I thought you might have some evidence that would confirm my suspicions. Mr. Wilkinson. The fact is, we are groping in the dark to find out where it has come from. We want to know where the source of it is. Then we can put the charge where it should be. and if there is any blame or credit, let us give it to them, but it has been roam- ing around in our countrjr in the West, and, from all the news we could get out of these favorable reciprocity papers, we have not been able to find the father of it, and we can not find who were the men Senator Williams. Do j'ou mind my asking anj^ questions? Mr. Wilkinson. Oh, no; go ahead. Senator Williams. One of your delegates the other day, if I un- derstood him correctly, and I want to know whether you agree with him or not, said the mills would close down if this reciprocity agree- ment became law. If that is true, it would seem that the reciproc- ity agreement must be very much against the interests of some manu- facturing businesses somewhere. I did not understand specifically what interest it was. Mr. Wilkinson. I Avill tell you. In that matter we know this, that when this proposed treaty was made public by the message thai EBCIPBOCITY WITH CANADA. 243 certain millers of Minneapolis—! do not say all of them — were favorable to it, and certain drain dealers. Now, Mr. Lowering, of the Pillsbury-Washburn Co., one of the biggest milling concerns in Minneapolis, has been quoted now for two or three weeks publicly in the papers as being opposed to it because it would have the eii'ect of so depressing the wheat production of the States of Minnesota and North Dakota that they would be compelled in self-defense to go to Canada for their wheat, and thereby be put at a disadvantage with other milling centers, and therefore they were not in favor of it. Mr. Mangison, the head of the Northwestern Elevator Co., another large grain company, is opposed to it for practically the same rear- sons, that it would hurt their market. Mr. Dunnwoody, who is the head of the Dakota Elevator Co., another large concern, is opposed to it for practically the same reasons. T can not say that those gentlemen are opposed to it. I can only say that they have been quoted publicly and in public meetings in Minnesota, and those quotations have been published in the news- papers as being opposed to it for reasons after reconsideration, and there is this fact standing out that when this reciprocity matter was first brought up there was an enthusiastic movement about it for the purpose of educating the ignoramuses, the farmers, as they called them, in public speeches to the benefit of this reciprocity. They found it was a pretty unruly set of farmers that they had to get into the schools to educate ; they found out that they were like some of the old schools in the olden clays when they threw the school-teacher out. Senator Williams. And locked him out. Mr. WiLKixsoN. And locked them out, and their enthusiasm has come to be largely a myth since that time. No^v, coming to the point that I want to emphasize in reference to this market report. Bear in mind that this market report is of February 10. Bear in mind that these gentlemen of the chamber of commerce — if I use the wi^ong term correct me, some of you Minneapolis fellows; it was the same men, whichever name they went under — had a recii^rocity meeting, proreciprocity meeting, on what day? The night of February 9, and a certain gentleman got up there and made a proreciprocity talk in favor of it, and the next day this fact of reciprocity, the argument he made Senator Simmons. Why not name the man. Mr. WiLKiNsriN. I shall name him before I get through, but for certain reasons I do not believe in imputing motives to people unless I know something about them, but I am only talking of this fact, that that argument made that night could not counteract, nor did not counteract, the market, but it went down in spite of these arguments telling hoAv much vi'e would be benefited by the proposed agreement. There has been a great deal said, and some people have imputed to that gentleman vvho made that speech a creation of the reciprocity idea, so called. I do not know anything about that. I want to say right here that that gentleman I respect as much as any man on the face of the earth. I think I have known him as closely as most any man in Minnesota for more than 30 years. I admire his ability and I appreciate it, but bear this in mind, there was never a truer saying than that the mistake of a great man is a great mistake. 244 KECIPBOCITY WITH CANADA. When great men are mistaken the consequences are more damaging than could be if it were one of the ordinary men. I want to go along to another day, just one more day, February 11 : " May wheat had sold down to 98|, possibility of reciprocity caused still further decline. Fluctuations sharp and nervouSj May declined 3^ in two days," so that you see that that is the headmg of the market report of that date. [From the market report of the Minneapolis Journal Saturday evening, Feb. 11, 1911.] May Wheat To-day Sold Down to 9S| Cents. rossiBiiJTY of reciprocity caused still further declines, fluctuatiors sharp and nervous — may declined 31 CENTS IN two DATS. Minneapolis Chamber of Commerce, February 11. — Wheat prices again to- day went to new low levels, the quotations on May being the lowest since August, 1909. The possibility of the adoption of reciprocity with Canada was largely responsible for the big break of to-day and yesterday. Pit offeriugs were liberal and support was lacking. More favorable weather conditions in the southwest was another bearish factor. Keports from Washington were any- thing but consoling to the bears. Sentiment was strongly bearish in spite of the break of 3i cents for the last two days and predictions of still further new low prices were frequently heard. The opening to-day was wild. May being quoted 99 to 99* cents, one-eighth cent lower to three-eishths cent higher thiui yesterday's close. Fluctuations were sharp and nervous. Early the near month .sold down to !)Ss cents, the new low price. This was followed by a seveu-eighths cent rally. Prices continued to zigzag, but were not in as wide range as in the early session. May closed at 982 cents, three-eighths cent lower than yesterday's close, and July at 99J cents, three-eighths to one-half cent lower. Minneapolis was more active than Chicago, and prices were in wider range in this market. Tlic day's report. Minneapolis Chicago Duluth New Yorli. . . St. Lonis . .. - Kansas City. Winnipeg- . . M:iy wheat. July wheat. Close to-day. Close yesterday. Close to-day Close yesterday. ». 98} ^993 ■ 9^J ■ 9-lJ . 89|@} . 95i ?0. 99i ■ 93i@J -995 .993 .94;(ai • 90i@i .9S8 1 99i 9U@i 008 98i 908 sum 96J 51.00 .92 1.00 .98, .90 .88 .96 @ Senator La Follettb. I want to ask you if you will give to the clerk of the committee the full printed statement that you have there from the Minneapolis paper for each day. Mr. Wilkinson. Those two days, I would like to. I would pass them over to him Senator La Follette. In order that they may appear in the pro- ceedings. Mr. Wilkinson. I borrowed this from a gentleman and promised to return them. Senator La Follette. I would like it to appear in the hearings with the headlines. Mr. Wilkinson. I gave the first one in full, every word of it. Senator Nelson. I furnished him those papers and I will give him copies. KECIPEOCITY WITH CANADA. 245 Mr. Wilkinson. I must return them under my promise. Then if you will see that they are handed to the clerk Senator Nelson. I will furnish the committee with copies. Senator McCumber. The same ones appear in the Congressional Kecord both of those days. Mr. Wilkinson. I think that has established the fact that we have already suffered to the extent that I contend we will suffer on the average at least year by year. Now, what is the effect, and what is going to be the cost of it ? There is another reason why we are going to be affected. Senator Nelson. Mr. Chairman and Mr. Wilkinson, will you allow me to put in a word right here ? Mr. Wilkinson. Yes, sir. Senator Nelson. I want to say that some of those elevator men of Minneapolis have written me, " for God's sake ! not to have this reciprocity agreement take effect until the next crop," until they can unload the wheat that they have in their elevators. Mr. Wilkinson. Now, we are peculiarly affected in these States that I have mentioned, because of the geographical situation. The wheat product of Canada is mainly in western Canada — Manitoba, Saskatchewan, and Alberta. I think that Ontario and the other parts of Canada produce about 22,000,000 bushels. According to the American Yearbook and also according to the Yearbook pub- lished by the Secretary of Agriculture, the production of wheat in Canada in 1908 was 112.000,000 bushels, in round figures. Senator McCxjmbee. You said in the American Yearbook. Do you not mean the Canadian Yearbook ? Mr. Wilkinson. I mean the American yearbook, the publication by Appleton & Co., which was published about in March, which takes in the products and the statistics of the United States and of Canada, and the figures are given identically the same upon the same years as are given by the report of our Secretary of Agriculture. I will not give you the odd thousands of bushels. I am speakins now in the millions. In 1908 I say that Canada raised 112,000,000 bu'shels; those three Provinces I mentioned were about 22,000,000 bushels less than that. They exported that year about 56,000,000 bushels, count- ing wheat and flour, given by the same authorities. In 1909 Canada produced 166,000,000 bushels of wheat, an increase from 112,000,000 bushels to 166,000,000 bushels. The greater part of the increase was in Saskatchewan. You will find by looking at those statistics that Saskatchewan produced 34,000,000 in 1908"and 85,000,000 in 1909, so that the increase is in Saskatchewan, which is along the boundary of North Dakota. I was talking with a gentleman who is one of the vice presidents of the Canadian-Pacific Railroad last year. Of course, we had not this in mind at that time, because that was last fall. He is the gentleman who has had charge of the direction of the irrigation works around Calgary. Some of you may know his name, but I have forgotten it. He is posted thoroughly on the development of western Canada, west of Winnipeg. That is his business. He is in charge of the land department of the Canadian Pacific. He told me that there was an increase in 1910 in Saskatchewan in acreage of about 35 per cent, added to the acreage that produced 166,000,000 bushels in 1909. We know that they did not produce as big a crop 246 EECIPKOCITY WITH CANADA. in 1910 as they did in 1909, but the acreage made it up in 1910. He told me also that there would also be a larger increase for the crop of 1911, because of the increase in the acreage brought in in 1910; that there would be 40 per cent increase in Saskatchewan alone. Now, that being the case, give them a normal crop, and instead of ] 66,000,000 you will find the crop of western Canada to be 266,000,000, or nearer that figure than the other. That wheat is there, right up on our boundary line, under practically and theoretically the same conditions as ours, to go to the market where it can get to the easiest and get the best price. That is where I think possibly that the sup- posed spread that there has been between those two places will not be realized or entirely closed up. Now, there is another question, and I am going to refer to a speech by the same gentleman to whom I referred before, a speech he made at the Devils Lake Chautauqua some years ago in July, in which lie censured the farmers for rushing their wheat to market during the fall months of the year. I do not know but what you remember the statement I refer to, because it was published in the papers. He also made that statement in another place in Minnesota. He said that the farmers were losing in the neighborhood of 10 cents a bushel every year because of the fact that they rushed their wheat to market during the months of September, October, and November, because it caused a glut in the Minneapolis and Duluth markets, and that a glutted market was alwa^'s a low market. I believe that he was correct in that statement. I believe that that condition in any market with any commodity does lower the price. If Canada raises 200,000,000 bushels of wheat for export in these northwestern territories, there we have, in addition to the normal crop of the Dakotas, which will cause this glut at these times, an ad- ditional two hundred or two hundred and fifty millions dumped right on us and cause a still greater glut, a still greater decrease and lower- ing of the market in consequence of it. That is another item to be considered, and I have the authority of a man who studies those things as closely as any man here. There is another thing, and I am not going to take much more of your time. That is this: I have been talking about the difference in price at Duluth and at Port Arthur or Winnipeg. That is not the real test of the effect that it will have on the market of the Northwest. The real test is the source from which that wheat comes. The Canadian wheat is so situated that it can be brought to Minne- apolis and Duluth as cheaply as it can be got to Port Arthur. It naturally would come there. Now, if this agreement goes into effect, theoretically the commerce of Canada will be on a better basis, so far as the marketing of wheat in our market is concerned; theoreti- cally, I say. Now, I have this statement to make in connection with that, and I inalve the statement, and I say it can not be contradicted, that it is borne out by facts that already exist, by circumstances which have taken place — that instead of the Canadian farmer being strictlv on an equality with the farmer in the northern part of North Dakota and the western part of South Dakota, the Canadian farmer is going to have an advantage of from 2 cents to 3 cents a bushel in getting liis wheat to our American market. That is another startling state- EECIPEOCITY WITH CANADA. 247 meiit, but it is based upon this fact, and it is a fact, upon circum- stances which have already talten place : When the Canadian iS'orth- ern line made connection with the Great Northern line at Emerson and St. Vincent on the Canadian boundary line, for a year or two afterwards there were large quantities of wheat which came down from Manitoba to be milled at Minneapolis in transit, under some bonding system you have. You people understand it because you passed the laAv making it — at any rate you ought to understand it — that wheat was broug-ht down to that place for milling by the rail- roads entering into the fiercest kind of competition of to-day, and it was brought down there on what they call an import rate, which was a lower rate than wheat shipped from tlie same distance on the other side of the line, in the northern counties of Minnesota and North Dakota. I do not know anything about the long or short haul proposition or anything else, but those are the facts. The same condition will prevail if this reciprocity agreement goes into effect; wheat that comes from Canada to any of the American markets will have to be competed for by the different railroads, American rail- roads, to get it here, and they will have to bring it in on an import rate in order to get it. That rate will be in favor of the Canadian farmel", will be a lower rate than the northwestern farmers can get, because of the competition, so the effect will be that not only are you placing the Canadian farmer on equality, but you are giving him the means of liaving an advantage over the American farmer in get- ting his wheat to the Minneapolis and Duluth markets. I am going to say just this one thing more in regard to the opposi- tion which we have got. It is addressed to the men who handle the wheat, a portion of them, and Avho believe that they would handle the wheat in larger volume, or the grain that would come in under this proposed agreement. The price that wheat is marketed at does not affect the profits of those men in the least. Their 1 cent per bushel is taken whether wheat is worth 50, 60, or 75 cents or $1. The volume of business is what they are after, and they w-ould not care if they handled 10,000,000 bushels under the new conditions if the American farmer did not get 25 cents per bushel for his wheat; they would still get their 1 cent per bushel. That is the position. They are not the men who raise the wheat or the men who have got all they have, practically, invested in the business and in farm work and farm industry. They are against it, and if anyone doubts that, I am ready to make good the statement I make here, and I will take him up there and give him one of the best audiences he ever spoke to, and it will not cost him a cent, and I will pay him for his time in the bargain. I just want to say this in conclusion. Where have the public meet- ings been held which have been in support of reciprocity ? They have been at the banquets at Minneapolis and in other cities, and there has never a man had the temerity to come out into our country and go before the men affected by this bill and try to advocate it. It has always been under the auspices of some of these trading associations, and in order to get up courage to advocate reciprocity they first had to partake of the solid and then of the spiritual inspiration. [Laughter.] Now, we have been for years, as they say, coming up this hill, and we have got to the point where we have some protec- 248 BECIPKOOITY WITH CANADA. tion, at least, for our product. For years we have been climbing the hill and we have been supporting your other industries by pro- tection in order that we could have this market. We have realized it in the last two or three years back, and we know now that we have got some protection ; and we intend to insist on retaining it. I want to say this, that the farmers of the Northwest have eaten of the tree of knowledge; they will never give up what they know to be their rights; and in a constitutional manner they will stand together, shoulder to shoulder; and they will march to the ballot boxes and they will have their rights under God and the Constitution. I thank you, gentlemen. Senator McCuimber. Before you leave I want to ask a question, be- cause you are so well acquainted with this Saskatchewan and north- western countrj^ Can you give the committee your judgment as to the immediate possibilities of the development of that country in the wheat-producing section that can compete and swamp the American farmers ? Mr. Wilkinson. I have been in the Saskatchewan country up as far north as Saskatoon; that is, I have been up there, about 150 miles north of Edmonton, practically over all of the intervening territory. I have been told that still farther to the northwest there arfe some wheat fields, and I notice that some even saj^ that they raise wheat up near the Mackenzie River. Senator La Follette. Plow far north of the border have you been? Mr. Wilkinson. We do not go straight north; we start from the northwestern boundary, and you can go over beyond Winnipeg 1,500 miles in a northwesterly direction and be in the wheat land every rod of the way. Now, judging from what they have done in the past and the short time in which they have commenced to open up Saskatche- wan territory, I make this statement : That I believe that these three territories in the next 10 years will raise as much wheat as the whole United States does at this time, from what I have seen of the country. Senator McCuarnER. At tliis point I would like to suggest to you that Sir Wilfred Laurier, in his speech before the Canadian Parlia- ment in speaking of the great benefits that would be derived by Canadian farmers to have the American market for their produce instead of the British market, declared that they could easily in- crease the output of northwestern Canada tenfold. You estimated at 200,000.000 bushels with the cultivated land. Tenfold would be 2,000,000,000 bushels as against about 700,000,000, the most we have ever raised. Mr. yriLKiNSON. I always have had the reputation of being rather conservative. I do not like to make any statements that are radical, but I would say that I believe that inside of 10 years, at the rate they are going on, that these three Provinces will raise more wheat than the United States does. I believe it, and they have got the ground for it. Tliej' have the territory and the acreage necessary, and the acreage to raise a great deal more. Senator Heyburn. ^"^niere do they draw the population that is raising this wheat? Mr. Wilkinson. That is a question that I meant to spealc on. The Canadian immigration authorities issued from Winnipeg only a short time ago a statement (hat the Provinces west of Winnipeg would take in this year 45,000 farmers, of which three-fourths or more would come from the United States. BECIPKOCITY WITH CANADA. 249 Senator Heybuen. Is that men alone, or families? Mr. Wilkinson. Meaning men to occupy farms— not population, but farms. Senator Clark. One other question. Mr. Wilkinson. Just let me finish that, if you please. In support of that there is a statement issued and published in St. Paul and Minneapolis that three railroads leading into that country to-day had contracts in the last of March or the first of April for a number of thousands of cars to take the immigrants' movables from Iowa and portions of the United States into that portion of Canada. Senator Clakk. The question I wanted to ask was whether or not it is not a definite and determined policy of the Canadian Gov- ernment to encourage in every possible governmental way the settle- ment and development of those lands? Mr. Wilkinson. I will say this, that they go further. They have talked about the liberality of our homestead laws. Compare them with the Canadian homestead laws, and ours are very conservative and very limited and expensive. A man going into Canada can take a homestead and live on it for years and get the title. In certain parts of these Provinces the men that went m there in the past were given work by the Government in fixing the roads around their farms, and they got their living out of it. They have not done any- thing of that kind to help our settlers. They have also another law where a man having a farm and a quarter section of government land adjoins he can take it as a homestead and attach it to his farm, but he does not have to live on the actual land. In addition to hav- ing a homestead he can preempt another quarter section for $2.50 an acre. That is the policy of their law. I want to call your attention to another thing that has been done there to settle up that country by the Canadian Pacific Railroad. I think it is published in one of tlae magazines here, in the American. They are carrying out a policy — and have been engaged in it for sev- eral years back — of opening up and improving farms on their lands and putting houses upon them ready for the settlers to come into and give them a low price and long-time payments. There has nothing of that kind been done here. You see there has been every attempt made to foster the immigrant in Canada by the Canadian Govern- ment and the Canadian business interest. They are doing it for the purpose of being prepared to take advantage of our markets, which it seems that now we are about to be idiotic enough to give them. Senator Stone. I want to ask you a question. Mr. Wilkinson. Yes, sir. Senator Stone. I do not like to consume the time, but I would like to ask if I understood you to say that in your opinion that within the next 10 years the three provinces of Manitoba, Saskatchewan, and Alberta would produce as much wheat as the United States? Mr, Wilkinson. Yes ; more wheat. Senator Stone. More wheat ? Mr. Wilkinson. Than the United States are producing at this tima Senator Stone. That would be to increase the output about 500,000,000 bushels? 250 BECIPKOCITY WITH CANADA, Mr. Wilkinson. Yes. Senator Stone. According to the estimates of the Canadian Premier, reported by Senator McCumber, the increase in those north- western privinces would be tenfold ; in other words, would add within the next 10 years about 1,800,000,000 bushels to the world's supply. Mr. Wilkinson. That was Senator McCumber's reference to the Premier's statement. Senator Stone. Now, if either your statement or his should be true — of course his is far more than yours — would not the certain effect of increasing the world's supply of wheat 500,000,000 or 1,700,000,000 within the next 10 years be to decrease the world's price of wheat? In other words, would not the increase in supply so far outstrip the increase in consumption as to lower the worlds price ? Mr. Wilkinson. That is true- Senator Stone. I am not through with the question. Mr. Wilkinson. I beg your pardon. Senator Stone. And if it did, how would you manage to keep up the price of American wages ? Mr. Wilkinson. Now, possibly I have not got all of your question in mind, but if I do not answer it all you may call my attention to those facts I do not answer. It is true that if the population of the world stands still the civilized portions of the world stand still Senator Stone. But this is 10 years. Mr. Wilkinson. I am speaking of 10 years. There is quite an increase going on in the world in 10 j^ears — (continuing) that your contention would be correct, and that the price of wheat in the world's markets would be generally lower. I think it would have that effect to a certain extent so far as the price is concerned. You ask me this question: Can we maintain the price of wheat in this country upon its present level with it all lowered around us? With a view to a certain portion, we could not come anywhere near it; but if you will treat us on the same basis as you treat the manufacturing indus- tries of this country, we are willing to take our share with you in the lowering of the prices that you may have to come against when there is such an increase of other products that it lowers them all around the world. [Applause.] Now, I want to say just a word about this question to 3^ou. If there were not any jorotective tariff around the United States, would not the prices of the commodities, the manufactured commodities that would be in the market, be lowered very materially because of the production of those commodities in other countries? If those other countries could see that in the next year, for instance, or the next five years, the protective tariff wall would be taken down from around us, would not it stimulate them to increase their production so as to flood your markets? Senator Stone. Then I understand Mr. Wilkinson (interrupting). That is just exactly where we come in. We are idiotic enough to go and take down the tariff wall that is protecting our wheat at this time, and we are stimulating them to the greatest exertion to increase their production of wheat so as to take advantage of it. Let us give notice to the world that we are going to do the same with the manufactured products, and that would RECIPROCITY WITH CANADA. 251 stimulate the other countries in the same way. Now, what is sauce for the goose is sauce for the gander. Senator Stome. Xow, Judge, your idea is that you would keep up the price of American w'hcat bj^ a duty which would keep out foreign- grown Avlieat. Of course, a'uy surplus of production here would have to enter into competition with the world. Mr. Wilkinson. At the rate Ave are going we would not have aiij' surplus; we would have begun to take it from the other places, and then we farmers have just the same protection. Senator Stone. But I say if there were a surplus it would have to go out in the world and compete. Mr. WiLiciNSON. If there was- It is not a supposable case, because we know Senator Stone. But we are exporting wheat. Mr. "Wilkinson. And we are exporting something that is not the wheat we are talking about, and we ai'e getting pretty near as much of the northern Canada in here as we are exporting to-day. Senator Stonl. We are exporting American wdieat. Mr. Wilkinson. "We are exporting to a certain extent at this time, but we are coming back now where we will not have much to export. Sena'tor Stone. That is not the import of my question. I asked you, if we had a surplus, to that extent we would have to compete with the world's market. Mr. Wilkinson. Undoubtedly that would be true. Senator Stone. Xow. so far as American-grown wheat was re- quired to serve our own people, to satisfy our own consumption, you would keep the price of that up by taxation on wheat from the out- side: that is your theorj^? In other words — permit me — you would pursue a policy that would compel the consumers of bread in America to pay a much higher price for that staple necessity of life than the people in all the balance of the countries of the world would have to paj ? Mr. Wilkinson. Xow, just let me ask Senator Stone. Are you in favor of that sort of policy? Mr. Wilkinson. I will go into that question if you will give me a chance. I am in favor of this kind of a policy that recognizes the industry of farming to be an industry worthy of protection the same as any industry in the country. [Applause.] Senator Stone. I agree with that. Mr. Wilkinson. I am in favor of a protection on wheat products — that is. on an equality with a line of protection on any other prod- uct. We are entitled to protection for the wheat we raise just as much as the woolen manufacturer has protection in manufacturing the goods for the coat I wear, if it is wool. I am entitled to the same kind of protection for the farm products that I raise in the same grade and in the same way. and equal to the protection given to the manufacturer of the shoes I wear. Senator Stone. Is not the whole system a rotten one? Mr. Wilkinson. I am not talking about that. I am talking about accomplished facts, and I do not want to bring down destruction upon any one of our interests, but I want just as fair protection, as fair a measure of protection, for the farming industry as we have for any other industry in the United States. [Applause and cheers.] 93285— Xo. 5—11 2 252 KECIPEOCITY WITH CANADA. In regard to that other matter I have only this to say: While I am a farmer, and while I have always thought that we were doing the right thing when we were building up our manufacturing industries, I have this to say: That if our industry, which is as important as any in the land because it jDroduces the food which moves the ma- chinery with which you run your factories Senator Gallikger (interrupting). I suppose you think there is as much equity and logic in protecting the wheat that you raise as there is in protecting the zinc and lead of the State of Missouri. Mr. Wilkinson. I think so. [Applause.] Senator Williams. One question right there. The Senator from New Hampshire asked you if there was not just as much equity and right in one of those things as in the other. Is not there also just as little equity and right in one as in the other? Mr. Wilkinson. I am not going into the free-trade argument at all, or anj'thing of that kind. I am talking of accomplished facts. Senator Bailey. I want to ask you this : There are some of us who agree that equal treatment must be fair treatment, and who while rejecting the argument for protection, both on the manufactured products and on the agricultural products, still maintain that even a revenue tariff ought to be allowed on one as well as on the other, and here is what I want to ask j'ou — I see you are a little disturbed right at this time about what you are going to do at the next elec- tions (laughter) — I want to ask you this in all seriousness: Would you not rather v^ote for a man who favored a tariff for revenue on all products of the farm as well as of the factories than to vote for a Republican who is a protectionist in spots and missed the farmer every time he could ? Mr. Wilkinson. I will say yes, sir, on that; so far as Senator Clark. You have another choice ; don't forget that you have another choice. Senator Gallinger. Don't forget there are Democrats who are protectionists in spots. Mr. Wilkinson. I say right here, I will answer yes. Senator Bailey. We want the record to show that the Senator from New Hampshire does not intend to describe me as any such. Mr. Wilkinson. I do not want Senator Smoot. Nor do I think the Senator from Texas will try to describe the Senator from New Hampshire as a protectionist in spots. Senator Bailey. No; I really intended to describe the President of the United States. Mr. Wilkinson. In answer to your question I will say yes, be- cause I consider a man who is simply a protectionist in spots is in- consistent and is not to be relied upon in any way. I would rather take chances with a man who had at least followed a consistent policy. Senator Bailey. And the Democrat who is for revenue in some places and not for revenue in other places is not very reliable? Mr. Wilkinson. He is just as inconsistent as the other fellow. Senator Clark. In other wofds, you Avant the bottle to be properly labeled. Mr. Wilkinson. Yes, sir. I want to say this— I speak, as I say, from accomplished facts— and I tell you right now and here that you will be convinced of it ; that you will hear from the galleries in EECIPEOCITY WITH CANADA. 253 November, 1912. You will hear it in thunder tones — that if you take down the wall, as you call it, between Canada and North Dakota, the tariff wall of protection around this country will be leveled just as flat as you level that. [Applause.] We to-day stand with the men we have stood by for years and we want them to stand with us, be consistent and protect our interests as we have assisted in protecting theirs. Senator Bailey. And suppose they do not do it ; what are you going to do? Mr. Wilkinson. They can go to the devil. Senator McCumbee. I want to correct a little error in the record as to a matter that did not probably belong in this record. I do not want even an error to get in if it does not belong in it. Air. Wilkin- son, in speaking of a national inspection, says : I never agreed on a national-Inspection proposition, and if that question was to come up here and be argued I would say this : There can be no uniform national inspection of wheat to grade it all on one basis, because different parts of the country raise different kinds and different qualities of wheat. That Is the answer to that proposition. Else it might be assumed that the bill for national inspection con- templated such a thing as that, I might say that there is nothing of that kind whatever in the bill or ever proposed to be in the bill. All the bill sought to do was to secure an inspection and a grading that would harmonize with the different characters of wheat raised in the different sections and which would give honesty and certainty of inspection in all grades so that the number of bushels that came into the elevator at Xo. 1 should go out of the elevator as Ko. 1, and not 1,000,000 bushels of Xo. 3 and 850,000 bushels of Xo. 1 out of that ele- vator. That was its object and I wanted to explain it, not for the purpose of argument, but to correct the record or the assumption. Mr. WiLnvi>'SON. We always did disagree on that proposition- - while we do not get to the point that we condemn one another be- cause we do have different opinions on that question. It was simply a matter of what we are up against Senator McCumbee. The wrong is in the assumption that the bill means something that it does not mean — means something that it does not. Senator Stone. I want to say it would be well for the members of the committee to read over the record before it is printed, because I believe there are some errors in it. The CiiAiEiiAN. It is the understanding that each member will carefully examine the first print and make any corrections and hand them to the secretary, so that the corrections will be made in the second print. Senator Smoot. As I understand that, it also applies to any of those giving testimony, provided they desire to go over their remarks. The Chairman. The persons giving testimony before the com- mittee are requested to examine carefully the first print of the testi- mony and turn in the corrections which they desire to make, so that they may be made in the second print of the document. Mr. Feig. The closing remarks of Mr. Wilkinson are the very crux of this controversy, namely, discrimination that is contained in this proposed legislation as between the farmers of this country and other countries. It is that discrimination which rouses the ire of every 2r>4 EBCIPROCITY WITH CANADA. fair-minded man, not only in the farming industry, but in every other industry in this country. What is right for one ought to be conceded to the otlier, and it lias been conceded, but it is now ijroposed to take it away from them. It is that that they are protesting against, and it is that fact that ought to appeal to every fair-minded man to whom this question comes for consideration, and ought to be considered well before he takes this position and forces us to take a different position in regard to economical questions. Mr. Wilkinson and the preceding speakers of our delegation pro- tested and made their arguments on the basis of that protest as far as it affects the grain industry in particular. We have with us an- other speaker who is identified with the dairy industry, and there are a great many people who perhaps believe that that will not suffer. We have every reason — our farmers who are engaged in the dairy business — to believe that at least indirectly the damage to that in- dustry will be equally as great as to the grain industry, but I will let some one else who is familiar with this make a few remarks before your committee, if you will give him the privilege of speaking. We have with us Mv. John R. Morlej^^ of Owatonna, Minn., the president and manager of the Minnesota Cooperative Dairymen's Association, an association having within its membership 125 cooperative cream- eries, business institutions, that have become prosperous and success- ful owing to the manner in which they were conducted and to the pro- tection they have enjoyed, but which are now also threatened by this iniquitous measure to be deprived of the same. STATEMENT OF MK. JOHN E. MORIEY. Mr. MoRLEY. Mr. Chairman and gentlemen of the committee, it would not be my purpose at this place and at this time to discuss the advisability or the adaptability of the protective system to our insti- tutions. It is a matter of history that we have followed the pro- tective system for at least a lifetime, a business lifetime, of nearly every man in this room. I do not know much about the protective tariff, but I do know this ; that is, I can realize this, that if we buy anything from a foreign country the foreigner gets our money and we get his goods. If we buy anything from our people in our own country, we have the goods and we have the money. That is a good fimdamental principle, it seems to me, for a nation to apply as a business proposition as well as for an individual. Senator Bailey. Do you think it would be a good idea for the dairymen to go out and spend $3 doing for himself what he could employ some other man to do for him for $1 ? Do you think that would be a wise arrangement? Mr. MoRLEY. I do not know that I exactly catch your meaning. Senator Bailey. I mean to say that it is a good deal better for the individual to give his money to somebody else to do something for him when they can do it in half the time that it would take him to do it for himself. "Wliat is true of every man in the Nation must be true of the Nation itself. Senator Sjioot. That woidd apply if the nuni had something else to do, but if he did not it would not apply. Senator Bailey. If the man had more goods and less money, or more property and less money, he might be much better off than he KECIPEOCITY WITH CANADA. 255 would be even though he had more money and less goods. It would depend upon the relation between the goods and the money. Mr. MoELEY. Now, Senator, a nation or an individual has got to sell more than they buy, haven't they? Senator Bailey. That would depend on what they are making to sell. If I am engaged in some lines of business, undoubtedly I have got to sell more than I buy or else the year's business nets me a deficit and that will bring me at last to the bankrupt court. For instance, I practice law and I could lay brick, I think. I am not sure that I could lay brick according to the level or the line, but I could lay brick, and yet I would consider it a very great economic waste to spend my time laying brick when I can practice law and make $50 a day and hire a better brick layer to lay my brick for $5 a day. Mr. ]MoELEY. The assumption would be in that case then that the American man's time was too valuable to go into the dairy business? Senator Bailey. It is never too valuable to do that which he can do best and to hire somebody else to do that which he can not do so well himself. Senator Smoot. That does not apply to a farmer very often, does it ? Mr. ^luRLEY'. No, sir. Senator Sjioot. The farmer generally is working on the farm and doing the work himself; if he has employment outside that he could earn more money at, then that would not so well apply, but it would be a thousand times better for the farmer to do the work, if it was only a dollar a day, rather than to employ a man at $1 a day to do the work and be idle himself. Senator Clark. I think Senator Bailey has asked his question as a practical experience. Senator Bailey. No, I simply want to direct the attention of the gentleman who is addressing the committee to the fact that an argu- ment ill favor of iDrotection is not exactly a profitable one before this committee. Mr. MoELEY. I do not propose to make an argument for pro- tection. Senator Bailey. I can not say that I subscribe to that, although I thoroughly agree with the argument for fair and equal treatment. Mr. Moeley. I do not propose to make an argument for protec- tion. It seems that the gist of this whole matter — I have been here for four days now — and it seems that the gist of this whole matter settles around the grain trade. That is the way it looks to me, that it is the grain interests which seem to nie more or less vitally interested, and, as Col. Wilkinson says, we do not know just exactly Adhere it started, but it seems to me either the milling interest or something of that kind. Now, I want to draw a little picture of early Minnesota life and connect it up a little with our national policy. Forty-two years ago, when I was a young man, I lived in Minnesota, out there in the same township I live in now. I was teaching a country school out in the western part of the county, boarding round. I boarded with one family for several weeks. I had to stay there longer than anywhere else, because they had so many children, and I stayed according to the number of pupils they had. This family lived in a small country 256 BBCIPBOCITY WIIH CANADA. house, and they had 17 children, so I naturally boarded with that family quite a while. Senator Bailey. Eoosevelt would have liked that. Mr. MoRLEY. The house consisted of one small room, with a lean-to on one end of it for the father ■ and mother to sleep in ; a lean-to on one side for the cooking apparatus, and in the main room was a loom where the mother wove the cloth for all those children, as well as the spinning wheel, and I slept upstairs in the loft with the rest of the children. That would make 18 of us in the loft. This was in the winter or the fall of 1869. Those of j^ou who are "old enougli to remember that can remember there was a great deal of dipcussion at that time on the protective system which our Gov- ernment had very recently adopted. This gentleman was a rank free trader; the country was entirely devoted to wheat raising. Wheat Avas worth, as near as I can remember, about 50 cents a bushel, with the fictitious value of our paper money at that time, which had not entirely recovered from the effects of the war. and, of course, he was a rank free trader, and, in fact, he was quite an orator, and not being accustomed to have an audience very often, he entertained me almost everv evening with free-trade talk, and I can assure j^ou, gentlemen of the committee, that he was almost as positive in his convictions as the Senator from Texas is in his. He was positive that he was right. I had an uncle in a near-by town where I used to go every Satur- day, and he was just as much the other way. He was a very strong jDrotectionist. I said to him one day, " I am almost converted to the free-trade system." Of course I was not old enough to vote. " I am almost converted to the free-trade principle.'' I says, " I intend to be a farmer; I do not see that this is doing the farmer any good. It increases the price of what he has to buy, and he has to sell his wheat products " — it was all wheat there then, and we expected that it would always be all wheat — " subject to the Liverpool market.'' Now, the old gentleman -was quite alarmed. He was afraid he was going to lose me from the ReiDublican Party. '' Now," he says. " young man, there is a future in this proposition.'' He says. " You are young." " Now," he says, " I will tell you what I will do : I will furnish you the New York Tribune, and you read Horace Greeley's editorials for one year and you will be a protectionist." And I followed his advice and I am a protectionist. I will say my father was also a protectionist and he was a radical Fremont Republican, and between us we have continued it from IS.")!; until 1908. Now, what were those editorials that Horace Greeley wrote? He says the farmer does not get the benefit of protection now, but when he builds up the great manufacturing centers, when he builds up the great centers of industry, then he is going to have the home market for his products. Now, gentlemen, that was 42 years ago. And now we come here before you and want to know what you are going to do with our home market. You older Senators, and I think there are some here from the manufacturing districts of New England States, know very well that the farmers of the Mississippi 'Valley have been your great pur- chasers as well as the people who have furnished your employees with cheap food. We had a virgin soil. We depleted that virgin soil in feeding your people for less than the crops cost to raise them. EECIPBOCITY WITH CANADA. 257 That has been proven repeatedly. It has been proven by statistics ; it has been proven by investigations. It was proven by President Koosevelt's Country Life Commission that the farmer sold his product for less than it cost to produce. Now, when the time has come that we can realize the promises that the Republican Party have made to us, and we believe that they were made in good faith, in the last 40 or 50 years, we are humiliated by being presented with this contention that the farmer does not need any protection, and the cartoon that Col. Wilkinson spoke about to you, who many of you call " Judge." He is not judge. Pie never arrived at that dignity. They call him Colonel out in the country. I do not know where he got that title, but you can bank on anything that the Colonel says, and he has not done it for a grand-stand play — he means every word he says. Now we are confronted with the proposition — the cartoon in the Washington papers, where the farmers were going out with tears in their eyes and diamonds in their shirt fronts. Now, I can assure you gentlemen that these two features of the cartoon are wrong, because the farmers did not come out of there with tears in their eyes and they did not come out with diamonds on their shirt fronts, and they will not go home from Wash- ington with tears in their eyes, and I venture they will not have diamonds on their shirt fronts, but we are now coming nearer being able to make a living for our families and educating our families and providing them with the necessaries, and a few of the luxuries of Kfe, than we were 40 years ago. Compare that time I spoke of with several of your homes in the vicinity of Dupont Circle, some of the homes on the old York Eoad going out of Philadelphia, some of the homes on the Palisades up above New York City, and some of the homes on the lake front in Chicago along the Sheridan Road, and see if those people have not had the benefit of this protectiA^e tariff, and if the farmer in the Mississippi Valley has not paid the bill. Senator Cullom. Confine yourself to the butter and egg industry. I understand you represent those industries. Senator Bailey. I would really like to hear you continue your lecture on these Republicans who have been trying to beat the fanner. Mr. MoRLEY. I did not know that my efforts Avould be confined to butter and eggs. Senator Ctjllom. Your lecture is all very nice, but it seems to me somebody else here will want to talk; that there may be one or two men who want to speak, and we want to hear the other men who want to speak. I do, at least. Mr. MoELEY. It is possible that some gentlemen do not like to hear about the promises made 40 or 50 years ago. I think that is very likely, without any discourtesy or disrespect to the Senator at all. The subject of barley has not been touched. I would like to say a few words on the subject of barley, with the permission of the chair- man. Barley in our country is also a very important crop. As I understand the situation, the tariff on barley at the time before the enactment of the Wilson law — the tariff on barley was 6 cents a bushel. Am I right? If not, would some one correct me? The Wilson-Gorman law made it 50 per cent ad valorem, or 20 per cent. At the time the Dingley law was enacted the tariff was 6 to 30 cents 258 EECIPEOCITY WITH CANADA. a bushel. What was the condition of the barlej^ interest at the time of the Dingley law ? The centers for barley or the barley markets were situated here in the East at Buffalo and different ports on the Lakes, and I under- stand Oswego was the domestic market for the product of barley. We imported at that time quite a little amount of barley from Canada. I believe it is generally conceded that Canadian barley is much better for malting purposes than is the American barley, with the exception possibly of the extreme Northern States. We are one of the border States, and consequently can raise the best barley or nearest approaching the Canadian product. The entire production of barley in the United States at that time was 63,000,000 bushels, and we imported from Canada 11,000,000 to 15,000,000 bushels. Twenty years afterwards our production of barley was 163,597,000 bushels, with a farm value of $102,290,000. Under the stimulus of jDrotection Senator Clark. What was our importation at that time? Mr. AIoELEY. The authority I got these statistics from did not give us any importation at all. I do not understand there is any impor- tation. I understood the tariff is prohibitive on barley. Senator Clark. That is what I wanted to get out. Mr. ^loRLEY. The centers of barley now have been to a large extent removetl from the Eastern States to the lower lake ports at Chicago, Milwaukee, and Minneapolis, and St. Loiiis. Now, we are interested in this as barley producers. Eemove the tariff from barley and so far as the influence of the Canadian market would go our barley would be reduced to a free basis. I refer to this matter of barley, as it is nut mentioned in the remarks of any of the other gentlemen. Now, when it comes to barley products Senator Groaka. I would like to correct the statement of the gentleman regarding barlej^ The Northwestern States do raise just as good barley as they raise in Canada. Anj^one who is familiar with barley knows that the weight and color of barley is essential to the making of beer. They raise in North Dakota and Minnesota as good barley as is raised anywhere in the world. Mr. MoRLEY. As I understand the barley situation, the difference in tlu' barley is because they take better care of it; it is not injured in the production. But it must be understood that the least mite of moisture in the barley will occasion a certain amount of damage, so far as malting purposes is concerned, when they color it. Senator Gronxa. The Canadians take more care to see that it is not colored. Mr. MoRLEY'. The Canadians take more care to see that it is not colored. Senator Gronna. You raise a white barley where there is not a very heavy dew. But they have chemicals now and bleach barley. So that it is not as important as it used to be as to the weight of barley. Mr. Laavrence. Mr. Chairman, I represent a joint delegation of representative farmers from Ohio and Michigan. We have been here two days already, and while I do not like to appear in any way discourteous, there are two or three delegations that have been wait- ing for some time. This delegation from [Minnesota has had the EECIPKOCITY WITH CAX,\DA. 259 entire time ever since 10 o'clock yesterday, and it seems to me, I sub- mit to the committee — is it just to l^eep these other delegations here over another night without giving them a chance to be heard and con- tinue the addresses of this delegation when it is doing so much dam- age tt) others? I agree with this sentiment and we admit them as our colleagues in this discussion, but to keep our people here another night without being heard — and other delegations, too, have got to come after us — I submit to you whether it would not be just to request this delegation to close and give the others a chance to be heard, those who have come an equal distance with them? [Ap- plause.] Mr. Feig. I fully appreciate what the gentleman has just said, and I can assure the committee that the rest of our delegation will be very brief. They have come here 1,200 miles, and we would like at least for them to come in here and have themselves registered. I can assure you that they will not any of them consume over three minutes, in order that they may have their names on the record. The Chairman. The committee does not, of course, desire to cur- tail the opportunities of any gentlemen appearing before us, but the privilege will be extended to all of them to record their appear- ance and file any statement that they may desire with the stenogra- pher. The committee sympathizes with this delegation, whose mem- bers have been waiting here for two or three days, but at the same time we want to give you people the fullest latitude and the fullest- opportunity if you will endeavor to arrange it in a harmonious way with the other people. Mr. Feig. ]Mr. Chairman, it will be perfectly satisfactory to the delegation if they are permitted to put in their statements and their appearances in the record. The Chairman. They will be received and printed as their tes- timony. Senator Stone. I would like to ask Mr. Morley if it will be satis- factory to him to write out what he desires to say and insert it in that form in the record? ]Mr. MoRLEY. Yes, sir; certainly. Senator Cullo-ai. Mr. Chairman, I would like to hear from the dairies in the Northwest. We have heard from those in the East, and if the gentleman will confine himself to the dairy question I will be glad. j\Ir. MoRLEY. I can do that in a very few minutes. Mr. Meighen. Mr. Chairman, I want to state that this gentleman represents the butter State of the world. You have heard of the bread-and-butter State of the world? Senator ^NIcCctmber. I think it is very proper to suggest that there is here a delegation from my State. They have come here prepared to stay all summer, if it is' necessary, to be heard, and we are not going to ask anybody to shorten his testimony. I, as one member of this committee, will not stand for any person being shut off who speaks for Minnesota and the Northwest. Senator Williams. I, as one member of this committee, am not willing to stay here all summer. Senator Bailey. If Senator McCuniber will permit a vote, we will meet the situation right now. [Laughter.] 260 RECIPROCITY WITH CANADA. The Chaiejian. I recognize that these gentlemen have come from a great distance to appear here, and are entitled to all the courtesy and consideration that the committee can extend them. Mr. MoELEY. Mr. Chairman, I shall take but a very few moments to express myself on this proposition. So far as the dairy interests are concerned, it removes the tariff from all dairy products. It puts us absolutely on the free list, and you might almost say on the free list of the world. Now, the condition would be Senator Williams. Eight there I would like to ask a question. How much butter do we import and how much do we export, and how much cheese? Mr. MoRLEY. You want to know how much we export and import? Senator Willi aims. Yes. Mr. ]\IoKLET. In 1909 we exported 5,981.265 pounds of butter. They are the latest statistics that I can get. That is a j-ear ago— for a value of $1,268,210. We imported in 1909, 646,320 pounds, at a value of $141,917. Senator Williams. We exported, then, about ten times as much as we imported. That is about it, is it not ? Mr. MoRLEY. Yes; we exported 5.000,000 and imported 646,000— a little over half a million — and exported nearly 6.000.000. Yes; that is right. Of cheese, in 1909, we exported 6,822,842 pounds, valued at $857,000.91, and we imported 35,584,143 pounds, valued at $5,000,000. That is taken from the Yearbook. Senator "Willia:\is. Have you the figures as to cheese? Mr. Morley. I gaA'e you the cheese. Senator Williams. I thought you were giving butter for the dif- ferent years. Mr. Morley. I have the exports and imports for 1906. Senator Gallinger. You had better put them in the record. Mr. Morley. We protest, of course, against the tariff being talten from butter and cheese, the same as from other products, and for tlie same reason. We are entitled to protection on those products the same as we are entitled to protection on grain, for we are entitled to it, and we claim that we are entitled to protection on all fann products as other industries are protected. The Eastern States have been for some time very desirous of getting the tariff removed from butter, and I think the New York Mercantile Exchange in the 1908 extra session — when you were considering the Payne-Aldrich bill- passed a resolution Ibefore that exchange to petition Congress to remove or, at least, to reduce the tariff on butter. They wanted to get the Ontario and Quebec butter coming down to New York. Of course our markets in the East are largely in New York and Phila- delphia and the Atlantic seaboard. Of course we sell a great deal of butter in Chicago, but the Minnesota butter largely goes to New York. That would take that market away from us if Canada is able to supply ns. She can import her butter for her western Provinces by water at a cheaper transportation than she could take the Ontario and Quebec butter West, and cheese as well. I do not see, Mr. Chairman, that there is anything more to be said on that question, because the argument in favor of that would be just the same as the argument in favor of the other. Senator Stone. How many creameries are you interested in or connected with? BEGIPEOCITY WITH CANADA. 261 Mr. MoKLEY. That has very little significance, but this organiza- tion has 126 that our president spoke about; but we have "in the State 798 creameries. We made, in the last report of 1909, 90,834,202 pounds of butter, and paid the farmers $22,296,000 for their butter. That is what the farmers got in cash after all the expenses of manu- facture. Senator Stone. About what was the average you paid to the farmers during that year ? Mr. MoELEY. It would be about 27 cents. Senator Stone. Twenty-seven ? Mr. MoRLET. Yes. This is 1909. No ; it would be a little less than that — about 26 cents. Senator Sjioot. That is for butter fat ? Mr. ^loELEY. Yes, sir; that would be on the average — possibly a little more, possibly 27. Of course there are extremes. There are creameries that average in paying for butter fat for the year 1909 as high as 29 cents. Senator Stone. What do you mean when you say j'ou pay them 26 cents? Twenty-six cents for what? Mr. Morley. For butter fat. The creameries all make their settle- ments on a basis of butter fat according to the Babcock test, and when it is turned out it will make more butter than the butter fat that it represents. Instead of buying milk by the hundred they re- duce it to a fat test. That is merely a technical term used with the creameries. Senator Smoot. About how much more is it on account of salt and water? Mr. MoELEY. About 23 per cent. Senator Smoot. I did not think it was so high. Mr. MoRLEY. Yes, sir. Senator Stone. Is there such a thing as a creamery trust? Mr. MoRiJ5Y. Xot that I know of; no, sir. I do not know of any such thing. Senator Stone. Is there not a board known as the Elgin board, that meets on every Monday morning and fixes the price of butter in the United States for your cream.sries? Mr. MoRLEY. No, sir; they do not fix the price for our creameries. Our butter is sold on the open market in New York, Philadelphia, and Chicago. The Elgin board is the same as the butter board in Philadelphia or the Mercantile Exchange in New York City. It is possiblj' the oldest butter board in the United States. It was at one time the center of a dairy district. Senator Stone. Does it not fix the price? Mr. MoRLEY. Just the same as any board does. It fixes quotations according to the transactions done the same as any of the different boards in the United States — the same as the grain exchange. The prices they fix are based on the sales made. They have an open call. The only difference is that the Elgin Board meets once a week and the boards in the larger cities meet every morning. Senator Stone. How much butter would fat that you paid 2G cents a pound for make; how much would it turn out? Mr. Morley. The butter is about 22 or 23 per cent more than the fat ; that would be the moisture and salt. Senator Stone. That is, a pound? '2G2 KECIPHOCITY WITH CANADA. Mr. MoRLEY. Yes, sir; 80 pounds of butter fat would iniike, ?ay, 100 pounds of butter. Senator Stone. What was the average price for the year you are spealcing of at which you sold butter? jNIr. MoRLEY. The price varies so that it would take considerable figuring to get at the exact price. I can give you the average for a single creamery. Senator Stone. What was the general range of the price? ]Mr. MoELEY. I said I think the general range for the butter fat paid the farmers for 1909 would be between 26 and 27 cents. Senator Stone. How much did you get for the butter ? Mr. MoRLEY. Well, we got the market price. Senator Stone. The general range of the market price — what was that ? Mr. ^MoRLEY. The average market price of the highest grade butter for 1909 was 29 cents in New York. Senator Stoxe. Twenty-nine cents a pound? Mr. MoELEY. Twenty-nine cents a pound for butter. That was the average of the highest quotation. Senatdi- Stone. I \A-ant to ask you, ISIr. ^lorley, if butter is not stored in large quantities and held from year to year? IMr. ^MdKLEY. Yes, sir; it is stored. I do not know how long it is held. Senator Stone. I think some of it is held a good while, from the way it smells. Mr. MoELEY. I have seen some of it that did not smell very good before it Avent in. Senator Stone. Do you know whether it is a fact that last year the hi boring men had to pay 40 cents a pound for butter, and yet a large amount of butter in storage was still held and carried over? Mr. MoRLEY". I really have no way of knowing what the retail price of butter in the States is. We do not do any retail business; we simply sell right on the open market for the wholesale price. You see, our average price for the year 1909, supposing the butter had all \»^(m the best, would have been on the basis of a 29-cent market. Senator La Follette. What would that be for butter by the pound ? ]\Ir. jMorley. What the sale on the market is of butter. Senator La Fotlette. That is, the New York price? Mr. jNIorley. The New York price; yes, sir. Senator La Follette. AVhat do you get at the factory? Mr. MoRLEY. The expense of getting this butter to the market is about 1-} cents a pound — from 1^- to 2 cents. j\Ir. Chairman, if there are no other questions to be asked, and as there are so many more who want to be heard, I think that is all I have to say. The Chairjian. Have you anyone else in your delegation, Mr. Feig — in the Minnesota delegation? Mr. Feig. I stated a moment ago that the suggestion of the chair- man, that the rest of our delegates put their remarks in writing, in the shape of a brief, in order that they may have them incorporated was satisfactory, and I believe that it is. Will not the committee be willing to have them at least give in their names? I will call them myself. EECIPEOCITY WITH CANADA. 263 STATEMENT OF MR. THOMAS J. MEIGHEN. Mr. Feig. I will now introduce ^h\ IMeighen. He was the chair- man of our committee on resolutions and is one of our old Minne- sota Democrats. I have found that out on more than one occasion. He was a candidate on the Democratic State ticket last year for auditor. Senator Bailev. It is a great pity you did not put him up before you used so much time. [Laughter.] Mr. Meigiien. Some of us Democrats make very Ioivj: speeclies. Mr. Chairman and gentlemen, just a word. 1 have no tirc-ome figures for you. I think you have had sufficient of them already, and really there is not much to be said in addition to what has been said in behalf of the agricultural interests of the great Northwest. The ground has been pretty completely covered, and there has been some ground covered, perhaps, that it was not necessary to covei'. Of course, you can not keep some of our old Republican friends from making their old-fashioned tariff speeches, and you can not prevent some of my old Democratic friends from free-trade sj^eech making. Xow, the question of the tariff, as it has been generally considered, it seems to me, has no place in this controversy — that is, the principle of the tariff. Whether protection is the projDer thing or free trade is the proper thing has no place in this controversy. I have my own opinion about that, but the question to be considered here, and the only question that needs to be considered is the question of equal treatment and fair treatment for all the industries of this country. Senator Simmons. The Democrats in my part of the country are not free traders. Mr. Meighen. I do not care what they are. As far as this matter is concerned it makes no difference to me what they are, or what any- body else is respecting that general question, because the question here to be determined is " Is it right to jeopardize one interest, and the greatest of interests in this country — the basic interest — and de- cline to disturb anybody else," leave everybody else alone? That is the question to be considered here. So I am not going to make my old Democratic speech on the tariff question. Now, just a personal matter. The Senator yesterday was trying to discount this delegation from Minnesota. He tried to show that they were not a representative delegation. He found from some source that there was a gentleman on the delegation who was a banker, the president of a bank. I plead guilty to being the president of a country bank, but my relations to a bank are only of recent origin. I live on the farm where I was born, 55 years ago, in Fillmore County, Minn., and my connection with the bank is simply a matter of busi- ness convenience. My interest is farming. Senator Smoot. What is the capital of your bank? Mr. Meighen. Twenty-five thousand dollars. It is the First Na- tional Bank of Preston, Minn., organized about nine years ago, and I have been its president since its organization. But I am not actively engaged in the bank, I am only thfre at the directors' meetings and occasionally at other times. Senator Bailey. To give it assurance and stability. Mr. Meighen. In other words, I was not born in a bank. I ws|s born on a farm, but as to where a man was born and as to his 264 BEGIPEOCITY WITH CANADA. environment after he was born will fix his position with respect to this question; it will fix his sympathies, and your sympathies fix your 230sition, and my sympathies are, and always have been, with the producers of wealth. The whole controversy on this question, and the whole trouble in all these questions of political economy is the question of the distribution of wealth. Now, I hold that the man who produces the wealth ought to be permitted to retain his fair share of it. Because I happen to have relations with a bank as a matter of business convenience it is insinuated that I have no right to come here and speak for the farmers of Minnesota, and yet I am living on a farm where I was born in the town Forrestville, FiUmore County, Minn. Why some people would have it that before you are competent to speak for a farmer or to stand up and defend his interests you should have the perfume of the cow barn upon you, and your coat tail should be plastered Avith the manure of the barnyard. Is that the way you would have it ? There is not a thing upon the farm that I have not done and can not do. My home farm consists of 1,000 acres and I have conducted it personally from year to year and hired the men and discharged them. Now, the question of farm wages came up here yesterday, and a Senator attempted to show that they were getting better wages in Canada than they are in America on this side of the line. As to northwestern Canada at the present time, there is not a great deal of difference, but the difference as to the farm wage is in favor of the laborer on the American side. Now, I am hiring farm laborers and I hire them and have to hire them by the year. We try to hire mar- ried men, men with families, and keep them the year round. The intense farming of our portion of the country makes that a neces- sity. It is true that the table that was shown here yesterday as to the wages during the threshing season in the Northwest are higher than the wages during the same season of work on our side, but that is about the only season that the men are needed — just a short season — a few weeks in the fall, when they are threshing, there is a great demand for help. It takes large crews to run those machines that they have in that country, but in our country the farm laborer has work the year round. I am now paying a man $35 a month by the year and I furnish him a house free of rent, fuel free, a large gar- den free, pasture for his cow free, and sometimes we give the man the use of a cow along with the pasture for the summer season. So that that man will fare better with this arrangement than any farm laborer fares in northwestern Canada, taking the whole year through. Of course, they may get big prices during the threshing season, but that does not show anything, because when the threshing season is over, in the wintertime, there is nothing for a man to do out there but spend the few dollars he has earned in the summer. Now, Mr. Chairman and gentlemen, I happened to be an admirer of James G. Blaine, although I did not vote for him. I thought he was a i^retty good kind of a Republican, though, and I took some stock in his kind of reciprocity. He made that term popular in this country, and it seems that on account of that fact, some shrewd fel- lows, wlio are to be benefited by this proposed pact, have taken the tag with reciprocity upon it and stuck it upon this abortion, and they (bought the people would just swallow it without looking at it — that EECIPEOCITY WITH CANADA. 265 they would never examine it. But some of us farmers up there, began to investigate it. ^ '\^Tien I was first questioned on this matter, I did not have an opinion. I said, " I do not Imow anything about it; I have not seen the bill." But they attempted to put through a resolu- tion favoring it in the ^Minnesota Legislature, when there was not a member of that body who had not seen the bill, and tried to force it elsewhere in the country, manufacturing sentiment for it. When the farmer was permitted to examine it he immediately repudiated it, and for the best of reasons. As to land values, I own some land in Manitoba. I was offered $20 an acre for it a short time ago, and I thought something of selling it at that price, but since this thing came up I have hesitated. It oc- curred to me that I would have to have some way of recovering the loss that I would sustain on my farm in this country, and I am going to hold it for an advance ; but I hope that I will not get an advance. Senator Baii.et. I hope you won't move. We have not got any Democrats to spare in Minnesota. [Laughter.] Mr. ^Ieighex. I would be greatly pleased if I had to take, instead of an increased price, a reduced price for it, because I do not think a man is very patriotic who will trade off his iVmerican citizenship for a few extra dollars upon a few acres of Canadian land. Gentlemen. I will not detain you longer. I thank you. [Applause.] Mr. Feig. Mr. Chairman and gentlemen, I hope you will hear just a few words from Mr. Currier. Senator Stone. Mr. Chairman, as one member of the committee, I will say that we must have some end to this matter. If all these 150 gentlemen are going to make speeches, we won't get through l^efore the middle of August, and I understood some time ago that these hear- ings would conclude probably to-morrow — maybe run over a day or two. It has been agreed that they may file written statements. The Chaieman. The gentleman will give his name to the com- mittee. Senator McCumber. Mr. Chairman, I ask that he be allowed to testify, and I will state why. If you will look over this record, you will find that about one-half of the time has been occupied by mem- bers of this committee instead of the witnesses, and I am guilty of occupying my part of it. I think when we have taken up half the time ourselves that we ought not to object to the witnesses taking up some of the time. Senator Williams. Suppose we resort to common sense and have testimony; let the chairman or somebody else examine the witnesses. I have sat here right along and listened to speeches on free trade and tariff for revenue. Senator McCumber. We have all indulged in it. Mr. Feig. I assure you that it will only be for a few minutes more. Senator Williams. WTiy not proceed now in a sensible way ajid let the chairman examine the witnesses? Mr. Feig. We ought to be through by 1 o'clock without any doubt. Senator Stone. I do not think this hearing ought to be used merely for the purpose of killing time and delaying the considera- tion of the bill. We are entitled to have a report on this bill at an early day, and the Senate has the right to consider it ; and if we go on in this way we probably will not have it considered this year. 266 BECIPBOCITY WITH CANADA. Senator McCdmber. AVe can not complain of the last witness. Ih was A'ery brief indeed and gave us important testimony. Senator Stone. He made a protection Democratic speech. Senator Clark of AVyoming. The possibilities are that some of the rest of us on the committee are not as well informed as others upon the basic facts, and I notice that a good many facts do leak out in some way or other from these gentlemen who have come before us. Senator Bailey. I want to record my protest against the statement that Mr. ^Aleighen h:(S made a protection Democratic speech. He said that llu> questinu of protection or free trade or taritf for rev- enue was not involved in it. but fro;',i his viewpoint it was merely a (luestion of equal treatment. Xow. I think that when a Democrat comes down here and makes a fair statement m}' brother Stone ought not to accuse him of Ix'lng a protectionist. Senator Williams. I do not think we ought to take up time in discussing the different phases of that proposition. STATEMENT OF F. V. CUREIER, SECRETARY MINNESOTA STATE DAIRYMEN'S ASSOCIATION, OF NICOLET, MINN. ISIr. Feig. I will state that Mr. Currier is a farmer, like all the rest of our delegation. Mr. Currier. Mr. Chairman and gentlemen of this committee, the speaker who just took his seat was complimented for being very brief, and I will be briefer than he was. I will simply state that I am secretary of the Minnesota State Dairymen's Association, an organization for promoting the dairy industry in that State, and that I also represent a large number of the local creameries of that State, or about 60,000 dairy farmers. I am here to pi'otest against this treaty. I have talked with differ- ent farmers and different men in my section of the State and I have failed to meet but one man who Mas in favor of the treaty and that man was a minister of the gospel who admitted that he had not read the schedule. I am a farmer, and I do not know whether I have any of the manure on my shoes or not. I had some of it when I left home, but it has perhaps worn off by this time. I can certify to the fact also that I am personally acquainted with each one of the delegates of our committee, and if they are not operating their farms, they own farms and they are interested in the farming industry. In other words, they are farmers. I myself was born in the town- ship where I live, and have since I was old enough to take up work of my own operated and conducted a farm. I am still operating a farm in the countj' in which I live, and I come here not with the idea that I am going to teach you anything in particular, but to make my protest known against this proposed treaty. That is all I have to say. [Applause.] STATEMENT OF H. C. RTJSTAD, OF KIRKHAVEN, MINN., REPRE- SENTATIVE OF THE FARMERS' ELEVATORS OF MINNESOTA. Mr. Feig. j\fr. Chairman, I now introduce Mr. H. C. Rustad, of Kirkhavcn, Minn., a representative of the Farmers' Elevators of ?»Iinnesota. wlierc we have 225 farmers' elevators which handle practi- cally one-third of the grain that is handled in that State. He will only Occupy a few minutes in stating his position. EECIPKOCITY WITH CANADA. 26? j\Ir. EuSTAD. Mr. Chairman and gentlemen of this committee, the farmers engaged in the raising of small grain, and also other farmers' elevators, earnestly want to tile this protest against the passage of this agreement in its present form for this reason, and it is a serious reason amongst all the farmers in general, that it leaves us in this position that ^^■e have got to dispose of our products in an open free- trade market, and that we have got to buy our necessaries for living in a protective market. [Applause.] STATEMENT OF J. Y. WININGS, OE EDEN VALLEY, MINN. Mr. Feig. jNIr. Chairman, there is another one of our delegates present, ^Ir. J. Y. "\"\'iuings. of Eden Valley, Minn. i\Ir. Winings is not only a farmer, but you can tell by the looks of him that he is a farmer. ^Ir. "WiNixcs. Mr. Chairman and gentlemen of the Finance Com- mittee. I want to say to you that men can not live by bread ;done. I see the time is very short, and I necessarily must Ije brief; but I want to say to you that I had to drop the plow handles to be here with you to-day — not lik_' a Cincinnatus, to take up the sword, nor like an Ethan Allen, nor like a Putnam, who rode down v'our stone steps, but, strange to say, as I rode along in the train and these liistoric points were pointed out to me, I seemed to be surrounded with a lialo of national pride, if you please. Xow, gentlemen, I want to right this Minnesota delegation in the eyes of this honorable Senate committee. I am proud to say that I am a member of this great American Repiiblic. I am not :isli;;med to be taken upon the streets here — as some of mj' friends have been jest- ing me — as being taken for a Virginian. I said, " ^.ly good friend, that is what my grandmother was. She was l.iorn near Culpeper Courthouse." I feel proud to recognize the people from the great empire of Texas, the thrifty New England State of Maine, from Georgia, on the other corner, to the great State of Washington, next to our sister of the snows in Alaska. I am proud to say that I can appear before a body of as intelligent Americans as I see before me to-day; but I must admit to you that I am convinced that they are able to compete with as phenomenal a problem as they have con- fronting them to-day. I am proud, gentlemen of the Senate, that when I don my gown at night to retire upon m}' farm — and I must say that I am living upon the farm, operating it in person — when my children surround me and look at the pictures of the great Capitol of Washington, that I can say that we have people in our American Congress able to grapple with the question, and that they are amply able to grapple with it. When our wars break out they can drop their plows, as it were, and they are ready to quiet the affairs of the Nation. Gentlemen, I thank you. I see that I am exceeding my time. [Applause.] STATEMENT OF 0. M. LAESON, OF MADISON, MINN. Mr. Laesiix. Mr. Chairman and gentlemen of the committee, there has been so much said on this subject that it is absolutely unneces- sary for anybody to say anything more. It has been well thrashed 93285— No. 5—11 3 268 RECIPROCITY WITH CANADA. out, but listening to the spe;il<:ers I find that tliere is one corner that they have left in the snoAv pile — at least 1 have not heard any men- tion of it. I am a farmer and own my farm land in Minnesota. I am dealing in farm land besides — what you might call a real-estate man. I want to impress upon the committee the fact that this so-called treaty has already worked a hardship on our State; it has worked an irrep- arable damage. We have corresponding agents in three or four different States — States in which lands are higher than they are with us, A\-hich men there are selling out — wlio say thej' are bringing them up to buj^ the cheaper land which we are offering for sale. I have corresponded frequent^ with those agents and asked them where the men are — where are the buyers that they have said they would bring up. The answer is invariablj' this: That it is absolutely no use of saying anything about going out and investing in land to any- body, because they do not want to make anj^ investment until a settlement of this treaty is made. They want to see which way it goes. I can assure this committee that in the holdings of land that I have, if this treaty becomes a law and goes into effect, I will im- mediately reduce the jDrice of land that 1 hold for sale $5 an acre and be thankful to get out of it at that. Senator Williajis. I-ot nie ask you a question. Do you not think that the land values in the United States are too high now for the good of the Re23ublic? IMr. Larson. No, sir; absolutely ud, ;-,en;itor. If you will leave con- ditions as tliey are in the State of Minnesota at the prasent time, thei'e IS not an acre of good tillable land in iiiunesota that is not worth $100 an acre with a good farmer upon it, and I want to say to you that the average price of farm land in Minnesota is consider- ably less than that. Senator Clark of Wyoming. "What per cent do these farm lands pay under present conditions? With the supposed capitalization of $100 per acre, what per cent would the farmer make on his invest- ment ? Mr. Larson. On the investment of $100 an acre in our community, that is offered — I can only state as far as land that I own is con- cerned — we paid between G and 7 per cent. Senator Clark of Wyoming. That was exclusive of labor on the farm? Mr. Larson. That is exclusive of labor and farm expenses, without figTiring the farmer's own work and his family's own work. Senator Williainis. If it be time, as somebody testified here the other day, that the farmer makes 2 per cent clear over and aboA'e his labor on everything, then it would take him 50 years if he bought a piece of land to pav for it. In other words, it is a 50-year purchase of land? Mr. Larson. Sometimes a farmer will make 2 per cent clear. Sometimes he will lose 6 per cent. At other times he may be for- tunate enough to make 10 per cent. A farm occupation or farm business is just like any other business. You deal with Providence, You have got to depend on weather conditions, and you can not tell when you see it in the spring what j'ou are going to reap in the faB. EECIPEOCITT WITH CANADA. 269 I think, Mr. Chairman, that that is all I have to say. I do not wish to take up your time any longer. Mr. Feig. Mr. Chairman, Mr. Larson has told you that land value in Minnesota would decrease $5 per acre if this treaty went through. I have recently been informed that the Canadian Pacific Eailroad Co. have ordered an advance of $3 per acre in the price of their lands, and that the Hudson Bay Co. have ordered an increase of $5 in their lands. This will show the different ways in which the treaty will affect the two countries as far as land values are concerned. I just want to make a few closing remarks, Mr. Chairman. I feel that we should thank this committee, and I do most sincereh^, gen- tlemen, thank you for the very generous consideration that you have given our arguments. I would feel that we were ungrateful if we went away from here without a formal expression of thanks to 5'ou for the kindness that you have shown. I realize what a burden we have been to you, but we have tried to get alons in the briefest pos- sible talk. AYe could have talked on this subject for two weeks longer, but I simply want to thank you again for j'our kindly con- sideration. Senator Smoot. Mr. Chairman, I move that we adjourn until 2 o'clock. The Chairman. Before the motion to adjourn is put, it might be well if some understanding could be had for the sake of convenience of a number of gentlemen who are Avaiting here, and if so, it ought to be done this afternoon. Mr. Lawrence expects to put his people before the committee when we reassemble, and if the committee could have some understanding as to about how long you would want, Mr. Lawrence, it might be well. We do not want to curtail you in any way. Then this large delegation from Buffalo would know a little better when they could appear. In other words, there are a number of gentlemen who are laboring under some inconvenience in not knowing just when to appear. Mr. Laavrexce. I appreciate the situation exactly, Mr. Chairman, and while we have 25 men here who have come all the way from Michigan and Ohio, and a large number of them are prepared to speak, I think the committee will consent to my stating to you that we will not occupy to exceed two hours. Before you adjourn I wish to make one request of the Senators of the committee, and that is that they will be here when the session is resumed. ^Ye would appreciate it very much better than to talk to their empty seats. I note that you have not practiced that at all as yet, but when you first begin you are quite apt to. You would pay us a great compliment — I mean if you would try to be here, and 1 will try to manage not to exceed two hours with our 25 people. Senator Smoot. There is a delegation here of laboring men who do not want to talk, but want to file their brief. It will not take them but a few minutes, and I think that if they could speak or be here and be allowed to file their brief just as soon as we convene, or even now, we would facilitate matters. Senator Lodge. There are also a number of men here representing the National Union of Stationery Men. It is a very large union. They were here and I filed their names yesterday. They will only take a few minutes — five or ten minutes at the outside. Only a few 270 . BECIPROCITY WITH CANADA. of them represent the union, and of course they are staying here at great expense. Senator .S.aioot. Tlien, JMr. Chairman, I move that we adjourn until 2 o'clock and then hear the labor delegation, if it will only take a few minutes. Senator Bailey. Mr. Chairman, Mr. Lawrence says he will occupy two hours. I suggest that we reconvene at 2 o'clock. If Mr. Law- rence and his associates occu23y even two hours and a half, that length of time would bring us to half past 4, and then we can hear these other gentlemen. None of them, I take it, expect to get out of town until to-night, and they will lose no time, and as those gentlemen have expected to have been heard by the committee next, I would not like to see that program disarranged. I think we could come back at 2 o'clock instead of half past 2. It does not take an hour and a half for luncheon. Senator Smoot. The only idea I had was that we could go to lunch and sign what letters we dictated this morning and get back at 2.30 o'clock and continue the hearings to 6 o'clock if necessary. Senator Bailey. If you had to read some of the letters that I have to sign you would not get back in three or four hours. I think we had better get back at 2 o'clock. Senator S^tooT. Very well; I will agree to that. The Chaiejian. The committee will now stand adjourned until 2 o'clock this afternoon. after eecess. At the expiration of the recess the committee resumed its session. The Chaie,-\ian. The committee will come to order. Mr. Lawrence is not here. The representatives of certain labor organizations aro present and will appear before the committee. STATEMENT OF J. T. CAKEY, INTERNATIONAL PRESIDENT AND SECRETARY OE THE INTERNATIONAL BROTHERHOOD OF PAPER MAKERS. Mr. Carey. Mr. Chairman, as I had a'n opportunity to make a par- tial statement before your committee the other day and did not finish, and as we lin ve a number of representatives that are not ad- vantageously situated so that they coulcl remain here all summer, and it is quite necessary that we leave here at as early a date as possible, and, to be brief, I will say that we want to take up but a very few moments. _A number of our local labor organizations, central labor unions, village boards, school boards, and so forth, have adopted resolutions against the passage of tlie bill. Senator Smoot. You want to file them? Mr. Carey. I would like to have these in the record. The Chairman. Leave them with the stenographer and they will be filed. Mr. Carey. I filed with the stenographer the day I was here before a list of the representatives I had with me whose names did not appear in the record, so, if that would be a correction, we would ask that their names be now inserted in the record. EECIPEOCITY WITH CANADA. 271 The_ Chairman. They will be inserted in the record for to-day if you will now hand the list to the stenograpiier. Mr. Caret. I would like to ask one of our representatives from a town wherethere is no other industry except a paper jnill, Corinth, N. Y., who will just state for your information what he believes our reciprocity agreement would mean for his town. Mr. Chairman and gentlemen of the committee, I would like to call upon Mr. M. T. Jones, president of the Palmer Local, Corinth, N. Y. STATEMENT OF MR. M. T. JONES, PRESIDENT OF THE PALMER LOCAL OF THE BROTHERHOOD OF PAPER MAKERS, CORINTH, N. Y. Mr. Jones. Mr. Chairman and gentlemen of the committee, I would like to say in regard to this bill that if it is put through we believe and know it will be detrimental to the men of our town, as there is only one manufacturing plant there, that of paper and pulp. In that plant there are employed 600 men. I come down repre- senting them, as president of the Local No. 7 and also as chairman of the allied trades, and to bring down resolutions which the president of the village board handed to me, signed by the village trustees; also resolutions from the board of education; and I represent them personally also; and I would like to file those resolutions and have them go into the record. The Chatrman. They will be filed. The resolutions submitted by Mr. Jones are as follows : Village of Cokinth, Corinth, N. Y., May S, 1911. The Senate Committee: GENTLEifEN : Siiice the Canadian reciprocity agreement is so intimately con- nected with the life and activity of our townsmen, our village board have taken the matter under consideration. Our main industry for many years has been paper and pulp manufacturing. Many of our best citizens have worked during their whole lives in our mills and know no other business. They are an industrious, frugal people, and could not easily learn another trade. As the passage of this bill means ruin to our townsmen and degradation to their families, we protest against its passage and ask you to rise to the impor- tance of the occasion and defeat this bill at once. W. J. BURNHAM, President. O. S. Putnam, Chas. B. Fridge, Geo. T. Roberts, Trustees. J. H. Densmoee, Clerh. 2T2, EECIPROCITY WITH CANADA. CoRiNTii, X. Y., May 8, 1011. The Senate Committee, M'ashiiigton, D. G. Gentlemen : The iiiidersigncd board of education of Corinth, N. Y., have considered very c.ircfnlly Die whole matter of reciprocity as affecting our com- mimity. We believe we have the welfare of our community as well as that of our school in our mind. We further believe that the passage of the reciprocity bill will work irreparable harm to our community. For many years our leading industry has been the manufacture of pulp and pajier. Very many of the laborers in our mills own their homes and have large families attending our schools. They are good, industrious, well-meaning citizens, and need the pro- tection of wise legislation. Should this bill become a law, it will mean the abandonment of many of these homes and the ruination of our beautiful village. In behalf of the families of our community and thousands of other families, we implore you to use your very best efforts to prevent this bill ever becoming a law. Very cordially, yours, Wm. C. Randall, President School Board. Charles H. Pitts, Clerk of the School District. W. J. Caton, S. 0. White, Chas. B. Fbidge, ilicHAEL Caret, Jr., ToRANCE Swift, Morris T. Jones, Members of the School Board. A. 11. HOLLISTEE, Principal of Corinth High School. Corinth, N. T., May S. 1911. The Senate Committee. Gentlemen : .Since the Canadian reciprocity agreement is so intiroately con- nected with the life and activity of our townsmen, our village board have taken the matter under consideration. Our main industry for many years has been paper and pulp manufacturing. Many of our best citizens have worked during their whole lives in our mills, and know no other business. They are an industrious, frugal people, and could not easily learn another trade. As the passage of this bill means ruin to our townsmen and degradation to their families, we protest against its passage, and ask you to rise to the im- portance of the occasion and defeat this bill at once. W. J. Bxtenham, President. O. S. Putnam, Chas. B. Fridge, Geo. Eobebts, Trustees. J. H. Densmoee, Clerk. INIr. Jones. These men and their forefathers have worked in the trade in this town for years and years, and we liave come up in the trade; and 94 per cent of the employees in this mill are American citizens, and it is up to us now, I believe, if the bill goes through in its present form, to go to Canada. Up in Canada they do not want unsldlled help, because they have enough of that now. All the skilled employees, and with them old parents of the present employees, whom they are su])porting, whom are American citizens, will have to go to Canada. We protest against that, and we know that the town will be closed up. Our high school and teachers' training class will all be wiped off the map. There will be no more Corinth, and it will become just simply a pile to decay. Senator Clakk. Where is that ? EECIPKOCITY WITH CANADA. 273 Mr. JoivES. Corinth, and it is about 17 miles north of Saratoga Springs, in Saratoga County, N. T. That is all I wish to say, only that we protest against being sent into Canada. j\Ir. Carey. With the permission of the committee, I beg leave to call upon Mr. John ^I. Stoughton, representing one of our locals at Hudson Falls, N. Y., who will also be very brief. STATEMENT OF MR. JOHN M. STOUGHTON, PRESIDENT OF THE HUDSON FALLS LOCAL OF THE INTERNATIONAL BROTHERHOOD OF PAPER MAKERS, HUDSON FALLS, N. Y. Mr. Stoughtoi^. Mr. Chairman and gentlemen of the committee, the remarks that I was going to make are practically the same as my predecessor's were. I have resolutions from our local in Hudson Falls, where our plant is a little larger than that of the former speaker, employs a few more men, about 1,G00, in the industry there, and we take the same stand over at our town that if this bill becomes a law it is practically going to put the organization out of business or else we have got to go to Canada to find employment. I will simply file my resolution to go in with those of Mr. Jones. Mr. Carey. In closing for our organization, I wish to say that we do not pretend to be informed as to the birth and conception of the reciprocity bill as now before the Senate. We do say that we are interested in it all from the fact that we are American citizens, and that we were given no chance to present our case before the Congress when the bill was passed there. In the hearing now before the Finance Committee of the Senate we appeal to you as our repre- sentatives to see that our means of existence is not taken away from us. We ask it in justice, and we will, if necessary, appeal to our millions of colleagues in the trades-union movement, as a protest, if our means of existence and employment are taken from us. We ask for justice at your hands, and I believe that you, after due consider- ation, will give that to us. Senator Williams. Just let me ask one question before you sit down. Are you representing the laboring men in the paper mills, the wood-pulp minis? Mr. Carey. I am representing the paper makers largely in the paper mills. Mr. Malin, the president of the sulphite workers' organi- zation, is here and will be heard. Senator Wh.liams. You say you have had no hearings? Mr. Carey. Xot before the United States Congress before the bill was passed. Senator Williams. Was not there quite an extensive investigation of that entire subject by the Sixtieth Congress, in the House of Rep- resentatives, and people summoned from all OA^er the country, a com- mission appointed to look into it, at the head of which was the pres- ent minority leader in the House of Representatives, Mr. Mann, of Illinois? Mr. Carey. Some two years ago. but not on the reciprocity bill. That was on the Payne-Aldrich bill. Senator Williams. That was gone into fully, was it not? Mr. Carey. Somewhat fully, not entirely. Senator Williams. But what its bearing was upon labor through- out all the industries ? 274 KECIPEOCITY WITH CANADA. Seiuitor La Follette. But you must take into consideration that a large part of tiie membership of the House of Eepresentatives has changed and that a large part of the membership of the Senate has changed. Senator Williams. I understand that, but they had simply ap- peared at one time. Senator La Follette. They want to be heard before the body that is going to decide the matter. Senator Williams. The Payne-Aldrich bill was an entirely differ- ent measure. Senator Clark. They want to be heard before the court that is to pass sentence. STATEMENT OF MR. JOHN H. MALIN, PRESIDENT AND SECRE- TARY OF THE SULPHITE PULP AND PAPER MILL WORKERS ORGANIZATION. Mr. Malin. Mr. Chairman, about two months ago I appeared be- fore the former Finance Committee in opposition to this bill, per- sonally and officially. At this particular hearing I am here with four- fifths of the members of my executive board, together with a large number of members from various sections of the country, whose names I would like to have recorded in the minutes of the meeting as being here to enter a protest against the passage of this bill. I believe we stated plainly to the former committee our objections to this bill, and will do so once more. Our objections to the bill, as it now reads, are that it is unjust to the industry wherein our men are employed. There is no sen-e of fairne-^s to the bill in any way, shape, or manner because of the fact that we do not have a chance if reciprocity witli Canada under the present bill passes, and Canada certainly has the upper hand because of the fact that they have the wood and they ha\-e the water jjower. "With respect to this bill our executive board r.nd our con\-cntion assembled in Albany. X. Y., on the 4th day of May. passed some resolutions, which I desire to read. I might say that my talk to you is going to be very brief; it won't take more than 15 or 20 minutes to go through the entire matter, and while I have not a copy of the resolutions passed at the various meetings I have about 13 of them, and I would ask your privilege to read those resolutions so they will appear in the minutes. The Chaie.man. Go on. ]Mr. ]\Ialin read resolutions as follows: [International Brotherhoocl Pulp, Sulphite and Paper Mill Workers of the United States and Canada.] Albany, X. Y., May J,, 1911. At an annual convention of tlie luteniatninal Brotherhood of Pulp, Sulpliite and Papor Mill Workers in convention assembled at Albany, N. Y., tlie follow- ing resolution was adopted: Whereas we believe tlie reciprocity bill now before the United States Senate, If adopted by said body and signed by the President, would work irreparable Injury to those employed in pulp mills throughout the United States, as tlie schedule referring to paper and pulp would prevent equal opportunities to tie wage earners engaged in said industry ; and Whereas the i)ulp and sulphite paper mill employees are working largely on the eight-lionr day in the manufacture of ground wood and sulphite pulp and paper ; and EECIPEOCITY WITH CANADA. 275 Whereas in the Dominion of Canada all the employees in pulp and sulphite mills are working 11 and 13 hours per day as against the eight-hour day en- joyed by our members; therefore be it BesoJvcd. That in convention assembled that we protest to the United States Senators against the reciprocity bill being passed as an injury to the wage earner employed in said paper and pulp industry ; and be it further Rcsohcd, That our International President be instructed to forward copy of this resolution to each United States Senator, with request that they vote to defeat the passage of the reciprocity bill. President-Secretary. Mr. Carey also submitted the following resolutions : [Hudson Falls Local No, 2, International Brotherhood of Paper Makers.] Hudson Falls, N. Y., May 7, J 911. Whereas at a regular meeting of the Hudson Falls Local, No. 2, International Brotherhood of Paper Makers, held at Hudson Falls, May 7, 1911. Whereas we the members of Local No. 2, International Brotherhood of Paper Makers believe that the reciprocity bill now before the United States Senate, if becoming law would work great injury to those employed at the trade, and Whereas the town of Hudson Falls is largely dependent upon the paper and pulp industry, any injury to said industry would work irreparable in,iury to the wage earner thus employed as a large number own their own home in the village of Hudson Falls ; and ^^■hereas it has come to our notice that the Finance Committee of the United States Senate is to give hearings on this bill : Therefore be it Resolved, That our local, voicing the sentiment of our own members and hundreds of wage earners in our village protest against the passage of the reciprocity bill and call upon the United States Senate to vote to defeat the passage of this measure, and be it further Resolved, That our president, Mr. .1. M. Stoughton, be instructed to pinceed to Washington and appear before the Finance Committee, United States Senate, and present this resolution and urge that they use their influence and vote to defeat the passage of the reciprocity bill. John M. Stoughton. Presidrnt. W. H. FOY. Secretary. [Pejepscot Local No. 2.3, International Brotherhood of Paper Makers.] Pejepscot Mills. JIe., Hay 7, 1911. To the Senate of the United States: At a meeting of Pejepscot Local No. 23, held on Sunday afternoon, May 7, it was voted by an unanimous \ ote of the members to adopt and forward the fol- lowing resoiutions and to send a delegate to Washington, D. C, to protest against the passing of the reciprocity bill in any of its sections in regard to pulp and paper : " Whereas the Senate of the United States has before it for action on same House bill No. 4412 ; and "Whereas we believe that the reciprocity bill with Canada is not only a detriment to the people of the United States and that the bill contains within its limits sections that we believe and know will have a tendency against the welfare of the pulp and paper industry of the United States ; and " Whereas we believe in equal rights for all and do not believe in class legis- lation on any one article or commodity, and we believe that the adoption of the reciprocity bill will have a tendency to not only lower the wages of the em- ployees of the paper mills of the United States, but drive out of the country the numerous pulp and paper mills and injure the employees of the said mills, some of whom own their homes and depend upon the s.-iid business for them- selves and their families: Therefore, be it resolved that we protest against the passage of the said bill in all its sections in regard to the pulp and paper industry. 276 KECIPEOCrXY with CANADA. ■' RcsolfctI, That \vi' ciill upon the I'uited States Senators from Maine to use every honorable means in tlieir power and to vote against the passage of the said bill in regard to the pulp and paper industry ; and be it further " Resolved, That we aslc the honorable Senate of the United States to eliioi- nate from the said bill any section or sections that has a tendency to injure or destroy the pulp and paper trade or its employees." Signed and sealed for Pejepscot Local No. 2.3. H. B. Brawn, I'rcsUJcitt, George M. Cliffoed, Secretary, Committee. Whereas, in the opinion of Local No. 27, International Brotherhood of Paper Makers, that the passage of the reciprocity bill now before the United States Senate, as regards the free passage of paper from Canada into the United States, is detrimental to the welfare of the employees of paper mills : Be it therefore "Resolved, That we, Local No. 27, International Brotherhood of Paper Makers, of Millinocket, Me., in regular meeting assembled, do hereby pray and petition our respective Congressmen from this State to do all within their power to serve their constituents by defeating this bill ; and be it further Resolved. That this local convey to Congressmen from this State our utmost confidence in their integrity and fair dealing to the wage earners of their respective districts ; and be it further Resolved. That we forward a copy of these resolutions to our international president, Mr. J. T. Carey, and a copy be sent to be presented to the Finance Committee of the United States Senate in care of our delegate. H. C. ZlEMANN, J. J. Melodt, S. J. Downing, Leo McFaelane, F. A. Beadlet, H. P. Walls, W. B. Baker, Committee on Resolutions. Fort Edward, N. Y., April 25, ISll. The following resolution was adopteil at .a meeting of the Fort Edward Trades Assembly, held under date of April 24, with instructions that a copy of same be forwarded to the United States Senators in the interests of the men connected with the above organization ; " Whereas the employees engaged in the newspaper industry of this village to a large extent own their own homes in this town; and " Whereas the present reciprocity agreement which is now before the United States Senate, if adopted liy that body, would mean the practical confiscation of the property of those wage earners, for the reason that it would be the means of driving out of existence the manufacture of pulp and paper in this district ; and " Whereas if the present tariff was removed from newspaper it would not result in giving cheaper papers to the readers, as it would be impossible for the newspaper publisher to reduce price of the 1-cent publication; and " Whereas we believe the present agitation for the removal of tariff on news- paper will not benefit the wage earners, but is a selfish class legislation to benefit the newspaper publishers : Therefore be it "Resolved. That the Fort Edward Trades Assembly protest against the pres- ent reciprocity bill as before the LTnited States Senate as an injury to the paper-m.aking industry, to the wage earners engaged in said industry, and call upon you as our representative to use every endeavor to see that the rights and Interests of the wage earners and citizens are protected." The above organization is comi)osed of paper makers, pulp, sulphite, and paper-mill workers, engineers, carpenters, machinists, millwrights, electricians, and firemen, all a part of their respective international unions with a total membership of GOO men. Henry Hussard, Secretary. KEGIPBOCITY WITH CANADA. 277 Fort Edwakd, N. Y., Apr/7 2.',, 1911. At a meeting of tbe village board of trustees, held here on the above datft the following resolution wns read and adopted, and we are instructed to for- ward copy of same to you : "Whereas the present reciprocity agreement now before tbe United States Senate, if adopted by the Senate will be very unjust to our citizens, as the bill will drive out of existence the industry in which they are employed; and "Whereas the men engaged in the paper mills in this village to a large ex- tent own their own homes, which will of necessity have to be sacrificed; and "Whereas we believe the present agitation for the removal of tariff on news- paper will be detrimental to the wage earner and the community, and is strictly class legislation for the benefit of the newspaper publishers : Therefore be it " Rcsolced, That we, the village board of trustees, protest against the passage of section 2 of the present reciprocity bill as before the United States Senate, and in the interest of our citizens engaged in the paper industry, we urgently request you to vote against and to bring about the defeat of the bill now before you." AxFKED Brown, President. James JI. Murray, Clerk., RESOLX-TIONS OF LOCAL XO. 3:2. GLENS FALLS, N. Y. Whereas the employees engaged in the newspaper industry of the United States to a large extent own their own homes in towns in which their members are employed; and Whereas the present reciT)rocity agreement as before the United States Senate, if adopted by the Senate, would mean the practical confiscation of the property of the wage earners, for the reason that it would moan the driving out of exist- ence the manufacture of paper and pulp in aforesaid districts: and AVhereas we. the members of the respective organization of the International Brotherhood of Paper Makers, call upon the Senators to see that the rights of the wage earners of the country are protected; and Whereas if the present tariff was removed from newspapers, it would not result in giving cheaper newspapers to the average reader, as in a ton of news- paper at least 8,000 newspapers can be published; and Whereas it would be impossible for the newspaper publishers to reduce the 1-cent publications; and Whereas we believe the present agitations for removal of tariff on newspaper will not benefit the wage earners, but rather reduce wages and confiscate their homes: Therefore be it Resolved, That we, the members of the International Brotherhood of Paper Makers, protest against the present reciprocity bill, as before the United States Senate, as an injury to the paper-making industry of the wage earners engaged in said industry, and call upon you as our representatives to use your every endeavor to see that the rights of the wage earners are safeguarded. Chas. Litchfield, President, John Linch. Secretary. Committee on Rc.'toliitioiis,. [Copy of resolution.] Kalamazoo, Mich., April 25, 1911. Hon. Wm. Alden Smith, United States Senatur, Waslungton, D. G. Deae Sib: At a regular meeting of the Kalamazoo Local, Xo. .">2, of Inter- national Brotherhood of Paper Makers, the following resolutions were unani- mously adopted, and we, the undersigned committee, were directed to forward same to you. "Resolved, That this local hereby protests against the passage of what is known as the Canadian reciprocity bill. We believe this bill to be detrimental to the paper-making industry of this country, and especially S(i to the wage earners employed therein ; and be it further 278 BECIPEOCITY WITH CANADA. "Resolved, That a copy of these resolutions be forwarded to the Representa- tive from this district, and also to the United States Senators." Feed Reams, Baenet Bensen, Peank Johnson, Secretary, Committee. Note. — This resolution written to Charles Townsend, United States Senator; John M. C. Smith, Member of Congress, Washington, D. C. [Thomson Local, No. 158, International Brotherhood of Paper Makers.] ScHinxEEviLLE, N. Y., April 19, 1911. Dear Sie : At a regular meeting of Local, No. 158, at Thomson's, held on Sunday, April 16, the matter of the reciprocity bill now before Congress and the Senate was discussed at length and it was Resolved, That if the present bill became a law It would work irreparable Injury to those employed at the paper-making industry ; and, further. Resolved, That we petition the Members of Congress and Senate to vote against the passage of this measure which would work irreparable injury to those employed in the paper trade ; and be it further Resolved, That a copy of this resolution be sent to our international presi- dent, requesting that he forwai'd copy to each Senator and Congressman. I am, very truly, yours, HoYT Van Debwerkee, Secretary Local 158. [Palmer Local, No. 7, International Brotherhood of Paper Makers.] Palmee Falls, N. Y., , 1911. Dear Sie : At a let^ular meeting of Local No. 7. International Brotherhood of Paper Jlakers, of Palmer, N. Y., the matter of the reciprocity bill now before Congress and the Senate was discussed at great length, and it was ResoU-ed. That if the present bill became a law it would work irreparable injury to those eniiiloyed at the paper-making industry; and further Resolved, That we petition the Jlembers of C<'>ii!::ress and the Senate to vote against the passage of this law, which, if it did become a law, would be a great injury to those employed at the paper trade and mean the practical confisca- tion of a number of homes of the wage (>aniers in towns where paper mills are now located : and be it further Resolved. That a cojiy of this resolution be sent to our international presi- dent, requesting that he forward a cojiy to each Senator and Congressman. I am, very truly, yours. Feed Hasenfuss, Secretary Local No. 7. [Felts Mills Local, No. 6, International Brotherhood of Paper Makers.] Felts JIills, N. Y., April 15, 1911. Dear Str: At a regular meeting of Felts Mills Local, No. 6, International Brotherhood of Paper JIakers, Felts Mills, N. Y., held on April 15, resolutions were adopted as follows : Be i1 vesnlved, That we, the members of Felts Mills Local, No. 6, of the Inter national Brotherhood of Paper Makers, communicate with Members of Con- gress and .Senate, asking that they vote against the reciprocity bill now before Congress boiomiiig a law, as we deem that such a bill would be very injurious to those employed at the ])aper trade if adopted ; and be it further Rcsiilved, That copy of those resolutions be forwarded to each Congressman and United States Senator. A'evy truly, yours, W. S. Cl.^ekb, Secretary Local No. B. KECIPEOCITY WITH CANADA. 279 Ballston Sr.v, Ainil ;,':.', n)ll. I)j:ar Sik and Brother: At a meeting of Local Ko. 20 held in the A. O H, liall at Ballston Spa, N. Y., the following resolution was atloptecl: •'Be it resolved. That we petition Memtjers of the rniled States Senate lo use tlieii' influence and vote against the reciprocity bill, believing, as we do, that if such reciprocity bill became law it would wtu-k injury to those employed in the paper trade and the citizens in general in towns in which paper mills are located." AvARD S. Dake, President. L. JIORSE, Seeretary. [Watertowu Local, No. 4, International Brotlierhood of Papti- Makers.] At a regular meeting of Watertown Local. No. 4. of the International Brother- hood of Paper JIakers held at Watertown, X. Y., April 30, 1911, the following resolutions were adopted: "Whereas the reciprocity bill now before the United States Senate aims to remove the tariff from paper, althou,gh maintaining restriction as to the impor^ tatlon of pulp wood : Therefore be it ■'Resolved. That we, the members of Watertowni Local, No. 4, International Brotherhood of Paper Makers, pi'otest a,gainst the reciprocity bill now before the Senate becoming a law : and be it further "Resolved, That we call upon each Member of the United States Senate to use his influence and vote to defeat the passage of the reciprocity bill, which, if adopted, would work irreijarable injury to the employees of the paper trade; be it further "Residved. That a copy of this resolution be sent to each United States Senator." Hakry Conklinc, Secretary, IJ/l Court Street, Watertoivii, N. Y. [International Brotlierhood of Paper ;\rakers, Local No. 145.] Defeeiet, X. Y., , 1011. At a regular meeting of Local No. 14.5, International Brotherhood of Paper Makers, held at Deferiet, N. Y., A^pril 30, 1011, the following resolution was adopted : "Whereas the employees engaged in the newspaper industry in a number of towns in which mills are located own their own homes: and "Whereas In towns where paper mills are located wage earners and citizens depend largely upon such mills for employment; and "Whereas the present reciprocity agreement now before the United States Senate, if adopted by that body, would mean the practical confiscation of prop- erty of those wage earners, for the reason that it would drive out of existence the manufacturers of pulp and paper in such districts : Therefore, be it "Resolved, That we, the members of St. Regis Local, No. 14.5, International Brotherhood of Paper Makers, Deferiet, N. Y'., protest against the adoption of the present reciprocity bill as before the United States Senate; and be it further "Resolved, That a copy of this resolution lie forwarded to each Member of the United States Senate with the request that they use their influence and vote to defeat the passage of this measure. J. S. OouGHLiN, SecrrUiry, Deferiet, N. Y. [Fort Edward Local, No. 28, International Brotherhood of Paper Makers] Fort Edward, N. Y., April 21, 1911. At a meeting of Local No. 28 of the International Brotherhood of Paper Makers, held at Fort Edward on April 23, the following preamble and resolu- tions were adopted : " Whereas we, the members of Fort Edward Local, No, 28, of the Interna- tional Brotherhood of Paper Makers, believe that if the reciprocity bill now 280 EECIPROGITY WITH CANADA. before I lie Unilod States Senate be adopted it will work irreparable injury to the w.in'c earners of onr village; and '■ Whereas paper and pulp making is practically the only industry in the vil- lage of Kort Edward, if any restriction is placed upon the manufacturmg of paper we believe it will work irreparable injury to the wage earners, a number of whom own or partially own their own homes in this village: Therefore, be it " Rcsiilvcil. That we request of each United States Senator that he vote to defeat the passage of the reciprocity bill now before the Senate; and be it further " Re.folrcd, That a copy of these resolutions be forwarded to each Senator of ■the United States Senate." Very truly, yours, Feank La Farr, Secretary. r International Brotherhood of Paper Makers, Local No. 54.] Otsego, Mich., April 27, Wll. We, the members of Otsego Local No. 54, of the International Brotherhood of Paper Makers, bej;" to call the attention of tiie Jleiubers of the United States Senate to the reciprocity bill as affecting the paper trade and the great injury that would be done to the wage earners employed in the industry if the reci- procity bill as now before the Senate became a law, and we can not see where the wage earners or readers of newspapers would in any way be benefited by the passage of this bill, but on the other hand it would work great hardship upon a large number of the employees engaged in the industry : Therefore be it Rcxolrcil. That we petition each Member of the United States Senate to use liis influence and vote to try and defeat the passage of the reciprocity bill; and be it further Resolvid, Th.at a copy of this resolution be forwarded to each Member of the United States Senate. Very respectfully, yours, Frank Martin, President. Floyd L. Berry, Secretary. TicoNDEROGA, N. T., April 21, 1911. Dear Sir and Beotheh : At a joint meeting of the International Brotherhood of Paper Jlakers, International Brotherhood of Pulp, Sulphite and Paper Mill Workers, and tlie International Brotherhood of Stationary Firemen, held at Ticonderoga, N. Y., on April 20, the following resolutions were adopted: " Whereas, believing that the reciprocity bill now before the United States Congress, if it becomes a law, would work to the detriment of the wage earners employed at the paper trade : Therefore be it " Resolved, That we, the members of the International Brotherhood of Paper Blakers, the International Brotherhood of Pulp and Sulphite Workers, and the International Brotherhood of Stationary Firemen, protest against the reci- procity bill becoming a law ; and further " Resolved, That a copy of this resolution be forwarded to the respective Senators and Congressmen with request that they use their influence and vote ■against the passage of this measure. Frank Colwell, Secretary International BrotJierliood of Paper Makers. Joseph Hooper, Secretary International Brotherhood of Pulp, Sulphite and Paper iliU Worlccrs. Jess Reed, Secretary International Brotliertiood of Stationary Firemen. Mr. Malin. I might say, Mr. Chairman, in reply to the state- ments made by previous spealiers this morning, a member of the farmers' delegation referred to one particular point that I believe the members of this committee are as well aware of as any man on «arth could l)c, and that fact is that the newspaper publishers are not giving to the public the right side of this present discussion of the bill. I claim that the newspapers are combined in that one particular effort, and tliat one particular effort is this: For the passage of BECIPEOCITY WITH CANADA. 281 this reciprocity bill, to benefit the pocketbooks of the publishers only, and because of that fact they will not come out and pul)lish the true conditions relative to this matter. "We have seen some examples of that since we ha^•e been in Washington. We have seen where pub- lishers, referring to my own State and the city of New York, where there is nothing in favor of this bill at all, and the only reason why that condition exists is because the newspaper publishers are running away with the idea that if there is a removal of the tariff of $;').75 a ton down to notliing that they are going to be able to secure paper at a lower rate. I want to say that in my opinion the newspaper publishers are particularly making a monkey out of themselves in not giving to the public just exactly the facts shown and the matters as they should be. They have not given the reciprocity bill the writing up in the proper manner as it should be written up, to my mind, because of the effect it would have upon their own pocketboolvs. Xow, there have been many of us who have been connected with this industry and many similar to this, and we have seen where the newspaper publishers have this one advantage; they are combined as one man, and they have one man or two right here every minute to support everything that is for this bill, because they think it is going- down in their own pocket. I dare say they would not support the bill the way they do if it were true they were going to have to pay just as much, or a little bit more, for the news paper than they are jiaying to-day. The conditions have already been stated to you by former speakers. The fact of conditions that exist are thus in our own opinion, and we feel we are right, because we have been in the busi- ness for some little time, and the men we have witli us, from some 25 various sections of the New England States, New York, and 3Iichi- gan, feel that we are right in our opinion. Our convention feels so, our executive board feels so, and what we want to find out is what the effect of this bill is going to mean to the men who own their own homes in the little towns and who are entirely dependent upon paper mills for their existence. Xow, I will particularly refer to the town I live in, and should it be so that I owned a little home and that industry would be wiped out of existence, I want to ask what I would do with that home. In this entire industry this condition is facing us, and I want to say that if this bill was a benefit to us as laboring men in any way, shajDe, or manner that we would be here with an organization that would be carrying their little banner 100 per cent strong for reciprocity, but we feel that it is detrimental to the interests of the American workingmen, and we are American workmen, and we want to re- main so. We do not want to be dragged away from this country to Canada in order to secure any assistance or to secure work. We have a right to feel that we have a right to protection, and we actually believe that the committee is going to give the bill consideration. In my own mind I have said all the time that the bill would pass the House but would not pass the Senate, because of the unfairness, and I do not believe that it will, because of that same fact. In be- half of the 100,000 workmen there are in this country dependent on the paper mills for a living and those that are dependent upon them entirely, I want to protest with all my might, and as an official of the organization and as the representative of American workmen, to 282 EECIPEOGITY WITH CANADA. the passage of (his bill, and to ask the members of this committee to use their best judgment on it and see that the rights of the Ameri- can workmen are protected in the United States. I thank you. [Applause.] I would like to submit the list of the men with me, and have them inserted. The Chaikjean. You can have them inserted in the stenographer's minutes. The list submitted follows: John H. Malin, international president. Fort Edward, N. Y. ; W. A. Larkin, first vice-president, Millinocket, Me. ; TI. W. Sullivan, second vice president, Berlin, N. H. ; Robert J. Dixon, international treasur(?r. Fort Edward, N. Y. ; W. C. Winn, international auditor, Lisbon Falls, Me. ; John P. Burke, Franklin, N. H., secretary of local; John S. Alexander, Palmer, N. Y., secretary of local; Fred King, Ballston Spa, X. Y., president of local; William Light, Mor- risonville, X. Y., secretary of local; John P. Stanton, Ticonderoga, N. Y., secretary of local ; H. W. Moors, Woodland, Me., secretary of local. Now, Mr. Lawrence, if you will act as master of ceremonies, the committee will hear you. STATEMENT OF MR. M. J. LAWRENCE. Mr. Lawrence. ^Ir. Chairman and Senators, the delegation I am with, being a joint one from Michigan and Ohio, have requested that I make this preliminary talk. I am going to force myself to be brief, and my sentences will be somewhat concise, and lacking in explana- torjr connections, but I know you will comprehend my meaning. I Avant to s;iy to you very emphaticallj', candidly, and knowingly, that the inference that was undertaken to be drawn out yesterday by a member of your committee, that it is only a portion or a few of the farmers of this country that are making this plea antagonistic to this pact, is wrong. I say to you, as I said before, candidly and knowingly, that it is universal. There are no sections which are exceptions. It is just as strong in the East as it is in the West. There is not an agricultural paper or publication that I know that has not been absolutel}' forced by thousands of letters from their subscribers to take the stand that is being advocated to you by the delegates before you from Ohio and Michigan. They represent the sentiment of the farmers, gentlemen. Do not doubt it, because it is absolutely true. Senator Simmons. Do you know anything about the sentiment of the farniei's. except in the West and the East? Mr. Lawrence. T know it only from the exchanges that come to us. In passing, I might say that I do not know, as the Senators are aware that I publish an agricultural paper and have done so for 39 years. The Chairman. You had better state, so as to have it in the record, where you reside and the name of that publication. Mr. Lawrence. I am president of the I^awrence Publishing Co., that own and publish the Ohio Farmer, at Cleveland, Ohio, and the Michigan Farmei', at Detroit, Mich. Senator Ci^ark. AVhat is the extent of their circulation? EECIPEOCITY WITH CANADA. 283 Mr. Lawrence. The Ohio Farmer has now about 134,000 annual piibscribers, all bona fide, paid in advnnce; the Michigan Farmer has a little over 80,000 now, of the same nature. There is a dearth of oratory in this delegation of ours, gentlemen. That is not the business of any one of us. So be generous. Senators, and let us make onr little earnest pleas and retire with our egotism alive [laughter], with the hallucination that we have made a little impression upon your august minds. There is no trust or combination of capital connected with this delegation, nor any other farmer delegation that has or will appear before you. Every one of them has given his time and expense through genuine patriotism to agriculture. So I know you will credit us with sincerity, at least. ily subject is the farmer, and I hope with the few remarks that I will make to try and get you to consider as a little more important, perhaps, the class of citizen he is and the value of his avocation. In making a retrospective of the history of this Nation, what indus- trial class, I ask, is entitled to more credit for its prosperity than the farmer? In making an estimate of the future continuation of this development and prosperity, what industrial chi^s enters into this estimate. I ask again, with moie importance than the farmer? I think I hear every one of you say in your minds " none " to both queries. The first great President of this Nation was a farmer. Abraham Lincoln, Eutherford B. Hayes, U. S. Grant, James A. Garfield, and thousands of others of our gn-atest men were raised on the farm. Senator Williajis. Don't forget Thomas Jefferson. Mr. Lawrence. "\Aliat kind of citizens are thej'? Up to 1776 agriculture was almost the entire c;dling, and over 70 per cent of Gen. AVashiugton's army came from the farm. In the decade from IS^iO to 1860 it was the intensified sentiment of the rural classes that focused the crusade to wipe the stain of human slavery from the escutcheon of this Nation, and when the crucial test came, the farmers furnished more than their quota to build and sustain to the end that living-wall that said, '• This Union must and shall be preserved." I was one of them for 4 years and 18 days and speak from actual knowledge when I sav that for cool courage, loyalty, and endurance the farmer soldier had' no peer. There are over 30,000,000 of our people engaged in the avocation of agriculture. They are by all odds the most homo- geneous class of our citizenship, in pedigree, far outranking any other class in genuine American blood. Wise statesmen have referred to them as the safety valve of our political system. They are not rampant or excitable. They set a high example of law-abiding patriotism. There never were strikes, riots, nor mobs among farmers. You never heard of farmers being arrested for violation of the Sher- man antitrust law nor for violating the customs laws of the country. The farmers have contributed their full share during the past 50 vears to the upbuilding of our other immense industries by paying the high protective duties on all they had to buy, but liave up to this time received a very meager share of its benefits. AVhen capital and energ}' invested are compared with other industries, the farmers' share of benefits from protection have been small indeed. Immedi- ri32S5— No. .^,^11 4 284 EEOIPROCITY WJTH CANADA. alely Avhen the great consuming market for farm products that he has assisted for so long and liberally to create commences to show him some little benefits, is it to be ruthlessly destroyed and a great foreign producing country, with immense advantages and facilities, to be admitted on equal terms to this home market of ours? You may say " Help the consumer to cheaper food." A worthy desire per se, but is it just at the expense of an equally worthy class? I challenge the President or any other man to demonstrate how the working of this jDact is going to reduce the prices of farm products to the consumers without lowering the prices paid to the American producers. There may be some legerdemain or hierarchal perform- ance incomprehensible to the layman by which it can be accom- plished. The President, the other day. in reply to an address of some officer of the grange was reported in the newsjoapers as follows: I believe it is contrary In iiature, it is tlyiiij; in tlje tVa-e of Providence, to put an artiliciai v\-a!l lilve that l)el\\"een tljis eonntry and Canada, and not get tlie benefit tliat v.-ill inure to peoples cf the same ccaiditions, the same lauguaye, and i)raetically the same ehar.'Ctrr of lii'iug. If we t:.ke duwn that wall we v\ill benefit by it. Did he mean to infer that the jjact proposes to remove that wall? If it did that, iMr. Chairman and Senators, this delegation would not be here. It takes down the taritf wall for everything the farmer lias to sell and leaves it impregnable for everything he has to buy. That is what we complain about. There in not one single thing of a finished product, perhaps, in that schedule, in a finished form, in the shape that the farmer has to buy it, but what is protected by what is called the " reduced tariff " in it. Again, the I'resident said, in that same address, I believe, that with this pact in force in a \-erv few years Canada will be buying as much farm products from us as we will from them. Is it possible that he was correctly reported in expressing such an opinion. Canada, as has been told j'ou, with its millions and millions of virgin sod undeveloped, with. I claim, equal to the whole of our Northwest for producing all the staples for this country, with seven and a half millions of people, G.5 per cent of whom to-day are pro- ducers, this country alongside of it, with equal commimication and transportation, Avith 1)2,000,000 of people, and then with their present surplus of 55 per cent of farm products and ours rapidly diminish- ing, averaging now betw'een 5 and 7 — I say again, is it consistent to prophesy any such result from the ethics of that pact? The production of wheat in Canada has incre.'sed from 51,000,000 bushels in I'JOO to 150,000,000 in 1910. or over 300 per cent in 10 years, over 50 per cent of which is surpUis. E\'ery indication points to a much greater per cent of increase during the next decade. It is safe to estimate that Canada will, in the near future, have for export over 150,000,000 bushels of this cereal annually. I will men- tion just a few samples of imports of products from Canada last year: AVheat, 152.000 bushels; duty, '25 cents a bushel Senator Williams. Mr. Lawrence, right there, just a question. Have you the figures of our importations of agricultural products into Canada? Mr. LaW'Rence. Yes, sir; I have them. I do not think it will l^ay nie to read them. I will state to you plainly, though, that it is RECrPEOCITY WITH CANADA. 285 less than one-quarter, and that has occurred largely from iDlaces like the Soo, or some places where transportation was so much superior from the American side to the Canadian side that it produced that importation from this country. Senator Bailey. Freight rates make that condition. Mr. Lawrence. I didn't quite hear you. Senator Bailey. I say freight rates cause that. Mr. Laweence. Yes ; in particular localities. I continue our imports from Canada for last year: Oats, 946,000 bushels, duty 15 cents a bushel; hay, 00,500 tons, duty $4 a ton; fresh milk, 11.700 gallons, duty -2 cents a gallon; fresh cream, 731,000 gal- lons, duty 5 cents a gallon ; maple sugar, 1,783,000 pounds, duty 1 cent per pound; wheat fiour, 144,000 barrels, duty 2o per cent ad valorem; butter, 1,000,000 pounds, duty 6 cents per "pound. • With these importations of farm products from Canada, paying our present heavy duties, which average about 33 per cent ad valorem, with their present great surplus and prospective development, what will be the imports when all duties are removed? The only answer is this: ilany himdredfold of increase. It is said our consumption is approaching the total of production. True. But why not encourage home production instead of buyi]ig farm products abroad, and thus stimulate increased rural population, the contrary tendency of which is becoming truly alarming^ With the intense systems of agriculture in vogue in many foi'eign coun- tries, it is absolutely safe to estimate that this cnuntry can pro- duce agricultural products sufficient to feed and clothe 400,000,000 people. Now, Senators, that is not an extravagant estimate. I have been in foreign countries enough and examined agriculture enough to absolutely know that estimate is within reason. Why did we protect every manufacturing industry in this country? Why? To produce it at home. I do not need to tell you that. Home produc- tion, almost regardless of local cost, enriches a nation and foreign purchases consume its wealth. I gladly reecho the cry to " benefit the laboring man," but I would not rob some other class to do it. Who is more truly a laboring man than the farmer? What kind or class of laboring man may I ask of you is more justly entitled to the gratitude and protection of his rights by this Government than the farmer? Some say injury to the few is justified by benefit to the many. If that is good logic, the whole theorjr of protective tariff is false and misleading. There are less than one one-hundredth of our population engaged in the manufacture of cotton fabrics. But the products are an actual necessity for every individual of our 92,000,000 of people. Why not admit cotton gfiods free from England ? I will stake my reputation upon the assertion that the cotton manufacturers of Manchester have not as much actual advantage over the cotton manufacturers of Colum- bia, S. C, as agriculturists of Canada have over those of this country. But I am and always have been a protectionist. The upbuilding of any one great national industry vibrates, distributes, and permeates benefits to all others, and the same rule in fC'uverse arbitrarily applies to an injury to any important industry. We are asking for no special class legislation for the farmer, but simply that he should receive fair treatment. He is not a beggar. He wants no coddling or baby- 286 EECIPEOCITY WITH CANADA. ing, but wants only justice. Furthermore, the politician who esti- mates the American farmer of to-day as either a fool or a coward is wandering very far from the facts in the case. As a matter of Gov- ernment finance, the United States duties on the little farm products from Canada last year paid into our Treasury over $5,000,000, which will not be yielded by the new pact. The hurrah of the secular press for this pact, which is liberally subsidized by it and whose agricultural patronage is infantile, is no safe criterion by which to judge of public sentiment. But, Senators and friends, in nearing the close I approach a sub- ject which is painful to me, as it discloses to a slight degree, at least, the fallacy of a great ideal in manhood that my zeal and loyalty had builded and clothed with raiments of near perfection. I was a sol- dier over four years in the Civil War, and was discharged at the close of that great conflict four months before I was 22 years of age. I have been two things all my life, a farmer and a Kepublican. I distinctly remember the Franklin Pierce campaign of 1852. I walked 2 miles with my father to the town voting place and saw him cast his first vote for Fremont in 1856. I cast my maiden vote while a soldier for Abraham Lincoln in 1864, and my every vote since has been Republican. We went far beyond our custom in both our papers, which are nonpartisan, to advocate the nomination and elec- tion of William Howard Taft. I shall vote for him next year, if the opportunity is given me. I truly loved the man. I truly love him still. No true man can look into those kind blue eyes and stand within the radius of that genial smile clothed with charity for all and entertain any doubt of his absolute honesty, sincerity, and motives for good. " But he is human, and it is human to err." The blindfolded origin and dominating jarogress of this Canada pact has most effectivelj' demonstrated that it is possible for a President to make a mistake. A great important international contract, with far- reaching effects and influences, that promise to grow and increase materially in their magnitude with application, is being forced with almost oligarchial power into law, that will result in an absolute robberjf of the most imjDortant industrial class of the nation and carry confusion to all other industries. But, Senators, this is not a one-man Government. If so, this Cham- ber of St'nators is a plaything and an extravagance. The framers of our Constitution wisely created this dignified legislative body of matured statesjiien to coi-rect the mistakes of the lower House and of the Executive. In ciuiclusion. let me say to you " Xoblesse oblige "" imposes great obligations. The people have honored you with rank and po'wer. Tliev justly expect much of you. I can not and will not entertain a thought that the fear of " non persona grata" will have any influence with the words or vote of a United States Senator in considering and disposing of this very important affair. I thank you, gentlemen. I beg your pardon for reading my notes. I was afraid I would take too much time if I undertook to do other than that. [.\])phuis('.] Mr. Chairman and Senators, I have the pleasure of calling on, we are proud to say in Michigan, " our farmer governor," three times the governor of one of our greatest and best agricultural States, the citizenship of which, I think, for intelligence and civilization, will RECIPBOCITY WITH CANADA. 287 compare favorably with that of any in this Union — ex-Gov. Warner, of Michigan. [Applause.] STATEMENT OF HON. E. M. WAKNER, EX-GOVERNOR OF MICHIGAN. Mr. "Warner. Mr. Chairman and members of the committee: I will be very brief. I come down here accompanying the delega- tion, including the president of our livestock association, chief dairy- men of the State, and some of our State horticultural members and others. In fact, it is a very representative lot of Michigan farmers. Personally, as Mr. Lawrence has just stated, I have been interested in farming all my life. At the present time I run two farms, but have also been largely interested in dairying and in the management of cheese factories for the last 20 years. The farmers of Michigan are about the same as the farmers of ail other States; they are not 50 per cent against this measure nor 75 per cent against this measure, but I really think 99 per cent are against it. It makes no difference whether they are Republicans or Democrats; you could go out in the country anywhere in Michigan; you will find the farmers of Michigan believe that this is an unjust proposition ; they believe it does not represent fair play, and I believe, gentlemen of the committee, it makes no difference what your feel- ings may be — you may be a free trader, you may be for duty for revenue only, or you may be a protectionist — when you read this proposition through you will see it is an unfair projDOsition from the farmers' standpoint, and I do not believe that a protectionist or free trader could differ in wanting to do the right thing with the farmers of this country. Just a moment in regard to dairying. I heard it spoken of a moment this morning. I know this to be true, and anyone can prove it very easily — I have not all the figures with me — but you take the prices of the dairy boards of Plymouth, Wis., and Utica, N. Y., and the Canadian dairy boards, where they meet each week and offer 100 or 500 cheese to be sold at auction, and you will find for the' year 1900 a difference of at least 2 cents a pound. That means that the farmers of Michigan or of Wisconsin or New York that were in the cheese business received at least 20 cents a hundred pounds more for their milk than they did over in Canada. Senator McCumber. Can you give us your statistics and make them a part of your remarks? Mr. Warner. I have not them with me, but I can furnish them as well. I have a statement to show you on this point that was sent to me the other day showing that out in Bloomfield, in Canada, last year the average paid was 85 cents a hundred pounds for nine months. The average of the factories in Wisconsin or New York or Michigan all run about the same, because all sell pretty much on the same market; the American market would average at least from $1.15 to $1.25 a hundred pounds for milk in nine months, and that is a conservative estimate. I have some factories of my own which run $1.30. It depends upon location, but as a low estimate I should think the difference last year for the nine months was fully 20 per cent between the prices paid to the farmers in Canada and 288 EEOIPEOCITY WITH CANADA. the farmers in this country. Now, that does not prevail at the present time. Since about February last the market has been slump- ing, until now the prices both on butter and cheese are nearly the same. I would not say exactly, but nearly the same. Senator Clark. Governor, are there any particularly natural causes that might lead to that, aside from the pendency of this measure Mr. Waenee. It might be, but that seems to prevail in Canada as well as in this country. Senator Clark. Are there any causes that would change the con- dition ? Mr. Warner. No ; you can take the average price for the last three years — 1908, 1909, and 1910 — and take the price of the dairy boards of Canada and of Wisconsin and of New York, and I know that the diiference for those three yoars would run from 11- to 2 cents a pound. Last year the highest price they got in Canada for the summer months was something like 11 cents, while our prices were 13, fully 2 cents difference. The same thing, of course, would prevail in the butter proposition. On account of the change in the tariff bill, mak- ing the tariff 5 cents per gallon, that means 50 cents for a 10-gallon can. You have about 25 pounds of butter fat in 10 gallons. So you have a tariff of 2 cents a pound, which was formerly 5 or 6 cents. With that there was more fat or cream sent into this country this year than formerly in five years. Of course, if this bill is to cheapen products, it may have a tendency to lower it, but still in this same article published in Canada, it is claimed there that the farmers of Canada are going to get the increased price — going to sell their cheese at the prices over here. I believe, personally, that there will be a midway ground somewhere; that we will not either go to the point of Canada's price or Canada up to ours, but somewhere between the two we will meet. The same thing, of course, is true of the hay market. Michigan is interested greatly in the production of hay. I know that our own places sold three carloads of hay last year, and in talk- ing with one of the largest dealers of Detroit — in fact, of "Wayne Counter — he told mc that two-thirds of the hay he sold last year tvus from Canada, and the Canadian farmer paid $4 duty. It can not hel^D but make a difference in the price, and from a citizen's stand- point, irrespective of party, it would appear to me that the farmers in this country, whether of Michigan or Minnesota, should have the same consideration at your hands as the man that is making automobiles in the city of Detroit or a man that is making stoves; if you are going to give preferences to one, we certainly ought to have it for the other. You remember well enough that President Taft in the talk he gave to the Springfield Legislature, in Illinois, made this remark, " I am a protectionist. I believe there are certain industries in this country which need protection which pay good wages and pay a reasonable profit." I agree with him on that. That is the reason we should have protection. But does he think for a moment that the wages paid in the farming industry of this country are higher than in the industries on which protection is going to be left on? Why, last year in the State of Jlicbigan the wages paid in all the factories of Michigan, according to the report ofthe labor commis- sioner, averaged $2.22 a day. Did the farm labor of Michigan get EECIPEOCITY WITH CAKADA. 289 that price? Xo; at least 25 per cent less. Could you take the other point that he makes there and pay a reasonable profit? I do not believe there is an industry in Michigan of any other kind — whether coal mines of IMichipan or iron mines or the manufacturing of furniture at Grand Rapids or any other large factories but what paid a better profit for the amount invested than was invested in all the fann lands of Michigan. Another fact which we are all interested in, as citizens of this country, and this is President Taft's Columbus speech — he says: ''We have with pioneer energy pushed on to the Pacific; taken all the good lands." It is not necessary for me to tell you people that this is not an exact statement of the facts. I remember at the National Dairy Show over in jMilwaukee last year I sat at the dinner one day beside a gentleman, one of the largest dairy men in Illinois — I forget the name — perhaps the Sena- tor from Mississippi would know of him. He was telling me of going down into ]*ilississippi and buying a large tract of the very best lands he ever saw lying outdoors and that he was going to raise alfalfa and going into the dairy business in the State of INIississippi. We have in Michigan not only thousands or hundreds of thousands of acres of land, but we could sell 1,000,000 acres of good wild land at $5 to $15 an acre that could be developed into good paying farms, and I believe, members of the committee, it is the duty of this country to develop our own lands because we go to develop lands of other countries. [Applause.] I am just informed this minute that the name of the man who went to Mississippi v.'as Gurler, and he told me he went into Mississippi and bought an elegant farm and rented 2,000 or 3.000 acres at about $10 an acre. He was inviting us to go down and see what we could do; and you know, my friends, the dairy industry of such States as Wisconsin and Minnesota and Michigan has been the making of those States, not from a financial standpoint alone, but from keeping up the benefits of the fertility of the soil, and that is just as important as making money. I am not going to take up any more time, because I am already trespassing. Senator AYilliajis. Just one question. With regard to the actual productivity, taking your State, is it decreasing or increasing? Mr. Waexee. Over our State generally ? Senator Williams. Yes. Mr. Wakxer. I think the older sections of the State — I know in population, of course, has been decreasing — have been going back. Senator Willta:^.is. I am talking of the fertility of the soil, the amount of product per acre. Mr. Warner. I think in the last tliree or four years, especially, we have been going the other way. The farmers are paying more attention to and taldng more interest in fertilizing. Where we used to sell 1 carload in a town we now sell 10 or 15 carloads, and, of course, we believe ouf land Senator Williams. In older sections the land is raising more per acre than it was 20 years ago? Mr. Warxer. Some are; Michigan farn: lands are much cheaper than they are in adjoining States. The vciy best farms in Michigan, until recently, could be bought at from $50 to $75 an acre, and you can buy elegant farms at $50 per acre, and we have inillions of acres of lands. Only two years ago the legislature established a connec- 290 EECIPEOCITY WITH CANADA. tion for the purpose of endeavoring to work immigration in Michi- gan. We have what is called the Western Michigan Development Co., made n):i of farmers and business men in the western part of the State. ^Ye ha^'e also what is called the Northeastern Michigan Development Co. The whole object of those two development com- panies is to get the people to move up into Michigan on undeveloped land, and I believe my friends, it makes no difference what your politics may be or what you may think on the tariff question, the first thing that you should do is to take care of our own people and our own country. [Applause.] Senator Clark. Will you allow me to ask you whether those lands you speak of are largely in private ownership? Mr. Warner. Well, they are mixed — mostly in private ownership: yes. The State lands are about taken up. There are some State lands left, but there are largo companies of different firms there that have good lands anxious to sell them at $10. Senator La Follette. Cut over? Mr. Warner. Cut-over lands. I imagine you have them in Wis- consin. Senator Bailey. Do you know how the price of wheat was affected by the treaty with Canada in 1854? Mr. Warner. No, sir ; that was before my time. I have never read it up. Senator Bailey. I have read a statement made by a Canadian commission that the effect was to increase the price of wheat in Can- ada to a parity with the price of this country. Of course, that was under a condition when we had a large quantity for export and they had a small quantity. I believe, however, that under present condi- tions there would be a decrease in the price of ours and an increase in the price of Canadian wheat until a price equilibrium is estab- lished ; but I do not think that will be true of all farm commodities. I think there are some farm products which in Canada will rise to the American basis, just as the wheat did in 1854. All that will depend upon the condition of supply and demand in this country, as it cor- responds with the supply and demand in that country, will it not? Mr. Warner. We had — without injecting politics into this, because I do not wish to do that — as we figure it, along in 1894, when we had the Wilson bill, so-called, near the border line — I only live 18 miles from Detroit — practically the same proposition that you are putting up to us; though I guess this is worse, because this is abso- lute free trade, and I know the farmers of Washtenaw, ]Macomb, and Monroe Counties, right around Detroit, have the effect of free-trade proposition on farm products. They would go to Detroit, naturally, and they would find alongside of them the" Canadian farmer and, of course, everything twice as much sitting in the same market and now will be recluced. Senator Williams. When was that ? Mr. Warner. In 1894 and 1895. Senator "WiLLiAr^is. The whole world was in a state of depression at that time? Mr. Warner. Yes. Senator Bailey. The price of cotton was just as low, and cotton was never subject to a tax. EECIPKOCITY WITH CANADA. 291 Mr. Warner. I want to impress one thing on you, that the farm is the poorest paid labor of any to-day. If you are going to protect anything, give the industry that is paid the poorest and do not take it off of that and leave it on the bounds. Senator Williams. One word before j'ou leave that. I agree that the farm labor is no better paid ; if anything, but what it is, every- thing considered, the poorest. Does not the living in a healthy en- vironment, with more room, with less expense, less daily expenditure of every sort, with no rent or small rent, and very much less board- ing charges, and don't a hundred things besides the mere gross amount of money he receives at the end of a week, a month, or a year fully compensate him and bring him into favorable comparison with the people who have to earn a living just at one thing, taking all the day, living in tenement houses and under unhealthy con- ditions ? Mr. Warner. You might admit he works about 25 per cent more hours than do factory employees. Senator Williams. What? Mr. Warner. He works 25 per cent more hours than the usual factory employees for less money. Senator Williams. That is very true, but their work does not — the farm work does not hurt him and kill him off like it does em- ployees in the factories. Senator Bailey. The drift is constantly from the farms to the city. Mr. Warner. That is true. Senator McCumber. I would like to ask a question before you resume your seat. As a matter of fact, as to the Canadian wheat prices, are they not on the basis of the foreign demand to-day ; in other words, they are selling on the level of the world's demand? No farmer, so far as wheat is concerned Mr. Warner. I think that is so, although I really do not know so much about the way the wheat is figured. Senator McCumber. Is it not a fact that we are selling above in our Northwest — considerably above the Liverpool price, with the freight added? Mr. Warner. Yes ; I think so. Senator McCumber. And therefore, if the Canadians are selling at the Liverpool price, with the cost of transportation, and we are selling at 10 or 12 cents a bushel above that, can you take away our protection and allow the Canadian wheat to come over here— are we not immediately brought down to the world of supply and demand and to go upon the world's basis the same as the Canadians are to-day ? Mr. Warner. Absolutely. Senator Bailey. That would only he true if they had enough to effect it. Mr. Lawrence. I would like to introduce Mr. Herl^ert Williams, a plain, common, successful farmer, from practical experience, from the State of Ohio. STATEMENT OF ME. HERBEKT WILLIAMS. Mr. WiLLiAiNis. Mr. Chairman and gentlemen of the committee, I take it that you desire to do what would be 1iest for the interests or 292 KECIPEOCITY WITH CANADA. all of Lhis coiintiy, and among those, things I want to suggest that if it is a nice thing to have a portion of our supplies manufactured at home, it would be a nice thing if we could have tliem all. This suit of clothing that I have on came from somewhere, and the food that we eat has come from the ground. Now, then, if we can pro- duce it all, so much the better. It would be better to have a large body of farmers farming in the vicinity of all the cities of America than it would be to send to New Zealand or Australia or way up ia Canada to get our food supplies, as England has to send to Argen- tina and those distant places. Yoix give a reasonable encouragement to American agriculture and you can depend upon it you will have plentj' American food supplies. The men out there in the country, on those little farms, the men whose existence was thought by Congress to be necessary and advisable when you made homesteads of 160 acres, the common, small farmers we talk about, are the people that supply this country with its provisions, not the corporate farms, not large concerns such as jNIr. Brown, of the New York Central lines, runs as a demonstration farm ; but the men who actually get out and cultivate their own small farms of 100 or 160 acres, or possibly a little larger of a little smaller — those are the men who will supply you in 3'our various cities. A few farms around one city and some around another, scattered all over America, if conditions can be such that farming Avill be reasonably remunerative, j'ou can depend upon it — I do not say anything but " reasonably remunerative " — that there will be farmers doing that very business; some near Detroit, carrying their supplies to that city; some near Cleve- land, Buffalo, New York, and other places, and you will get sup- plies from near-by farms and not have to go aw;«y. I would like to read briefly, and I shall take a few minutes here. I shall speak only generally. I want to read briefly from the last annual report of the Secretary of Agriculture in ]Mr. Taft's Cabinet. First, I will rend from what is labeled page 9 ; it is the first printed page in the book. I got into an altercation with Mr. Lawrence's newspaper before, and so I asked the Congressman from our district to send this up, and it is very nice reading. The newspapers print from this, and it may be misinformation. I do not know how much you know about the conditions out on the farm. It may mislead you to see in the daily papers every day that the farmers are the most prosperous peoiole that the sun ever shown on, and it comes from this, Mr. Wilson saj^s: Year after year it has been my privilege to recorcl " another most prosperous year in agriculture." Sometimes the increased prosperity has been due to weather unusually favoruble to agriculture, sometimes to higher prices, caused by a great yield or deuuand or by a scant production, but usually the advance in farmers' prosperity has been in spite of various drawbacks. That gets into the newspapers: the rest of it does not. But he goes on to say that we produced last year — that is, for the year this covers — nine billion dollar's worth, nml it sounds big — nine billion dollars of horses, cows, goats, hogs, corn, wheat, oats, and potatoes, and everything of that kind; but he forgot that we feed almost all of that to this stock', and have not very much stuff to sell, and if we sold ever}' last sou of it, it would be $300 each for the people engaged in producing it, and we furnish the capital and do the work, and then yon call that prosperity, [Laughter.] It is really not quite that EECIPKOCITY WITH CANADA. 293 much, because I hear it quoted that there are 33,000,000, and I had gone on the theory that it was 30,000,000. Xow, then, I want to read again from page 19 of this same report, and I want to refer at least to all there is "in this report from page 19 to page 26, inclusive, but I do not intend to read it all. Ynu may- read it if you wish. It has got some valuable information in it. Reading from page 19, he says: High prices was one of the subjects of my annual report for 1909. It was shown that for many years previous to ISO" or a little later, the prices of farm products received by farmers were even less than the cost of production and often little if any above that cost, so that during a long period of years the farmer was not thriving. It was shown also that in the upward price move- ment, which began about 1S97, the prices received by the farmer have advanced in greater degree than those received by nearly all classes of producers. That this should have been so was merely a matter of .lustice to the farmer to equalize the reward of his efforts with the rewards received iu other lines of production. The farmer was not thriving, and now I will answer what I under- stoocl to be the question that the Senator from Texas asked from the previous speaker: What was the effect on the price of wheat during the former Canadian treaty? I do not know that that was the question, but I understood it that way. I happened to be looking that up for a long period of years. In connection with this — I am going to speak of it — for a long time previous to 1807 the American farmer was not thriving, is the language of Secretary Wilson, and in looking up my father's old account book — since his death I hap- pened to find the answer to your question — a pavt of it. My grand- father commenced to develop the farm that I am working on, and now it is mine — about the year 1811, and my father was born on it, and so was I. They are both dead, and I am carrying it on on the same land, with a little more added to it. I find in my father's ac- count book of it that in the year 185C). in September, he sold his wheat for SI. 12^ a bushel, and last September I sold mine, what little I had of it — my line is principally milk, but I sell wheat some- times when it is more advantageous to do it than to use it for cow feed. My father sold it in IS.jO for $1.12. and I sold last fall for 95 cents, and I got about the fair market price in proportion to other people throughout the country, or a difference of 17 cents. And now I will go further and tell you what caused that. I think I am telling you right. I submit it for your judgment anyway. As I un- derstand it, that former treaty went into effect in 1853 or 1854 — per- haps 1851. Senator Gallingee. 1854. Mr. Williams. And went out of effect in 1866. Senator Galli^'ger. That is right. Mr. Williams. And there was not a minute from the first to the last of all that period of years wlien this country was not being painted in blood all over, and they were drawing on us for farm supply. When the treaty went into effect we had not finished our Seminole War — that everybody had for<;:otten cost us $10,000,000. We had the Mormon War and sent a military exiiedition across the Plains and carried everything in wagons. It cost something to do that. England, France, and Turkey and Russia were fighting the Crimean War, and England also had a little war with Persia that lasted part of one year; and England had the great Sepoy Rebellion 294 KECIPEOCITY WITH CANADA. and sent some hundreds of thousands of soldiers over a period of years to repress that rebellion in India. England and France, and possibly some other countries, I am not certain, sent annually naval expeditions, accompanied by large convoys of troops all up the China coast to force them to do something. They had expenses in connection with that, and they wanted all kinds of agricultural prod- ucts to furnish those armies. Then they had the Garibaldi wars in Italy and other little wars in Italy. They had the great war between the German States that resulted finally in the consolidation of what is now the German Empire. That important war came after the treaty, I believe, and the consolidation came after it, but they had that war in which I think they had the battle of Sadowa and some of those transactions occurred. Anyway, it was a large force of men employed almost by all the nations of Europe ; and then we had a little eruption of our own that took up five years here, tearing everything to pieces that we could, and the farmers, joining in the armies of the North and South and fighting each other here and destroying property nnd not developing anything, not. producing anything for sale. Why, bless your souls, if j'ou will get as many wars in the next few years as we had then, then we won't object to the treaty as I know of. [Laughter.] Now, then I want to read again from page 21 of this same report. Mv. Wilson has shown up to this time that previous to 1897 the farmer was not thriving. On page 21 he says, speaking of some exhaustive investigations that he has made about the price of farm products and the increased price of farm products: The iucrease of price of farm produfis in their transfer from producer to consumer was thoroughly investipited in all parts of the country, and for a large variety of products liy t!ie Industrial Commission. .Although the facts obtained in tliat in\ estigation are now about 10 years old, it is believed that the ratio between producer's and cousiuner's prices are approximately the same now as they were then. M any rate, it seems probable that the farmer is not now recei\ing a larger share of the consumer's price than he received 10 years ago, and he may be receiving a smaller share. That take.^ us back then — this is dated July 10. It runs up to the 5th of July, 1910; I believe the end of the fiscal year — and says "10 years ago," and that takes us back to 1900 ; and he had brought us up to 1897 and is silent on those intervening years when we may have made something, but he says we never made anything at any other time. But so far as the great multitude of farmers or others of the country are concerned he is jDretty nearly right. A man does not make very much introducing the farm stutj at present prices even. He has got to have some particular advantage or some pectiliar advantage or some fa^■orable location in order to make any profit at all in running a farm at the present time. It can be done. A man can conduct a farm so as to make it a little more than pay its expenses if he has a good location, but hundreds of thousands, t\nd perhaps millions, of farms are sacrificed because the owners can not make both ends meet at present prices; and let me tell you that is the reason why the farm- ers leave the farms and move into town, into railroads and shops and factories. You make that farm business profitable and the drift will be toward it. Boys go to Alaska, almost to the North Pole, for money — to dig gold out of the frozen ground. They would rather dig potatoes in a civilized country than'to take that trip, but they KECIPROCITY WITH CANADA. 295 take the trip. You make the business moderately profitable, not exorbitantly so, if you can, so far as legislation will do it, and you will have plenty of farmers, and they will want to get the drift the other way. Of course, a farmer to be a farmer must know how to farm. It don't do to send a factory hand onto the farm, and when we have hard times and they undertake to ship us factoiy-bred help from some city, it is absolutely useless. They may be nice men, but they are not qualified to do our business. I want to read one thing more from a body that was created here in Cong-ress, and that is called the Country Life Commission, and I cut this out of a newspaper, and I will not vouch for its cor- rectness, but I presume it is correct — at any rate, you may verify it. I suppose you have access to it somewhere, but the third' ]:)aragraph of the report made by that industrial commission — made to Congress and, I suppose, to both Houses, in February, 1909. I do not remem- ber who composed the industrial commission nor how well quali- fied they -were. Senator Bailey. Was that the Industrial Commission or the Coun- try Life Commission. JMr. WiLLiA:\rs. The Country Life Commission. I will read from the first of it. This report was made to the President and was read in both Houses of Congress. Substantially the report is as follows, and then the third paragraph is all I care to read of it here, for the purposes of this hearing: Yet it is true, notwitlii'tnnding nil this iji-d^'icss is uK'nsninl liy tiistorical standarils. tliat a,ffrir;iltm-e is net coiiiniprci.-illy as ]irofita)ile as it is outitled to be for the Jalior and euer.uy that the faniirr exiieuds and the rislis tliat he as- sumes, and that the sociril conditions in the open eonntry are far short of their possil)ilities. We nuist measure onr a;;ricultnral elticiency by tlie iinssil)ilities rather than liy eoniiiari^on witli iire\iiiiis conditions. Tlie farmer is almost necessarily liandicapjied in the develoianeiit of liis bnsiness becanse his capital is sm;dl and the volnme of his transactions limitcil. and he nsn^iily stands practically alone asainst organized inteicsts. In the genor;.! roiidjostnient of modern life, dne to the groat clnngcs in manui'actoi-ies and ((numerce. inequal- ities and discriminations have arisen, and, natnrally, the sep.-ii'ate man snffers most. The unattached man has problems that .uon ernment should understand. That is all of that paragraph. There is a lot more of good read- ing in that, and they did extremely well, I think, for men who were not better posted when they started than such men must necessarily be that could not know. Any of you, probalily, I do not know you personally, but most likely any of you coming out into the country would not understand what yon did see, unless you had been there before and were somewhat familiar with the condition of things. So I take it, and I am about to close, that we all want to do the right thing. "We wanted last year — I was always a Eepublican — I am not going into the political part of it, nor to speak much of these threats that have been made, because I don't like to do that — but you get out into the country and the farmers are imanimously, I think, almost unanimously, opposed to this. The gentleman down here from Minnesota the other day was cross-examined somewhat why he did not get moi'e signatures of the farmers. You can not get them all. He did pretty well. I am answering the Senator who made those inquiries. You could not get them all from my own State. I do not know that we have any petition at all, but we are in earnest and we farmers generally know what is being done about this treaty, 296 ' KECIPROCITY WITH CANADA. and they know and the other States. Speaking generally, we want lower tariffs and that is why so many farmer Republicans voted some portions of the Democratic ticket. We do not want to be compelled to destroy the protective principle. We believe, many of us, in the protective principle, but we wanted readjustment here, so that our many farm implements— the man who sold me my corn harvester could not charge me $120 for it and sell it near Chatham for $80, which has been done. We wanted a readjustment along those lines and we sent some Democrats — a good many Republicans had a hand in it over to the House, and nobody had heard of this treaty, and of course the Democrats, as soon as they got hold of it, they took just this point. I am saying this more for the benefit of the Republican Senators on this committee and in the full Senate, that if they drive us to do it we may be driven to reduce everything to a common level, if we can not raise everything to a higher level, as a matter of self protection. We do not want to do it. We believe in the protec- tive principle, and we do not want to be driven out of our party; at the same time, you can see how it naturally will come about that the Democrats saw an opportunity to put the President in a hole that he dug for them, and went right about promptly and ratified his treaty so far as the House is concerned, and the Democrats in this branch are likely to do the same thing. Senator Ct.aek. They will do it out of pure patriotism. [Laughter,] Senator Bailey. Tt is patriotic to put a Republican President in a hole, especially when he dug it for himself. Mr. WiLLiAJis. He dug it for himself, and I don't blame you for attending the funeral at all. [Laughter.] Still, if you should see your way clear, Senator, or Democratic Senators, not to be partisan, I tell you that the people who produce the results, re- gardless of party affiliations, are the people that are going to get the credit, and we do not want you to do anything for us that you think would be unfair or give us unfair advantage. Now, do not do that. We are not here to beg for privileges, but we are here simply to demand, in all fairness, that Ave have our rights. We wanted lower tariffs, and we were satisfied to suffer the consequences, of course, and let some of it be taken off from our stuff. That is right. We wanted a readjustment, but we did not suppose a pit was being dug for us up here in the White House, to be sprung on us in the middle of the winter. Nobody had heard a thing about it. We could not protest, could not do anything. We have one-third of the population of America engaged in the business that I follow — the business of one-third of the people of this country frittered away, or at least important steps taken regarding it, and not a human being engaged in it was consulted, not a human being permitted to know that the man we had elected was doing that thing. Senator Stone. That was the Secretary of Agriculture, Mr. WiixiAMs. Tlie Secretary of Agriculture did it. He knew it, being a niemlicr of the President's Cabinet, most likely, and he undertook to hoodwink Mr. Bachelder, the master of the National Grange, into O. K.ing it. Mr. LAWUENf'io. ]\Ir. Chairman, I want to say one thing. Hon. James Wilson ditl not know anything about that any sooner than you did. T know wliat I am talking about. Senator Stone. Tde is favoring it now. Mr. Lawrence. That don't make anv difference. EECIPKOCITY WITH CANADA. 297 Senator Bailey. I will promise you ^Yhen we get a Democratic President the Secretary of Agriculture will know what is going on concerning the farmers. A Voice. Good. [Applause.] Mr. Williams. Then it was concealed even from the Secretary of Agriculture, but he tried as soon as he knew it to get Mr. Bachelder to 0. K. it. Now let me read from page 20 of this Secretary's report : "They (the farmers) must run the risk of overproduction and conse- quent disastrously low prices.'" What is the difference whether the "overproduction'' is from our own farms or from those of an alien country • Flood the market either way and we have " disastrously low prices." I had covered this case as far as I cared to. Others present have spoken to you, and I have been listening a couple of days and many of the details which I might have mentioned have been so thoroughly gone over that it would be a waste of time to do it again. The only point I make is — it is a general point — make (Uir business just moderately prosperous, and when you reduce our in- come reduce our expenses, too. Senator Williajis. You mean by that not that the Government should make your business moderately profitable, but that you want it to let you make your business moderately profitable? Mr. Willia:ms. You are right about that. Senator AVilliams. That it should not burden you exclusively? 5Ir. Williams. I did not speak quite correctly, lint you hnve the idea. There is some reason for the lu'ice of things in towns iM'-ides what the farmers get. Anywaj^, while we are upon the cost of living question, our laboring men in the cities are not entitled, in my judg- ment — I submit it to you — to draw gold-field wages and then expect to live at poorhouse cost. You can not do it. When you are in the gold fields you pajr exorbitant prices, and if you are going to boost everything in the cities, whj' boost their cost of living. At any rate, the cost of living does not come very largely from the stuff they eat. It is the stuff they wear, the rent they pay, their fuel bill, and a hundred and one other things that you know about as well as I do. Senator Bailey. Did you ever hear any complaint about the cost of living until the farmer began to receive good prices for his product ? Mr. Williams. Xo; I never did. The first appeal was made by my friend Ilowland, of Cleveland; and we used to live in adjoining- towns. He introduced a resolution to investigate the cost of li-^-ing, and that was about the first that I really thought anything about it. That shows the cost of living all right, and the people in the towns know it; but let me tell yon that the people in the country know it. I buy most of my stuff. The cost of living is partly my suit of clothes, my shoes and hat. I buy groceries, pepi^er, salt, and molasses. and all that kind of stuff; corn and oats and wheat and j potatoes I produce myself. But T buy about as much as the rest do in propor- tion to my means, and it is the cost of living. There is one other thing I would like to call your attention to. Sly business is milk. Every other dairyman's business is milk. I do not understand what Gov. Warner was talking about the cheese factories. The milk is the finished article to me. "Wlien it leaves my place it is peddled out around the town. I live in the vicinity of .\.shtabula. Ohio, a town of 1.5,000 or 20,000 people, and they have 298 EECIPEOCITY WITH CANADA. light milk wagons. I wholesale the milk, and they peddle it around in wagons. But I go to my miller, Mr. Eiderbaugh, and he may be down here. If he is, I want to say this for him. He runs a mil], and he is president of the Chamber of Commerce of Ashtabula, and he is in favor of this treaty, as all the chambers of commerce are. I trade at his mill. I go to the mill, and I buy a lot of brown gluten, a by-product made from corn generally ; it may be made from wheat and other cereals, the inside kernel of the oat, but not very often. As it is, I go there and buy gluten from him to feed to the cows, because it makes good cow feed. It is full of protein and possesses a high nutritive value, and I get it for $32 a ton. Fifteen or sixteen years ago the same stuff sold at $14 or $16 a ton — the same stuff — and not only that, but I am told I can not buy that gluten of any mill in the county except Ridenbaugh. Now, then, that gluten, to him, is his manufactured article ; to me it is raw material ; and I put it through the cow and turn it to milk and that is my manufactured article. But I can not get m}^ raw material free. Now, I have talked quite as long as I expected and have not gone over all of these items in detail, and probably many of them would be foolish to remind you of. You know these things yourself, without calling 3'our attention to the fact, that the business as a whole, in a general wav — the legislation ought to be such that farmers all over the country, your State of ^lississippi and my State of Ohio, the East and West and everywhere, Texas and Alabama and jMaine and the Avhole of them — should be self-sustaining and have the farms that feed the cities located in the immediate vicinity of those cities. Then you won't have to go off to Saskatchewan and other places for the food supplies that we consume. I tliank you, gentlemen, for having listened to me so patiently, and I want to say that I have noticed your patience with me and the jn-evious speakers and the way you are taking hold of this thing T have no doubt you are trying to find out what the truth is and will act accordingly. [Applause.] Senator Stone. Mr. Chairman, I would like to have a subpcena issued to have Allan & Graham appear here and bring with them copies of all literature that they have circulated in opposition to the reciprocity agreement, whether written or printed. The Chairman. If ^^ou will hand the clerk of the committee the full names of the gentlemen referred to, with just what documents yoti want, he will communicate with them. Senator Gallingee. I think there is a question whether this com- mittee is entitled to demand of any person correspondence on a public question. I think it is most extraordinary. Mr. Hull. Mr. Chairman, I will say that I represent the grange here. I want to tell this committee in all honesty just exactly what there is about that. We have read the articles' in the New York- Herald, as I know Senator Stone presented it to the Senate, and they were referred to this committee yesterday. Now, when the grange has needed legal assistance for several years past, or technical assistance, we have consulted Messrs. Allan and Graham. They are our advisers. You see that we are simply ordinary farm people, coming from the farm. We know the farm end of this thing. The matter of technical tariffs we do not under- stand. We presented here for your consideration the difference be- EECIPEOCITY WITH CANADA. 299 tween the rates of tariff the farmers of this country had to pay as compared to what the tariff rate imposed upon what il e farmers of Canada had to buy. Those things were prepared for us by Mr. Allan and Mr. Graham. Xow, you gentlemen, as a Senate committee, understand the rights of any organization to have legal assistance if they want it and pay for it. Senator Stone. I am not questioning the right of anybody to employ any man. I simply want to know whether we can see copies of the literature they circulated. Mr. Hull. You can do it, Senator Stone. We will be glad to show it. "\Ye scattered it all over this country. Some of those technical tilings ^Ye^e presented to you the other clay. Senator Si'One. You have no objection to the request that I make, then. Mr. Hrix. I have no objectici]i to that request other than the inference that is drawn that these members of the grange have been presented — that is, that their arguments have been made up for us — by a firm of lawyers. Xow, we came down here, and you have the chance to question us, and that firm has never suggested in any way what we should say here. We have simply called on them for soine teclmical information, and we are not going to submit a bill to tliis committee to pay for this technical information. Senator McCriiBER. AVould it not be well to add to the request of the Senator from Missouri also the further request that the repre- sentative of the press shall furnish the correspondence that he has had favoring this bill and the means by which it should be enacted into law ? I would not ask it of either of them. Senator Bailey. Mr. Chairman, I want to make this suggestion — and I have no idea what the correspondence is, but it is obvious the committee would have no power to make an attorney produce his correspondence with his client. Senator Stone. Certainly not, and I am not asking for any corre- spondence between the client and the attorney, but I am asking for copies of literature prepared by this firm of lawyers and circulated throughout the country. Senator Bailey. I imagine that is the very kind of literature they have submitted or will submit to the committee. I imagine that if it has been circulated through the mail it has been filed here. I have no objection myself. Senator Willi.4MS. Mr. Chairman, it strikes me that, independently of the question of jurisdiction and power of the committee, you or I have no right to question the right of any organization, whether it is an organization of newspapers or laboring men, or grangers, to employ counsel to write briefs for them, or to write articles for them, if they want to. That is within their power. What we sit in judg- ment on is the thing itself, after it is proposed and brought to us, whether it is good or bad, and whether it is sound or unsound. Senator Stone. How are we going to psvss upon it until Ave see it? Mr. Hull. I would like to ask the Senator how many other in- dustries have been represented here by attorneys? We consider that, Senator, an insult to the farmers and grangers and the grange organizations of this country that we should be asked to do a thing 93285— No. 5—11 5 300 HECIPEOCITY WITH CANADA. that this committee nor any other committee in the United States have ever asked men to furnish. Senator Srasv. To furnish the literature that you circulated? Mr. liuLL. We furnished this literature here for you. Why should you send a subprjena for our hnvyers and ask them what they counsek'd, or how we counseled with them, or what part of this argument they have arranjied? Senator Sto^k. Mr. Chairman, I do not think there should be any feeling about it at all. There is no insult about it. Mo insult is intended. The only thing I am ;is:kii!<)- is that these men who have circulated this literature shall exhibit to the committee cojjies of the literature thev circulated. I -want them to furnish all of it or copies of it. Senator Gallixgee. I submit, INIr. Chairman, that it is none of our lousiness. Mr. Hull. Certainly not. If we want to go lound here and confer tngeiher, I do not know wliy we have not the rig!;t to do it. Si'nator Stone. ITndou]it>?(l]y you have. Mr. TIiTLL. I do not know whj' wo could not furnish experts, and they fnrnish this thir.g to you. Senator Bailey. Mv. Chairman, as n friend of the grange, althonsh not a meniber of it, T would sug^^st that they completely explode the idea that there is any mvstery or secret aliout it by bringing the ;>,ttorneys here and tendering them to the committee. That is what I would do if I were in tlv.nr ijlace. Senator S:\rooT. "Without subpcena? Senator Bailv.v. Without snliyio'na. If the farmers are doing any- thing wrong in this matter, it is the first matter of this kind in which thej' have been guilty of misconduct. [Applause.] Mr. Lawr!;xce. They are not doing it now. Mr. Tlt'LL. I vi'ill s;a' to any fair-minded man thnt we will do any- thing in reason; and I will ask ISlv. Allen to be here Jiext week, and 3'ou can confer with him. Senator YfiLLiAiMS. Ask him to be here early next week. Can we not get him here iMonday or Tuesday? Senator Stome. And bring copies of all literature that they had distribo.ted. That is all that I want to see. Mr. Lawrence. I do not want to lie suggestive, but I promised to get through with our delegation in two hours, and we will be entitled to some credit. The Ci-iAinMAN. You are entitled to all the time required. STATEMENT OF DR. J. L. SNYDEE. PRESIDENT OE THE MICHreAN STATE AGRICULTUEAL COLLEGE. Mr. Lawrence. I desire to introduce Dr. J. L. Snyder, president of the Michigan State Agricultural College, the college that is con- sidered the leading one in this country. Mr. Snyder. Mr. Chairman and gentlemen, I shall not indorse this last statement. I desire, however, on behalf of myself and on behalf of other members of our delegation, to express to yon our sincere a))])i'eci;ition for the attention and the hearing that 3^ou■ arc givinsj VIS. We wei'c not offered an onportimitv to be heard at the other end EECIPROCITY WITH CANADA. 301 of the Capitol, and as far as I know none of us were called into con- sultation at the White House. But you are most generous in the courteous treatment and the time that you are giving to us, and we want yon to know that we appreciate it. I shall speak very briefly. A few days ago I heard a member of your distinguished body say that he was a protectionist; that he believed that a sufficient tariff should be levied to make up for the difference in the cost of production; and that, inasmuch as he could not see that it cost more to produce agricultural products in this country than it did in Canada, he therefore could not see any reason for levying a tariif on the agricultural products brought in from Canada. I think, however, that it has been proven beyond doubt that it does cost more to produce agricultural products in this country. But I want to submit to you gentlemen that this is not the question. It is simply a question of market. Shall "we divide the farmers' mar- ket — the farmers ^^ bo have lived under this protecti\'e system and who have contributed to it through all tb.ese years? Shall we now come up and say to them, '• You must divide your market with tlie people of a foreign country " ? This market is fixed. The consumers of this country will use a certain amount and no more, and every carload of grain that comes in from Canada curtails our output that much. Every trainload of steers that come in from Canada takes the place of a trainload that would probably come from Oklahoma or Missouri. That is the ques- tion, gentlemen. Shall we open our markets to that great country of the north, with all its great advantages, to compete with our .Amer- ican farmers on the old land? But that is not all. If this reciprocity passes, there will be a great exodus of people to that country. We will not only have to comjjete with the output, but we will actually furnish the men, the teams, and the money to develop that country, and that is really a more si-rious problem, or just as serious, as the competition that we will meet from the products of that country. Again, we need our labor; we need our men. Every State in the Union could use perhaps twice as many farmers to good advantage. A few days ago I met some gentlemen from my State who had developed a large property in Texas. They have spent oyer $150,000 on large farms there and have sent a number of families to that State. Only a few days ago a company was formed in my own community to develop a large tract of land in Mississippi. They are scouring our country to get the families to send there. They are furnishing capital, andl can not for the life of me understand why the Southern States, and some of our Western States, should wish to send our people to Canada to develop that country when they are so sorely needed in our own land. That is a wonderful country. Those of us who have never been there can scarcely form any conception of it. We naturally think it is so far north 'that the climate is so cold that very little can come from it, but you compare that country with some other countries: Take the northern line of Minnesota and Dakota, and project that line eastward across the Atlantic and you will find that that line will run through Paris and through Vienna. The northern part of France, Holland, Denmark, and the northern part of Germany— the finest agri- 302 KECIPEOCITY WITH CANADA. culttuiil countries in the world — lies in the same latitude as Canada. Highly civilized nations, prosperous nations, lie as far north as the Hudson Bay, and you know that the British Islands lay way north of that land. Senator AVilliaiws. That is not the isothermal line, but the same latitude? Mr. Snyder. The same latitude ; yes, sir. Senator Williams. Not the same isothermal line? Sir. Snydek. But Alberta ha? as many hours of sunshine during a year of twelve months as has Mississippi or any other place on the globe. Of course the isothermal lines vary very much in different countries. But that country is susceptible of wonderful development. They can bring under the plow from 3,000,000 to 4,000,000 acres annually for the next .50 years. Xow, can we afford to send them the labor to develop that land and then meet the competition ? I do not believe 10 per cent of the farmers of any State in this Union, after full consideration, would think of indorsing this movement. Xow. we know the effect the opening all of the Middle West had on the agriculture of the East. We know how the lubor and capital went West. V-'e know how the prices in farm values depreciated in tlie Eastern Stiites. My grandfather's farm sold at one time in Penn- sylvania at $100 an acre, and the same farm sold long years afterwnrds for $20 an acre. You know that some good farms in the older States Avould not bring a price equivalent to that which was expended in erecting Iniildings. Wien the West was opened up, the farms of the East could not compete with the new land where they followed meth- ods of expensive farming, where they did not have to use fertilizers and rotation of crops in order to maintain fertility ; where they reallv exhaust the soil rather than try to conserve it; but in the last few years matters liave changed. You gentlemen have helped to vote large appropriations for our Agricultural Department. Every State in the Union has its experiment stations and agricultural colleges. They have sent out their extension lecturers, their farmers' institutes, and their bulletins among the farmers to teach them better methods of farming, to teacli them to conserve the soil and follow rotation of crops and to hand down to the coming generation the farms in better condition, or in as good condition, as they found them. Now, I want to say to you gentlemen that if you bring into com- petition this great northern country you will undo much of the good work that you have done, because the old soil can not compete with the men who farm extensively on new land, who can hitch up a steam plow and turn over 600 or 700 acres in one season. You heard the other day of the man who bought 1.200 acres and also a steam plow that turned 10 furrows at a time. ITe put in something like 700 acres of wheat, and the crop the first year paid for his land. Now, T want to submit to you gentlemen that the people of this country can not compete with such" conditions, and if this reciprocity passes, I believe it will bring on a period of depression such as the Eastls. I want to ask you is it fair to place us in competition with people over whom we have not a sav as to what their methods of living shall be; what their gotsd roads shall be; what their educntion shall be; whether the men ~lion wns coming nji — to observe their disc.ission of how thov •■'m](] extend th"ir horticultural tields. The po.^sibility of fruit raisitig in Cjvnnda, ep:i)ecipny around the Great Lakes, is ni;;rvc](ii;s. a gri'al do;d )mr:' than t ever cxjiecfed. and a great deal more, I believe. t]i;'n yo,i gentlancn appr.-MT.ite. I do not imagine that m;iny of yon have had fri;it or farm exjjeriejice, but I as]: you to take these statements as T nrahe them, as carefully as I can, and put yourselves, for the time l);'inr:. in our plac:-. and to ask for thrt fair denling which I know you are willing to I'rant. The first time I ever met Alex. ?irc?'eill. who is ii nv the chief of the fruit division, with headqiinrters at Ottawa, in charge of all the fruit industries in C'inadn, extending wav up into the mari- time Provinces, he toolv me from Detroit cci'oss to "^Yindsor and a little north, and there I visited his fruit farm. I noticed the condi- tions there were not favorable, and I knew ilr. ^IcNeill, who was a poorl Scotchman and a good fruit grower, ;;r,d I was at a loss to know whv that conditir?;) existed. T no!ii\'d his vineyards were going down and were not cared for, and he stated to me, when I asked him the cause, that he had no market. He said, " If T could send these grapes pcross (o Iteiroit I co'dd make a good profit; " but the dif- ference ill cost DO th.e tariff it^;>'lf was sufficient to absolutely put him out of business. Now, as I believe you understand, and if I remem- ber it correctlv, (be dutv on small fruits, berries, is 1 cent at the EECIPEOCITY WITH CANADA. 307 present time by the quart, Trhich menus a IG-quart case, which is the ordinary package that we ship. The duty on apples in h;irrf]s is )i:i cents per bushel, 75 cents per barrel; and gcntiemen ask nie the question— wo export just as many as we import — "How is it euino- to alfcct fruit? " It is true, gentle- men, that figures do nut lie. but sometimes figures can be manipulated in such a v. ay that they get a good v, ay from telling the truth, and it is well to understand Avhy it is possible we ha^ e exported to Canada a half a million barrels of apples in a single year and at the same time received from Canada a half a million "^barrels. It must be understood that the half million Ijarrels wdiich went from the States into Canada were not consumed, but were sent there because of the fact that the shipments could be best made through the port of iiomreal on account of the fact that the refrigerator sovice over the Canadian lines is superior to the refrigerator service over the same line — not superior in quality, but the units of size of their refrig- erator service are smaller, and we could use a s)nall service wdiich we could fill, whereas in tiie American service the compartments are so large that it would be utterly im]>osRil)le for the average fruit grower to fill one. So that our exportation, you may call it, into Canada, of nearly half a million barrels W'as practically for a for- eign market other than Canada, while the fruit which came from Canada was for American consumption, and came into direct com- petition with our fruit. In the meeting at Toronto two years ago the question v»-as dis- cussed, and it was presented by one of tlie officers of the Department of Agriculture, or a similar department, whate\er it is called, and a gentleman spoke nearly the wholf evening there before the fruit growers, and the whole sum and substance of his talk was " The thing we need is markets, markets. We can produce the fruit. In'.t the question is to get rid of it." And now we do not projjos,? th:it they shall have our markets. V^e do not wish that it should be so, and that is Mdiy the fruit growers, not only of [Michigan, whom I ha^-e the power to represent, but the fruit growers <^f the State of New York, the fruit growers of the State of Ohio, and the fruit growers of other States, do not desire any such condition and clo not desire to give to them the mar- kets which vre have helped to build up. A gentleman said, '"Yes; but 3'ou have the markets of Canada.'' "^A'hat kind of trade do you call it, my friends? What are the markets of Canada for the fruits? Toronto is practically the onlv city that you could consider a Uiarket, and they have more fruit in the Niagara peninsula, on the ^'anadian side down from the district of Winona and through St. Catherines, which I have -visited — they h;ive more fruit there than Toronto can take care of and they have to ship to the Canadian northwest. They take the fruit o^er'the whole fringe of markets commencing from Port Huron, Toronto, Detroit, Rochester, and New York, over the whole line all the way round. Michigan and New York are vitally interested in this lucposition, because we come on the same latitude, the same line, practically. Our fruits ripen at exactly the same time; we have the same class of fruits— apples and peaches, etc., small fruits, and beirios._ There is one man in mv town, who works for a commission house in Detroit, who spends a good deal of his time in the vicinity of Winona— that is, 308 EECIPEOCITY WITH CANADA. in the Niagara peninsula, on the Canadian side, just across from Ni- agara Falls. He wi irked there in berries, raspberries, etc., and they bring those berries in and pay a duty of 16 cents a case and compete with us in the Detroit market, which is one of my markets, although I am in the Avestern part of the State, on the shore of Lake Michigan. Now, these propositions appear to us as being financial proposi- tions, but there is a greater motive for us to oppose this proposition than monej' alone. I have worked for at least 14 years to try to develop in the State of Michigan, and for less years in other States, a horticultural growth, which we now see coming upon us. There never has been in the past 20 years that I have been identified with the work such a growth in horticulture as at the present time in the States, and you know it. ^Ye are raising the standard of our pro- duction. The President has laid down as one of the fundamental principles of this pact the plan that we are to reduce the cost of living, as well as to allow the newspapers to have free paper. The farmers and the newspapers are the ones considered. Now, I sub- mit, my friends, that we have been working to give you better markets and to secure better markets, and the tendency of the times to-day is to overcome that condition which you call the high cost of living, and it has been explained here that the farmer is only in a very small degree to blame for it. The middleman is the man who has been getting the profits on the farmer's products, and you are not going to help it any by allowing the middleman to get it out of the Canadian products in any way. l-]ut the pendidum has s^vung one wa}^, and it is new swinging the other. The tendency of the past has been to draw the boy away from tlie farm and into th.e city, attracted by the glamour of the ease of living and the ease of professional life as comiDared with the long hours ;uid the hard work on the farm. That has been the tend- ency, and we arc trying to correct it. and it is being corrected. Never in all the time I have been interested in it — and I have tried to be a close student on this subject from the very first — never have I seen so much of the return to the country. Back to the land is the cry of the day, and your proposition here that is beiore you would give that a black eye and send them right back into the city again. It can not be otherwise. I do not care about the difference in cost. The pirice of apples in Canada is practically a dollar — according to your own records here — lower than in the States, because it says right tliere — I picked up j-esterday one of your bulletins — that at a certain time apples were worth $3 or SU, when in the States they are worth $5 a barrel. We care very little about the difference in price, but I tell you it will means more than dollars for the States if you stop this return to the country — the return of the young- man to the farm. Do we want to do that? In my estimation of this whole proposition it is not the poor, measly dollar that ■\\e want, but we want to improve conrlitions in agriculture and make it attractive, to attract to it better friends, better knowledge, and refinement. Wc are entitled to it, and we are working for it, and the greatest harm this bill could do to us is not to take the dollar out of our pocket, and it will do it, but it would return us to a condition where we coidd not have that progress which to-day stamps the American farmer as a peer of any on top of God's green earth. EECIPEOCITY WITH CANADA. 309 That is why we oppose any profiosition of this kind. After we have built up these markets we simply say that it is wrong to take them from us. After we have done our part, and now that we hope to raise the standard of American citizenship, why should we open it even if those people over there happen to have had some of the same blood in their veins originally that we have? I see no particular reason for it. Because I have worked hard and my family have — my wife with me, and my children have worked, and we have made a beautiful home ther-e and surrounded ourselves with beautiful orchards — is that any reason? Am I selfish because I have done more than my neighbor who has been negligent of his duty and his responsibilities and opportunities and posibili- ties? Am I selfish to step in and enjoy the fruits of my labor? I can not see it in that way. I simply want to submit that the fruit' growers of ilichigLm — yes, of Xew York and Ohio and all the States practically — oppose this proposition. ^Ve not only feel it would be against our financial interests — but over and above that it is against the progress which we have mapped out for the American farmer. Senator McCumbek. Have you any statement that will show, over a period of years, the difference in value of the horticultural products in Canada and the United States that you can give to the committee? Mr. Bassett. I do not think those statistics have ever been pub- lished. I will state right here that I have letters Avhich I will be glad to f^irnish from fruit growers in Winona and St. Catharines. At St. Catharines they have a large cooperative packing house. Mr. Robert Thomjoson is the head man of that proposition, at St. Cath- arines, Ontario, right on the Niagara belt, across from Niagara Falls. It is St. Catharines on Lake Ontario. Those men wrote me when this first came up asking what we thought it was going to do in our section, and we tried to get together on figures; in other words, to figure what a bushel of peaches were worth at a certain time, but that cjuestion of grading fruit is a difficult proposition. It is easy to say No. 2 wheat or No. 2 corn. There is a very firm and decisive range there, but when you talk about a No. 1 apple you do not know how many poor apples there are in the middle of that barrel. Senator Williams. You said a moment ago that the apples were worth practically a dollar a barrel more. j\Ir. Bassett. According to your records here ? Senator Williazhs. According to the records. Does that record show that those were the same apples ? Mr. Bassett. No, sir; but Senator Williams. There is no indication that they were the same quality of fruit at all. So that proves nothing at all. Mr. Bassett. Let me tell you that it does prove something, if you want proof. You understand that in Canada they have what they call the fi-uit-mark act. Do you know that they are about 10 years ahead of us? Their fruit is better than ours, because under the fruit- mark act a man can not pack a barrel of apples and put culled stuff in the middle, the way we do in Michigan. [Laughter.] I am going to tell you the truth and shame the devil. It has been done. We have no legislation in the States that corresponds with the fruit- mark act of Canada, and the result is when you ask the question— 310 BECIPEOCITY WITH CANADA. you say that does not jDrove anything — it proves simply this, that the ajDples under that bill would be better than our own. Senator Williams. The same apple would be, but a different apple would not be. Mr. Bassett. I mean to say that under the fruit-mark act a barrel of apples that leaves Canada must pass inspection. A barrel of ajiples that leaves the United States does not pass inspection. There is no such thing. Senator "Wiiaiaims. I do not mean the size of the apple, but the character of the apple — Albemarle Pippins, Winesaps, or whatever it is. Ihey have their price everywhere. Mr. Bassett. Yes, sir. Our apples are Northern Spy, Baldwin, Greening, Macintosh Red, and Jonathan. ' Senator Hbtbuen. Do you know in what States on the Pacific coast they have legislation ? Mr. Bassett. They have State legislation. Senator HETB^_^R^:. Under which no barrel of apples packed in the manner yon ha\e suggested can leave the State? Mr. Bassett. That is true and that is mighty good legislation, but it is State legislation and not national legislation. The fruit-mark net is national, and I would be mighly glad to see a bill similar to the fruit-mark bill in force in the States, but we have none at the present time. I am practically through. If you had not asked me the question I would have sat down. I mentioned the fact that we have a ten- dency to improve conditions. Ex-Gov. Warner here mentioned the fact that we have in our State enormous tracts of territory that are valuable for farming. We desire to improve them. I was in charge of a land-show exhibit in Chicago last year from our three counties, which brought to our State an enormous number of in- quiries and many purchasers of land who wanted to carry on and make farms — make homes. Pass this bill and these people instead of coming to Michigan would go up iiito the northern section. They are going there now. "We are losing sojne of the best blood we have in tlie United States. I know that some liave gone from our State, and this -wc-uld simply put a premium on that proposition. If they would go there, with no markets in the State to furnish, they will go there all the more rapidly and eagerly when tliey can go there under conditions as staled and ship to the States. But the effect of this bill will be not only to reduce tlie market values of our crops, but it means a setback to agriculture. It means many more times the loss of any few dollars; it me;ins the hiss of our crops and land, too. I hate to hear a man talk dollars. I tell you there is a matter of principle in this, and while it is true that Avheat might be injured and fruit injured and milk and butter and cheese, it is going to lessen the standard and lower the standard of agriculture in the States; and it is the one thing that the county ;ind State horticul- tural society and all its organizations are working against without any selfish moti^'e wluitever in the belief that this lull means a set- back. We do not lielieve it is right. We ask you, even though you are not all farmers, if you can put yoursehes in our place? We have no threats, not une. We will take our medicine. We are American citizens. If wo. do not like the men wlio represent us we know how to get others, and we do not ha\'e to go out of the party to get them. EECIPEOCITY AVITH CANADA. 311 I thank yon. There are some men left who believe in a square deal. [Applause.] STATEMENT OE H. N. ENSIGN, FARMER, OF OHIO. Mr. Ensign. Mr. Chairman, your frog pond down here has got me so hoarse that I do not think I will be able to talk — I mean the Potomac Eiver. I have been here two days listening to these dis- cussions. I have heard the governor, I have heard the editor, and I have heard everybody. I have wondered at your patience in listen- ing to us farmers — we all call ourselves farmers. I believe I am the only genuine, Simon pure, died in the wool, mile wide farmer in the whole business. I think that I fully represent them. I have drawn my whole living from the farm from a child up. I have spent my whole life there, except two or three years, when I studied Ijoiies and medicine, but I never practiced any of it, thank God. [Laughter.] But I learned some of it. Now, JNIr. Chairman, I am going into details more than the rest of them. I vv'as practically assured by my friends here that T would not be called on to say anything to you people. I came here with mj^ heart in my hands, but I find that you are men all the same. We look at you in my Ohio home, from the long distance, and see j^ou as Senators ; we do not see you as men. Yf e read of you as Senators ; we do not read of you as men. We are taught almost to look upon you as something beyond the human mind, but I find that you are just as the rest of us, with the higher exalted position that we have given you. Now, gentlemen, going into details, clay before yesterday on my way here I stopped at the Ohio Senate — Oh, j^es; we have one up there yet. [Laughter.] There is a bill in the house there by which they are trying to do away with their canals — Ohio's canals. You have one that starts right down here at the foot of the street and goes right into Ohio, a great waterway, built by Jackson or Jefferson or some of those old fellows. To-day Ohio's people in one branch of the legislature are trying to do away with them, while over in the senate the}^ were fighting over a bill to build a canal from the Lakes to the river. There are your antipodes coming together. The same thing is coming in this United States Senate. The antipodes are going to meet here ; the great interests are coming out against the farmers of the States. Mr. Samuels, the secretary of agriculture of Ohio, said to me, "Are you going down there to see those fellows ? Have you the courage to talk to them? " No; but I am here to talk to you. It is quite a large delegation and quite respectable — the rest of them are large and I came for the respectability of it. [Laughter.] Mr. Samuels, along about February 20, sent out to different corre- spondents in the State and asked, " What proportion of your people are in favor of the Taft reciprocity? " He got a report. Mind you. this was along about the 1st of March. He said that 58 per cent of the people were opposed to it, 23 per cent are in favor of it, and 19 per cent are noncommittal — don't care either way; catch it going or coming. Mr. Samuels says: "Mr. Ensign, since then the people from that great Commonwealth of Ohio have been heard from. The people from the great Commonwealth of Ohio are beginning to study this matter, and it is perfectly safe for you to tell those people that 312 EECIPEOCITY WITH CANADA. at least 99 per cent of the people up here in Ohio are dead set against it." My friend here says he voted for Taft. He is a Kepublican. He looks it. -, -, • , i -r> , ,• I am going to say to you that I was a dyed-in-the-wool Kepubhcan up in tlfe nineteenth district, that for the first time in its history has a Democratic Congressman here— old Ben Wade's, old North Wade's, Gideon's district sends to this Congress a Democrat. Why? Be- cause it is an agricultural district and they have not been respected. That is the reason why. Senator Pomerene, from Ohio, was made possible to be here, representing that State of Ohio in the United iStates Sennle, by tlie change in the vote in the agriculture districts. That is why Senator Pomerene is here instead of Senator Dick. Senator Smoot. And, of course, to vote against reciprocity? Mr. Ensign. That is right ; we know that. We did not expect it. We did not know anything about this reciprocity up to that time, Mr. Smoot. Mr. Burton criticized me because I asked him to work against it, because we sent a Democratic Senator and Democratic Congressman Jfrom the old tenth district, where I now live. I said: "If "the people at that time had heard of this and had known it at the time of the election, not one of j'ou would be here unless you are nearer the President than I am." Now, gentlemen, I have got to talk from memory. I have no sta- tistics to fall back on. I did not expect to make this talk. I did not bring any documents with me and I have to make it from memory. Everybody is invited here Imt the farmer, and we have to come on our knees, as said here 3'ester(Ui3', with tears, to get a hearing. We are not interested in tliis. anywa}'. Ye?, sir; we are deeply inter- ested in it. We can not get a hearing before 3'ou until it is all fixed, cut, and dried. That is the situation the farmer is in. Why? Thirty-three ])er cent of the farmers can not come here without praying for it. Everybod}^ else is invited here — everybody comes here; the manufacturer of wools, and all those come here and fix their own schedules, practically. We can not fix a schedule, and to-day eNerything under the sun that I can think of that the farmers produce is put on the free list except wool. And what is the matter with wool to-day ? Your Schedule K that Ave hear so much about. I have a bunch of sheep that I am feeding. I bought them last year. The market report from Chicago said only three or four days before I left home, '" We do not know what kind of price you will get for your sheep " — and I am feeding them and throwing awa}' rny corn on them because of Schedule K. "'We do not know Avhat to offer for sheep; we do not know what they will bring." They cost me 4 cents last fall in Montana, and I am only oifered 3 cents f-'ir them to-day. Sen;' tor Smoot. You mean the agitation against Schedule K, not Schedule K. Yiv. E^'suiN. That is it; the agitation is doing all of this. Senator Gallincee. Do 3'on think that sending Democrats to both Houses of Congress has helped you in that matter? Ml. Ensicn. I do not know. It seems to be six of one and half a dozen of the other. Senator Galunoer. If 5'ou look at the votes you may change your mind. BECrPBOCITY WITH CANADA. 313 Mr.^ Ensign. I am going into details riglit now. Last 3^ear about this time I sold 3 or i carloads of hogs and got 10:} cents for them. I just took 1 of those carloads. 100 of them'weighed 2,200 pounds. Those from Colorado came to $2,750. The same bunch of hogs on the farm to-day are waiting for sale, and I can not get 5-J- cents for them. Senator Smoot. Do you think that was the effect of the Aldrich bill? Mr. Ensign. ^ The Payne-Aldrich bill, or something of that kind. Tli;it is the thing Ave are up against, and cattle is tlie same thing. Mr. Wilson. Secretary of Agriculture, teils us that cattle are dimin- ishing all the time. A carload of cattle will average 1,460 pounds. Forty steers come to ii.TSS. The same launch was "sold for 7 cents last year, sold this year at o}. which comes to $37. (12 a head, or $10,200. and yet the Secretary tells us we ha^e less cattle than be- fore — growing less all the time. What is the matter? The farmer is not making this. Now we have got a lot of wheat. I am selling wheat; they were selling it the day I left. They were loading it in tlie sidetrack at the farm. They are paying 75 and 80 cents for it. The balance of tlie wheat v,;.s sold last summer and they got SO cents for the very best Avheat. It is to reduce the price of wheat. They have left one thing nut. When the fanner sells his wlieat he gets 1 cent a loaf for the bread. V\'ho gets the other 4 cents? You buy l^read in this town and ijay 5 cents a loaf, and I want to know who gets the other 4 cents ? I might say that I have two sons up in Alberta. They have gone up into the cheap land of Alberta and are raising wheat there. One of them came home in January to visit our home. He said, '' P'ather, you do not want to work against this bill." He said, " Why, we have land up there which can produce 3 bushels of wheat to your 1 on the old farm, and we can put it in your markets as cheap as you can. The freight is a little bit more from Alberta to Chicago and Mil- Avaukee than it is from your farm up there." I said to him, " I have got more boys in the United States raising wheat than I have in iilberta. I stand for the bo3's in the United States." I have got six of them. Five of them and myself voted for Roosevelt. The other would have voted for Taft, but he had gone to Albert;!. [Laughter.] I will read you this little article and then sit down. It is entitled "The Canadian adventure." It is from the Pittsburg Press of May 11: rUK CANADIAN ADVKNTURE. C'llonists nre an-iviiiQ- nt A^'innipPu' :it the rate of ],010 a Jay. Americans 'ive cnaiiii^' su fnst tiiat Viiitt'd Stall's ctistoiiis otficc^rs have boon \mi a.t the (]is|iOi=al (,! fl:p f'jinacliaris to help in the eiicniions worlc of oxaiiiiniii!-' Hie new niTivals and tlieir " iilniidf-r." Some 4.5.0ti() Amcricaiis, witli .']';;'»,( lOO, Odd worth iif r.<.t.f.-,Y,., I ..,.^r, .,..+-,. .1 «^ 1-1, ^.TTT., ^ ,, l\n i-.i. +!-.« ,!-..,. Til nl! iTiTf n niiUwin npw fc (lii 1.1 I 1 I 1 (.1. I n I M I 1 1 1 I i ^ 1 L I 'J I J 1 J I I I" 1 . ■ I V 1 I I T ^I»-J.>-' ' " ' v' 1 ' 1 I ' ■- "- H» 1 '-'i 1 1 ^ <- J.' -y r ,■--.-, . . -^ » ■ uf personal property, are Icnowii 1o t)e on the way. In all. half a million new citizens are in siL'lit'. And the new towns! ()\er 2sn of them will be pnt on thp map thi.s sprins— ."jO by the Canadian Pacific. 9G by the Canadian Xoi-thern, lo.j by the (liand Trnnk Railway. It is, indi'ed, a thrillinj;- drajna. a tre- niendoas spr^raaeie — iliis iirnsh ^if men, women, and children into the norlheru learhi^s of the continent where the lasr sre.it adventure in free land awaits them. 314 BECIPEOGITY "WITH CANADA. ^Yhy are they going to Canada? A¥hy are they not staying in the United Slates? It is because they can go up there on that kind of land that my son has bought for $3 an acre. My son, the one that went up there four years ago, went 50 miles — a boy who had never been away, only to school — from a railrond. He and another man were the only people within perhaps 25 miles of another house. He says, " To-day I can count from my little cabin over 50 farms occu- pied by straight legitimate farmers," and he said there were mil- lions and millions of acres left there that will soon be on the market. He said, " Daddy, com.e up here and invest your money on this land. You can get it cheap. Bring along the plows, drills, and harrows, and go to raising wheat that the reciprocity will soon give us a chance to put into Chicago." I am not going. [Laughter and applause.] Mr. Lawrence. I know that my friend Ensign did not mean that remark that he made to apply as it might be accepted. This bill has been referred to the Finance Committee, and every hour of its hearings have so far been given to the fra-mer. I think we should feel grateful, instead of criticizing their actions. I will say for myself thnt nothing bat extreme courtesy has been tendered to me. I now . take pleasure in introducing Mr. I. E. Waterbury, of Michigan. STATEMENT OF MR. I. E. WATERBURY, OF MICHIGAN. Mr. Watefjsuey. ]\Ir. Chairman and members of the Finance Committee, I have taken quite a little interest in listening to the dis- cussions which have occurred before your committee during the past few days. I have read with equal interest of discussions which oc- curred upon previous days. It is a great wonder to me that your attitude toward the gentlemen who have asked to be heard before your committee has not been similar to the attitude of the g-entleman who spoke at a public meeting at which I was pi'esent one time. The gentleman who preceded him had spoken at great length, the audi- ence had become somewhat weary, and the time had come to close the meeting, and by courtesy the gentleman who was to follow was introduced, and he simply said: "Gentlemen, it has occurred to me that a man who has bored an audience for two and a half hours without any apparent result has either used too large an auger or else he has bored into the wrong place." I do not want j'ou to feel that the farmers who are appearing before your committee are doing anj such thing, and to avoid any repetition of the many good argmnerits which have been brought to the attention of the committee, I desire to approach this question for a moment at a little different angle than it has been approached since T have been present at the hearings. We farmers feel that should this bill be passed in its present form we would be confronted by a very serious condition ; we feel that we are not theorizing in this respect, and for one I do not care to present any theory to you as to the causes which lie behind the farmers with relation to this proposition as it is before you for consideration. We are willing to accept it as the result of the demand for a cheaper cost of living, believing that that was the one prime motive which the President had in bringing about this agreement. I de- sire to prove to you that it has not been the fault of the farmers of the BEOrPEOOITY WITH CANADA. 315' country that the cost of living in the United States has increased in recent years. I desire to prove to you, contrary to the assertion of- our President, that we do not need at this time or at any time in the immediate future the added resources of Canada to feed the people in the urban centers of this country. I hold in my hand the Crop Reporter for TNIarch, a publication of the United States Department of Agriculture, a great department of the executive branch of our country, which has been established and kept going at a very considerable expense by the Congress of the United States in recognition of the fact that the agricultural industry of the country, as our basic industry, is of very great im- portance to the country and worthy of special care and promotion. In this document which I hold in my hand the Secietaiy of ^Vgri- culture, who now, I believe, states himself as being in favor of this proposition and asserts it will not injure our farmer.^:, has caused to be prepared some statistics which I believe have an important bear- ing upon this proposition. He has prepared data relating to 10 prin- cipal agricultural staple crops of this country, covering a period of 43 years, from 1866 to 1908. The crops taken into account are wheat, corn, oats, barley, rye, buckwheat, potatoes, hay, tobacco, and cotton. In preparing this data, not only the average production per acre has been taken into account, but the production per capita for the population of this country for this period of 43 years, 100 represent- ing the per capita production for the whole time. For the purposes of comparison he has caused this time to be divided up into 10-year periods. Beginning with 1800 we find, with 100 representing the per capita production in the country of those 10 agricultural staples for the entire period of 43 years, we find that in the period from 1866 to 1875 the percentage of per capita produc- tion is represented by the figures 82.9; for the 10-year period of 1876 to 1885 the per capita production is represented by the figures 103.1 ; for the period from 1886 to 1895 the per capita production is represented by the figures 104.6; for the period from 1896 to 1905 the per capita production is represented by the figures 105.6; for the period representing the balance of this time, or the four years from 1906 to 1910, the figures representing the per capita production for the country are 109.8. I submit, gentlemen, that in this period of 43 years these figures, which are official and are prepared by the Department of Agricul- ture, show that we have not only increased our production per acre, but we are growing more per capita, and we have grown more per capita, for the individual inhabitant of this country to consume in each 10-year period than we did for any previous 10-year period in that time ; and yet we are growing more to-day by several per cent, the figures for the past three years being represented by 109.8. But I also remember that when this agitation regarding the in- creased cost of living started over here in Cleveland, as our friend here has mentioned, that the principal topic discussed was the high cost of meat. That was the thing that seemed to be the last straw that broke the camel's back, as it were. Now, fortunately, I have official figures in my hand relating to this proposition, and I think I will be able to prove to you that there has been no falling off in the consumption of meat food products by the farmers of this country which is responsible for any increased cost. 032S5— No. 5—11 6 316 EECIPKOCITY WITH CANADA. Senator Williams. You mean no reduction in the production of meat ? Mr. Wateebury. That is what I mean. I have here a bulletin issued in February by the International Institute of Agriculture at Eome, a body which was authorized partly by this honorable Senate, in which official figures are taken from all the different countries in the world nearest available to 1900 and 1910, showing the number of meat-producing animals in tliose various countries for those two years, and bj' these statistics I am able to prove to you that we have now, at the present time, in this country more cattle, more sheep, more hogs available for the meat supply of the country than we had to years ago. Briefly I will state to you that these figures for 1910 show that we have 193 more cattle for each 1,000 population in this country than we had in 1900; that we have 80 more sheep per 1,000 popula- tion than we had in 1900 ; that we have 45 more swine per 1,000 popu- lation than we had in 1900. These figures are official, and I will be glad to leave them here for the consideration of the committee and the reading of any portion of that report into the record which you may desire. Senator Clark. Do not those figures conflict with some of the statements made a few moments ago that our Secretary of Agricul- ture makes the statement that we have less beef cattle and less swine? Mr. "Wateebury. I think the gentleman must have been mistaken. He said he spoke from memory. I have checked up these figures with the official figures of the Department of Agriculture, which I have with me, and I find them to be the same in both cases. Now, gentlemen, the point which I wish to make by submitting this official copy is that there is no just cause for the passage of a bill of this kind to reduce the cost of living, because the cost of living, any increased cost of living, is not accounted for by any decrease of production, and the gentlemen who have preceded me have shown you that we have nowhere near reached the limit of our possibilities of production in this country. Now, we have only just scratched the surface in many of our States, including Michigan and Wisconsin, which the Senator here represents, in that direction. A good deal has been said regarding the comparative cost of pro- duction. It has been said that there is perhaps no need of a tariff between countries where the cost of production is practically the same. It has been stated to you, and I think in such a plain manner that you have been convinced by it, that there is a vast difference feetween the cost of producing agricultural products in the United States and Canada. For example, let us take wheat, for instance, and we are not interested in wheat in Michigan nearly to the extent we are in many other crops. The official figures, which are available from similar sources to those which I have read to you, show that on an average, during the past three years, for instance, they have grown about three more bushels of wheat per acre in Canada, taking Sie entire croji, than we have gTown. That, at the present market fractice of allowing 80 cents to the bushel, would be about $2.40. _ You have been told how our farmers, during the former depletion ©f their soil, have been obliged to buy expensive fertilizers to keep EECIPKOCITT WITH CANADA. 317 up its productive qualities. It is a small estimate to say that the average man who grows wheat in this country at the present time uses about 200 pounds of fertilizer, worth about $2.40 to $2.50 more, making in all a sum from $4.75 to $5 which he is behind the Canadian farmer, if you grant that his land is worth the same price and that his labor costs the same amount which the Canadian farmer's labor costs. But the sum which I submit to you exceeds the amount of profit which the average American farmer makes upon the acre of wheat. It exceeds the average rental for the average acre of land in the United States, even in its more productive parts, if we except Iowa, in the corn belt. A good deal has been said by the President of the United States in his numerous speeches that the farmers of the country would be benefited by a cheaper source of thin cattle to fatten upon their corn. We have with us a number of large cattle feeders, whom we would be glad to present to you for a hearing upon this proposition if there were only time. I have in my pocket interviews from Western cattlemen, one in particular, a Colorado man, who has large holdings of cattle in the Canadian Northwest. It has been stated, and I think you gentle- men are well aware of that fact, that a great many cattle upon the ranges are fattened upon grass. They do not bring quite as high prices as the finished, corn-fed cattle, but they are sufiiciently good for export grade, many of them. They are able to produce in the Canadian Northwest alfalfa, in addition to their cheap nutritious grasses for forage purposes; they are able to produce large quan- tities of oats and barley and roots, which crop is very much more productive there than in the United States. They are able to apjDly the old country methods of cattle feeding, by which they can produce a finished, high quality of cattle upon these feeds. Just a moment. I will take time to give you some figures regard- ing the increase in the production of oats and barley in two of those Provinces during very recent years. Take oats, for instance. In the four years from 1907 to 1910, the acreage in Saskatchewan alone increased by 143 per cent, and in Alberta alone by 217 per cent. The increase in production was, in the entire period in the Canadian Provinces, represented by over 30 per cent — 31.3, I think, to be exact. For instance, in Alberta alone, the acreage increased 253 per cent during the last year, and these figures simply serve to add weight to the facts which have been presented to you regarding the very great increase in the production of the small grains of Canada in recent years, and the very great possibilities for such production in the future. Senator Stone. Have you figures showing the acreage for the two periods ? Mr. Waterbtjet. I have, sir. Senator Stone. I do not wish you to read them, but I should like for you to insert them — I mean the number of acres, for the two periods you mention. Mr. Wateebury. For the two periods I mentioned ? Senator Stone. Yes. Mr. Wateebuey. I would be glad to do that. Senator. I will hand them to the clerk. 318 KECIPROCITY WITH CANADA. (The statement presented by Mr. Waterbury is as follows:) Canada JjarUy. Acreage. 1909 1, 864, 000 1908 1, 745, 000 1907 1, 683, 000 Increase, 1907-1909 181,000 Per cent of increase, 10. Per cent nf increase, Saskatchewan alone, 72. Per cent of increase. Alberta alone, 253. Production (bushels). 1909 55, 398, 000 190S 46, 762, 000 1907 44, 342, 000 Increase, 1907-1909 11,056,000 Per cent of increase, 1907-1909, 25. Per cent of Increase, Saskatciiewan alone, 232. Per cent of increase, Alberta alone, 454. Canada toheat. Acreage. 1910 9, 295, 000 1909 ■ 7, 750. 000 1908 6, 610, 000 1907 6, 050, 000 Increase, 1907-1910 3. 245, OOO Per cent of increase, 54.5. Production (bushels). 1910 149, 990, OOO 1900 166, 744, 000 1908 112, 434, 000 1907 92, 691, 000 Increase, 1907-1910 57, 299.000 Per cent of increase, 61.8. Average yield per acre during these years, 17.5 bushels. Average yield in United States during same years, 14.5 bushels. Canadian exports of wheat during these years averaged 41 per cent of entire production. Canada oats. Acreage. 1910 9, 864, 100 1909 9, 302, 600' 1908 7,941,100 1907 7, 236, 100 Increase, 1907-1910 2, 628, 000 Per cent of Increase, 1907-1910, 36+. Per cent of Increase in Saskatchewan alone, 146. Per cent of Increase in Alberta alone, 217. Production (bushels). 1910 301, 200, 000 1909 375,558,000 1908 : 266,026,000 1907 , 229,217,000 Increase, 1907-1910 71,783,000 EECrPEOCITY WITH CANADA. 319 Mr. "Waterburt. Much has been said to you with regard to the need of developing our own country. JMuch has been said to you with regard to the policy which has been pursued in this country for many years with regard to the protection of its manufactures. It is not my purpose to raise to any extent the issue of protection. I simply re- iterate, in the words used by one member of your committee, that it is just simple fairness that we are after. I submit that the general pohcy which has prevailed in this country of protecting production for the purpose of building up a home market has met with the ap- proval of the American farmer upon the idea that in time he himself would profit, not only by that market which had been so built, but by a participation in the benefits of that protection. All these years he has worked harder and remained poorer than those engaged in other vocations, simply because he has been compelled to sell the products which he had to sell upon the world prices, less the cost of transpor- tation, while he was obliged to purchase the products which he had to buy not at the world's price level, but at that price level witli the cost of transportation and a portion of the tariff premium added. Kot for many months in most of the many products which he grows, in the entire history of our country, not for many years, in any event, has he been privileged to reap any benefits from that tariff premium, and now when our exportable surplus of agricultural products has declined somewhat, when there may be a prospect that in the near future he will, in some one or two instances, benefit by that, when he may be able to become a scientific laborer, to applj^ the principles of scientific agriculture which have been taught him at great expense through our agricultural colleges and experiment sta- tions. We are confronted by a condition wliich proposes by means of reciprocity with Canada to add to the exportable suri)lus of those two countries grouped together an amount which will postisone for many years any prospect which he may have had to put his business upon the same level which other businesses of the country are placed upon. If this bill passes, the President and his advisers have found a way to postpone the time when the application of this principle will come home to the farmer. Economic laws will operate in the future as they have in the past; each recurring census will continue to show that the cities have grown more than the country, and that tlie popu- lation of the rural districts has gradual h^ and surely decreased, while the population of the cities has increased. In the meantime, our statesmen will continue to be, as they have been in the past, alarmed about this condition. They will continue to send out orators and send out literature and start " back to the farm " movements, but, gentlemen, the question of whether the boys stay upon the farm is an economic question, and an economic question it will remain. I have heard since 1 have been here the remarks made by some gentlemen who thought they were well informed on this subject that the farmers are getting rich; they are gftting too rich; they are getting more than their share. I submit to you, gentlemen, that the man who makes that statement is not well informed. Tlie farmers are not getting rich. As has been stated to you in very plain terms, they ace simply getting on their feet; they are beginning to be more prosperous. They have become in recent years the very best customer that the American manufacturer has. Their purchasing power has 320 KECIPKOCITY WITH CANADA. increased, and their added resources have gone into the channels of trade, and by crippling their purchasing power by the passage of a bill of this kind — and I will submit, gentlemen, that you will agree with me that it will, if it accomplishes the purposes for which it is dedicated, cripple their purchasing power — and you are doing the manufacturing industries of the country an injury greater than will be recompensed by any possible increase of Canadian trade which they will gain from it. It has been said that the farmers are buying all kinds of luxuries. Gentlemen, do you object to the farmer having a sanitary bath- room in his home? Some of them are beginning to get them now. Do you object to his having a piano in his house for the culture and refinement of his daughters? Some of them are beginning to have them now. It is only a very small percentage, perhaps 1 per cent, of them who are buying the cheaper class of automobiles, but who gets the money for them? The city industries get the money, and they get it at a profit of something like 100 per cent. Is there anything so very bad about that that needs to be corrected by a bill of this kind? I have occuiDied more time than was my allotment. There are many things more which I should like to say, but I desire to thank your committee for your kind attention and leave the balance for the other members of the delegation who will follow. [Applause.] Mr. Laweexce. We commenced at half-past 2. We have had somewhat more time than I mentioned. We have several other mem- bers of the delegation who had expected to say something upon this question, but the unanimous verdict of our party, considering the conditions, considering how you have heard this same story virtually so many times over, and that there are others waiting for us, is that we should close now. I will ask that one prepared paper, that has most of these sta- tistics, prepared by the long-time president and secretary of the Ohio Dairymen's Association, be filed. Have I that permission? The Chaieman. Yes, you may file anything you wish. (The paper filed by Mr. Lawrence, as the statement of ISIr. E. P. Bailey, is as follows:) PAPER OF MR. R. P. BAILEY, OF TACOMA, OHIO. I desire to call your attention to the significance of the figures I herewith give you in tracing the actual transactions of 10 tracts of lands in two townships in Belmont County, Ohio. I further make the broad statement that those figures fairly represent the fluctuations in the average farm land in all the North Central and Eastern States. There can be no results without a cause. Permit me, then, to theorize a moment. After the abnormal conditions prevailing during the rebellion had ceased the soldiers returned to civil life, a fair propor- tion going to the farms. This somewhat stimulated values, causing to some extent the very high prices mling for land from 1867 to 1875. But during this period the Government had passed the home- stead law, which perhaps did more to develop our whole country than any other law ever passed by Congress, also large land grants to railroad companies pushing westward. This and the vast army of land agents exploiting with get-rich-quick schemes attractiveness BECIPKOCITY WITH CANADA. 321 the western land drew from the East and Middle States so many farmers that from 1880 to 1900, 20 years, it seemed all wanted to sel! and no buyers. The virgin soil of the great West, tilled by enthusiastic immigrants and their families, increased food production beyond the need for the market, and the prices fell below cost production. Consequently none prospered either East or West. The western farmer increased his wealth only by the increase in value of his lands, after subject- ing himself and his family to the hardships of pioneer life. Since 1900 the population has caught up with our food production, and through the incentive of remunerative prices the American farmer^ guided by our experiment stations, agriculture colleges, and the National Department of Agriculture, is studying soil, conservation,, and crop production as he never did before, with wonderful results. This will shortly solve the food-supply question if the distribution of the same can be properly adjusted. Now, gentlemen, the proposed reciprocity treaty with Canada brings into competition with the American farmer lands larger in area than our western country, and in the production of haj', oats, and barley surpasses our most fertile western plains. This competition, judging from the past ex- perience in our own country, will depress agriculture in all States of the Union equal to or greater than the new lands of our own West did, from 1880 to 1900, depress eastern agriculture. In con- clusion I ask, is it fair to the farmers of our country to permit a people with no interest in common with us to place on our markets their food products, which owing to conditions cost less to produce than those of our farmers, who desire to educate their families, as is their bounden duty and right? Does the business interests of the county want to see the low land values again and the consequent depression prevailing during 1880 to 1900? 1868. J. H. Bundy et al. sold to Nathan Bundy 436 acres for $38,072, at $87 per acre. 1868. N. Bundy sold Jolin Hoyle 134 acres of the above farm for $14,464, at $108 per acre. 1880. Same 134 acres sold to John White for $7,150, at $54 per acre. 1896. Same 134 acres sold to Alden Lee for $4,910, at $37 per acre. No change In buildings. 1869. N. Bundy sold to William Stanton 66} acres for $6,074, at $92 per acre. 1880. Same tract sold to Francis Davis for $4,300, at $65 per acre. 1885. Same tract offered for $2,500, less than $40 per acre. No buyers. 1911. Same tract sold for $5,000, at $75 per acre. 1868. S. Bundy et al. sold to William Bundy 115 acres for $9,435, at $81 per acre. 1889. William Bundy sold to D. C. Bundy, same tract, 115 acres, for $3,500, at $31 per acre. 1911. D. C. Bundy sold to county commissioners 80 acres of above tract for $9,600, at $120 per acre. 1870. William Bundy bought 160 acres for $15,000, at $94 per acre. 1898. Same tract, 160 acres, sold to Allen Bailey, $7,000, at $44 per acre. 8. E. Bailey sold to William Starbuck 135 acres for $6,500, at $50 per acr& 1887. Same tract, 135 acres, sold to G. E. Bradfleld for $3,500, at $26 per acre. 1875. George Starbuck sold J. H. Bundy 195 acres for $12,000, at $61 per acr& 1886. J. H. Bundy gold same farm to JIary Fisher for $7,618, at $30 per acr& Xo change in buildings. 822 EECIPROCITY WITH CANADA. 1ST5. I). B. Stanloii boiigbt irA acres for $9,394, at $61 per acre. 1885. I). B. Stantdu offered above farm for .$6,930, at .$45 per acre. No buyers. 1875. D. PJailey boiigbt 55 acres, no buildings, at $55 per acre, for $3,02.5. 1894. D. Bailey sold same with house and barn for $1,815, at $33 per acre. 1873. L. & N. W. Bundy bought 200 acres for $13,000, at .$65 per acre. 1891. Eighty-four acres of the same farm were sold to J. Bernhard for $2,612, at $43 per acre. 1908. Same 84 acres sold to Jlr. Berry for .$S,050. at $103 per acre. 1808. W. E. Bundy paid $8,000 for 80 acres, at $100 per acre. 1880. Same tract sold for $4,800, at $60 per acre. 1894. Same tract sold for $3,800, at $47.50 per acre. 1007. Same tract sold for $8,000, at $100 per acre. The Chaie-aian. There are present to be heard delegations from North Dakota, also some one hundred or more persons and delegations representing the Chamber of -Commerce of Buffalo, the Eochester Chamber of Commerce, and the Xorth Tonawanda Board of Trade, together with one or two representatives who are not with delegations. The chairman is informed that the North Dakota people are will- ing to wait until to-morrow morning. Is that correct. Senator Mc- Cumber '? Senator McCumbee. I should say, Mr. Chairman, that, following the spirit of this reciprocity agreement, the barley raisers will sur- render to the interests of thr brewers. The Chaiemax. If the North Dakota people are willing to wait until to-morrow morning, the committee will proceed to hear the Bull'alo people if they will wait for a few minutes until Mr. Timothy Healy, international president, representing the International Brother- hood of .Stationary Firemen, makes a brief statement to the commit- tee; then we will hear the Buffalo delegation or their allied interests. STATEMENT OF MR. TIMOTHY HEALY. jMr. IIealy. ]\Ir. Chairman and gentlemen of the committee, I ask for two minutes, and I intend to confine myself to the two minutes. I represent the International Board of Stationary Firemen, a laboring organization. We have a delegation here from different States representing our brotherhood, with myself. All that I want is to be recorded and have their names recorded as against reciprocity will. C^.ii-tl:!. Senator Smoot. You have the list with you? Mr. ITealt. "We have the list here : Samuel Glasgow, of Philadel- phia ; William J. Brennan, of Newark, N. J. : John J. Cunningham, of Boston; N. J. James, of Washington, D. C; and James P. Hol- land, of New York City. The Chaie^fan. The names will be recorded. Mr. Healy. Now, the firemen are a class of hard-working men, that always have worked long hours, and the world knew ^'ery little of them. We have been organized for the past 10 or 12 years, and in that time we have been working for better conditions and shorter hours. We had to work up to a few years ago 12 hours a day, day and night, for the 3C5 days of the year. The fireman produces the steam that gives you lig'ht, heat, power, elevator service, and everything else that is used in our everyday life. We have progressed in the KEOIPKOCITY WITH CANADA. 323 United States, and probably in the larger cities and some of the smaher cities in the industrial districts, until now we have three shifts of eight hours. There is no such thing in Canada, with the exception of Vancouver and probably Victoria and British Columbia. In the industrial sections of Canada, the paper-making industry, the fireman is working 12 hours a day, and workmg for 25 to 30 per cent less than we are paying in the United States. I know what I am speaking about, because I have traveled through Canada, as well as through the United States. I have been in every State in this Union in the inter- est of the brotherhood that I represent, and we are afraid — we are almost certain — that what we have gained we are going to lose if the employers and the business men of the United States have got to compete with Canada. We are against reciprocity on behalf of the brotherhood which I represent. I want to be recorded as such. Thank you, gentlemen. The Chairman. Mr. "W. E. Robertson, president of the Buffalo Chamber of Commerce, is here, and I will ask him to introduce his speakers. STATEMENT OF MR. W. E. ROBEETSON. Mr. EoBEETSON. Mr. Chairman and gentlemen, the Buffalo dele- gation wishes to express its appreciation formally for the courtesy shown us by the J^orth Dakota delegation, and others who liave stood aside to give us this opportunity. I am a plain business man, and therefore am not going to attempt to spell out for you the equities in this matter. The great fact that we want to have established here is the unanimity of our city of four hundred and t^Yenty thousand odd people, the city of Eochester, which is here with us, of over 200,000 people, and the entire Niagara frontier, with reference to this subject. We believe that it is sound, and the speakers who will be presented representing various organizations in onr city, some affiliated with our chamber of commerce, we hope will bring out some facts that may enable you to get at the meat of the situation, or throw additional light on some points that may seem obscure. I am going to ask the Eochester Chamber of Commerce to speak first, and then the Xorth Tonawanda Board of Trade, and then fol- lowing that will be the presentation of the Buffalo Chamber of Com- merce position. I will introduce Prof. George M. Forbes, representing the Eoches- ter Chamber of Commerce. STATEMENT OF PROF. GEO. M. FORBES, OF ROCHESTER. Mr. Forbes. Mr. Chairman and gentlemen of the committee, I can guarantee to you that 1 will not take more than three or four minutes of your time. I can do this, because I have an exceeding simple testimony to give. I do not propose to undertake tlie analysis of any industrial or commercial conditions, nor to give you any sta- tistics, because I have not the experience and the information which would enable me to do that. I have listened with intense interest, as have my colleagues_, to the discussions of the last few days, which are immensely informing, and which represent the interests of one class of people in the Ameri- 324 EECIPEOCITY WITH CANADA. can Union. I doubly regret that I shall not have the opportunity to continue at these hearings and get the information which I am sure will come from the other great classes of the American people who have not been represented in the last few days. As the chairman of this delegation has stated, I come from the city of Eochester, N. Y., and rej^resent its chamber of commerce. The specific testimony which I have to give is that the chamber of commerce is unanimously and overwhelmingly in favor of the reci- procity agreement. I also state that we represent the sentiment of the whole city of Rochester ; we believe this is so, because it is voiced by the press of that city with complete- unanimity — that is, without respect to jDarty restrictions. Republican, Democratic, or independ- ent, circulated throughout the whole of western New York; we have yet to find in our inquiry a single dissenting note in regard to this matter. Senator Bailey. Are your people equally in favor of removing the tariff on all manufactured goods? Mr. Forbes. I can not state as to that. Senator Clark. May I ask one question: What benefit do your people expect to derive from this that will result from this unanimity of sentiment? What is the special benefit that they think will result to them or others of the American jDCople ? ]Mr. For.BEs. The special benefit, I believe, is the lessening of the cost of living for one important matter to the vast wage-earning and more narrowly laboring portion of the community, and the estab- lishing of more jDrofitable trade relations with Canada. Senator Gam,inger. How are you going to lessen the cost of liv- ing? What is the process? Mr. Forbes. I stated to you that I am not here for the purpose, and do not propose to be drawn into any attempt — because I am not competent to do it — I do not propose to be drawn into any attempt to analyze or set before j'ou industrial conditions and statistics. I came to put before you the simple fact of the sentiment of our com- munity. Now, with regard to the farmers, for instance, who surround the community, I would say with regard to them that if there is opposi- tion to this it has not made itself apparent in any organized form, and if it exists it certainly is not true of the population of that vicinity, as was stated bj^ Mr. Collins yesterday regarding the farms of the Northwest, that that ojDposition is very enthusiastic, vehement, or bitter, and I believe the rfasmi for that, gentlemen, is that the con- viction in our community is practically universal that the climatic differences between the situation which we occupy and the colder northern latitudes in reference to trade relations are, on the whole, a safeguard in regard to diversification of industries, diversification of production, and are, on the whole, a safegimrd and guaranty against any serious injury from the proposed reciprocity agreement. Senator Gallinger. You mean it will prevent importations into our country' — the climatic conditions? Mr. Forbes. I simply mean what I say. Senator, and that is all that I can state regarding it. That conviction is a matter of com- mon knowledge to the people of that vicinity. Senator Galunger. And yet, if you please, if there are differing climatic conditions that are going to protect the American fanner, how are vou troing to reduce the cost of living? EECIPKOCITY WITH CANADA. 325 Mr. Forbes. The cost of living will be reduced by the lowering, of course, of prices of some commodities. Senator Gallingee. Why and how? Mr. Forbes. Because under reciprocity the existing high prices can not continue for certain varieties — this has been said before you here very clearly, that the tariff wall, as it is called, does hold up those prices, and you have had stated before you here in a clear and convincing way the fact that it does by arguments that nobody can get away from. Senator Gallinger. That is going to reduce the price that the American farmer gets for his products? Mr. FoiuJES. Xow, just a moment — allow me — this has been said before you, that a market has been built up ; that that market and the right to that market is claimed by the farmers. Now, what is that market? I should say that that market is not an impersonal market. It is a human market. It is a market of human beings, and that market of human beings, ever}- single jDarticle of that protection affects the purchasing power of the wages of those human beings. Senator Gallingee. Do you think the human beings of Canada have an equal right in that market to those in the United States? Mr. Forbes. I do not propose to enter into that question. I have no idea on that question. I do believe there is a question, a broader question, a larger question, which has been intimated here by speakers as to the nature of that line which is drawn there be- tween the two countries and as to how much significance is to be at- tached to that line, but I am not here for the purpose of giving testimony upon that question. Senator Clark. I did not carry out my inquiry as to what caused the sentiment, but I have been listening here for two days with a great deal of interest, and have received more information as to the farming conditions in Canada than I have ever had before in mj' life. I have been firmly convinced from these gentlemen who have had the practical experience, who know the conditions that exist on each side of the line, that there is a possibility of raising iden- tically the same products in Canada that there is of raising those products here; that is, the products that have been spoken of, and under conditions that are actually more favorable to Canada. ilr. Forbes. I am not convinced of that fact. Senator Clark. I am somewhat convinced by the uniform testi- mony of those who, I assume, speak in good faith and with a knowl- edge of the conditions. Mr. Forbes. I am convinced that something of that kind exists. Senator Clark. But what I was going on to say was if, in my judgment, if this pact is to be carried out, it should be carried out upon some other line than that of the superiority of American con- ditions in raising these products, and that was what I was seeking to find in the attitude of your people. Mr. Forbes. It is exactly the attitude of our people, and it is ray firm conviction that the location of our communities as against the more northerly latitudes is a real protection and a real guaranty against injury from the trade in the two countries. Senator McCumber. Let me ask you if you know anything about die wheat raising in the Northwest? Mr. Forbes. I have learned in the last few days about all I know about it. 326 REGIPE-OCITY WITH CANADA, Senator McCumber. Notwithstanding the facts that have been gi^•ell in the last few days, contrary to them, you insist that the American will not be brought in competition with the Canadian farmer? Mr. Forbes. I have not said that there will be no competition with the American farmer. Senator McCumber. Do I understand you to mean, then, that the Canadian farmer can not produce in Saskatchewan cheaper than the American farmer can produce in North Dakota ? Mr. Forbes. I say no such thing. Senator McCtjubbr. Then you agree Mr. Forbes. I say I am not convinced that there would be no com- petition with the Canadian farmer ; but suppose there is competition with the American farmer, I assert that there are interests of the people of the United States, independent of the farmers, that ought to be taken into consideration in hearing this whole question in its broadest aspect. Senator McCumber. And one of the interests, of course, would be the interests of the brewer against the barley raiser ? Mr. Forbes. The interest of the laboring man. Senator McCumber. Do you know anything about the difference in the prices of barley between Winnipeg and Milwaukee ? Mr. Forbes. Senator, I have already stated, in the jalainest possible terms, that I am not here for the purpose of giving any such in- formation, and I have learned in the last two days all that I know of this subject. Senator McCuseber. You have an opinion, but you have not the facts upon which the opinion is based. Mr. Forbes. I ha^'o the facts stated here — presented in the last two days. Senator McCumber. May I ask your business? Mr. Forbes. My business is the business of teaching. Senator McCumber. Teaching ? Mr. Forbes. Yes, sir; the Rochester Chamber of Commerce is so broad in its policy, so representative in its membership, that it takes into its membership all classes of the community, and has avowedly declared itself as deeply interested in the general welfare of the committee. Sena! or McCxj:\rBER. That is, teaching in schools? Mr. Forbes. I am teaching in the University of Rochester. Now, there is one other thing that I wish to s;n' Senator Sjioqt. The plan of not going into the detail of this was agreed to before you came here, was it not? Mr. Forbes. No, sir. Senator Si\rooT. How did the Globe and Commercial Advertiser, of New York, of May 11, 1911, report this then? This is the report of the proceedings of j'esterday. I have the paper from New York, so T suppose it was given to some one that gave it out to the public: The Bufl'nlo cleloi^ntion said tbey dicl not propose to so into the A. B. C's of tlu- matter, but that tliey wanted to impress on the committee the unanimity of the demands of that \mvt of the country for ratification. E. C. McDougall, president of the Clearins House Banl< of Buffalo, presented the first argu- ment. Anotlier spenlver was H. A'. Burns, for the barley and malting inter- ests, which are great in Buffalo; and particularly all these leading interests of the city and of that part of the State voiced a desire for closer relations with Canada. KEOIPKOCITY WITH CANADA. 327 Mr. Forbes. You do not understand me to represent Buffalo, do you, Senator? Did I not make it plain that I represented the city of Rochester? Senator Smoot. I thought you were one of that delegation. Mr. FoEBES. I am here by invitation of that delegation. Our chamber of commerce sent a delegation of five persons to represent the Chamber of Commerce of the city of Rochester, and I stated at the outset that that was the body I represented. Senator Bailey. It is just like Senators ; sometimes they give out advance copies of their speech. Mr. Forbes. I would like to ask Senator "Williajis. I suggest that the gentleman be allowed to proceed. Mr. Forbes. I would like to ask the committee this question: Whether it is not legitimate for this delegation, even though it is not informed in detail as to these matters of trade analysis and statistics, and if it is not a matter of importance to this committee that it should know the sentiment of this country, however generated, what- ever the causes may have been which have led to the convictions of the people in regard to the matter — whether it is not of imijortance to this committee to know what those sentiments are ? I would like to ask further, and I know the whole significance of my remarks is in this one thing, as to whether the testimony which I am giving here as to the mere matter of public sentiment is sig- nificant testimony? Xow, it is significant testimony exactly in jDro- portion as it is typical and representative testimony; just in projDor- tion as it can be taken as an index, as a thermometer, of the average sentiment of the American people. You have had presented before you here in the last few days testimony which is sectional ; testi- mony which is gathered very largely around one commodity ; testi- mony which has come from one class of the community. Now, it you can get testimony as to the sentiment of an average and typical American community, is it worth your while to know what that sentiment is, no matter whether I am able to analyze or give you the causes that have generated that sentiment ? Senator Clark. I think that inadvertently I precipitated some of this discussion, and I answer " yes " to your question. But here is a section of country extending to Minnesota, representatives from every section, who say that their particular industry, which is very great, will suffer exceedingly, and they give us the details and the reasons why they think it will suffer, and they appeal to us not to pass the bill. You gentlemen appeal to us to pass the bill because you say the sentiment of your section is for it. Now, are we to act upon what we think is the sentiment of your section as contrasted to what is produced here as fact from these gentlemen who give us the reason why they think it will harm them? Ought you not to give us rea- sons to combat their facts ; ought not we to have the benefit of that ? Mr. Forbes. I think the gentlemen who follow me will do that very thing. At the same time I think it is for you to judge, not by the sentiment of my section— I should describe that as of very little im- portance — but the question is whether that section is typical. You heard here the statement that Rochester was regarded by the East as a western city. 828 EEGIPEOCITY WITH CANADA. Senator Clark. We took that for what it was worth. Mr. FoKBES. You heard tlie statement that Rochester was regarded bj^ the West as an eastern city. The diversification of its agriculture, its industries, its manufactures, its occupations, its average of people, in e\ciy respect, I claim that it is a typical American city, and for that reason, whether you may for other reasons be inclined to decide this question one way or the other, tliis testimony is significant just in so far as you regard it as being testimony regarding the opinion of a typical American city in regard to this question. Senator Williams. I would like to ask you a couple of questions more to see whether I misunderstood you or not. I understand you are of the opinion that the passage of this act would, pro tanto, un- shackle commerce between Canada and the United States. Mr. Forbes. Yes, sir. Senator Williams. And I think you also expressed the opinion that it would reduce the prices of some of the necessities of life to the laboring man. INfr. Forbes. Yes, sir. Senator Williams. I submit he has given two reasons, at any rate, why it should pass. Mr. Forbes. I will say further that in reference to the testimony that has been given here by the farmers as to the effect of this on certain commodities, and the estimates which have been made as to the actual injury which that would produce, I would like to ask the committee whether any tariff legislation of any kind or descrip- tion has never been enacted in this country that was absolutely fair and equitable? Senator Heybi-rn. I would like to ask j'ou a question inasmuch as the comittee does not answer questions. ilr. Forbes, ^fv question was a rhetorical question. Senator FIeybttrn. It will be answered later. You say it would reduce the cost of living. Would it reduce it by enabling you to purchase in the foreign market or by compelling the home market to sell it to you at a less price? Mr. Forbes. Well, I simply think it will reduce the cost of living because it will make a freer market. Senator Heyburn. But the word "freer " is rather general in its application. Mr. Forbes. It is generally understood by the American people. Senator Heyburn. Can you answer my question — would it make living cheaper by reason of enabling you to purchase in a foreign market or by reason of enabling you to purchase more cheaply in the home market? Mr. Forbes. By opening a foreign market to some extent, of course. Mr. Heybtjen. Then, your idea is that it would be a proper policy to close the home market in order that you might purchase more cheaply in the foreign markets? Mr. Forbes. It is my conviction that it would be a proper policy to open the foreign market to some extent in order that the cost of living may be somewhat lessened to the laboring man. Senator Heyburn. Lessened how? How would it be lessened? Mr. Forbes. I have stated the only reason which I can give in my previous answer. EECIPKOCITY WITH CANADA. 329 Senator MgCumber. Should that apply the same to the thinti;s ■which you sell as to the things which you buy ? Mr. Forbes. The question as to where such policy shall begin and as to how far it shall go, and as to all the details of the equity of that, it is for you gentlemen to decide. Senator MgCumber. We are seeking for information. Mr. Forbes. I have given you the only information at mj- com- mand. If there is no further question, I shall leave this with you, as I have tried to make clear the one contribution which I have to make. Mr. Robertson. Mr. H. W. Brush, of the North Tonawanda Board of Trade, will be our next speaker. STATEMENT OF MR. H. W. BETJSH. Mr. Brush. Mr. Chairman, I have consented — but in view of the cross-examination that my predecessor has been through, I might say now, with regret — to present an open letter from the North Ton- awanda Board of Trade. I do wish to make this explanation, how- ever; naturally it was expected that there would be some question here. North Tonawanda is a lumber market. There came with me two lumber dealers, one a " dyed-in-the-wool " Democrat and the other a " rock-ribbed " Republican, who are entirely competent to answer any question that might be raised in connection with the lumber interests or any action taken in North Tonawanda in con- nection with reciprocity. It was difficult to get them to leave and it was thoroughly understood that our hearing would be held yester- day, and they were both compelled to return last night, but there are lumbermen here from Buffalo, who I know will be glad to answer any questions which may come up. I simply present the letter to the Finance Committee : North Tonawanda Board of Trade, North Tonawanda, N. Y., May 10, 1911. To the Finance Committee, United States Senate. Gentlemen: The North Tonnwanda Bo!,rd of Trade has given the question of reciprocity between the United States and Canada the most careful considera- tion, as there is probably not another city of 20 000 in the United States that has such direct and intimate business relations with Canadian firms. This grows out of the fact that the Tonawandas are the hirgest white-pine market in the world, and, of all the cities on the Great Lakes, Chicago alone disputes with it the supremacy in aggregate annual lumber traffic. On a question so vitally affecting the growth and prosperity of the Tonawandas, a growth that has averaged 1.S3 per cent for each of the past three decades, it can be readily understood that the board of trade wished to be well advised before it com- mitted itself to any declaration on this very important question. Not only have all conditions been carefully inquired into, but a postcard canvass of the entire membership of the board of trade has been taken. This postcard vote showed the overwhelming sentiment of 12 to 1 in favor of the broad, business- producing, equit.'ible plan that our Chief Executive so earnestly champions. In all previous legislation on lumber tariffs this board of trade has uniformly urged the retention of the highest possible tariff, believing that it was in the interest of the lumber Industry and of local business prosperity to advocate such procedure. The action which the l)oard of trade has taken in this in- stance, therefore, is radical and unprecedented; but the more the question is studied the more it appeals to the business sense of all concerned. With the knowledge that labor conditions across the border, particularly when measured by output for any given amount of pay roll, vary very little from the condi- 330 RECIPROCITY WITH CANADA. tions that obtain at home, this board of trade can not understand why there shonl(.l be iiny more of an artificial commercial barrier between New Torli State and the Province of Ontario, for instance, than between the State of New York and the State of Pennsylvania. If there were a restricted market there cuuld be some advantage is restricting the source of supplies, but in normal business times there is a market, and a growing market, for every foot of lumber that can be produced. This is evidenced by the fact that 20 years ago the Tduuwandas handled nearly 800,000,000 feet of lumber at prices that do not compare in any way with the prices paid for lumber to-day, while only half as much lumber is handled now as then. Probably the most striking summary of the entire lumber situation of the United States is found in the statement, in August last, of the manager of the National Lumber Manufacturers' Assocation, who, in addressing the lumbermen of the Pacific coast, said : " The day of cheap lumber is passing and soon will be gone, but the men who make the money will be those who own timber and can hold it until the supply in other parts of the country is gone. Then they can ask and get their own price." The organization which he represents opposes the pending reciprocal agree- ment, but can any stronger argument than their manager's own statement be produced in favor of providing the United States, the general consumer, with freer access to the supplies that are so bountifully supplied across the border line? Forty years ago three-fourths of the timber now standing was pubhciy owned. Now about four-fifths of it is privately owned, and of this four-fifths 48 per cent is held by only 19.5 great holders. Of these I'.io the Weyerhauser Timber Co., the Southern Pacific Railway Co., and the Northern Pacific Rail- way Co. are chief. Timber tracts that sold for .$20,000 40 years ago now com- mand over $1,000,000, and are steadily and rapidly increasing in value. Which is most in need of your careful consideration — these great corporations or the thousands of business men, the hundreds upon hundreds of thousands of home builders who would lieneflt from the enlarging of the supply of this necessity, this great gift that nature never intended should be monopolized? Most respectfully sulimitted. The North Tonawanoa Boabd of Tkade. Senator Gallii^gei:. Just one question: Tiiis so-called reciprocity agreement puts agricultural products on the free list ? Mr. Brush. It does. Senator Gallingee. Are you willing to have finished lumber put on the free list for the benefit of the consumer? jNIr. Brush. The raw material, that is, the unfinished lumber, comes in free. Senator Gallingee. I mean the finished lumber, the Mr. Brush. The finished lumber ? Senator McCumbbr. Yes. The farmer does not buy the unfinished lumber. Mr. Brush. Well, I know this, as I have said — I am not prepared to answer the questions. I know this, so far as our local sentiment is concerned, we feel there should be more attention given to the admission of anything that would come under the head of "raw products." When it comes to any competition of labor, it is a dif- fent question. Senator Smoot. Do you think your chamber of commerce would agree to have a Canadian reciprocity act passed by Congress having free finished lumber from both countries? Mr. Brush. I am not in a position to answer that. Senator S^tooT. Do you think they expect to get any Canadian trade in finished lumber under this pact? Because if they do, I think they will be sadly disappointed. We charg'e a duty of 50 cents per thousand feet where it is finished on one side, and where it is tonguod and grooved, planed, and worked on two sides, 75 cents per EECIPKOCITY WITH CANADA. 331 thousand feet. In case finished lumber comes into this country, it comes in at those rates, and if we want to send finished lumber into Canada the rate is 25 per cent ad valorem. There is not very much reciprocit}' in that, is there ? Mr. Brush. We voted on this question as it stood. Senator Bailey. During the years when the Tonowanda Chamber of Commerce was always opposed to taking the duty off of lumber you had not exhausted your lumber supply around Tonowanda, had you? Mr. Brush. The lumber came from Michigan, but the point is the same; it was nearer. Senator Bailey. Xow you want to bring it from Canada ? Mr. Brush. Certainly. They believe now that raw products in the main should have more attention than they have had heretofore. Senator Bailey. Are they milling more? Mr. Brush. Well, it is forwarding more than milling. Senator Bailey. They would hardly stop it and let you take a profit for forwarding it. They would forward it themselves as they bought it. The fact of the matter is you have extensive mills there, haven't you ? Mr. Brush. There are box and shook and other mills. Senator Bailey. You want to draw the material free ; that is the truth of it. Mr. Brush. Yes ; as we have said here, we believe it should be freer trade. Senator Bailey. I know that a difference in tlie condition makes a difference in opinion. I can understand how the friends from ]\Iichi- gan used to want the highest duty on lumber until they denuded their forest. Xow thej' want to buy lumber from other people to manufacture into furniture, and they want it free. That is the kind of inconsistency that you Republicans sometimes practice. Mr. Brush. As I said in the first place, there are lumbermen who can go into this question and give you the information that I am not in a position to do. Senator Bailey. You know, of course, that under the law now the duty is only about 7 per cent on rough lumber ? Mr. Brush. Substantially. Senator Bailey. And the duty on cheap underclothing is about 80 per cent. Don't you think we ought to reduce that 80 per cent duty before we repeal the 7 per cent duty? Mr. Brush. We took the vote on the proposition as it stood. Senator Clark. One reason assigned by your Chamber of Com- merce why this duty should be reduced was the scant supply of American growing timber, and it gave the percentage under private ownership. I am inclined to think from the percentages given that they did not include in their calculation something like 200,000,000 acres of timber now reserved by the Government in its forestry reser- vations, and only compared the unappropriated, unreserved timber upon the public lands v/ith the private supply. Do you know any- thing about it? Mr. Brush. I take pleasure, Senator, in informing you that all the statistics given in this are taken from Senate Document 818, issued under the auspices of your committee the Senile Finance Committee, in February last. 93285— No. 5—11 7 332 BECIPEOCITY WITH CANADA. yeiiator McCumber. "Will you tell me whether some of your people there who are ititerestcil in this free lumber into the United State? own Canadian timber? Mr. Brush. Some of them do; there are as many Democrats as Republicans who are owners. Senator Bailey. I am glad the Democrats are able to buy timber. Senator McCujiber. That stimulates their interest in importing it free, doesn't it? Mr. Brush. Undoubtedly, to some extent. Senator Stone. I would like to ask you if you are prepared to express an opinion as to whether admitting lumber free would reduce the cost of finished lumber to the consumer in the United States? Mr. Brush. I would prefer to have some of the lumbermen answer that, Senator. My personal opinion is, from all the information I have been able to gain from that, that on the higher grades of lumber there would practically be little difference; on the lower grades there might be more. That is my impression from the infor- mation I have gained. Senator Stone. Did you ever know of a business man, particularly a Republican business man, who was willing to have the duty re- moved from his particular production? Mr, Brush. They are changing their minds on this question, Senator. Senator Hetburn. I desire to ask you a question : Is your purpose in supporting this treaty that it will enable you to deal exclusively in Canadian lumber, or else compel the American producer to reduce his price? Mr. Brush. I do not believe that anyone is in a position to limit, or even prophesj^, what the effect will be. Senator Hetburn. I asked what your purpose was in supporting this measure in regard to that commodity. Mr. Brush. As I stated before, we believe more attention should be given to anything that comes under the raw products. Senator Hetburn. That is more general than I desire. Of course you, being one of the parties who present themselves on behalf of those in favor of the treaty, you must know your purpose in present- ing it, or the reasons that actuate you. I want to know whether or not that reason is that you may be enabled to purchase Canadian lumber cheaper, or compel the American producer of that commodity to sell to you at a lower price? Mr. Brush. There are two points involved.- Senator Hetburn. I think there is only one. Mr. Brush. It will steady the market in the first place. The sup- plies are nearer there, but they are retreating farther west. Senator Hetburn. You do not answer my question. I want to know what your purpose in supporting this treaty is. Mr. Brush. I believe it will be in the interests of Tonowanda. The lumbermen will answer any questions, though, which you wish to specify. Senator Hetburn. Your belief is a general one? Mr. Brush. It is a general one. Senator Hetburn. That it would be to the interest of your town? Mr. Brush. Yes. EECIPEOCITY WITH CANADA. 333 Senator Heybuen. You do not know why or how it would interest or benefit your town ? Mr. Brush. We think that it would lead to larger business. Senator Heybuen. With Canada ? Mr. Brush. With Canada ; both ways. Senator Heybuen. That answers my question. Mr. KoBERTSON. INIr. Chairman, it must be admitted that you men are going to spell out and decide whether or not this reciprocity treaty shall be passed or not. Now, on account of our geographical location, if freer trade be- tween the two countries follows, we, as a great commercial center, a great port, with our lakes, canals, and transportation, must of neces- sity profit as a community in the handling of this increased com- merce. Now, there is where Buffalo is sure to prosper, through its handling of increased commerce. Now, our chamber of commerce represents business interests, ac- cording to the Census Bulletin 101, of .58.4 per cent of everything that is manufactured in this countr)- — 58.4 per cent of the various lines of manufacture in thi-^ country are produced in our city. Our chamber has taken action on the matter and no protest whatever has been entered against the reciprocity treaty, and the various men who will speak here will speak on particular industries with which they are acquainted, hoping thereby to bring out some facts which may be of interest to you. But as a community, if reciprocity is estab- lished, we can not help but pro-per or make increased profits out of this tremendously increased commerce through our gates. The Eng- hsh press and every newspaper in this country would bear out that contention of our community. It is obvious. It requires no proof. Senator Smoot. Does your chamber of commerce approve of, as I expressed to a former speaker, that they want all raw products free of duty? ^Ir. Robertson. Our chamber of commerce will speak through the speakers who know the subject and will speak here. Senator Smoot. I will ask ycu, then. Mr. EoBERTSON. I do not know. sir. Senator Smoot. That is, your chamber of commerce onh^ expresses itself now as to lumber ; is that your chamber or is that the Rochester Chamber of Commerce ? Mr. Robertson. I am speaking for Buffalo; and men who will follow, and who can give you the facts which may enlighten you on some of these features, will speak, and they know, and I do not. I simply am the president of a great commercial organization for the time being and can not be considered to know these things. Senator Smoot. You do not want to express an opinion, then, as to whether they want raw materials free or not? Mr. Robertson. I would not be in a position to. Senator Smoot. Do you want them ? Mr. Robertson. Do I ? Senator Smoot. Yes. Mr. Robertson. I have not considered that question. I have con- sidered this question of reciprocity as explained by Secretary Wilson before the business men of Buffalo, who has stated the position of the administration frankly on it. and a Member of Parliament, Mr. 334 EECIPKOCITY WITH CANADA. Guthrie, from Canada, and we believe that if you do adopt it that it is a good thing for us now. Senator Bailky. Let me ask you this: You say that, as a general proposition, freer trade will increase the volume of trade and be a good thing for Buffalo. Would not that same reasoning apply to the whole country ? Mr. EoBERTSON. It Avould seem to ; yes. Senator Bailey. Then, are your fifty-eight and a fraction per cent of the various lines of manufacture ready to take their reduction as proposed in this treaty to the farmers? Mr. EoBEETSON. I believe that each line of industry has its own peculiar difficulties, and that in taking up each line by itself and making a thorough study of its business aspects without regard to politics is the only way to come at a conclusion which is sane. I can not answer for .18 or all of our lines of manufacture. We have 198 different lines of manufacture in our city. Senator Bailey. You stated the general proposition, in which I agree, that freer trade means a larger volume of trade, but if freer trade with Canada means a larger volume of trade for Buffalo, freer trade with all the world means a larger volume of trade with prac- tically every seaport in America. Mv. EoBERTSON. It docs not necessarily. Senator Bailey'. You ought to be willing to give all the other places the same advantage that you are now seeking for Buffalo, and you ought to join us in apjolying to these various lines of manu- facture a scale of reduction corresponding to the one proposed in this treaty. I just wanted to be certain that we are going to have the moral support of Buffalo when we reach that. Senator Clark. I want to ask one question along the general line; As president and chairman of your board, you represent it in a gen- eral way. Xow. in a general way, is it not a fact that under present conditions the city of Buffalo, without any change that shall work injury to Minnesota or any other section of the country — is not it a fact that without any change and under present conditions Buffalo is now one of the prosperous centers of the whole United States, and has not its prosperity for the last 15 years been extraordinary as com- pared with the advance in other sections of the country? Has it not been exceptionally prosperous? Mr. EoBEETSON. I do not know as to its being exceptionally pros- perous. The city is prosperous by reason of its location. We have wonderful natural advantages. It can not help but be prosperous, You can manufacture anything there. Senator Clark. Then the proposition is that the Senate is to choose between making a prosperous man more prosperous and making a reasonably well-to-do man less prosperous? Mr. EoBEETSON. I hardly think that is it. Senator Stone. I want to put a question to you in this form: If we take the tariff duty off of many articles raised on the farm and reduce it on other articles produced on the farm for the benefit of the con- suming public at Buffalo, the workingmen in these 198 manufactur- ing industries, for instance, and the men who own and manage and operate them, do you think it would also be proper and right at the same time to take the duty off of some articles of necessity and to reduce the duty on other articles of necessitv the farmer buys and which you create? RECIPKOCJTY WITH CANADA. 335 Mr. Robertson. I think the question is being answered by the people of this country; that, if anything, the Democratic victorV last fall indicates that very trend of thought. Senator Stone. And it accords with your sound judgment? Mr. EoBERTSON. Yes, sir. Senator Smoot. I want you to talce word to your chamber of com- merce that, as far as I am personally concerned,"if the time ever comes when they, for selfish reasons, demand free raw material, they will never receive the support of the man that produces them to protect their interests. Mr. Robertson. I appreciate that. Senator Williams. I think this is hardly a hearing. Mr. Robertson. I would like to offer in evidence as a fact, which is a fact, a telegram from the manager of Crandall Horse Co., of Buffalo, which is as follows : [Telegram.] Buffalo, N. Y., J/oy 11. 1911. Geoege Ueban. Jr. Care The Xeio Willard Hotel, Washington, D. C: On Jlonday of this week we sold Daniel JIcGi-egor, of Toi-onlo. Cauada. to be retailed on open m;n-ket tbere, nineteen work hnise for forty-flre hundred seventy dolUars, or an average of two hundred forty dollars iier head, to which a duty of twenty-five per cent must be redded. If this duty wore removed Canada and the Northwest would be best buyers for at least twentv thous.uid horses the coming serson. A. D. CliONK, iliumgci- CraniliilJ IJor.tc Co. Mr. Robertson. Buffalo is one of the largest horse markets in this country. Senator McCumber. Are those horses to develop the farm, sir ? Mr. Robertson. I can not answer that. We had with us Mr. J. C. Dold, the president of one of the pack- ing companies, with packing houses in Buffalo, one in Kansas City, and one in Wichita. He was compelled to leave. He has left a letter here which I would like to read, or enter without reading, as you say. The Chairman. You may enter it and it will be printed. (The letter of Mr. Dold filed by Mr. Robertson is as follows:) W. E. EOBEETSON, President Buffalo Chamber of Commerce. Deab Sir: When requested by you on my way from Boston to Richmond, where I have a delegation of branch managers waiting for me for the opening of our branch there, I expected to be able to add my modicum to the testimony of the representatives from the Niagara frontier in favor of reciprocity before the Finance Committee of the Senate. As I am now absolutely forced to leave for Richmond I ask you kindly to read what I would like to have said in person. While naturally sharing the favorable convictions of the great majority of merchants and farmers along the Niagara frontier in favor of the proposals, a few practical " butcher " facts, as a representative of part of the packing industry of the Niagara frontier, may have bearing at this time. Therefore, on behalf of this industry I wish to state that, along with oilier packers of Buffalo, I do not believe that the reciprocity agreement would affect stock raisers (at least not in our territory) adversely, excepting possibly so far as keeping down the peak load of the high cost of liviug. The range of prices is, after all, a matter of supply and demand. As to this, our experience of 40 years during the many changes affecting the product and its prodnction has shown about an average throughout. In regard to the peak load of high prices, about a year ago the price of all live stock was unusually 336 BECIPEOCITY WITH CANADA. high — about the highest since the war. The prices of hogs, for instance, was forced up to 11 cents per pound, so adversely affecting the cost of living as to bring nbout Inbor troubles, high-meat riots, and almost kill the export trade in meats. Incidentally, Russia, Hungary, and even China were enabled to enter into competition with American nie.its. It will take several years to fully recover the lost trade to its full former prestige, even under normal con- ditions, and the farmer who boosted prices must eventually pay for it by the other extreme. For instance, hogs are now about 6 cents per pound, or nearly half of the high-peak load. It is therefore hard for us packers to sympathize with the down-trodden farmer who forced us to pay about $27 for a hog which probably did not cost him over $15, and, besides, to take the brunt of the con- sumer's damnation and to lose plenty of money on the product. In this case reciprocity might have avoided these adverse conditions and have kept the price of live stock at a reasonable and profitable basis for the farmer. It might have avoided inevitable comeback of re\ erse conditions. On cattle, Canada does not produce the high grades of corn-fed cattle we do, particularly those of the West and Southwest. The Canadians have, however, in the past supplied a great deal of feeding and breeding stock, which under the reciprocity treaty could be shipped over here, fed on our farmer's grains— admittedly the highest source of return a farmer can get out of his feeding grain and not counting the humus value to the soil — the Canadian farmer could even afford to ship these fat cattle back again and market them in Canada as such. During the most prosperous days of range cattle young steers were often shipped from Texas and the Southwest to the ranges of Montana, and from there either to feed lots in Nebraska or to the markets of Chicago, and all this presumably at profitable return. Being an old constituent of Gov. Stone, I remind him that Kansas City is probably the largest stocker and feeder market in the world to which grass cattle are shipped in the fall to be resold to the feeder and fattened on corn, fitted for high-grade beef in the eastern and export markets. As to sheep and lambs, some years ago Canada shipped many lambs into this market, usually young stock for feed purposes. Being of a superior breed these were much s.iuglit for )iy the feeders of the E;i stern States for the profitable conversion of their grains into fat mutton. This condition might come about again to the equal advantage of Canadian breeder and Ajnerican feeder. As to hogs, the peculiar type of hog bred and raised in Canada, and their feedin,;,' for a large part of pea meal, makes Canadian bacon sought for at a premium in England, often at from 1 to 2 cents per pound over American bacon. This, I believe, will create a large market for hogs raised by American farmers to be shipped into Canada for domestic consumption. This would be of large benefit to the American producer. Although somewhat against the best interests of the packer, who on account of the duty of H cents will not be able to ship the cured product into Canada to any great extent, although even under the present tariff when relative prices have admitted thereof, we have shipped from our Buifalo plant the maun- factured product in considerable amounts. However, speaking for our own firm, we are inclined to talve a broad view of the matter, realizing that what benefits the people at large must benefit the individual sooner or inter, and for this reason we believe that all of the packers in the Buffalo district favor the proposed reciprocity agreement with Canada. Our interests are also in the West. We have plants at Kansas City and Witchita, Kans., territories which I believe will not seriously feel any competi- tion in this line from Canada, owing to the comparatively small amount of live stock they can produce as against the enormous product of the South and Southwest, to say nothing of the vastly superior quality — the splendid marljle heifer beef raised in Texas and Oklahoma, having admittedly no peer in all the world. I might also, in conclusion, remark that the Dolds are farmers, to a great extent, along the Niagara frontier, having a grain and stoclc-fattening farm, producing principally whe.nt, timothy hny. and corn for silage purposes, Neither the writer nor the superintendent of our farm— formerly a professor in agri- culture at one of the eastern colleges and an unusually intelligent and practical agriculturist— can, after having discuss(>d the matter'from all sides, see where our farming interests can in any way be adversely affected by reciprocity. J. C. DOLD. BECIPEOOlTy WITH CANADA. 337 Mr. Robertson. Xow, as a much older business man, and one who has had a wider outlook on the general business of our conununity, I want to introduce President Elliott C. jMcDougall, who is president of the Buffalo Clearing-House Association, who was once president of the clearing-house section of the American Bankers' Association, former president of the New York State Bankers' Association, and the former president of the chamber of commerce. STATEMENT OF MR. ELLIOTT C. M'DOTJGALL. Mr. McDouGALL. jNIr. Chairman and gentlemen, I do not believe in personal remarks, but I can not refrain from saying that I am probably the only man who has spoken or who will speak here who deals in a commodity unprotected by the tariff. [Laughter.] Senator McCtjmbee. If the gentleman will state his business, we can better comprehend his testimony. Mr. McDotjGall. Oh, yes. I am a banker. That is, I am a bank official. There are one or two points I want to call attention to. Senator McCumbee. You belong to no company, do you, that has any interest in paper, print paper, in any way ? Mr. McDouGALL. No; not any. I have no interest of any kind in manufacturing. I have confined myself to my own business. Senator McCumbee. Or any interest in a paper that buys a manu- factured article? Mr. McDouGALL. No interest in any jDaper, or interest in any manufacturing concern. I am interested simply in my own ^.nstitu- ion, and I have confined myself strictly to my own business. If there are any other questions with regard to my interests I shall be very glad to answer them. There is one point I would like to make. Col. Wilkinson, who spoke a Minnesota man — and they presented a very good case — said that they could not find out from where this demand came ; who was it that started this reciprocity movement; who was the sponsor for it? They said they had looked and tried to find out, and that same trouble has come up in connection with a good many other matters because the person is one who generally is lost sight of, and I am inclined to believe that the person who started this movement and is interested in it is the consumer who is very seldom regarded. Now, to illustrate that point Col. Wilkinson said that of about 240,000,000 bushels of grain, which was somewhere near the average production, about 40,000,000 of it probably was used by the producers, and that 200,000,000 were sold to other consumers, which means that the price on the 200,000,000 to other consumers was desired to be maintained at as high a price as possible. Now, he also said, as I understand it it seems to me very clear that he said, practically, that was an expectation ; that in considera- tion for the farmers voting and supporting a protection for manu- facturers that the farmers were to have their turn and get their share of the bargain, and it was just about time when they were to realize their expectations. Now, gentlemen, that simply means this— I do not blame any farmer for getting just as high a price as he can for his wheat — but that simply means this, that, artificially, they were to hold up the price of their products and to make other con- sumers pay an artificial price for it because they wish to get it. 338 HECIPKOCITY WITH CANADA. Now, I do not know any reason why. They also brought out in their testimony that wheat produced in Canada was a better wheat, and any man, even though he is not a miller, who has seen it, knows it is a better Avheat. I think that the consumer is entitled to have his day in court and to ask why, if the real difference in price, considering the quality of the wheat, is about 10 cents a bushel, why this consumer should not be able to get that good wheat and get the benefit of that differ- ence in price. Senator Sijimons. Does that apply to the consumer of everything else in the same way? Do you know that the farmers are asking that the consumers of all products be put upon the same basis ? Mr. McDoTTGALL. I have no objection to answering questions if you will take them as my personal opinion, except when I state that I am authorized to speak. I think that every other consumer has the right to be considered just as the consumer of wheat. Senator McCumbee. Buy upon the free-trade market the same as the producer of wheat sells upon the free-trade market ; is that your view ? Mr. ^McDiicGALL. Yes. "Sly view is — that is my personal view; I am not authorized to express this view for the chamber of commerce ; but I will answer any question you wish to ask me — yes; if the pro- ducer of wheat is selling on a free-trade market that every other man shall sell on a free-trade market. But if it is not advisable because we have to have a revenue, why then the producers of wheat, the farmers, should have the same protection that any other man has— that is my personal opinion. Senator Smoot. Then you are in favor of this reciprocity bill? Mr. McDorr.ALL. Yes, sir ; I am in favor of that as it stands, be- cause that is all that is in sight now. Senator McCujiber. You would be more in favor, however, if we could attach to it a very broad free list ? Mr. McDoroALL'. Personally, if there was the slightest prospect that it would go through. Senator S:srooT. Do j'ou think that if we had everything on the free list, the same as the farmers' products are here, that you would have very many consumers with money enough to buy your products? Mr. McDouGALL. Yes ; I think we would have plenty of consumers, but I do not know where the Government would get its revenue. Senator Clark. You think it is a step in the right direction; is that your view ? Mr. McDouGALL. Yes. Do not misunderstand me. I am not com- ing here as an advocate of free trade. There is no sentiment in Buffalo for free trade. I would be misrepresenting Buffalo if I should so state. I am not coming here as a representative for tariff for revenue only. Senator McCttmber. Yet you advocate free trade in all food prod- ucts of the farmer? Senator SirooT. I thought it was free raw material. Mr. McDoroALL. Yes, sir; we do. That is a selfish standpoint. But we come here on that basis, because that is all that is offered to us. Senator Smoot. Would you want to go anj^ further? Mr. McDoiTGAi.L. Individually, yes, sir. b RECIPROCITY WITH CANADA. 339 Senator La Follette. Would Buffalo ? Mr. McDouGALL. Why, gentlemen, I am perfectly frank to say that Buffalo is just like the farmer. If you touch the Buff'alo manu- facturer, every manufacturer will -want his end of it let alone and reduce the duty on the other fellows. There is no secret in that. There is another point I want to raise. They spoke about the fact that there was no export trade in there. Now, gentlemen, I submit this. Here is a pretty grave question. I do not want to argue. All I want to do is to suggest these ideas; it is not necessary for me to argue with you gentlemen. I want to suggest the idea, which is this: It is a very grave question whether this artificial price for wheat is not what has killed our export trade. We used to have a good export trade. Col. Wilkinson was correct in stating there was very little export trade now. Have not we killed it by our artificial price on account of the tariff ? Senator Simmons. Is there any trouble in finding the world's markets for all the wheat we produce if we do not need any of it for consumption ? Mr. McDotJGALL. Xo; there is no trouble in finding it at the proper price, but not at our price. We can not sell to them and satisfy them at our prices. We have held them up before. Senator Simmoxs. You mean to say that the wheat is higher in the domestic markets in the United States than it is in the world's markets ? Mr. McDouGALL. Yes; so the gentleman from Minnesota testified, and I never heard a man who knew more about the practical part of his business than Col. Wilkinson. Senator Simmons. Now, is Canadian wheat higher in the domestic market of Canada, Senator, than it is in the world's markets ? Mr. McDouGALL. I can not answer that question. You will have to ask some of the grain men that question. I am falling back on the testimony of Col. Wilkinson. Senator Simmons. It is testified here that the price of Canadian wheat in the domestic market of Canada is the same as the world's price. Mr. McDouGALL. Yes, sir. As I recollect it, I believe Col. Wilkin- son did so testify, and that is very natural, because I presume Can- ada can not possibly use the wheat it produces, while we are now consuming very nearly all the wheat we produce. Senator Bailey. Do you know what proportion of wheat the United States produces of the world's siipply ? Mr. McDouGALL. No. sir. Some grain man will have to answer that question. Senator Bailey. It is about 20 per cent. Mr. McDougall. Yes; but I am inclined to believe that we have killed some of our markets, because I know that some of the con- suming nations have said, we have got to start new wheat fields else- where. We have to find new sources of supply. We can not depend on the United States market. It is too unstable for us. There is too much speculation. We have been held up too often. Senator S^ioot. If we have people enough to consume all tlie wheat we raise, we need not bother about that. 340 EECIPEOCITY WITH CANADA. ^h'. McDoLHiALL. But T think we might be able to raise twice S:S much and make more money, even if we did not get quite as high a price for it. Senator Smoot. That argument will never appeal to the farmers, or anyone else who knows anything about farming. Mr. McDouGALL. A gentleman spoke about Mr. Hill's railroad. Mr. Hill can defend himself, l>ut, as I understood, his criticism was that they had built spurs running up into Canada — short spurs. I can not see how that is going to damage this country. They tap the States and they bring the wheat into this country, and they get the long haul, and we build the engines to haul it; we keep up the track for it to pass over, and we build the ears in which it is hauled, and I do not really see where that is any damage to our country, because if he does not do that the Canadian Pacific Railroad from above will build down and tap that country, and they will carry it to Canada. I do not think that was a particularly strong point on their behalf. Xow, the gentleman also said that we would have a panic if this kept on. Of course, I would have to apologize if I argued on that point with you, but what I am here to convey to you is this, and to say this — I do not know anything about the sentiment of the rank and file in Buffalo; that is, we have people there — for instance we have very many operatives; we have women clerks who work in dry-goods stores who do not get enough to live on, hardly. We have a lot of labor which is not high paid. Now, they are entitled to con- sideration as is the farmer, but I do not know what the sentiment is. I do not speak for them. I simply come to bear testimony to this effect, that among the business men generally in the city of Buffalo, in the city of Niagara Falls, and all through that section, among the business men generally, the sentiment is almost positively unanimous in favor of reciprocity. Xow, the Chamber of Commerce in Buffalo has about 3,000 mem- bers ; is that right ? Mr. Robertson. Thirty-two hundred. Mr. McDouGALL. Thirty-two hundred. A great many of those are not manufacturers. They represent all sorts of interests, and wherever a question comes up for discussion before the chamber, a postal-card notice is sent to every member as to what the matter is which shall come up for discussion, and inviting them to come there and hear it discussed pro and con, and then to vote on it, and the chamber of commerce voted overwhelmingly in favor of this matter. Senator McCt mber. Do you think that all of the members of the chamber of commerce read all of the pact, or whatever you call it? Mr. McDouGALL. Xo, sir. Senator ilcCu jibek. And knew what it was ? jNIr. McDouGALL. Just a general idea of it. Of course it was explained. Senator McCumbee. They had heard of reciprocity and thought it would help them sell the manufactured articles in Canada and so they were in favor of it without reading it and without knowing very much about it except that it was reciprocity. Mr. McDouGALL. Yes, sir ; that is my private opinion, except this, as has been explained here, that Secretary Wilson did, and explained RECIPROCITY WITH CANADA. 341 the matter before quite a number of the members of the chamber of commerce. Senator La Follette. Do you think it would have made any differ- ence in the opinion of the chamber of commerce if Col. Wilkinson bad been there and presented the argument of the farmers such as he has presented here? Mr. McDouGALi.. I do not think it would have made any great difference. We are all for our side, as Mr. Wilkinson is for his, and we are entitled to as much consideration as Mr. Wilkinson, and no more. Senator Williajis. Yours is in favor of removing the tax and his suggests that we keep it on. Mr. McDouGALL. Yes, sir. Senator McCumber. His claim is that he has not received, and the people he represents have not received, the fair proportion of the general prosperity of the country, and yours has received more than its share, and therefore you want to increase yours and reduce theirs. Mr. McDouGALL. It is the struggle for existence. Senator McCumber. Not a struggle for existence, but a struggle for advantage. Mr. McDouGALL. I will admit that, Senator ; that is the soul of business to-day ; every man is getting all the advantage he can — I do not mean an unfair advantage — but he is getting all the advantage he can, and everything he gets he thinks is fair. Senator Clark. I take issue with you there. Every man is not attempting to get all he can or working altogether for his own ad- advantage without considering the effect on other people. Mr. McDouGALL. Well, of course, if it is a bad thing for the country at large, it will be a bad thing for the man who gets it. He has to have intelligent selfishness. I mean that every man is doing the best he can for his own interest. Senator Clark. With due regard to the interest of others. Senator Willlims. With due regard to the rights of others and his duty to others. Mr. McDouGALL. That expresses it exactly, but I do not think that the average business man considers that in regard to philan- thropy; but T think the average man does with regard to the rights of others. That expresses the idea exactly. I thank the gentlemen. Mr. EoBiNSON. I think, gentlemen, that there are three subjects here on which we can give you some light. On the rest I simply wish to note the appearance here to get rid of the others. I would like to note the appearance of Mr. George Urban, jr., of the Milling Exchange; Mr. Theodore Metz, of the Builders' Exchange; Mr. C. F. Warner, representing the Eeal Estate Association; Mr. James Wil- son, representing the A^'^lolesale Merchants' Association; Mr. W. L. Manning, representing the Wholesale Grocers' Association ; Mr. H. A. Meldrum, representing the retail merchants ; Mr. Henry Adsit Bull, representing the common council of the city. We will next take up the barley and malt subjects, following that with such light as may be thrown on this subject of wheat by a representative of the corn exchange — Mr. Preisch. Now, the length of these talks will depend on entirely how inter- esting they are to you, as I realize you have been here all day, and I do not want to burden you. I will next call upon Mr. Burns to address you. 342 EEciPKOci'nr with Canada. STATEMENT OF MR. H. V. BURNS. Mr. Burns. Mr. Chairman and gentlemen of the committee, when our western competitors appeared before the House of Repre- sentatives — the Ways and Means Committee of the House of Repre- sentatives — they laid great stress on the fact that the malting su- premacy of the United States, under existing conditions, had been removed from the East to the West. In conversation some months ago with Representative Tawney he emphasized this same fact. Gentlemen, that statement is true. The malting supremacy, under existing conditions, has been removed from the East to the West, and I am not here to say one word that will change those conditions. Let them keep their supremacy. Neither am I here to wage any trade war before your committee, but I am here to plead for justice, simple justice, for the cause which I represent. In 1890 Congress enacted tariff laws which completely cut off our best and nearest supply of raw material, Canadian barley. For 21 years, gentlemen, our western competitors have had, within their fingers' touch, 160 — yea, as high as 178,000,000 bushels of barley, a terrible handicap that for the eastern manufacturer. But we are still in the game, a little bit sore, a little bit tired, awfully discour- aged at times, but still doing business at the same old stand. Now, gentlemen, are our western competitors prepared to come before this committee, as it did before the committee of the House of Representatives, and practically admit that their eastern competitor is so far their superior as a business proposition that we stand up against a handicap of 178,000,000 bushels, and they fall down to ruin, as they say, under a possible importation of five or six million bushels? That is all it means, gentlemen; that is what reciprocity means, so far as barley is concerned, a possible importation of five or seven million bushels. The present duty on barley is 30 cents a bushel — prohibitory. When the duty was one-third less than it is now, 10 cents a bushel, under the most favorable conditions the amount of Canada barley imported was only 10,000,000 to 11,000,000 bushels. I think twice i"t reached 11,000,000 bushels. In 1901 the total crop of the United States was 109,000,000 bushels. In 1902 the crop was 134,000,000, a difference in 12 months of 25,000,000 bushels. Gentlemen, what effect did that excess 25,000,000 bushels have upon the American farmer? Seven-tenths of 1 per cent a bushel. Now, if 25,000,000 bushels will make such a ripple on the finances of the American farmer, why borrow trouble as to the possible importation of 10,000,000 bushels? Bear in mind, gentlemen, that these 10,000,000 bushels were superior bushels, better than we raise in the United States. Canada barley always has sold at a premium. Now, we have heard a great deal from our farmers here about the ignorance of the eastern man and the superior knowledge of the western man. I am going to retaliate, and I am going to say to you gentlemen that an}' editor of any rural paper, and body of farmers, or any body of men who come before this committee and make the statement that a 30 per cent prohibitory duty has been an advantage to the American farmer, don't know what they are talking about. Pretty strong words, those, you say, but a man can use strong words and use them very chesty, too, when he has got the United States EECIPEOCITY WITH CANADA. 343 Government back of him. And, gentlemen, the Bureau of Statistics of the United States Government stands right back of me on that statement. What do they say? Let me read them to you. I have stated that this legislation took effect in 1890. Consequently it is fair to both sides that we take that as a pivotal point. What do we see? For the 17 years previous to 1890 the American farmer received 61.6 cents average per bushel for his barley. For the 17 years subsequent what do we see? The American farmer I'eceived 43.4 cents per bushel, an average less per bushel of 18.2 cents. Figure that average on 160,000,000 bushels. Our friends were very great in figuring the anticipated loss on their wheat. Let them wake up and see what they have been losing in the past on that barley crop. Senator Smoot. Have you figures to show what the average price has been since 1898 ? ^Ir. BuENS. No, sir. I can tell you approximately. Senator Smoot. What were they? Mr. Burns. About 7.5 cents a bushel. Senator Smoot. Then the reason that the average price is but 4?) cents was on account of the extremely low price between 1893 and 1898? ilr. Burns. The reason the jorice has advanced in the last three years is that our country has not had or has not raised enough barley. I would like to illustrate that to you. I will sav that the total crop of the United States to-day is 164,000,000 bushels. The malting con- sumption is about 55,000,000 to 60,000,000 bushels. So there is an apparent surplus of 110,000,000 bushels of the malting requirements, and yet, gentlemen, I to-day am bringing thousands of bushels of barley from the coast, which is transferred seven times in transpor- tation simply because we can not get enough western barley of the right quality to run our malt houses. To-day barley in Buffalo is selling at $1.14 a bushel; oats are selling at 34 and 35 cents; corn at 67 cents. Xow, does it stand to reason that the farmer Avould leave his good bar- ley at home when he could get $1.14 a bushel for it, and bring his oats and corn to market at 50 to 60 cents a bushel less? For the last two days since I have been here I have been in communication with Buffalo, and I have received the daily reports, showing no barley offered. Go to Milwaukee ; go to the other western points, and they will tell you that the same condition exists. What is the reason, gentlemen, we are not raising enough barley? The reasons are not those stateld by the Senator. I will give you the explanation. When you cut off our supply of Canada barley you cut off a supply of the best barley that grows outdoors, and when you cut oft' that supply you lowered the standard from the best barley that grows to a No. 3 grade raised in this country; and. gentlemen, let me say here that these crop reports are made up on Xo. 3 grade. Now, you never could and you never will get as much for nothing as you get for something. You never can get as much for an inferior article as you can for a superior article. Canada barley, I have stated, always sold at a premium. Western barley sold at so much per bushel less than Canada. It was the Canada barley that kept the standard up— the price. No matter what barley you bought, 344' RECIPROCITY WITH CANADA. if you bought* New York State barley, if you bought Ohio barley, if you bought Michigan barley, no matter where it came from it was always so much under Canada barley, and Canada barley was the standard. Now, when you took away that standard and reduced your grades right down to a No. 3, it is simply a question of local competition. It is a question of what I will sell my barley for, what the other gentle- man will sell his barley for, and the next man his barley, the tendeiicy always being to depress and lower A'alues, until in 1896 they ran the price down to 32 cents per bushel. They ran down the price one year to something like 42 cents. Let me make just a little more clear on another point right there. Senator Smoot. Let me ask you. What did you say the price of barley is in the United States to-day ? Mr. Burns. In the United States? Senator Smoot. Yes. Mr. Burns. In Buffalo to-day it is $1.12; in Chicago it is about the same. Senator Smoot. What is it in (^anada? Just the duty less? i\Ir. Burns. To make this more plain, let me reduce it to a com- modity that we are all interested in — another farm product. Now, let us suppose that at the same legislation that Congress cut off our supply of raw material ; that by the same legislation they completely eliminated the quality of fresh eggs, so that thereafter we would have to depend entirely on cold-storage eggs. Now, there always has been a differential, and there always will be a differential, between strictly fresh eggs and cold-storage eggs. Does anybody suppose that after being familiar with that differential, with the strictly fresh eggs eliminated, that in 10 years hence the average price to the farmer would be as much for eggs under a cold-storage standard as it had been under the strictly fresh egg standard? No. Because why? The standard is lowered and the intrinsic value is not there. Gentlemen, Canada barley was our strictly fresh eggs and western barley our cold-storage eggs. Senator Bailei'. Would you let me ask you a question there? You said a while ago that the Canada price of barley was the United States price minus the tariff. If you repeal the tariff duty, what would happen ? Would the price of barley in Canada rise to a level with the price in the United States. Mr. Burns. If we would repeal that duty on barley, our market would make their market. Senator Bailet. Let us come to a definite and specific statement. Would the effect be to increase the price of barley in Canada to a level with the United States price ? Mr. Burns. I think it would. Senator Bailey. Why could not you import it then just as well now, and pay the duty? Mr. Burns. I will answer that. That is a very natural question. I have stated that our importations of barley amounted to 10,000,000 or 11,000,000 bushels. Now, there has been a great amount of barley raised in the Northwest, trade laws have always demanded that that barley be designated as Manitoba barley. Wliy? Because they have early frosts up there, and frosted barley won't germinate. When we have used Manitoba barley it was alwaj's sold as Manitoba, and the BEOIPEOCITY WITH CANADA. 345 buyer took his chances on the germinating qualities. He is buying cold-storage eggs, because the chances are 25 per cent of it won't grow. Now, when you put a 30-cent duty on Canada barley, you took away their market, too. Those same fields that used to produce 10,000,000 to 11,000,000 bushels of barley sought other sources of outlet. They have been raising peas and beans, and for that reason I make the statement that this amount of barley from Canada re- duced itself simply to one of 5,000,000 or 6,000,000 of bushels. My personal opinion is that there would not be 4,000.000 bushels of barley come in from Canada. That is my personal opinion after an experi- ence of 30 years in the business. Senator Clark. How much comes in? Mr. Burns. None: that is Senator Clark. You do not use any Canadian barley ? Mr. Burns. We can not. Senator Clark. I thought you spoke about the price of barley brought into the American market. Mr. Burns. I did. Senator Clark. TVliich led me to conclude that some was sold in the American market. Mr. Burns. No; the question was. What was the price in Canada, not in America ? I said the price in Canada was our price less the duty. Senator Clark. Then, we have a price on it ? Mr. Burns. A price on what? Senator Clark. On the barley. Mr. Burns. I take the Canadian papers. I am not familiar with Canada barley, because I never buy it. Senator Clark. We are at croas purposes somewhere. You saj' the Canadian price is the same as the American price less the duty ? Mr. Burns. Yes, sir. Senator Clark. Carrying that out, there must be some price on this side for it; in order to establish that price there must be some- thing sold. Mr. Burns. I understand. My answer would be that if Canada barley to-day — we will say western barley is sold at $1.12 in Buffalo, I think that on that basis Canada barley would sell for $1.15. It would sell at a premium. Senator Bailey. That is with the duty paid? Mr. Burns. Yes, sir. Senator Williams. You would have to pay the duty beside ? Mr. Burns. We would have to pay the duty. Senator Bailey. If you can buy the barley in Canada for the United States price minus the duty which you say is the price there, I can not understand why you do not buy it and pay the duty and then bring it into the United States at a price equal to what you are now paying for the United States barley ? Mr. Burns. I started to answer that. The answer is this: I have stated that the importation of Canada barley never amounted to more than 10,000,000 or 11,000,000 bushels. Let me qualify hero and say that the best malting barley, and the only barley that comes into 346 KECIPBOCITY WITH CANADA. the proposition with the malster, is the barley raised in Ontario. Northwestern barley does not come into it. We do not use it. We do not want it. It is always sold, as I say, with a brand. Now, the farms that formerly used to produce this 10,000,000 to 11,000,000 bushels of barley, by reason of not having any market, have gone into other lines of producing — producing peas and beans — so, conse- quenth', there is very little barley raised in Canada, and what is is mostly of a seed nature. Senator Bailey. You think the American tariff is practically de- stroying the barley industry? Mr. Burns. Absolutely. Senator Bailey. Then the northwestern farmers are pretty nearly right in claiming that the repeal of the tariff would come pretty near destroying the wheat industry over here? Mr. Burns. It is a different proposition, we are not complaining on account of any repeal of duty ; on the contrary too much duty, and I claim that the facts I Iiad presented prove that in barley we have at least one commodity where protection failed to protect. And now, gentlemen, I notice in the report of the agricultural de- partment of the State of New York, published about three weeks ago, if my memory serves me right, that there were 5,000 farms lying un- tilled in the State of New York. "WTiat is the reason? '\'\Tiat is the answer ? I wish I could take this committee along the shores of Lake Erie, down the barley belt of New York, to Geneva, and show you the farms there that were formerly valuable on account of the excellent barley crops that they raised. Now they are lying idle. I wish I could take you to the cities and towns of Oswego, Syracuse, Rochester, Jordan, Weedsport, Lyons, and other towns, and show you malt houses which were formerly beehives of industry now standing as monuments of idleness. That, gentlemen, is what the prohibitory duty of 30 cents per bushel has caused our State. Senator Clark. Why would that make the barley farms lie idle there? Mr. Burns. Because New York State sowed Canada seed. Next to Canada barley came our barley. Our farmers could not compete in raising the limited supplies of barley which they did raise in com- parison with the thousands and thousands of bushels raised on the western farms, and consequently they quit the business. There is practically very little New York State barley raised there. Senator Heyburn. How far west do j'ou go for your barley? Mr. Burns. We go to Duluth. Senator Heyburn. How far west is the barley raised that you use? Mr. Burns. Minnesota, Duluth, Wisconsin, Iowa, and North and South Dakota. Senator Bailey. I see that this table printed with the treaty shows that we exported to Canada 164,000 bushels of barley last year, and that would look like an explanation of why they were not producing much now. They are buying it from us. Senator Smoot. I think the exportation from this country was not to eastern Canada, but to western Canada. Senator Bailey. The table does not subdivide Canada. Mr. Burns. Now, gentlemen, I have taken more time than was allotted to me. I would like to go on and talk for a half an hour longer. KECIPBOCITY WITH CANAI>A. 347 Senator Williams. I am afraid there is one thing that is not clear in your testimony, so I will ask you the question again. If there wad any Ontario barley brought into your market, what price would you have to pay for it f Mr. Burns. AVe would pay a premium of fi-om 3 to 5 cents a bushel. Senator Williams. Plus the duty ? Mr. BuENS. The duty added. Senator Williams. The duty added, and 3 or 5 cents. I was afraid the Senator from Texas did not understand. Senator McCumbee. I understood. you to say that there was no barley being oiiered now. Mr. BuENS. Very little. I qualified there. I said in the last three days in Buffalo the report since I have been here shows "no barley ofEerings." Senator McCumbee. Why wasn't there any offering? Mr. BuENS. They could not get it. Senator McCumbee. Are not there great quantities now lying in storage in Milwaukee, and great quantities lying now in bond, wait- ing for this reciprocity agreement to go into effect so that they can turn it on the market? Mr. BuENS. Where? Senator McCumbee. In Milwaukee. Mr. Burns. Xot that I know of in Milwaukee. Senator McCumbee. I have letters from the Cargill Elevator Co., which are the greatest dealers of barley of any dealers in the United States. I have also some from the Berger-Crittenden Co. of Mil- waukee, who also deal in barley, and from Mohr-Holstein Commis- sion Co., and all of them speak of the market being so dull that they are holding cars day after day, and can not dispose of them. Mr. BuENS. Holding where? Senator McCumbee. In Milwaukee. Here is one. I will read a portion of it where it says " To-day there is practically no barley market, and barley is almost unsalable, at a decline of anywhere from 12 to 20 cents per bushel." I shall also read from a letter from Berger, Crittenden & Co., from Milwaukee. They say, " The market was as dull as ever, with only a few cars of Wisconsin sold. Outside of this a few cars of Minnesota were sold, whereas the few cars carried over for the last three or four days were again carried over to-day. Maltsters and brewers still hold- ing back. We naturally will have to await developments." Mr. Burns. What is the date of that? Senator McCumbee. That is in the latter part of February. Mr. Burns. Oh. Senator McCumbee. That has been the condition of the barley market in Milwaukee. Now, what has made any great change be- tween that time and the present time ? Mr. Burns. I will tell you, sir, very gladly. Under the existing conditions the Buffalo maltsters and eastern maltsters have been obliged to supply their demand before the closing of navigation on the Great Lakes for the purpose of saving the cost of increased trans- portation. Up to December there has always been a very stiff market. You can see why, because the East is continually buying. After the close of navigation there is a lull because we have got our supplies for the next three or four months. The whole entire East is out of the 93285— Xo. 5—11 8 348 KECIPROCITY WITH CANADA. market. Now, the very conditions that the Senator has read there exist every year at that time. Senator McCumbek. The writers did not give that as the reason. In every instance they say they are waiting the development of the reciprocity agreement. Mr. Burns. Senator, you can accept my word as a gentleman that is the reason. Senator McCumbee. The word does not agree with the letter. They give a difPerent reason. Mr. Burns. It happens every year; these lake supplies that we buy generally last us until May. They are just about exhausted. Now, we are in the market for barley. That is the reason we can not buy barley. You know the malting business is a perpetual busi- ness, Saturday, Sunday, holidays, Fourth of Jiily, and every day. We can not stop to-day and start to-morrow. It is a continual process. We must have our supplies. Under the present arrangement it so unfortunately happens that we all are to go into the market at one time, and up goes the market, and when we get our supplies, down goes the market. Senator McCumber. You are in favor of taking all of the duty off barley ? Mr. Burns. I certainly am. Senator McCumber. You are also in favor of taking all of the dutj' off malt, are you? Mr. Burns. I will answer that question by just this: Now, the farmers who spoke here yesterday spoke from a selfish standpoint. Everybody does. Senator McCumber. I am just asking you whether you are in favor of it. IMr. Burns. I was going to answer it. The Buffalo maltsters take this position. We come to say, gentlemen, for 21 years we have been handicapped by 178,000,000 bushels against the West. There is no opposition you can give us. We have won our sjDurs. There is no opposition you can give us from Canada we are afraid of. Senator McCumber. Are you willing to take off the duty on malt ? Mr. Burns. Yes ; I would not care a snap of my finger about it. Senator McCusiber. Would you also be willing to have it taken off of beer? Mr. Burns. I know no more about the brewing business. Senator, than yon do, and I am not here to discuss it. Senator McCumber. It would not affect the price one way or the other whether you took it off or not ? Mr. Burns. It could not affect us an}' more than the taking away of our supply of raw material affected us. It was a wicked thing; when the farmers stand up, as they did yesterday, and tell you what the possible result will be on their wheat, gentlemen, it can not com- pare with the effect the 30-cent duty had on our industry. Senator McCumber. The brewers have been running behind all these years, while the farmers have been getting to be millionaires, have they? Mr. Burns. We are not making any such statement. Senator McCumber. Have you compared the farmers' homes with the averape brewer's home — the palaces all over the country? Do EECIPEOCITY WITH CANADA. 349 you think the farmers should have some of the profits that are going to the brewers every year? Mr._ Burns. I am not here to defend the brewer. I do not linow anything more about the bi-ewing interest than you do. I am strictly a manufacturer of malt, and I am prepared to" answer any question along the line of barley. Senator McCnucEi;. Malt goes into the beer, and the maltster's in- terests and the brewer "s interests will benefit' by the farmer losing so much ? Mr. Burns. The farmer will not lost one cent. Senator McCumbee. Yon will get your barley cheaper, but the farmer won't lose anything ? Mr. BuENS. We won't get our barley cheaper. Senator Bailey. A^iLit good will it do you to take it off, then? Mr. BuENS. It will do us this much good. We in Buffalo have been at the wrong end of the game. We were in the position where it took our supiDlies away from us. Senator Bailey. You are still in the business ? Mr. Buexs. ^Vait a minute. The West has over 178,000,000 bushels right there. They would not be affected a little bit. Let me tell you right now, I think I have shown right here that there is ab- solutely a shortage in the supply of barley, if the farmers do not raise any more barley in the next five years than they have in the last two or three years. You are going to see the same differential be- tween oats and barley three years from now as now. This duty has nothing to do with it. Senator ilcCu.MBER. Was ixTrley worth more during the period from 1893 to 1897 than froivi 1S!I7 up to the pre^:eu( time? Mr. Burns. Yes, sir. Senator McCu3ibee. It was scarcely half as much on an average, was it? Mr. Buens. You are talking- of '67, you say ? Senator McCumbee. Xo; from 1893 to i897, as compared with from 1897 up to the present time. Air. Bue^s. Yes; that was a low period. But why was it a low^ period? Let me explain that to you. Senator McCumbee. There was a lower tariff then. Mr. Buens. Let me explain that to you. The consumption of barley — let me go a little bit further: Every barley dealer and every elevator man in the West — I do not care whether East or West — is asking, " Where has barley gone to ? " We do not know. We know that we only consume fifty to sixty million bushels. We know the Government report says there is 104,000,000 bushels, and we know we can not get any barley. The barley is soiling higher tlian it ever sold. Wliat is the use of borrowing trouble on a matter of an importation of six or seven million bushels of a superior grade which -will stimu- late and not lower the market? Senator Williajis. You said that if the duty were removed you could not buy barley any cheaper? Mr. Burns. No, sir. Senator Williams. You mean by that you could not buy it any cheaper without considering the duty? At the present time, if you '^^^y it; you buy it at a certain price, but you pay the duty. Mr. Buens. Yes, sir. 350 EECIPKOCITY WITH CANADA. Senator Williams. Do you mean you would buy it at the same price afterwards and you would not pay the duty? Mr. Burns. Yes. Senator Williams. That is what I thought. Senator SaiooT. I did not so understand your statement before. Mr. Burns. I ^\ant to make it clear. Senator Smoot. I understood you to say that barley to-day was 88 cents in Canada. Mr. Burns. Yes, sir. Senator Smoot. And that if you bought the barley you added the tarifi' to it? Mr. Burns. Yes, sir. Senator Smoot. Making it the same as the United States crop? Mr. Burns. That is correct. Senator Saioot. You also stated that if the duty were taken off barley that the Canadian price would advance to the United States price ? Mr. BuitNS. Yes, sir; I say that. That is what I tell you. Senator; that is what I understood the question, to put it in a different way Senator Williams. He fixes his price and then he considers the duty separately? Senator Simmons. Then, do I understand you, taking the duty off of the barley will not allect the price? Mr. Burns. I can not hear you. Senator Simjions. As I understand you, taking the duty off of barley will not affect the price of barley in this country? ilr. Bi RNS. Xot one cent. Senator Sim^ions. Why give up the revenue, then, that the barley is now bringing to the Government of the United States? Mr. Burns, ^ye are not getting any revenue. The duty is pro- hibitory. Senator Simjions. There is absolutely none coming to this country now? Mr. Burns. Practically none. Senator Bailey. Only about 2,400 bushels. ]\Ir. Burns. The question is this. We want the best raw material. This prohibitive duty is doing nobody any good. Senator Simmons. It is not hurting anybody, according to what you have told us. Senator Smoot. If the price is advanced it would help you ? Mr. Burns. Yes; because we want to get all the best material we can get. Senator Smoot. This barley is better than the United States bar- ley, and for that reason, and no other ? Mr. Burns. One other reason: Perhaps there has been no other industry in the United States which has been so completely revolu- tionizecl by the advent of modern machinery as the malting business. Millions of dollars have been invested in modern malt houses, but, gentlemen, our farmer has not kept in step. I speak from a personal knowledge, when I tell you that the barley raised in the Northwest to-day is no better than it was 10 years ago, and it will not be bet- ter. Why? Because for 10 years they have been using the same seed over and over again. Let the American farmer get the benefit of that Canadian seed, then it won't be long that Canada will boast of raising the best barley. RECIPEOCITY WITH CANADA. 351 Senator Heybuen. Wliere do you get your information that they have been using the same grain for seed each year ? Mr. BuENS. From tlie fact that we have by necessity been deprived of Canada seed and sowed western entirely. Senator Heybuen. Have you any knowledge on that? Senator Hetbxjen. I live close to a barley-growing country and I think you had better check up those figures. Mr. BuENS. AVliere do they get it? Senator HDeybuen. "We get the best seed we can get. Mr. BuENS. Wliere do you get it from? Senator Heybuen. From diilerent places, and the farmers are up to date and they don't use any inferior seed. Senator Williams. Do they get any barley from Canada ? Mr. Hetbuen. I presume so. We raise a very high grade of barley. There is no complaint about it. They buy it. Mr. BuENS. You say they use the best barley. Wliy, then, is our Government report made up of No. 3 grade? They can not get enough of No. 2 grade to make an established grade. You could not buv 50,000 bushels of No. 2 barlev at anv market in the United States. Senator Hetbuen. Don't you admit yf>u get your high grade from the Northwest? Mr. BuENS. We do not get any high-grade barley. Senator Hei"bI'Ex. You use an inferior barlej^? Mr. Burns. We use a barley from the Northwest; we pet the best barley we can buy : we do not get any Canada barley. Senator Bailet. I suppose that the real test of the malt is the beer; is the beer inferior to-day to what it was? Does this north- western barley make a good beer? Of course I understand you are not a brewer, but you probably have some experience. [Laughter.] That would be the test with me. If the northwestern barley would make just as good beer I would think it would be just as good barley. Mr. Buens. I will answer that this way: That every brewer I know is in favor of getting the duty removed on Canada barley so that he can use Canada malt. Not that he wants to get it any cheaper. We don't give a rap what the price is. We would rather pay a dollar a bushel to the farmer than 60 cents. Senator Heybuen. WTiy don't you import and pay the duty, then ? Mr. Burns. There is not enough raised; we irilled their market when we made the duty prohibitory. Senator Claek. That is what I can not get through my head : If the New York State farmers raised that barley then, why don't they raise it now? Mr. Burns. Because they can not raise in limited quantities and compete against the West. Senator Heybuen. You say you don't care what it costs. Senator Claek. Following out my question, could the New York State farmer raise barley any cheaper if the Canadian 1)arley was imported ? Mr. BuENS. No. It would not affect the price of production in any way, but he would get more money for his barley on account of the quality being about equal to Canada, which, I repeat, always sold at a premium. 352 EBCIPBOCITY WITH CANADA. Senator Clark. You say one argument why the Canadian barley should be imported free is so you can renew barley raising in New York? Mr. Burns. I am speaking for New York. .Senator Ci-vrk. What difference does it make? Is not the land as productive? "Why do not they raise it as much now? ^Ir. Burns. Wliere? Senator Clark. In New York. Mr. Burns. New York State farmers stopped raising barley be- cause our barley and Canada's was always blended together on account of its uniform quality and sold at a premium. When the standard was reduced and the importation of Canada made prohibi- tory by the 30-cent duty, our farmers could not compete with the lower grades of the West and barley raising ceased. Senator Bailey. You mean you can compete with Canada, but you can not compete with the Northwest? Mr. Burns. What is that question? Senator Bailey. I say, you mean to tell the committee that you can compete with Canada if the duty were taken off, but under pres- ent conditions you can not compete with the Northwest. Mr. Burns. Exactly. Senator Williajis. I understood you to say a while ago that you could raise barley cheaper in New York, provided you could get every year the Canada seed? Mr. Burns. No ; not the Canada seed ; the Canadian former price. Now, gentlemen, it is getting late, and I do not want to detain you any more. I thank you. Mr. Robertson. I was just going to say that I agreed that we would be through by 7 o'clock, and I intend to keep that promise. Mr. Preisch is here to speak on lumber, if you wish to get any infor- mation on that subject. He will be glad to give you enlightenment on any question you may ask. Mr. Churchill can give you enlighten- ment from the standpoint of wheat; but you have given us your attention, and it is entirely up to you whether we put on another man here or not. Senator Bailey. Have those gentlemen any prepared statements? If they have, I would like to have them file them. I would certainly like to have their statements filed, if they have any. Senator Williams. Ask them to prepare their statements and file them. Mr. Robertson. If we could file a prepared statement, it would answer the purpose, I think. Mr. Preisch. You have asked some questions of the representative from Tonawanda. I will be glad to answer those question if I can, if you care to ask them again. I have been in the lumber business the best part of my life and possibly I can perhaps give you some information. Senator Smoot. Do you consider logs raw material? Mr. Preisch. It would be raw material, certainly. Senator Smoot. It is not for the man that gets the logs out; he spends all of his money and time on them. Mr. Preisch. I should answer that in the trade logs and rough lumber are considered raw material. Senator Heyburn. Polished mahogany is raw material in the case of the man who makes the furniture, isn't it ? EECIPEOCITY WITH CANA.DA. 353 Mr. Peeisch. Yes, sir. Senator Heybuen. The Senator from Utah asked about logs. Senator Smoot. I asked the other party from Buffalo. Mr. Peeisch. The reason why there is a differential on dressed lumber, which has always been recognized in preparing each tariff' bill, is because of the cost of dressing lumber. The principal item of cost of labor and the labor in the planing mills of Canada is less; the cost of the ground or land on which the mills stand is less. The freight is less from points in Canada, thereby it has been recognized that dressed lumber should have a dilferential, and it has been recog- nized in each tariff' bill as it has been prepared. Senator Smoot. I recognize that principle too, but I recognize this fact, that the man who works in the timber receives a less wage in Canada than in the United States. Mr. Peeisch. He does not. Senator Smoot. You say he receives less wage in the lumber mill ? Mr. Peeisch. I say that the average employee in the planing mills of Canada, and the cost of the planing mill equipment — the building, and the land it stands on, the absence of density in Canada — puts the American mill at a disadvantage, and that differential is put on to counteract that. For instance, in Tonawanda it is an incorporated city. The city taxes on the land are considerable. The land has con- siderable value. Where their planing mills stand, the planing mills in Canada, they are generally in some little frontier town where the land is of little, if any, value, and usually in a Canadian lumber town they have been exempted from taxation perhaps for 10 or 15 years, in order to establish the industry, and that is the reason why this dif- ferential seemed necessary on dressed lumber. Senator Bailey. It is purely protective, then? Mr. Peeisch. Yes, sir. Senator Smoot. You import an immense quantity of rough lumber and very little of the dressed lumber ? Mr. Peeisch. Exactly. In Tonawanda I supjDOse 40 per cent of the lumber is imported from Canada. Senator Williams. Do you think the United States Government ought to compensate you for preferring to do a business in a town instead of out in the country ? Mr. Peeisch. No; but following out the principle of protection Senator Williams. I understand the other reason you gave was that the United States Government fixes a high tariff tax upon the machinery you use and Canada does not, but I can not understand why you think the Government ought to compensate you for choos- ing to do business in an incorporated town. Mr. Peeisch. I did not express that as an opinion. I gave you that as a reason that has been expressed before and that has been recog- nized as the principle. Senator Smoot. Do you export any lumber to Canada — finished lumber ? Mr. Peeisch. No; we do not. We have shipped some rough lum- ber to Canada, but, of course, with the 25 per cent ad valorem duty on dressed lumber we could not ship ajiy dressed lumber to Canada. Senator Bailey. As a matter of fact, we ship quite a little lumber to certain parts of Canada — there are certain parts of Canada where 354 EECIPEOCITY WITH CANADA. thc3' grow a soft lumber, and when they want lumber that has strength they shijo it in, don't they? ]Mr. Peeisch. The Canadian lumber is white pine, spruce, and Norway pine and fir. Senator Bailey. Fir is found in the far West. Mr. Peeisch. And they have no hardwood of any particular value. They have a little fir. They have not got a great commercial quan- tity and the importation into Canada of hardwood is considerable. They have none there. Senator Stone. How would it help you as a lumber maker to get the lumber free? Mr. Peeisch. Our rough lumber free? Senator Stone. Yes. Mr. Peeisch. The duty is only about $1.25 a 1,000 feet, I think. It would not make very much difference, except it would give us a little wider margin in which to buy our supplies. Senator Stone. Would it enable you to sell your product any cheaper to the consumer? Mr. Peeisch. I do not think it would make very much difference, except this, at a time when there was a great commercial demand, when lumber that could be liad was needed. Senator Stone. Can you state now the total amount of revenue received on the lumber that you jDropose to admit free? Mr. Peeisch. The revenue some years ago was some million dollars, that was when the tariff was $2 a thousand. I should think the revenue was two million, three million, four million, or five million dollars. I am not sure of those figures. Senator Stone. If you got the lumber free instead of paying sev- eral million dollars revenue, who would get the benefit of that? Mr. Peeisch. I think it would be partly to the consumer and partly to the manufacturer in Canada. I think the thing would equalize, and, in time, as I started to say, when there is a great quantity of lumber, I think the price of lumber would be as high as here, but in time of depression I think you could buy your lumber cheaper in Canada. Senator Stone. You are an importer? Mr. Peeisch. Yes, sir. Senator Stone. You pay duty now ? Mr. Peeisch. Yes, sir ; we do. Senator Stone. If you did not pay duty you would get your lum- ber that much cheaper. Mr. Peeisch. We would. Senator Stone. Would you sell any cheaper? Mr. Peeisch. We would. Yes. If our lumber costs us less we expect to make a certain percentage of profit. If lumber goes down we sell for less. Senator Bailey. Did you do that when they reduced the duty from $2 a thousand to $1.25; did vou reduce j'our price 75 cents all along the line ? Mr. Peeisch. The price of lumber has been going down for the last year. Senator. I would not attribute that to the lowering of the dutv, but the general conditions. Lumber has been selling less by about $1.50. BECIPKOCITY WITH CANADA. 355 Senator Bailey. When the Government brou^iit clown the duty from $2 to $1.25, did you put down your price 75 cents then on that account ? Mr. Peeisch. Senator, that would be a difficult question to answer for the reason that we bring our lumber in in bulk. We bring the entire product in the log. Some of that lumber sells for clear and some for culls. That selling for culls sells for less than it costs us to milL We want to make a profit on the better end, and so we did not reduce our prices horizontally 75 cents; some prices went down a dollar. Senator Bailey. There are other elements of price except the tariff. I understand that. But you said in reply to Senator Stone you would reduce your price in accordance with the reduction of tariff. Xow I ask you if you had done that and you are not able to say. Mr. Peeisch. I say this: If $1.25 is taken off the lumber competi- tion will force the price down. Naturally competition would put the price on it. Senator Bailey. Did competition do that when we reduced the duty from $2 a thousand to $1.25? Mr. Peeisch. I say the price of lumber has dropped, but whether it dropped because of the change of the tariff or the price condition I can not say. It has dropped from $1.50 — more than 75 cents. Senator Bailey. Then it is true that there is some other element there that has an influence on the price, other than the reduction of the tariff. Mr. Peeisch. That is correct. Senator Smoot. You have stated that if you liad free lumber you would have a wider market — how would you get a wider market ? Mr. Peeisch. We would have a wider market to buy in. Senator Smoot. You buy now in Canada. Mr. Peeisch. Some of it. About 40 per cent. Senator Smoot. Now, taking the duty off you will buy instead of 40 per cent near 100 per cent. Mr. Peeisch. Xo; not 100 per cent. As a matter of fact, the white- pine stumpage is principally in the State of Minnesota, and in a few years the balance of the white pine of Xorth America will be largely in Canada, and we will be forced from year to year to get a larger proportion of our white pine from Canada. Senator Williams. If you could buy lumber for less, you would buy more lumber and do a larger business, and whether you did or not, the trade would, wouldn't it ? Mr. Peeisch. The volume of our business is measured rather by our sales than our purchases. Senator Williams. In proportion as the price of a thing is re- duced — something that enters into a product yon are going to sell- just in that proportion the trade would manufacture more of that, would it not? Mr. Peeisch. Naturally. Senator Williajis. Because it would have a wider market for selling as well as purchasing. Mr. Peeisch. Exactly. Senator Bailey. About how many feet of hnnber now go into an ordinary cottage home ? 356 EECIPEOCITY WITH CANADA. Mr. Preisoh. I could not answer that, because we are wholesale jobbers. Scii.itor IIajley. .\ot over 10,000 feet. Mr. Pkeisch. From 10,000 to 20,000. Senator Bailey. At $1.25 a thousand, if you make it 15,000 say that would be $18.75. Mr. Peeisch. Yes, sir. Senator Bailey. Do you really think anyone would be deterred from building a home because it cost $18.75 more ? Mr. Preisch. No; I said in the beginning that I thought the tariff made very much les;^ difference in the cost of lumber Senator Bailet. I hardly think the additional expense of $18.75 would deter a man from building a home. Mr. Peeisch. No, sir. Senator \^'iLLiAJrs. I would like to ask you one more question, just one of those circulative questions: Would you be willing, if you got your logs and rough lumber free, to permit the free im- portation also of dressL'd lumber? .Mr. PitKiscii. I tliink that we should have the same differential. I think that the differential we have had is fair and I should like to see it maintained. Senator Willia:\[S. But you want to put the logs on the free list? Mr. Peeisch. Logs from Canada are prohibited by the Canadian Government from export. Senatnr Vi'ili.iajis. I understand that if this Canadian reciprocity goes into effect, as I understand it, the export duty will be removed on rough lumber and feet per plate, is 22i cents per square foot. Canada's duty to the United States would be reduced from 22^ to 8, lu- a reduction of 141- cents per S(|uare foot, whereas the United States manufacturer is given eight-tenths of 1 cent reduction. That scarcely looks like equitable reciprocity. Senator Wir.TjA:>rs. Suppose they gave you absolutely free entry into Canada with glass? iMr. Str.vssiu'bgf.r. If they gave us absolutely free entry into Canada with glass, we could not ship any more glass into Canada than we do to-day. Senator Williams. That is what I thought. ]Mr. Strassbubgek. Exactly. The glass that goes into Canada goes into the border points, and scarcely can be called competitive sales witli foreign-made glass. As far as the American manufacturers are concerned, 3'ou can give us free trade into Canada and our im- ports will not increase materially: and you can give Canada free trade into the United States, and we will not worry one bit so long as you can guarantee to us that Canada will not erect plate-glass factories. Senator ^kCnivtr.Ki;. Will Canada, when we give them reciprocity, lie in position to make ]3late glass very cheaply? Mr. STRASsniutr.'ER. Not as cheaply as European manufacturers; but we would be doing this : If we put through the plate-glass item in the reciprocity bill, we would be placing Canada in position to EECIPEOCIIY \\'1TH l^ANADA. 361 build factories and ship glass into the United States. .Vnd what does it mean? The American or United States raaniifactiirer to-day can not ship his glass any place except in his own country, because it costs so much more to make than elsewhere. ^laterials, labor, in- vestment, etc., are higher, and we have got to depend upon the sales in the United States for the consumption of our product. Senator Clark. Do you ship to any market outside of the United States? Mr. Strassbueger. AYe do not ship to any market outside of the United States, and we are the only plate-glass manufacturers in the world who can not ship outside of their own country, and probably the only manufacturers of anything in the United States who can not ship outside of the United States. Senator Williams. Then j^ou would not have any market in the United States except for the tariff? Mr. Strassbueger. "\Ve would not have any market, except for the tariff, in the United States. We organized under a tariff protection, we are an industry that was fostered by a protective tariff, and we can not have the American market except with that protection. Senator Smoot. Without the tariff, do you think it is impossible to make glass in the United States, where we pay three times as much as Belgium for labor Mr. Strassburger. Senator, if we reduce our wages to the level of Belgium, we would have to reduce them to 65 cents. Senator Williams. If you tried it the American man would not work for you, and you would have to close up j'our shop? Mr. Strassbueger. Exactly. Senator Clark. Are you manufacturing glass any cheaper year by year ? Mr. Strassburger. We are making glass cheaper this year — the last few years, than we did during the last 10 or 15 years — yes, Senator. Senator Clark. What is the duty to-day? Mr. Strassburger. The duty to-day is 22-1 cents per square foot on glass from 7 to 25 square feet to the plate, the sizes covered by the Canadian reciprocity bill. Senator Clark. Have you got any hope that with the extension of your industry you can reduce the prices at all ? Mr. Strassbueger. We are stri^'ing in that direction all the time. Senator Clark. Now, is it your opinion that it must always con- tinue to be a purely home-selling product, protected by a high tariff? Mr. Strassburger. No, Senator. Plate glass of the sizes we are discussing to-day was first manufactured and i^rotected by a tariff of 50 cents per square foot. That 50 cents has been reduced gradually until it is now 22.V cents. We came before the committees ourselves two years ago and asked for a reduction of 12^ cents per sfiuare foot, and some of the Senators now on the Finance Committee, and serv- ing then, will bear me out. All we require is equitable protection and we shall not ask any more than we need. Senator Clark. On these sizes? Mr. Strassbuegee. On the sizes in this bill, yes ; I am not referring to any other sizes. Senator Claek. That answers my question. 362 RECIPROCITY WITH CANADA. Senator La Follette. How much have you reduced the price in the last 20 years? Mr. Strassbuegee. The plate glass to the purchaser from the factory ? Senator La Follette. Yes. Mr. Steassbtjegek. We have reduced the price, Senator, from $1.50 or $1.75 to thirty-odd cents. It is materially reduced. Senator La Follette. How has that been accomplished, that re- duction? You have not reduced the wages? Mr. Strassbuegee. No; we have not reduced the wages; if any- thing, they are up a little ; but we have equipped our factories with modern machinery, and we have in many cases put in improved machinery that was not in existence 15 or 20 years ago. We have methods of grinding and polishing glass to-day which occupy one- third or one-fourth the time it took 20 to 30 years ago. Senator La Follette. Have you ever visited the factories abroad? Mr. Strassburger. No; I have not personally visited them. Senator La Follette. Do you know in a definite way whether your factories are as well equipped as the factories abroad? Mr. Steassijurger. 1 think, on the whole, Senator, that there would be little advantage in one over the other in the way of equipment. There is a big advantage in some of the foreign countries in the raw- material situation aside from labor. The chemical analysis of the sand and the salt cake used in Belgium and France does away with certain flux material we must use, and they save that much, in addi- tion to the labor. Senator Clark. Do you get all your raw material here? Mr. Strassburger. We get practically all of our raw material here. We buy arsenic, sometimes we use American and sometimes foreign, and W'e buy small quantities of German clay; outside of that we practically buy everything here, and we really could use all American products. Senator La Follette. Where are the principal plants located? Mr. Strassburger. Pennsylvania, but there are factories in Ohio, Indiana, Illinois, ilichigan, and ^Missouri, as well. Senator La Follette. Do you get your raw material in the Statel Mr. Strassburger. We, our company, gets the material — the sand- in the State of Pennsjd\ania, which is the principal material. Senator La Folleite. How far from the factory is that? Mr. Strassbuegee. It is a matter of 150 miles, I suppose, to most of the factories. Of course, we use other materials close at hand and others from a distance. We use soda ash from Michigan or New York State, and some from Ohio. Senator La Follette. Do you use great quantities of that? Mr. Strassbuegee. Quite a good deal of that. Senator La Follette. Shipment, then, is a matter of some im- portance ? Mr. Steassbiirger. Yes; but I do not want to take much time on this subject. All I want to say is that the American manufacturers think, and they believe, and they feel they know that to put this plate-glass item into the reciprocity bill at 25 per cent ad valorem is not fostei'ing American industry but opening up a way for Canada to build a factory whereby she can advantageously market her product. REOIPBOCITY WITH CANADA. 363 Senator Smoot. Do you know whether Canada has material for the making of plate glass ? Mr. Steassbukgee. I think, Senator, you will find Canada has all that is required, including cheap fuel, water power, which we do not have, and I think the labor end of the Canadian factory would not be paid quite as much as our own, but I would not want to go into that and a lot of other details. I simply want to state for the Amer- ican manufacturers that we were organized on a protective-tariff basis, and you are going to take it away from us by giving Canada an opportunity to build factories in Canada that will be able to send glass to the United States in competition with us and take away part of our own market without giving us anything in exchange. The Chairman. What are the chief uses of plate glass nowadays ^ Mr. Steassbhrgee. For glazing buildings, store fronts, and for the manufacture of mirrors and glass on furniture, desk tops, and so forth. The Chairman. Is the automobile industry included? Mr. Steassbuegee. The automobile industry uses about % per cent of the plate glass consumed in the United States. Senator Smoot. What percentage? Mr. Steassbuegee. Five per cent. Senator Smoot. Small sizes are used to-day more than thej' ever were? Mr. Steassbuegee. I would not say that, Senator; no. I do not think that the consumption of small sizes has increased materially, in percentage, I mean, as compared to the whole, over what we showed you two years ago when before the Finance Committee. Senator Smoot. I am not speaking about two years ago. I am speaking of about 10 or 15 years ago. Mr. Steassbuegee. Ten or fifteen years ago? Oh, yes, greatly, and one of the big difficulties of the industry to-day is that we have to supply such an enormous quantitj' of small glass, and have to sell it in competition with European-made glass at prices below our own cost of manufacture because of the low and inadequate tariff on small glass from other countries. We have to hope to make up such losses on the sales of large sizes of glass. The foreign manufac- turers already have part of our own market on large glass, as well as small, and this bill would give Canada an additional share of the part we need most. Senator McCumbee. You are from what city? Mr. Steassbutegee. Pittsburg. Senator McCumbee. That is a considerable glass manufacturing city? Mr. Steassbuegee. I should consider it the center of the glass industry of the country. Senator McCumbee. Yes; and you represent the sentiment of the people of Pittsburg against reciprocity? Mr. Steassbuegee. I do, sir. Senator McCumbee. Because of that reciprocity Mr. Steassbuegee. No; I won't say that, Senator; I qualify that. I do not want to be misunderstood. I am not here to pass opinion on any reciprocity, except plate-glass items, because that is the only one with which I am thoroughly familiar. 364 RECIPROCITY WITH CANADA. Senator McCumbek. Do you represent the sentiment of the people who are engaged in the manufacture of glass? Mr. Steassbdrgee. I do that. Senator McCumbee. And they are opposed to this treaty? Mr. Steassbuegee. They are opposed to the item calling for reci- procity on plate glass. We have to give Canada a reduction of 14| cents against the reduction to the American manufacturer of eight- tenths of one cent. I can not express any opinion on the balance because I do not consider myself qualified. Senator Williams. Is Canada making any plate glass? Mr. Steassbuegee. No, sir. Senator Williams. Then, what you are afraid of is the infant that may be born up in Canada at some future time ? Mr. Steassbuegee. Conditions are being made by this bill that will enable them to erect factories to produce plate glass. Senator Williams. What is the difference made by the bill? Mr. Steassbuegee. The difference will be 14-i cents per square foot reduction on a tariff of 22i cents a square foot coming into the United States. Senator Williams. The difference will be 8 ? Mr. Steassbuegee. Eight-tenths of 1 cent, Senator, on glass enter- ing Canada, but l-H cents entering the United States. Senator Williams. On everything covered by the bill? Mr. Steassbuegee. Yes. Senator Williams. And the infant is not born in Canada ? Mr. Steassbuegee. The conditions are propitious. Senator Williams. It may result, you think, in the future ; but the infant is not even born yet. Mr. Steassbuegee. That is the reason I do not want to take any time, except to state that this is the condition that Congress will create by passing this bill with the plate-glass item in it. Senator McCumbee. The point I want to make is that you are afraid of the conditions that may come into existence, and therefore oppose the treaty upon that ground ; but your same people are not at all afraid of the condition that is already in existence in the broad fields of the Northwest that threatens the farmers' industry at the present time. That does not seem to appeal to some down here. Mr. Stilvssbuegee. I won't admit that. I am not qualified to state what the sentiment of the people of Pennsylvania is on the general principle of reciprocity, and I only came here to state that the Ameri- can manufacturers of plate glass feel that by passing the glass item— and I refer to nothing else — will place the Canadians in such a posi- tion that they can build a plate-glass factory and advantageously unload part of their production on the United States by taking away from us part of our market without giving us anything else in ex- change for it, and I have no other proposition to submit. Senator McCumbee. I think you are justified in your fears. The only point I want to make is that we are justified in much greater fear. Mr. Steassbuegee. I have no disposition whatever. Senator, to argue the reciprocity bill; I only want to make this plain statement; I do not, in other words, want the bill to go through — if it is going— without having been on record in a short statement, such as I have KECIPEOCITY WITH CANADA. 365 made, in behalf of the American manufacturer and liis workmen of what it will do to them, and further than that I have nothing to say. Senator Smoot. It does not take very long to start factories. The Chairman. Is there anything else? Mr. Steassbukger. I have concluded, if the committee have no questions to ask. The Chairman. All right. Mr. Bronson, will you address the committee? Senator Smoot. Mr. Bronson wants to leave the city to-day. The Chairman. Mr. Bronson, Senator McCumber is willing to yield to you, in view of that fact. Will you state your full name ? Mr. Bronson. Leonard Bronson. STATEMENT OF LEONARD BRONSON, REPRESENTING THE NATIONAL LUMBER MANUFACTURING ASSOCIATION OF THE UNITED STATES. The Chairman. Whom do you represent? Mr. Bronson. I represent the National Lumber Manufacturers' Association. This is a federation of associations organized in the dif- ferent parts of the country by the sawmill interests. It is not a gen- eral rejDresentation of the business of lumber. The lumber business. take it as a whole, is divided into i^erhaps the ownership of timber, the manufacture of lumber, and the sale of lumber. We represent lumber from the log to the dealer. We represent simply the mill itself. It is necessary, I believe, to bear that division in mind. There are several subdivisions of this t)usiness, of our own business, between logging and sawmilling. In many cases the sawmill owner is simply that. He owns no timber; he does not log timber — that is, he does not bring the log from the woods to the sawmill. And, then, when he has cut the product and put it on his dock or yard, he simply sells it hi the bulk. That, of course, is not in the majority of cases, with the large manufacturers. I was quite interested last night in the little discussion about the animus of people — that we are all selfish — but the modification of that put out by the committee was a very happy one, and it is a good thing for us and for the county that we can honestly feel with a real patriotism that the interests of the people and our larger interests are identical, that we are not merely selfish. We ha^e to study things and handle things from the commercial standpoint and a personal standpoint, because we have got to make money to live, and to live is the first thing, provided we can live well. The lumber manufacturers, the lumber producers of the United States, are op- posed to the proposed reciprocity agreement. I think we are oiS^osed to it as a whole. I believe, from our knowledge of tlie bill, from our part of it, that it was so ill considered, so nonreciprocal, that it is not for the interests of the country as a whole any more than it is for our interests, or for the interest of the country as represented by the lumber industry. There are lum- bermen, as you saw last night, who are in favor of reciprocity, but they are seldom manufacturers; they do not belong to the people whom I represent. In almost every case, perhaps in every case, lumbermen who are in favor of reciprocity, who were in favor of a reduction of the lumber duty two years ago, who are in favor of free 366 RECIPROCITY WITH CANADA. lumber on general principles, are men usually located along the border who are interested in the importation of lumber, or men who have interests and investments or manufacturing enterprises in Canada. Some of the members of this committee perhaps have re- ceived some memorials on that last point in favor of the reciprocity bill, pointing out one thing and another regarding it, coming from an agent for British Columbia timber. The active j^roponents of the reciprocity in the lumber business have all been of that class. We are not a political organization; we are not Republicans or Democrats. From an economic standpoint we are not protection- ists or free traders or tariff-for-revenue men, l:)nt we have all of them in our ranks; and as citizens they stand for those things which they believe, and it is somewhat remarkable that in this matter the protection Republicans — the man who believes in protective tariff, as a principle — find a fundamental objection to this bill, in that it removes the protection — the duty — from articles which he believes need some protection, and, on the other hand, there are Democrats among us wlio believe, perhaps, in a tariff for revenue, and they say that this bill is utterly illogical ; that it takes away the revenue from the Government, derived from an article from which revenue is assured, and the collection of which does not injure the people, or, at least, injures them as little as any other tariff that can be thought of. for we are agrecMl on this matter. Of course I can not speak of free-trade Democrats, as there are none of them nowadays. This bill proposes to admit rough lumber from Canada into the United States. That means admit all the rough lumber free into the United States, practically all, because that which comes from other countries, that of the ordinary sort, is too insignificant to speak of. I am not referring to cabinet woods, the higher class of ma- terials of that sort. But it is the ordinary lumber which enters into our industries, and to building and general construction purposes. It recluf(>s the revenue to the extent, without looking it up, to be pre- cise, of about tweh'e hundred thousand dollars to one and one-half million dollars a year. Yty taking off $1.25 a thousand feet, which was the amount of the rough-lumber dutj'. The value of our importa- tions from Canada during the last fiscal year was $19 a thousand feet. The specific duty amounted to about 7 per cent ad valorem. There was a reduction from about 12 to 7 per cent ad valorem, with the specific reduced to the ad valorem, by the Payne-Aldrich bill. It is, I think, of legitimate interest to everyone, not only to you, but to the people, to know what the effect of that reduction was, so far as it can be determined, and what advantages they gained and what disad- vantages, and what consequently may be expected from this measure; I should preface it by saying there is not much relation — thatjs, not a close relation — between the sawmill price, the cost of manufac- turing lumber, and the price the consumer pays for it. The mill man makes lumber at a pretty definite cost; he sells it for as good a price as he can get. For the last two or three years they have had practi- cally no profit ; and it goes perhaps to the retailer, who distributes it. There arc such costs of transportation and handling incurred that the consumer is not apt to know anything about any small change in the cost or in the Avholesale price. The reduction in the cost of lumber at the mill EECIPEOCITY WITH CANADA. 367 Senator Williams. Eight there; is it true up in your country that there is a retail lumbermen's association, which divides up the territory, and by agreement, so any man won't sell any other man's territory, and a certain price is fixed for the lumber ? Mr. Beonson. I think, Senator, that there is not as much of that as there was said to be clown in JMississippi. Senator Willia:ms. I hope not, but is there any of it up your way? Mr. Beomson. That is a disputed question. We do not know, as manufacturers, but we have our suspicions that sometimes that is done. Senator Williams. We fined them $30,000 apiece, down with us. Senator Claek. You sell in the open market? Mr. BE0^"S0N. We sell in the open market; we are simply pro- ducers, sawmill men. The retail dealer, I suppose, in the lumber business is quite like in every other business. If he finds home com- petition getting pretty lively, cutting each other's throats, it is very easy to go into the same territory or neighboring territory and attempt to get business by cutting the prices. Senator Williams. Did any of this system exist in your country, or does it — the system whereby the Eetail Lumbermen's Associa- tion would say to a mill that if you sell to a certain party, we will put you on the blacklist and not buy from you at all ? Mr. Bronson. I can not say, as to my own knowledge. I have heard that charged. I do know this, however, that we consider, and everybody else believes, I think — every honest, fair man believes, that it is not right to solicit the trade of a dealer and then sell him, and then go beyond the dealer and sell that dealer's customer at the same price that you sold the dealer. Senator Williams. Let us see about that. Suppose a man was building a large number of houses. Say, several years ago, when Yazoo City burned up — burned off the face of the earth, all the busi- ness part of it, and two-thirds of the residences; and we had to go to work and rebuild. Now, I ask whether if I was a dealer in lum- ber in that town and suppose I wanted a carload of lumber, and a dealer wanted a carload, or I wanted 10 carloads and the dealer wanted 10 carloads. You think it is not ethical from a business standpoint to let me have the same quantity of lumber at the same price? Mr. Beonson. I was not speaking about any condition just like that. I was speaking about ordinary trade conditions. Senator Williams. Suppose, then, independentij^ of a fire, that I Avanted the same quantity, saj' 10 carloads, and another man wanted it, and my business was practicing law and his business was buying and selling lumber. Do you take the position that it would be an unethical thing to sell me the same quantity of hunber at the same price that you would sell it to him? Mr. Beonson. You are getting down to a pretty fine question. 1 *hink there is a general rule that anybody who goes to any sawmill, as a general thing, can buy lumber at that mill and take it away. I know there is no wholesale dealer in Chicago that would not sell anybody who buys the stuff and takes it away and pays for it. Ordi- narily you can go to any mill and buy all the lumber yon waiit. But the millman recognizes" this fact, that his constant market, his regu- lar customers, are the retail dealers or the big wholesale consumers. 368 EECIPliOClTY V>'ITH CAXADA. regular bin'crs, and he recognizes the fact that those people must live and that as a matter of good faith, good-fellowship, good citi- zenship, he should not disturb them in the legitimate conduct of their legitimate business. Scnatiir Smoot. If they did, they would not buy from them the next time, would they? j\Ir. Bronson. No. Senator Smoot (to Senator Williams). I say, if they did sell to a customer, the business man would refuse to buy from such seller. Senator AYh.liams. Oh, no; as a rule the majority of men, under ordinary circumstances, are buying less than a carload and the lumber dealer is buying 40 or 50 carloads. Everybody recognizes the right to make a difference between the wholesale and retail price. Mr. Bkonson. And yet it is that very distinction which has brought about largely this talk of a Lumber Trust. Senator Williams. In my State for awhile it was charged, and believed proven, that if the sawmill sold to anybody except the recog- nized members of the lumbermen's association of that town that then none of the other members of the retail lumbermen's association would l.)uy from that sawmill and shut it down. Mr. Bro>-son. That has been the case oftentimes. It has some- times obtained in a way so objectionable and injurious to us manu- facturers that we have protested. At the same time, we are in busi- ness, and do not want to lose our customers. Senator WiLLiA:sts. You would not dare to run the risk of being put on the black list. While holding up the consumers they hold you up at your end of the line. ]\Ir. BnoNSox. That question of lumber practice, if you will permit me, I will talk about a little later, in connection with another matter. Senator La Follette. I would like to ask you, in that connection, if the sawmill men have an agreed price list which they make to all lumber dealers? INlr. BiJoxsdN. Xo, sir. Senator La Follette. Within a given territory? Mr. Beonson. No, sir; I will explain that. They have lists — I will explain the best I can — but lumber j^rices are open. There are no lumber prices made to-day, to my knowledge. Our association, of course, has to do with the general matters and the association has nothing- to do with these things, because there is competition amongst our own members. The associations themselves are members of mine. Consequently, we can not deal with that matter. But I am in a jjosition to know something about, or, perhaps, to infer, and perhajDs I have a general knowledge rather than personal, minute knowledge, which sections are apt to be subject to that sort of at- tempt. Of course, every one wants to make as much money as he can, and if he is honest he says as is " legitimate." We Avant, and we are entitled to, a reasonable profit. Senator La Follette. What does he mean by "legitimate"? Keeping out of jail? ]\lr. I3konson. Keeping out of jail, violating no moral or economic law, violating no duties of his citizenship. I think most lumbernien are as honest as most other men, and here is one way — they recognize, I think every business man believes, that the Sherman antitrust law is mistaken in not allowing regulation ; but it is the law to be EEOIPKOCITY WITH CANADA. 369 obeyed. Therefore, we can not make agreements, we do not make agreements, but some of these people, some of these associations, carry on an educational process. It is purely educational — that is, it im- presses upon the manufacturer what his lumber is worth; what it costs him, what the general market at the time is likely to be, and I know people, or know of associations, whuse members will be reached occasionally by circulars, saying "The market conditions warrant such and such a price." The man that receives is under no obligation to make that price, but if it comes from authoritative enough sources, he says, " I will try that out, and if it works, all well and good." If he finds that he can not sell at that price, he does not ; but the tendency of those things is to even up prices, though it never has succeeded in fixing prices. Senator La Follette. The tendency is to make that price, is it not ? You say, " Even up prices." It has the tendency to make the price that the circular says will be justified by the conditions of the trad© and to make it throughout the territory higher than the circular says. Mr. Beonsox. I suppose it has a tendency to do that, but it does not accomplish it. I never knew the time Senator La Follette (interposing). Do you mean it does not ac- complish it, because some men will take advantage of an opportunity to cut under that ? Mr. Beo>'sox. There is* too much competition in the lumber busi- ness for anything of that sort to be complete in its effect, absolutely. 1 never saw the time when for any kind of wood, you could not beat any price that*was put out as the proper price. Senator La Follette. Who puts out this document which you just described ? Mr. Beonsox. Sometimes the secretary. Mr. La Follette. Secretary of what? Mr. Bronsox. Some association. He will put it out. Sometimes it will be a trade paper — one case I knew of where a publisher, purely independently, on his own hook, without authority from anybody, got to giving this market information by letter mail, specifically, and he had great influence throughout a section of the trade for a good while. In default of any combination, possible liability of contract from a business standpoint, there has never been such a thing which lasted more than six months, or three months, in the lumber business. They use these methods of education. Senator La Follette. Such a thing — what lasted not more than three months ? Mr. Beonson. Those prices. Senator La Follette. Until prosecuted under the Sherman anti- trust law they made these agreements ? Mr. Beonson. I have never known of prosecutions; but those agreements — I never knew any to be effective. I have been con- nected with the lumber business" rather intimately for 25 years, before the time of the Shennan antitrust act, and I liave seen— I have been in meetings again and again where — in those days under very serious conditions, bad conditions, they would make an agreement, perhaps on a rising vote, to make such a price, beginning to-morrow morn- ing, for perhaps a definite period, or as long as they could. Some people, however, would go out before the day was over to tell their agents to sell " all you can at the old price." I never knew anything 370 RECIPROCITY WITH CANADA. of that sort or brand to amount to anything in the long run or in any large way- C'onsequently the effort now is to get people to under- stand what things cost. Senator La Follette. Were any efforts made to enforce that, in the way of any punishment in the trade? Mr. Beonson. I do not believe so. Senator La Follette. In the matter of scales? Mr. Bronson. No. Senator La Follette. Have you not known of anything of that sort? Mr. Bkonson. I have heard that — two or three small penalties. Senator La Follette. What was that penalty — ^how imposed and who imposed it? Mr. Bronson. The whole thing was so indefinite Senator La Follette. If they had got down to the proposition of imposing a penalty it must have been imposed by somebody. Mr. Beonson. Oh, yes. Senator La Follett-e. By whom was it imposed in the— — Mr. Beonson. By the secretary Senator La Follette. How was he authorized to impose any penalty ? Mr. Beonson. Well, sir, Senator, you will have to allow me to recall that I have said that I had heard of such things being done occasionally. Had heard of two or three instances of that thing — I heard of it two or three times, but I do not know the details. Senator La Follette. I am not asking you f# the details, but I ask you what authority — who vested the secretary with any author- ity to impose a penalty? Mr. Beonson. I do not know, sir. Senator La Follette. That thing was done? jNIr. Beonson. I do not know actually that the thing was done, if it was done. I am sorry that I do not know who imposed any penalty. I was not on the inside of that sort of thing at that time. Senator Keen. Mr. Witness, how many of these associations are there, so far as yon are advised, whose officials advise their fellow dealers as to what tariff they ought to charge? Mr. Beonson. I do not know that there are any in the retail trade. Senator Kern. In any part of the trade or branch of the trade? Mr. Beonson. The price infomiation is given out by the secretaries by price-list companies and by the trade newspapers. Senator Keen. I know, but how manjf of these associations are there whose officers assume to give out this information and advice? Mr. Beonson. I should imagine this country Senator Keen. Mr. Witness, in a city like mine, 240,000 inhabitants, where people have to pay the same price for lumber, by an ironclad rule, no matter from whom they buy, and where in all other cities in that neighborhood, that part of the State, exactly the same prices prevail, is that uniformity of price, or is it usually a high price, the result of a local association, or is it merely a coincident. Mr. Bronson. I do not know, sir, how it is in j^our city. It has been charged publicly that there are cities in Avhich thei'e are local combinations or associations which control the price. Senator Kern. Is this not true, that if a dealer in Indianapolis, where I live, should undertake to make a substantial cut in the price EECIPEOCITY WITH CANADA. 371 of lumber, and he does that to the deti'iment of his competitors in business, is it not true that such a dealer would be compelled to go out of business, because he could not buy lumber anywhere ? Mr. Beonson. That is not true, but I imagine if there was so strong a combination in Indianapolis as that Senator Keen. I do not say there is a combination there. Mr. Beonson. If there were so strong a combination, though I do not know of any city that has, there would be plenty of other ways to make it so uncomfortable for him that he could not do business. Senator Keen. How could they make it uncomfortable for an in- dependent American citizen who has undertaken to exercise his right to deal fairly with the public ? Just tell this committee that. Mr. Beonson. I should have to draw on my imagination some- what, but my imagination is somewhat vivid, and if you would like to have me indulge in romance Senator La Follette. We do not want that. Do you know about this business? Mr. Beonson. I am testifying regarding the manufacturing, or sawmill, end of the business. Senator La Foi.lette. You know whether this condition existed or whether it has existed, and you can tell us definitely without draw- ing on your imagination. Mr. Beonson. I beg your pardon. The ' -«nator from Indiana asked me why it could be made uncomfortable^ - — Senator Keen. Yes. Mr. Beonson. For an interloper Senator Keen (interrupting). I did not call him an interloper. I said " independent American citizen." Mr. Beonson. A man who upset the little scheme they had there. Senator Keen. Yes. Mr. Beonson. If the Senator wishes me to make an attempt at an answer, I should say that I should imagine that they might under- sell him — his particular trade — discriminate against him. Senator Keen. Freeze him out. Mr. Beonson. Freeze him out. I can imagine that would be possible. Senator Claek. They might do that in any bv-siness. Mr. Beonson. Oh, yes. Senator Hetbuen. Control the transportation, against him? Mr. Beonson. I do not know about that. Senator Keen. Is it true that some gentlemen were indicted in Indianapolis for carrying on a scheme of this kind ? Mr. Beonson. I think not. I do not remember it. This excursion into the retail business is outside of my province and outside of my particular knowledge and has drawn me away from some of the things I wanted to say. I want to admit right now, however, that a good deal of the information— most of the information regarding Canadian competition is misinformation. The advocates of a lumber duty are wrong sometinies, just as the other people are wrong most of the time, in my opinion ; that is to say, the conditions are not through our whole 3,000 miles of northern border the same; and a man may talk about a situation m New Brunswick or Ontario which does not obtain in British Columbia or somewhere else. The test of desirability of a lumber duty, not 372 EECJPKOCITY WITH CANADA from a protective or any other standpoint — yes, from a protective standpoint, in one view of it^ — lies in the dissimilarity of conditions on the average. If you take the labor contrasts between Ontario, the Georgian Bay country, and our country, across the line this side, in the white-pine country, there is not very much difference. They hold the timber on somewhat different terms; they do not make the same investment that we do. They bid for the privilege of taking license or limits. That bid or bonus is sometimes high, amounts to some substantial price, but beyond that they pay for the timber when they cut it, and they pay only for what they cut. In the meantime the Canadian Government, or the provincial gov/- ernment, carries the risks and hazards and the only cost, so that there is only the investment in this original bonus. We, on our side, of course have to buy, usually, land and timber together, if bought for any long-time investment, ourselves; not only the investments, the risks, the hazards, fire, whatever it may be. That condition obtains all along the border. The Canadians almost invariably have that advantage over us, and in some cases.it amounts to a good deal and in some to comparatively little. As to labor costs, there is not much difference between western Ontario, or what we had better call cen- tral Ontario, Georgian Bay country and that district, and ours. There is not much difference in the Lake of the Woods country on the two sides of the line. There is not much difference in the woods of Brit- ish Columbia, as compared with the woods in Washington. The prominent difference is in their methods of landholding. Senator Williams. jMethods of what? Mv. Broxsox. Land holding. We have to buy; very little leasing. It makes a ver^' important difference. Senator Kerx. PLxplain that to us, to those of us who are not familiar with the terms. ^Ir. Bronson. The Crown, since the days of 1865, I think that was the time of the consolidatiim — the Dominion was organized about that time — the Crown has sold no timber lands, nor attempted to, but they are held as Crown lands and leased for certain purposes, for a limited time or for a continuously renewable period, at the option of the Government. On those lands they have put certain restrictions; whatever they please. In the eastern maritime Provinces, and in Quebec and in British Columbia, I think in the western Provinces of ]\Ianitoba, Saskatchewan, and Alberta, there is a fixed — I am not quite sure as to all of them, but I know it is so as to British Colum- bia — a fixed charge when they take ever the land, a fixed annual rental. In British Columbia it amounts to $1-10 a square mile west of the Cascades and $115 east of the Cascade ^fountains, owing to the different classes of timber. Timber west of the Cascade Moun- tains averages 20,000 feet minimum to the acre, making this annual charge or rental very low per thousand feet — one-half to 1 cent per 1,000 feet. Senator Heybuex. How much to the acre? Mr. Beonsox. One-half to 1 cent a thousand feet. It is $140 per square mile. Did I say acre? Senator Kern. No; square mile. Senator Heyburn. I understood you to make the statement as to the (|uantity of timber upon an acre of limit. Mr. BiiONSON. Per acre? BECIPEOCITY WITH CANADA. 373 Senator Heybuea. Per acre. Mr. Bronsox. It will run over 20,000 feet up to 100,000, and re- duced down to the carr^nno charge per 1,000 feet of standing timber it would amount to something like half a cent to a cent, according to the density of growth. The Crown lands of Canada are the public lands, the same as ours. The Crown-granted lands, and they are the absolute fee of the lands, are comparatively limited in area, ancl especially limited in the quantity of timber, because it was those lands that were granted years ago, embracing the southern shore of the St. Lawrence Eiver and the Gulf, a considerable quantity in Brunswick, very largely — almost all, I think — of Nova Scotia, and a thin fringe in Ontario along Lake Ontario. Those lands, which were granted in fee. have largely been cut away of their timber and are now agricultural lands, though there remains a considerable quantity in spruce — a large quantity of spruce on the farmers' lands, settlers' lands, etc., the granted lands, in Quebec and New Brunswick. I think that ^Ir. Morris will say that there is considerable of that timber; is there not, Mr. Morris, of that fee timber? Mr. MoEEis. Five million acres in Quebec — 8,000 square miles. Mr. Bronson. As to the vast bulk of the timber, it stands on Crown land, and is granted on these terms I have spoken of, but with the additional requirement that this timber shall not be cut to be manu- factured outside of the Dominion of Canada. Ontario was the first Province to put that rule into effect, first as to saAv logs, follow- ing the ?2 duty in 1897. Before that it had an export duty of $2 a thousand on logs, but following that it put an absolute prohibition on the export of logs. It followed it with sliingle bolts, pulp wood, etc. Then the other Provinces followed suit, luitil now I think the only Provinces from which timber can be exported are New Bruns- wick and Nova Scotia, and there is so very little of it there that it is not worth talking about — that is, of stuif capable of export. Senator Lodge. Callable of export? Mr. Bronson. Yes, sir; but there is very little of it available for export — no way of getting the logs away from that market, -whereas in all the other Provinces logs could be taken across the border to the American mills very easily. Quebec passed such restrictive laws last si)ring, just about a year ago, so that there is absolute pro- hibition of export shipments of logs, of the raw materials. That leads to a situation — the President, in his optimistic Senator Siimmons. That restriction applies only to logs? Mr. Broxsox. It applies to logs, shingle bolts, lath bolts — every rough product of the forest. Senator Snuroxs. That applies only to logs to be converted into lumber ? Mr. Beonson. Yes, sir. Senator Simmons. It does not apply to rough lumber; there is no restriction as to that ? Mr. Bronsox. None whatever. The requirement simply is that the rough material first comes from the woods, from the tree, shall be from there manufactured in the Dominion, sometimes in the Province, and that is true as to every Province with the exception of those that I have mentioned. The President, in his optimistic introduction to this agreement, say-: "Free lumber we ought to ha\'e." Tliat is a 93285— No. 6— ] 1 2 374 BECIPEOCITY WITH CANADA. dogmatic statement, which of course we dispute. "By giving our people access to the Canadian forests we shall reduce the consump- tion of our own, which in the hands of comparatively few owners, have a value that requires the enlargement of our available timbers." That expression, however, " by giving the people access to the Cana- dian forests," is what I particularly wanted to mention and call your attention to. This reciprocity bill does not give our people access to the Canadian forests, nor to Canadian logs, which are produced at a cost exceeding the value of the standing timber ; that is, the log is worth more than double the timber standing, of the ordinary timber, not white pine. Neither does it give access to the logs, but only to the product of the sawmill itself — that is, to an article — to a commodity two stages removed from the raw material. Two manufacturing operations have been performed upon the tree; it has been felled, cut into logs, and brought to the market — it may be the mill — then it is put through the mill. Canada does nothing on that point for us, for the American people. Now, I am talking as a citizen in a way, for it is no advantage to the American lumber industry that the logs should be brought across the border to accentuate the domestic competition already existing, for the Xorth competes with the South and the East with the "West, and the south- erner would have a right to complain, perhaps. He certainly would not be benefited if a few northern operators were permitted by this pact to bring logs across the border, the cheap logs from the cheap Canadian timber, and cut it in the northern mills to further coinpete with the southern mill, but as a citizen I want to call your attention to it as the important one in this pact and treaty. It is of signifi- cance to the American people. It indicates something of the character of this — the carelessness with which this treaty was framed. We admit Canadian lumber, a product of the sawmill, upon which perhaps $8 a thousand has been extended in the way of labor and supplies, and on top of the $'2, $3, or $4, or whatever it is, stumpage value, standing value, give that free access to our markets, but do not require Canada to give us any advantage whatever. She does not release her forest; she gives us no access to her forests, but just to her sawmills. It seems to me very strange that the representatives of the United States Govern- ment who negotiated this treaty did not cover that point. Senator Simmons. Let me see if I understand you. You say that before this product of the forest can be admitted free into this country under this treaty that there must be expended on it about $8 a thousand in labor? Mr. Bronson. Labor, supplies, and so forth, as a manufacturing process — two manufacturing processes. Senator Simmoks. You mean to say that it has to be cut, hauled to the mill, and sawed ? Mr. Bronson. Yes. Senator SuirvroNS. And that involves a cost of about $8 a thousand? Mr. Bronson. Oh, yes. Senator Summons. Then, after $8 of labor has been spent on it it is allowed to come in free? Mr. Bronson. From Canada. Senator La Follettb. Do you manufacture? EECIPEOCITY WITH CANADA. 375 Mr. Bronson. Personally? Senator La Follette. Yes. Mr. Bronson. No, sir. Senator La Follette. What is your official relation to the manu- facturers' association? Mr. Bronson. ^fy title is "Manager of the National Lumber Man- ufacturers' Associaticin." For many years I was connected with the lumber trade papers and got quite a large general acquaintance with the lumber business, manufacturing industry especially, and with lumbermen, so they selected me for this position. Senator La Follette. Wliat territory does this association cover in its organization? ilr. Bronson. Its memljers are the North Carolina Pine Associ- ation, whose headquarters are Norfolk, Va., and covers North Caro- lina, Virginia, and South Carolina to some extent; the Georgia and Florida Sawmill Association, covering the territory indicated by its name, with headquarters at Tifton, Ga.; the Yellow Pine Manufacturers' Association, embracing the remainder of the yel- low-pine territory — that part of it west of Georgia ; the Southern Cypress Manufacturers' Association, representing cypress, practically all the leading mills being members of the association ; the Hardwood Manufacturers' Association of the United States, with headquarters at Cincinnati, covering the southern hardwood belt; the Michigan Hardwood Manufacturers' Association; the Northern Hemlock and Hardvrood ^lanufacturers' Association, covering AVisconsin, north peninsula of Michigan, and part of Minnesota ; the Northern Pine Manufacturers' Association, covering the white pine of Wisconsin and Minnesota, and Michigan to some extent ; the Western White Pine Manufacturers' Association, taking in the western mountains of Idaho, Montana, and eastern Washington; the Pacific Coast Lumlier Manufacturers' Association, a great organization out there, covering western Washington, that great manufacturing district there, extend- ing out somewhat into Oregon ; the Oregon and Washington Manu- facturers' Association; the Southwestern Washington Lumber Manu- facturers' Association; the Pacific Coast Sugar and "^^^lite Pine Manufacturers' Association, with headquarters at San Francisco, em- bracing manufacturers engaged in the production of sugar and white pine; and the Kedwood Manufacturers' Association. Those are the associations which make up the membership of the one of which I am manager ; all making it, as you will see, an oi'ganization national in its scope. Senator La Follette. "Wliat duties have you as manager? Mr. BeojS'son. ^My duties are chiefly to be diplomatic — I beg your pardon for being flippant, but my duties are to represent the industry, so far as I can, in regard to the matters a- to which their interests are common. Senator La Follette. "Common " or " conflictinii' " ? Mr. Bronsox. Common. I do not do anything with prices. I do not do anything with competitive freight rates on the railroads, but I do this : I will try to explain ; if there is any railroad legislation that is of interest to our people at large, to one section of the country as much as another — some matter regarding some claim sheets, uni- form bills of lading, anything like that— I represent them all. 376 RECTPROCTTY WITH CANADA. AVhoic tlioir interests are common, like a matter of this sort here, where the.y are agreed, or Largely so, I represent them. Does that answer your question? Senator La Follette. Yes. The Chairiwan. Is that all, Mr. Bronson? jNIr. Bronsox. No, sir. Senator La Folletite. The reason I asked you if you were a manu- facturer, I wanted you to give us some statement of the labor cost and milling in producing lumber in the various grades. Mr. Broxson. Well, sir, I can give you some general information that is pretty accurate ; fairly so. Senator La Follette. Have you practiced in your business, hainng learned it in the mills? Mr. Bronson. I have practical knowledge from the securing of statistics and all that sort of thing now, but not from the standpoint of running a mill ; no, sir. Here, I supi^ose. the importance of the question as to prices, cost of labor, and all that, is in regard to the competitive situation between this country and Canada. As I stated a little while ago, there is not much difference between the cost of production in which labor enters in Ontario and the correspond- ing districts of our country, the white pine country. Labor costs run, in the American mills, from a comparatively low figure, per- haps, say, $1 for common labor in the South — some sections where the negroes are employed — I would like to be corrected if I am too low on that. Senator Stmmons. I think they pay $1.25 to $L50. Senator AVilliajis. Sometimes it goes clown to $1. Mr. Beomsox. I think that the minimum would be about right, about $l.riO to about $2 a day in sections of the North for common labor. Of course, skilled labor demands all sorts of prices, depend- ing upon supi^ly, and the degree of skill required and the par- ticular i")lace. Sawyers constitute one of the highest class of em- ploj'ees that we have in the sawmills, for the reason that he sets the joace very largely for the mill. There is the filer, the man who can fit a thin band of steel 40 feet long and 12 or 14 inches wide so that, without flange or anything else, it will follow two wheels or two pul- leys at a speed of 10,000 feet a minute against the pressure of a log 4 feet in diameter being crowded against it at a speed of 5 feet a second. But they ha^e the same problems in Canada largely. The difference in the cost of labor between Canada and the United States is due to the general lower range of prices in Canada on the borders, but it is sliown particularly in Quebec — the maritime Provinces, where the habitant does not want, does not need, does not ask the prices that are paid in Maine. Generally, along the northern border, prices average a little more; in British Columbia we find in the sawmill, though not in the woods, a class of oriental labor which commands wages from one-half to two-thirds or three-fourths of that paid on the American side. Senator Clark. Is that in Canada ? Mr. Bronson. In Canada, Chinese and Japanese; though I know of only ojio mill, and that is in Washington, that has any considerable number of them, in fact that has any — one mill that has Japanese— and they wish they could get more. Senator Clark. Do they have Hindoo labor on this side? RECIPROCITY WITH CANADA. 377 Mr. Beonson. I do not know of any; I do not think they are allowed to drift across the border. If they are there they have drifted in or stolen in. I have never heard of any. There are situations I wish to call your attention particularly to in regard to the coast trade, the trade on either coast. Next Wednes- day, as I understand it, the southeastern lumber manufacturers on the south Atlantic coast are to be here and address this committee. I will not go into it to any extent to anticipate what they will show, but I will confine myself largely in that matter to the Pacific coast, which is_ not represented here and perhaps can not be represented here during these meetings. Senator Simmons. Before you get to that Mr. Beonsox. I beg your pardon. Senator Si:ioions. I was not here when you first began to make your statement. Just as I came in you were speaking about the price they paid per square mile for timber land ■ Mr. Bronsox. That was in British Columbia. Senator Snuioxs. In British Columbia ? j\Ir. Beoxsox. Yes, sir. Senator Simmoxs. You said that amounted to about $140 per sec- tion or per square mile ? Mr. Beoxsox. Per square mile. Senator Simmoxs. That, you say, is only about 1 cent per thou- sand? Mr. Beoxsox. Yes, sir. Senator Suoioxs. Have you stated up to this time — you have not stated since I have been here — the stumpage price ? Mr. Beoxsox. There is no stumpage price in British Columbia — no stated price, only an estimated market. Senator Si3tM0xs. "What are the prices they pay for the timber in addition to this rental you spoke of a while ago ? Mr. Beoxsox. T\Tien you cut the timber you pay 50 cents a thou- sand under the present Ijasis, and that is made permanent. Senator Simmons. That is stumpage? Mr. Beoxsox. You pay for the stumpage, for the standing timber, the privilege to hold and the privilege to cut. This per section or per square mile price of $140 west of the Cascades is on that timber alone, and that amounts to about a cent or one-half cent per thousand feet. Senator Simmoxs. That is insignificant? _ Mr. Beonson. Yes ; that takes the place of our taxation across the line in Washington. Senator Sim3ions. That is the way I understand it. Mr. Brox-sox. Of course, they have had some small expenses, amounting to perhaps 5 or 10 cents per acre — oh, yes, considerable more than that, but a small amount, in staking and exploration and finding the timber, and then you pay this annual license per section — per square mile. Then when you cut the timber, such as you cut, you pay 50 cents a thousand. Senator Simmons. That is what the timber costs you— 50 cents per 1,000? Mr. Beoxsox. In the future. _The Chaiemax. Mr. Bronson, when the North Dakota people yielded to you it was the understanding that it would be but for a 378 EECIPEOCITY WITH CANADA. short time. They have the right of way, and you have already had over an hour. It was not your fault, because you have been the sub- ject of questions from members of the committee and have been giv- ing it very interesting and intelligent information. The committee has no desire (o curtail your hearing, but feels that the North Da- kota peoiDle have the right of way. They have made arrangements to return home to-day. Mr. Beonson. Certainly. The Chairman. And perhaps are entitled to go on now, with the understanding that you may continue at some future time, either next Wednesday or some other time that may suit your convenience. Mr. Beonson. I shall be unable to be here next Wednesday. Senator McCumbee. Perhaps you could go on a little further now. The Chairman. You could go on until 12 o'clock; the committee will hear you. Senator Heyburn. Just a moment, Mr. Chairman. The Chairman. Yes. Senator Heyburn. This gentleman will speak for all the lumber- men of the Northwest in that business. The question of lumber in the Northwest has been verj^ meagerly gone into, and I think it is very desirable that it should be gone into more extensively. There are many facts that should be brought out in determining the question of this pact, and I would like such an arrangement to be made that this gentleman should have a full hearing without anj' particular limit on it. It would be kept within reason, and that it could be fixed at the time when he could be here to get them. The Chairman. J\lr. Bronson has been waiting here for several days, but it is for them to look out and arrange these hearings within the limit. Questions will arise, and when it comes to interruptions it will take so much more time than was expected, but the committee believes that we can give everyone a patient hearing. Mr. Bronscin. I appreciate that. The Chairjian. If Mr. Bronson could be here early next Wednes- day, the committee would be glad to hear him. ]Mr. Beonson, Please allow me to explain. Our annual meeting is on Wednesday week, and I am compelled to make some preparation for it. Our people are coming from all over the United States to Chicago, where it will be held. Senator Heybukn. Mr. Blackman wired that you would represent all those people. Mr. Bronson. I think I can say before 12 o'clock some things tliat ought to be said. The reciprocity is unreciprocal in the points of dressed-lumber schedules. Attention was paid to that last night very briefly, and it is a matter of great importance to both countries and to the entire industry. I ha\-e no need to say anything to ym gentlemen about it now, because I found you were thoroughly in- formed. Say Canada charges import duty on the dressed lumber of 25 per cent ad Aalorem. which is di'essed on more than one side, and almost all the lumber commercially is dressed on more than one side — if only one side, that is to save the freight Senator Simbkins. I thought it was 2.5 per" cent. Mr. Bronson. Twenty-five per cent ad valorem; yes, sir. Our duty on dressing amounts to, transferred from the specific to the ad va- lorem, 6i per cent on the importations, of the last fiscal year, one- EECIPBOCITV WITH CANADA. 379 fourth of theirs. The result of this thing is going to be that not only will Canadian lumber be manufactured by Canadian mills abso- lutely, but it will be dressed in Canadian planing mills; whereas our lumber will have to go into Canada rough, to be dressed there. They will do the dressing of the entire country — for both countries, so far as the trade between the two countries is concerned. No doubt this particular point is of particular importance to the hardwood manu- facturers who make hardwood flooring. We shipped during the last fiscal year Senator Simmons. What is the Canadian duty on rough lumber? Mr. Beonson. None. Senator Simmons. Then it is free? Mr. Beonsgn. It is free and always has been free. Senator Simmons. Unfinished? Mr. Bkonson. Unfinished. This compels the manufacture of our rough lumber in Canada, whereas this reciprocity agreement has a chance to change that condition, and we insist that an important amendment, an absolutely necessary amendment, so far as the lum- ber business is concerned, is to put the planing-mill duties of tlie two countries on an equality. It would be greatly to the advantage of our people and no unjust disadvantage to them. For that matter carries the further fact that if you control the dressing of lumber you control the sale of it very largely, and the Canadian manufacturer who has an opportunity to sell in this country will be in a position to say, " We will not sell you the rough lumber, unless you will buy your dressed lumber and your sash and doors and other things of us." It is going to put a club into the hands of the Canadian manu- facturer which will hit the trade and affect the consumer all along the border. I want to say, too, along another line: The question was asked here, " Do we want any duties on lumber, so long as we export to Canada?" This was mentioned yesterday. It is shown by the average prices. The average price of the lumber that we import from Canada is eighteen or nineteen dollars a thousand. The average price of lumber exported to Canada is $28. We ship them hardwoods— 50,000,000 feet or more, 50,000,000 to 75,000,000 feet of long-leaf pine, pitch pine, to the lower Provinces, eastern Provinces — for they have nothing there to serve the same purpose. Thej' have their fir in the Pacific country, but that has a 75-cent freight rate, whereas they can ship the pine around by all-water to Lake Superior, which has been done. It is a matter of transportation. Then there is another place where we sell lumber — in the northwest Provinces. They have developed so fast that their facilities are not sufficient — important facilities — and it is too far to ship from the eastern Prov- inces, Ontario and Quebec, so they Ijuy here, and we buy from their section and exchange at that particular place. The west coast faces the most serious proposition anywhere. The Atlantic coast enters with a comparatively low grade of pine, what is called " North Carolina pine," " old field pine," timber which produces on the average low-grade lumber, which competes directly with the spruces of Quebec, New Brunswick, etc. ; but that competi- tion is accentuated if this duty is taken off by the lower freight rates- water rates — coming from Canada, a difference usually of from 50 to 75 cents a thousand feet for the same distance^— from Canada as from the United States, owing to our coastwise lavs. We can use 380 EKCIPiiUCITY WIXH CANADA. onlj' Amerieun \fssuls bet^^■een .Vmerican ports. Canada can ship to our ports iu vessels of unj nation, and you are all aware that the foreign shipping has an advantage ii\'er us, so much so that it has driven us off the sea. I'liis disadvantage is accentuated on the Pacific coast. On the l*acific coast the cost of transportation from Seattle or Portland or Tacoma to San Francisco at present is $4 a thousand feet. To San Diego or San Pedro, $4.50. It is uniformly, under normal conditions, when there is no special spurt of business, a dollar a thousand less from Vancouver, the same distance as Seattle and through the same channels. It is nothing but the tariff that has saved that tremendous market of Sau Francisco to our own pro- ducers on the coast. California consumes — of lumber from outside of the State — over a billion feet a year, coming from the north, and the advantage, owing to our coastwise laws, to the British Columbia manufacturers is such that they can capture that business with the duty removed just as far as they can build mills to take care of it. The lumber duty is a somewhat permanent thing. They have not sought to go out for that business, business which they could not get as against the duty, particularly as they have been busily engaged in taking care of their own trade in the northwestern Provinces — Alberta and Saskatchewan — but you take this duty off and imme- diately they will have the incentive to build their mills. They are better equipped with immediately available timber than we are ; that is, the country has not been so long developed. We ' have cut trees away from Puget Sound shores. It is a costly logging proposition, a logging railroad proposition. We have to go back to the timber; but still, in British Columbia, along the Straits of Geor- gia and channels, there is an enormous amount of timber, easily and cheaply available, so that in addition to their lower valuation of timber as shown by their forestry commission, which made its report last December, there is this possibility of rapidly increasing their production to take our trade, and when the Panama Canal is opened, instead of our manufacturers profiting bj' that canal, if the tolls are equal and the duty is off, the British Columbia and the ^Mexican mills can, with their shipping advantage, capture our Atlantic coast trade in lumber, regardless of anything else. We hold that this treaty recognizes in no way the lumber industry — that it failed to do in behalf of the people what it should have done. It ignored conserva- tion. You call to the stand any forester of standing in the United States and he will tell you that to lower the price of lumber, particularly the low grades, is to defeat and deter conservation. Conservation is a ques- tion of using up the low grades (ir poorest trees and so extending the life of the industry. The effect of our specific duty is protective of the low grades. We already get more low-grade stuff than we can use, and you invite more of it in Canada, and then you can not sell v\diat 3'ou produce. You have got to leave it in the woods and can not put money into it. Gifford Pinchot said that : Forester Graves said that ; every State forester will say it ; every forester that I know of anywhere in the country will tell yoii that to take the duty off of lumber is to set back the cause of conservation indefinitely. S(>nator Clark. Mr. Pinchot is in favor of the law, as I under- stand it. EECIPEOCrXi A'lTH CAKAUA. 38 1 Mr. Bronsois'. I do not know what he says about this reciprocity, but he says very distinctly that if free kimber is effectual in reducing the price of lumber hi this country it will be detrimental to conserva*^ tion. I have not heard him exjircss himself on this matter. There is much more that I would like to say to you gentlemen, but I have intruded upon j-oiir patience already too much. The Chairman. I will say that a little later on, if you desire to be heard, the committee will be glad to hear you. Senator Sijimons. If ]Mr. Broiibon tlcsires to tile a statement, I suggest that he will be at liberty to do so. The Chairman. Yes; if you desire to make any further state- ment setting forth your views, the committee will be glad to have you do so. jMr. Bro^sox. I should be very glad to present home views in that way. The Chairman. And the committee will be glad to have them printed in the record. Senator McCtjmber. Mr. Chairman, it is but fair to say, in intro- ducing those who will speak for the interests of North Dakota, that it is purely an agricultural State. There is no other productive business in the State outside of agriculture, and while there are those of the speakers who have business other than purely agriculture, every profession is dependent upon the success of the farmer there! and therefore nearly every man in the State is pretty thoroughly acquainted with the farming business. Gov. Lewis is here, and he will be the spokesman for the Xorth Dakota delegation and intro- duce them. Gov. Lewis. Senator Penrose and gentlemen of the committee, I hope that our Senator's remarks have not been misleading. I am not Gov. Lewis. I am simply one man wdio was a farjuer and who happened to be a lieutenant governor of the State, and that is some time ago. By way of introduction, however, to explain fo you possibly our position why we are here, I will say that when it was rumored that the administration was flirting with Canada with reference to a reciprocal trade agreement between the two countries the farmers of our country were not particularly alarmed. We are somewhat inclined to feel reciprocal with that country with* reference to trade relations; but when the real information that the bill carries got out among the people then they were, as agriculturists, certainly alarmed. And so I will say to you that about 75 or 100 business men and farmers got together in Grand P>jrks to see what was Ijest to be done, and we concluded to call a State convention, inviting every county in the State to elect delegates to that State convention, and that it should be nonpartisan. I think it was March .31 that the convention was called for; and when we met we found we had between 700 and 800 farmers in that convention, and representative men from every part of the State. In the course of our proceedings we elected a delegation to come down to Washington. We elected Democrats and we elected Republicans, and I will mention one of them — however, I know you gentlemen know the gentleman — former Senator Purcell, who sat with you in the Senate Chamber here for a short time. He was a member of this delegation; but. owing to the fact that he has a case involving a large amount, he was unable to be 382 EECIPEOCITY WITH CANADA. with us to-day. He \Yas to have been here and spoken against this proposition. Now, we do not desire to present this matter, and we do not pre- sent it, in a political way. We do not want to mix any politics with it. We are aware in the Northwest Ave have got to flirt a little with some of you Democrats if we are to be saved, owing to the fact that the administration is favorable to this bill, and I want to say that I am sure that some of the Democrats in the Senate are going to look very good to some of us northwestern farmers before we get through. Now, that is all I care to say at the present time. I may want to enter into some discussion of this question a little later on. I want now to introduce you to one of the old farmers, and one of the largest farmers in our State, Mr. Larimore, who has been there for some time, and who is a very extensive farmer. STATEMENT OF N. G. LAEIMORE, OF LARIMOKE, N. DAK. Mr. Larimore. Mr. Chairman and gentlemen of the committee, 1 will detain j'ou but a very few minutes. The gentleman has spoken of Democrats and Republicans being sent here from our State. I will state that I am an old Missouri Democrat, and I would like to be shown where anyone is to lx> benefited by this pact, except pos- sibly two or three interests. A short time ago I saw in the literature in the Post-Dispatch of St. Louis an article which read something like this : This reciiDrocity agreement will certainly be a great benefit to the whole country. Just the taking off of the duty on lumber would benefit the farmer very greatly. Now, most of you farmers know that the average farmer through the Northwest does not buy 500 feet of lumber a j^ear. And he says it will be a great benefit through the introduction of Canadian fish. The average farmer does not consume a great deal of fish of any kind at any point. He wound up by saying. " It takes the odious tax from wood pulp." Now, it seems to me that for the mere pittance of the tax on wood pulp, newspaper men ought to know that if they pauperize the farmer they will lose thousands of subscriptions, not for revenge but from actual necessity. The farmer, as a rule, reads his daily newspaper and a number of magazines, but if his produce is so re- duced in price that he has to dispense with some of his luxuries, news- papers will certainly be one of those luxuries that must be dispensed with, and magazines will follow with it. Now, I have a few thoughts to express here, and I will not detain you but a very little while. I have tried to touch on points that have not been reached by parties who have preceded me here, and I put them down in writing and wish to file the paper with you gentlemen when I get through. I have been in the grain business for almost 50 years, about half that time as a dealer and half as a farmer. I have been a member of the St. Louis Merchants' Exchange 47 A'ears, and a close observer of the causes and effects of fluctuation of the grain market. Prices are not always influenced by supply and demand, but oftener by the manipulation of the bulls and bears. Some few weeks ago the papers pul)]ished telegrams from C'hicago, stating that since the agitation of reciprocity, wlicat had declined about 17 cents per bushel, and the EECIPKOCITY WITH CANADA. 383 bears had made millions. Among the names given as big winners, I recognized many old-time bears who have been hibernating since the comitry was prosperous, but now the threatened calamitj' is bringing them out of their holes, with ravenous appetites from their long fast, and should this Canadian wheat be dumped upon our markets they would raid prices as they did a few years ago when wheat sold at 50 cents and corn at 20 cents. Prices of corn are influenced liy the prices of wheat. This would enable Europe to buy our winter wheat, practically the only wheat exported, at half its normal value. Xow, most of the remarks that have been made here refer to spring wheat. It seems to me that people generally do not recognize the fact that the price of spring wheat, if it is reduced, winter wheat must follow, and also the price of corn will follow, because corn is influenced by the price of wheat more or less all the time. While this condition would pauperize the farmer, the saving to the consumer if he got the full benefit would be less than 1 cent a day, but the consumer would pay just as much for a loaf of bread as if wheat sold at $1.50 instead of 50 cents per bushel. The miller and the baker would get all the profit. It has been said that we must soon get wheat from Canada or go hungry. ^A^ren Kansas was first being settled, 1 ;).s-isted in getting up subscriptions on the St. Louis Merchants' Exchange for a number of years to feed the people of Kaii>us ou account of the crop failure. Kansas now is one of our largest wheat-raising States. The same conditions existed for many years in the western part of North and South Dakota. Xow those sections produce as fine crojis as the east- ern parts of the States. This revolution in the production of wheat will continue west- ward through Montana and the far '\^"est, and there is ))rol3al.)ly one- third of the Xorthwestern States still waiting for the ]ilow. The pioneer farmers were poor and felt compelled to rob the fer- tility of their soil by constant wheat cropping to pay for their lands. TheV are now just ready to change their mode of farming to enable them to build up its production. Lands in Europe that have been farmed for 200 years produce 35 to 40 bushels per acre. Our lands can be equally improved ; conse- quentlv it will be several hundred year- before we require Camula wheat to feed our people. I am unable to understand why Canada barley should be admitted free. It does not enter into the cost of living; the brewer is ab- solutely the only beneficiary. Let us see if he is so sadly in need of it as to rob the farmer of 20 cents per bushel for his relief. At the close of the war we built a warehouse covering an entire block, and handled the first grain coming into St. Louis over the Missouri Pacific Railroad. We put in 500 special bins to hold each a carload of gram. The millers and brewers would not buy graded grain. Adolphus Busch and his father-in-law, Mr. Anheuser, had a small brewery m South St. Louis. Mr. Busch came daily to our warehouse to examine the barley he had bought and wasn't afraid of getting his clothes soiled, but would get down into the dirty bins and thoroughly ex- amine the grain. By strict attention to business he has increased his capacity until now he has a plant covering V>0 acres. Mr. Busch is a clever gentleman and deserves success. He owns a palace a. Pasadena that is said to have cost, witli his sunken gardens, over a o84 EECIPEOCITY WITH CANADA. million and a half dollars. He owns a palace in Germany, and also one on the Atlantic coast. Last winter he had a golden wedding, that the papers reported cost over a quarter of a million dollars. Mr. Busch is a generous giver to charity, but does he need the 20 cents per bushel on barley as a donation which reciprocity gives him. Would it not be better to let the farmer keep it to help raise the standard of farm life and as au encouragement to the farmer's boy to remain on the farm? It is said that the next move will be annexation. Why bring that country with its untold millions of virgin soil to compete with our farmers, who have built up the prosperity of our country? If I have a little store, and a wealthy corporation gets its goods cheaper and opens a store on the next corner, I am soon driven to the wall, as our farmers will be when the floodgates of Canada are opened. The farmer, it is said, will be recompensed by getting his lumber and machinery free. The average farmer does not buy 500 feet of lumber a year. Suppose I go to a carpenter and say your wages must be lowered 2.5 per cent, but we will make you whole by forcing the manufacturer to sell j^ou your jack plane and other tools at 25 per cent off. His losses are daily, but his gains only once in 5 to 10 years. And with the farmer he loses ten times as much yearly on crops as he gains once in 10 years by getting lower-priced ma- chinery. Now, gentlemen, I have a clipping here that I wish to file with you, in which the editor of one of the largest and one of the most promi- nent northwestern newsjoapers asks the following questions, admit- ting thereby that the reciprocity people know that this bill will reduce the price of farm produce and the prices of farm land. It is expressed something like this: If you knew that in five years farm produce and farm land would be returned to their normal value, would you not then consent to favor reciprocity? Well, gentlemen, that is about all I have to say. I will leave the papers to be filed. Senator ]\IcCr:3iBER. I would like to ask that the paper, in addition to the one that has been read, be printed also in the record. The Chaii:ma^. The papers will be printed in the record. (The clipping referred to is as follows:) HON. N. G. LAEIMOKE .\NSWEES .\ FRIEND. Lds Angelas. Cal., March 31, 1911. Tlio E\i:ning Timf.s. Cniiid Fo)7,-.s, A". Dak. Gkxtt.k.men : I aui just iu i-eceii)t of a lotter from an old aisrt highly esteemed friend, mnv at the head of one of the most enterprising newspapers in tbe Nortliwcsl. He was formerly n sl.-inch friend nt the farmer, but from tlie toue of his letter I fear that he has fallen from ,m:ice. He :isks the following ques- tions, lo which I wonld like to reply through the .-olunms of the Times. " You an! oiniosed to reciprocity on the theory that it wonld injure the prices of yonr land anil of your piodTice." One of the :ir,g\inients used by I'resident Taft and others for adrocatiug recijirocity is tliai ir will reilncc ilie cosi of living. In reducing the cost of liv- ing, it must necessarily lie by reducing the cost of farm produce. Let us sup- pose that reciprocity and its attendant evils reduce the price of wheat to 50 cents jier bushel, a contingency to be expe(.-ted. the cost of living thereby would be reduced about three-fourths of 1 cent a day. The value of any proiierty is liasc'd on the returns it iir(Hl\ices. With wheat selling at ."lO cents per bushel, farm land would have but little \alne, and the corn values follow closely the prices of wheat, as \ery few wcuild caie to engage in an enterprise if everything BECIPEOCTTy WITH CAN.M1A. 385 they buy is protected by a high tariff and all they have to sell is open to the competition of the cheap lands and cheap labor of the world, ^'ou ask : "What difference does it make to tiie farmer if prices of land are depressed; lie keeps on nsiug the land, and in fonr or live years (/(indiliims chan.n'e, so that the value is as much as before tlie increase." Very few of us would care to live on bread and water four or five years, hoping for a chani;e to normal conditions. Tlien. many farmers arc in debt and their farms mortgageil. others desire to sell to chauge locations and occu- pations. This depression in values fer four or five years would diive many such to paupers' graves. You say, " Suppose the price of wheat went ilnwn, due to this c.nise, but after Ave years, with a changing population, the value is restni'ed to the present basis and there for all time, would you ob,iect voting for reciprocity on these conditions'.' " If the farmers are jiauperized for four er five ye.irs. what becomes of the business of the country? of laie years tiie country h;is been prosperous be- cause the farmer was prosperous. Iteverse these conditinns and what would be the result'.' The C.-inadiau farmer is ilontitli'ss ex]iei;ting tliat reciprocity will enable him to get iietler prices for his wheat, but in this he is sadly mis- taken. He would only be furnishing a club to break his own head as well as that of the American farmer. Until the igitation of reciprocity, yiinnea])Olis millers paid practically as much for No. 1 northern whe;it as it was fpiotcd at in Liverpool. If .50.liOO.OO(i bushels of Canadian wlie.it is thrown on our markets, this wheat with the aid of the "bears" weuld dri\e prices sc low that the Canadian farmer wnnld sorely regret the reciprneity agreement. Recent telegrams to the daily papers st.ited tha.t since (he agitation of reci- procity the price of wheat had declined IC.^- cents jiei- bushel and the "bears" had made millions: giving the names of some of the he.avy winn(.>rs. Among them I recognized the names of se\er,-il old-time "bears" that had been hibernating for a number of years. During these loirg yenrs their claws and teeth have been growing and they are out of their holes exceedingly hungry from their long fast. The " bull " is an animal of prosperity. He enables the millers and elevators to do a le.gitimate business without the risk of specnlation by enabling them to hedge their purchases of wheat from day to day. A line of country elev.itors may buy twenty to one hundred thousand bushels of wheat per day. This is all sold to the bulls for future delivery. The miller may buy 100,000 to 500,000 bushels of wheat to grind. He hedges it by selling to the " bulls," thereby pro- tecting himself from the fluctuations of thi^ market, buying in his hedges as he sells his flour. The " bull " must command a large amount of money to pay for the wheat as it is delivered to him, while the " bear " requires but little or no money. He is a wrecker. He fattens on the wrecks and ruins of business pros- perity. Nothing is more to his ta.^te than a panic. He is a yellow-ril)boner. He says ; " I am a yellow-ribboner, because I am foi'ninst the blue riblion. I 'ates what I plaze, and I drinks what I plaze, and I don't care a doni what 'appens — so it don't 'appen to me." Apropos to the old adage, "coming events cast their shadows before," we have ju.^t had n shadow in this IGJ-cent decline in wheat on simply the agita- tion of reciprocity. AVhat will be the reso.lt when the hydra-headed monster appears? This will be the harvest of the "bears." the ruin of the farmer, and with him the prosperity of the whole country. If this great body of Canadian wheat is dumped on our markets, the " bulls " will not he able to carry the load, and the " bears," with nothing to resist them, will force lU'ices below the living ]ioint for the farmer, and instead of Liverpool making the prices for the world, the American "bear" will have that credit; then the Canadian as well as the American farmer will unilo in denouncing reciprocity as the greatest curse that was ever put upon both countries, M'hy have reciprocity only with Canada? Why not have it with .Moxwo, England, France, Germany, and other countries? In other words, why not have free trade? The .Minneapolis and Duluth commission men and elevator men and trans- portation companies naturally favor reciprocity, as the volume of their business would be largelv increased, and they got just as much for handling whe.'il that sells for 40 cents as if it sold for .^l.TiO per bushel, only slightly selfish. Yours, very truly, N. (J. I.AKIMOIIK. 386 El'X'TPKOCITY WITH CANADA. Gov. Lewis. Mr. Larimore is, as I have said, one of the largest farmers in our State. I thinli his farm is something like 15,000 acres. The next gentleman whom I will ask to address this com- mittee is a small farmer, and you know our farmers are not used to talking to representative bodies, and this gentleman will be pleased to have you ask him any questions you desire, and I think you will find him very well posted on the subject. I present Mr.- Kingman, of Hillsboro, N. Dak. STATEMENT OF K. T. KINGMAN, OF HILLSBOEO, N. DAK. Mr. KiNGJiAN. Mr. Chairman and Senators, I did not know that the governor was going to interject that. I have sat here during the last two days and heard questions that were asked some of the gen- tlemen who appeared before you, and I hoped I would not be asked many questions. I just want to cover one phase of this question. The Minnesota delegation covered very extensively — Mr. Wilkinson in particular — the conditions that surround the Northwest, and I want to show, if I can, to what extent they apply to some of the other States in the Union. Xorth Dakota, Minnesota, and South Dakota are not the only wheat-producing States in the Union. It is a fact that we have had, and are having to-day, a premium on our wheat over Canadian wheat of apjDroximately 10 cents a bushel. It has been lower than that in the last six or seven years, and has been higher, but our wheat has averaged in the last six or seven years about 10 cents over the Canadian price. The misconception Senator Kekn". You mean in the States adjoining Canada? Mr. Kingman. Yes, sir; I would take the markets of Minneapolis and Duluth and compare them with Port Arthur and Fort William. The general impression is when we s^Deak of the Winnipeg price there is to be added the freight from Winnipeg to Port Arthur. That is not true. ^-N^rile Winnipeg is the market point where the wheat is sold, the price obtained is for the wheat delivered at Fort William or Port Arthur. Winnipeg quotations are for wheat delivered at Port Arthur or Fort William where they are placed upon equal con- ditions with Duluth ; elevator facilities and conditions are upon the same basis. One of the other gentlemen will speak more elaborately upon this subject. He Avill also go into the barley question more elaborately than I will. I think our standpoint on barley was very ably presented by the maltster from Buffalo who was talking in oppo- sition to it yesterday. If I were a lawyer I would be perfectly will- ing to have our case rest on the evidence which he presented here j'esterda}^. You would ask us why this difference of 10 to 12 cents between our American markets and the Canadian. If our price is established by what our surplus, together with that of other countries, based upon the world's supply and demand brings in Liverpool. ^^liile supply and demand as a rule, we would admit, very largely influence the price of any product, we must insist that in our case it is more largely modified by local conclitions. For the sake of ar- gument M-e will admit, if you please, that it is local conditions that give us this premium on our wheat. I wish to show some of the con- ditions which I think enter into the giving to us of 10 or 12 cents a EECIPKOCITY WITH CANADA. 387 bushel premium, and I wish to show also, if I ciin, that the premium which the northwestern farmer enjoys is extenJocl to the farmers of the winter-wheat States. I doubt if few of you realize tliat Penn- sylvania raises 30,000,000 bushels of wheat. Texas has increased her production, until last year she raised 18,000,000 bushels of wheat. Senator Bailey. And the best in the world. Mr. Kingman. North Carolina increased her production in the last 10 years from 2,000,000 to 7,000.000. Senator Bailey. Looking at the matter aside from the glory of Texas, and for the glory of the whole country, I will say that the barrel of flour that took the first premium at the last Paris exposi- tion was milled at Denton County, Tex., out of wheat grown in that county. Mr. Kingman. Manufactured from Turkey Red, was it not? Senator Bailey. I am not sure about that. Mr. Kingman. There are two or three conditions that enter into this premium that comes to us in the Xorthwest. We will admit, for the sake of argument, that it is local, that it is a home condition, but are we not entitled to it? Some one suggested here yester- day that if we are to get this 10-cent premium it niust come out of the consumer. If it came out of the consumer on the basis of the present per capita consumption it would be a loss to him of 50 cents a year. However, with our present method of distribution we doubt very much if this saving would ever reach the consumer. I would say in this connection that when our wheat sold in North Dakota for 38 cents a bushel the price of the loaf of bread was 5 cents, and it was still 5 cents when our wheat sold for a dollar fifteen. It is true that some of the housewives make their own bread, and in this case they might gain some difference in the lower cost of flour. The competition of Buffalo and the Southwest for a portion of our high-grade northern wheat to mix with their winter varieties gives the northwestern farmer a great advantage in the way of com- petition for his product. Minneapolis is also a competitor with the Southwest for a portion of their winter wheat to mix with the higher grade northern wheat in order that the ]\Iinneai3olis miller may lower the cost of his barrel of flour, thus giving equal advantage to the winter-wheat grower. The prestige and reputation of American millers, particularly the Minneapolis millers, enable them to sell large quantities of their flour to foreign countries even at an advanced price. Of our exportable surplus of wheat, as represented by both wheat and flour, we sell to Great Britain about one-third, the larger per- centage of which is wheat. The balance goes to 21 different coun- tries, many of which have no particular connection with Liverpool, and, with the exception of Germany, Belgium, and the Netherlands, practically all of it goes in the shape of flour, direct from our Ameri- can mills to these countries. We sell to Cuba, the West Indies, and Bermuda one-third as much flour as we sell to Great Britain. ■ Our milling interests are of such vast magnitude, as_ compared with other countries, that a large advantage is thereby gained in the lower cost of manufacture. Germany, Great Britain, Belgium, and the Netherlands are eliminated from competition with our mills by virtue of their not milling sufficient to supply their home needs. We export none of our northern whear— I say none, practically none— 388 KECIPEOCITY WITH CANADA. except as flour, and have not for a number of years. All our high- grade Avheat, every bushel of it, is needed at home. It is a fact that our millers can mix southern winter wheat with our high-grade northern wheat to tlie extent some years of 40 to 50 per cent and not lower the standard of their flour. There is another feature that enters into this 10-cent premium not accounted for in the table of prices which I will ask to have filed. The comparison is based upon the Xo. 1 northern grade in both countries while as a matter of fact Xo. 2 northern in Canada is equivalent to our Xo. 1 northern in the United States, making a difference in the two grades alone of 2 or 3 cents. Xot only that, but within the last two or three years competition with Minneapolis by the Southwest and Buffalo has given us a premium for our cash wheat of from 2 to 2it cents and as high as 3^ cents. In that same connection the prosperity of some of the farmers in the winter wheat States has enabled them to hold in their bins a large portion of their crop and to that extent heljDing to reduce the visible and in some degree affecting the price they receive. After the opening up of the Northwest in the eighties and early nineties some of these States practically gave up the production of wheat. Iowa practically gave up its 23roduction. not entirely but largely so, but with the increased price of the last few ycai's the States of Pensylvania. Ohio, Illinois, Oklahoma, IMi^soiiri. Texas, Kansas, and Xorth Carolina have in- creased its production and some of them have raised the largest crops in their historv within the last five ^^ears. The winter wheat States produced last year 404,000,000 of our 695,000,000 crop. Ilh- nois acreage of wheat is one-fourth that of her corn; Ohio, two- thirds ; Indiana, one-half that of her acreage of corn ; Oklahoma, one- fourth ; Xctiraslca. one-fourth; and Kansas, one-half that of her acreage of corn. The corn States seldom raise to exceed three crops of corn without rotation to clover, and in order to seed their lands to clover it seems necessary to seed either with wheat or oats. Their acreage seeded to oats taken together with that seeded to wheat makes an average for these States of more than two-thirds that acreage planted in corn. It is this system of conservation of soil fertility by rotation of crop that has enabled the corn States to produce their present enormous crops of corn at the same time pro- ducing the largesi yields of wheat and oats in their history. It is till" prosperity of th(>se jMiddle Wi'slcrn States that has per- mitted them to keep back in their bin-, the invisible, or at least a large portion of the invisilile. to the extent of from a hundred to a hundred and fifty million bushels, and to that extent influencing the prices they ha\c received for their production. That has had a tendency to iiiciea-e this premium which we enjoy. We contend and it is cdnccihMl l)y a large pcr'"entage of the commission and milling interests of the Northwest that our home supply and de- mand together with home conditions more largely enter into the making of our price — and in fact is making our price more largely than Livcrpofd. Onr millers are alile to export two-thirds of our exportable surplus. It runs all the way from 50 to fi5 per cent to countries that lia\i' no particular relations with Liverpool. Now, if you remo\'e tliis barrier and admit Canadian wheat, and it is not perhaps the '25,000.000 that might come in to-day or to-morrow, but the possibilities (if what will come in the future that stares us in KECIPKOCITY WITH CANADA. 389 the face, and while perhaps in theory you would not change the world's supply you AAOuid destroy the conditions that give to us the premium, we now enjoy. They have very largely increased the production of wheat in the northwestern Canada, particularly in Saskatchewan and ilanitoba. The Minneapolis millers want 'that wheat. If they got all they wanted of that Canadian high-grade wheat they would not want or need any of the Southwestern or Middle States winter wheat. They tell me at Minneapolis — and I believe it is true — that the competition for the southern and southwestern wheat of Nebraska, Kansas, Missouri, and other States has in- creased their premium more than it has to us in the Northwest. I can not give you the exact percentage of winter wheat crop that has been shipped to Minneapolis to be ground with our own northern wheat in the last year. Senator Kern. To what extent do the millers of ilinneapolis get their winter wheat from Canada ? Mr. Kingman. They do not get any wheat — the bond proposi- tion — I believe they tried it. There is but one mill that operated under the law in Minneapolis; there is, I understand, but one mill now operating under that law, and that is a Buffalo mill. ^Ve have a gentleman here who will elaborate on that and who is familinr with it. Senator Kern. I do not know that I have the data. I want to know why they gave it up. Mr. KiNfrMAN. They gave it up, as I understand it, because they had to use that mill exclusively for the grinding of Canadian wlieat under the supervision of a Government inspector. I think they ex- pected to realize large benefits, but, as a matter of fact, found that they could not. Others will elaborate on that. I only understand it as a general proposition. I want to impress upon the committee this one fact: The winter wheat States have raised their largest wheat crops in the last five years. Iowa is the only one of these States that has not. Texas, Oklahoma, and North Carolina ha'\'e more than tripled the production of their wheat in the last 10 years. The idea that we can not supply our home demand for an unlimited period seems to us. in our judgment, fooli-li. The possibility of their in- creasing the production of wheat in these winter-wheat States is tre- mendous, especially some of the newer States that are not seeding to clover as extensively now as they will in the future — like Okla- homa and Texas. I wish to refer to the interest that lias been shown in the last few years in better farming, more intensified farming, the adoption of more scientific methods, which is greater than I think you gentlemen have any possible conception of. ^Ye had to skim cream from our soil when we raised wheat for 50 cents a bushel. We had mighty little to hve on beside the ozone nf North Dakota in thos,-, days.^ You must know that it is practically impossible to raise wheat in any country for 40 or 50 cents net to the farmer and exist. We did it ; we got through it, but we skimmed the cream. We ha^.e reached the point Avhere we ciin not do it any longer in our country, but T \vant to say that Canada can. For the next 15 yenrs Canndii fin go through the same iDrof-ess that we did. It is human nal ure for man to rob and get as much out of the soil as he can. I heard the presi- dent of our agricultural college say. "If it were possil)1e to so till 9.3285— No. 6—11 3 390 EECIPROCITY WITH CANADA. the soil — if this gL'iieration oimld so till the soil — as to take eA'ery available element out of that soil, get it into one crop and convert it into dollars and cents without reference to future generations they would do it." AYe did it because we had to do it. We are raising closer to-day. Clover is the greatest soil redeemer. Clover has made the corn States. Clover has increased the production of corn in the corn States and clover will increase the production of whsat in our northwestern wheat States. Germany, France, and England have trebled the production of wheat in the last 20 or 30 years on soil that has been tilled for a thousand years. Senator AA'illiajjs. You mean the production per acre? Mr. KixcifAN. The production per acre — the yield per acre— yes, iir. I intended to say that. Can we not do the same I We have already started. Necessity will compel us to do it. When we can increase the production of our farms, increase our yields, and in those increased yields every bushel that we increase the yield we will lower the cost per bushel. To-day we are raising on an average from one year to another about Ki bushels. I think that is so. Senator McCiviber. Thirteen? jMr. KiNfoiAN. Last year it was very low. That is hardly a cri- terion to go Ijy. Senator ^McCloibfe. Thirteen has been our average for several years. Mr. KiNGJtAN. And we believe that we can not only increase the production of wheat in North Dakota and the Northwest as well as France and Germany, but we also believe that when we have adopted, as we are trv'ing to adopt, the methods which have been adopted and in force in the corn States — those States where land is worth $250 an acre — that we will not only double the production of wheat but also increase the production of beef, mutton, and pork beyond any question of doubt, supplying beyond question the needs of our people for years to come. If we are forced to give. up the production of wheat now we can not rai=e corn successfully in competition with the corn States. We are striving hard to acclimate seed that will ripen, and we are raising small fields of corn, but it is doubt- ful if our cold nights that give us the northern hard wheat will ever give us the corn to fatten cattle; but we can raise the stockers for the corn belt as well as Canada. If we are going to redeem our soil we will have to raise stock to consume our clover. Mr. Laeimoee. Will j^ou allow me to make one point right there? "Wlien I went into business, over 40 years ago, Iowa was not raising any corn at all. We had nothing from Iowa to store. I was in the grain-storage business and know something about it. The only thing we got from Iowa was spring wheat. Now, you know what Iowa is iSoing, and southern Minnesota the same. The corn belt is working north, and it will get up into our country in a very few years. Mr. KiNCJiAN. We hope it will, and we hope it will do for us n'hat it has done for the corn States. Their method has increased not only the production of corn but also greater wheat fields. Mr. Chairman, I have forgotten \-eryr much that I wished to talk a1>out, and have talked about much that I did not intend to. I would like to finish with one more statement. We feel that the corn belt will be as largely affected by the passage of this measure as we will. We believe that we can increase our jd reduction in the Northwest. About 25 per cent only of our North Dakota land to-day is under cultivation. EECIPEOCITY WITH CANADA. 391 Less than half of that -wliich can be cuUivated is under culti\ation. We made great strides in the way of increased popiiLition and the increased development of onr State in the las( ]0 years, and hope to continue if we are not forced to go to Canada. But we do believe that we can not compete with Canada in the production of wheat. We can not go back to the conditions that we lived under for 15 years — 50-cent wheat — robbing our soil of the elements that were there. Senator "\Yillia:^i:s. Do you think you are not competing with Canada at all ? 3Ir. Ki^orsrAX. Xone whatever. To a certain extent, we might say we are competing with Canada, if it were tru)(. 1. Drc. 1. SI. 061 81.07J SO. 99i SI. 07; 1.02 .86} .96j 1.05; 1. lOf 1.021 .95il . 99; 665,000,000 115,000,000 1.04 1.04 1.07 1.1s: 7s. 2;d. 7s. 2Jd. 7s. 5d. 8s. io.;d. Taken by Great Britain, 56,418,000 bu.shels (28.90 per cent). 1909. Minneapolis - Chicago Wirniipcff . . . Liverpool ... Do .1/a// 1. Sept. 1. Bcc. 1. SO. 94! S1.025 .973 1.05S .94; ■ m I , 1.12 1.16 7s. y.;d. 8s. IJd- 37,000,000 8»,00»,000 Taken by Great Britain, 43,389,000 bushels {19.06 per cent). 1910. Minnca]iMl <1iicaKn .. Winniiicg Livcr^rfjnl. Do.... .)i(iii e. .Jiiln 6. .Vp(. 1. Dec. 1. 1 Jl.(.»'i; SI. 16 Sl.lH S1.02J. 1. 02; 1.03J .983 .9U . '.'8S 1.06 1. 03} .91-J 695.000,000 1.04 .97 1.08 .98 7s. :);d. Os. 9J<3. 7s. OJd. 6s, lOd. Held in rnnncrs' bands: Mar. 1, 1905, 111,000,000 bushels (20.1 per cent); Mar. 1, 1906, 158,403,000 bushels (22.9 per ccul); il.nr. 1, 1907, 206,664.000 blishola (28.1 per cent); Mar. 1, 1908, 148,721,000 bush. -Is (23.5 per cent); Jlar. 1, 1909, 143,692,000 bushels (21.2 per cent); Mar. 1, 1910, 173,334,000 bushels ('j:;.5 per cent ). WoUd's wheat riMp: P.I05. :'..:',27.I184,000 bushels; 1906, 2,428,998.000 bushels; 1907, 3,126,96&,000 bushelK 1908, 3,176,479,000 bushels; 1909, ;>,ii04,418,00O bushels; 1910, 3,549,7:35,0Mi bushels. KECIPROCITY WITH CANADA. 397 Senator La Follette. Go ahead and make your explanation. Mr. Kingman. I will not take up your time any longer, Sena- tors. Senator McCu^iber. I want to ask vou a question or two that you know something about, and that is about the possibilities of the Canadian northwest in grain productions, wheat, oats, barley, flax, and rye. Mr. KixoiiAx. "Well, the possibilities are way bej'ond the con- ception of most men— the possibilities of the three northwestern Provinces of Canada— Manitoba, Saskatchewan, and Alberta. They have been raising an average of about 21 bushels of wheat, taking their tillable area on a basis of 15 bushels of wheat per acre, would produce an amount equal to the present world's supplv, of more than 3,000,000,000 bushels. It is not at all reasonable to iDresume that it would all be seeded to wheat, but it is a possibility. That is a rather strong statement, but I think it is true. Senator McCumber. Xow, Canadian grain. No. 1 northern and No. 2 northern, is sold upon a basis of the Liverpool price, less cost of transportation, is it not ? Mr. KiNGMAx. Yes, sir. Taking it as a rule since they have had a market at Winnipeg the price of wheat at Port Arthur — the cash price has been the price at Liverpool less the cost of transportation. Senator McCumber. And that is from 10 to 15 cents per bushel less than Minneapolis and Duluth prices? Mr. KiNGMAx. It averages about 10 cents. To-day it is only about 4 cents. Senator McCumber. Have j'ou figured the real rate at Avhich it will run ? Mr. KixG^rAX". It has been as high as 20 cents in the last four or five years, but the average difference has been about 10 cents. Senator McCumber. Xow, where would be the nearest market for this Canadian wheat, provided it could get better than the Liverpool price ? Mr. KixGMAx. The United States, of course? Senator McCumber. What particular point? Mr. KixGMAX. It would naturally go to INIinneapolis — that is what they hope to do. The promoters of this measure hope to take it there. They have lines already built to take it there. Senator McCumber. Then, if it would go to Minneapolis would not the inevitable result be to place us also upon the basis of the- Liver- pool price, less the cost of production ? Mr. Kingman. There is no question about it. Go to Minneapolis and ask a miller; sit down quietly with him and ask him frankly, and he will tell vou so. Senator BArLEX. What kind of morality is that where a man tells you the truth when you talk to him quietly and not publicly? Mr. Kingman. There is a certain class that tells us this will l^e the greatest thing for the Northwest. I want to say to tie Senators pres- ent that the sentiment of Minneapolis and St. Paul shows a marked change in the last two months on this question. I doubt if the large delegations that were expected to come here from the chambers of commerce will appear. I doubt if they will come. I thinlc it safe to say that one-third of the members of the Chamber of Commerce of MinneapoHs— now, this is purely a statement— I have spent some 398 EECIPEOCITY WITH CANADA.. days there, and I can mention at least half a dozen prominent men who are really opposed to this measure, men who have changed their views in the last two months. Senator La Follette. I will interrupt you to say that at least three men who came with delegations to speak for reciprocity before this committee stated to me last night that they had changed their opin- ion on the subject after listening to the presentation of the farmers' side of the case here before the committee in two days. Mr. Kingman. I wish you would make some more of those inter- ruptions. Senator. "We would feel better. I believe I can speak with confidence when I say that there is a change in sentiment among the jobbers in some of the wholesale business communities of the Northwest. When this thing came out they were told — the news- papers told them and, of course, it must be true — our Xorthwestern newspapers are very reliable on subjects of this kind with a certain class — but some have changed their minds — they have discovered that they can not sell dry goods, groceries, clothing, hardware, and other things in competition with Winnipeg; that there is some doubt about their supplying that great Northwestern empire with the pros- pect of their own immediate territory suffering a greater loss in purchase power than can be offset by any increased trade with Canada. Some of the men who were in favor of this measure a few months ago see their mistake to-day. Winnipeg has just as large an access to capital as ^Minneapolis or Duluth and as low rates of interest. We hear much of the benefits that are going to the consumers of our country through the reduction on manufactured articles and the increased trade relations with Canada. This strikes us as something of a joke when we have already got aliout all the trade we could ever hope to get. I do not know whether I have the figures right, but I think we enjoy over 60 per cent to-day, and any further increase would seem to us as extremely doubtful. Mr. Osborn, who is, I think, (lie Chief of the Bureau of Statistics of the State Department, tells us that our lartje exportations, consisting principally of steel products, railroad supi^lies, agricultural implements, vehicles, etc., make up the great aggregate of our exportations to Canada. Coal, of course, must bo included. It strikes us rather doubtful that any remission of duties on these articles would ever serve in any way to benefit the farmer. Senator McCttmber. A'^liat kind of farm machinery do they use generally in the Northwest? Mr. Kingjian. They use American machinery. Our International Harvester Co. is supplying harvesters; sending them across and paying the duty, and selling them there as low as they do in this country. Senator McCumbee. As a matter of fact, almost all the machinery in Saskatchewan came from the United States under present con- ditions. Mr. Kingman. Very nearly all. • Senator Johnson. How do you knoAV that they sell it as low? Mr. Kingman. I admit that that is merely a statement. I have heard it and read it; although I do not know it to be a fact, I be- lieve it is true. Senator Smoot. I know that in Alberta it is not sold cheaper than in the United States. EECIPEOGITY WITH CANADA. 399 Senator McCtjjibee. I think the Cfinadian Northwest pays just as much as^we do, and probably a little more, for their machinery. Mr. KiXGJiAx. I am speaking of the price— when they have paid the duty. I will say that it is merely a statement. Senator Johnson. I read it m the newspaper, and I wish to have it go into this record as merely a statement, for I really do not know it. Senator McClimber. The point I wanted to draw from your state- ment was that the implement manufacturers might increase their trade m Canada and get a little, and they would save at least what they pay the Canadians m tariff, and still hold the Northwestern Canadian trade. They, of course, are interested in it. Mr.-KixGJiAN. I want to convey the idea that they would be bene- fited by any remission of duty, I believe, in most instances on agricul- tural implements, which is from 2i to 5 per cent. However, any re- mission of that kind would simply go into the pockets of the manufac- turer and would not affect prices in the United States. Senator McCviiBEE. Also, if they develop that great Northwest very rapidly, on account of free trade with the United States, that will increase their field of consumption. Mr. KiNcoiAx. Tremendously; just like the development of our Northwest did. It would increase the employment and the use of agricultural implements very largely, but at our expense. Senator Hjeitbuex. Does the Minneapolis market buy, to any ex- tent, the wheat of the real Northwest — the Northwestern States ? Mr. KIXG3IAX. I do not think they do. They have, in some in- stances, brought some of it to Minneapolis, but it is of a different character, and, as I understand it, their method of milling makes it rather impracticable to use it. I am not an authority on that. It is simply my understanding of it. I think perhaps these Minnesota men can tell you all about it. The Chaie3iax. I have, as chairman of the committee, a communi- cation from the Secretary of State giving some data, which I will have inserted in the record of these proceedings. (On motion of Mr. Smoot, the committee, at 1.10 p. m., took a recess until 2.30 o'clock p. m.) AFTER RECESS. After the expiration of the recess the committee resumed its session. The Chairmax". The committee will come to order. Mr. Lewis, if you will proceed. Mr. Lewis. Mr. Chairman, before calling on the next speaker I would like to clear up one matter which has only been hinted at to- day, as it may come up again. It is a question of grinding wheat in bond. Up in our section of the country those who are favorable to this proposition frequently say, you are bringing Canadian wheat into this country and grinding it in bond now under the drawback system. To show you that that system is so cumbersome, and it is hard to apply, and must be for the reason that the Canadian wheat can be shipped in here, the price being something like 8 to 10 cents below our wheat, and then getting the drawback on it^hat would make the wheat, if there was nothing to hinder it, show a profit over 400 EECIPBOCITY WITH CANADA. our American wheat in favor of the Canadian wheat; in other words, there are features connected with the transaction making it cumber- some must be evidenced by the fact that very little is ground in bond. I have here a letter from Mr. Bell, who is president of the Wash- burn-Crosby Co., one of the largest milling companies in the world. They have a capacity of 40,000 barrels a day. I will not read Mr. Bell's letter, but just a portion of it bearing on that subject. He says: The obstacles in the way of grinding Canadian wheat for export may be summed up as follows, and in a measure this may account for the small amount of wheat actually ground during the last few years : To grind Canadian wheat or foreign-grown wheat — First. The wheat must be kept separate in bonded tanks or bins. Second. All stocks of wheat or flour in the mill, the product of the XJulteil States, must be removed. Third. A Inaid must be gi\en to the Tnited States Government to pay the duty on all wheat received. The mill must be bonded and at all times in charge of customhc)U.?e othcials. Fourth. To liquidate this bond we must export the identical product, or, failing in this, must pay the duty on the wheat used in maknig the liour. Fifth. Vre must give a boml not to remove anything from the mill while grinding Can;i(lian wheat except by permission of the customhouse official urder heavy penalties. Sixth. If we add any wheat grown in tlie United States, or any flour manu- factured from wheat grown in the United States, every pound of the same, either wheat or flour, is treated the same as if it came from Canada or any other foreign country. We must, therefore, not only export the flour from wheat grown in the United States, but flour made from the original Canadian wheat. He saj's : I am not able to gi\ e you definite information as to the total amount of Cana- dian wheat ground iu the United States under the bonded manufacturer's ware- house provision of the general tariff act. nor can I give you the amount .ground under the drawback act, but these figures can be obtained from the Treasury Ueparlment, and I am of the opinion that the total amount, including the wheat giDUud in our own mills, will not exceed 4,000,000 bushels, a very infinitesimal amouut when you think of the large quantities of wheat that have passed through the United States consigned to foreign countries, shipping in bond. I take it that -1,000,000 bushels is i^ractically not one year's grinding, but extending over a )5eriod of several years. Senator Stoke. That is a letter from whom? Mr. Lewis. That is a le^^ter from Mr. Bell, the president of the Washburn-Crosby Milling Co., of Minneapolis. He is their head man. Practically has charge of the business. Senator Stone. They import a large amount of wheat in bond, do they? Mr. Lewis. Into the United States? Senator Stone. From Canada? Mr. Lewis. No; wheat is shipped through the United States in bond, destined for some foreign country. Senator Stone. Do they grind wheat in their American mills? ilr. Lewis. There is only one mill in the United States, I believe, that is grinding Canadian wheat in bond, and that is a mill owned by these people, and that is located in Buffalo, and Mr. Bell says that the amount they have ground does not exceed 4,000,000 bushels, he thinks, for all the mills, extending over a number of years. Senator Stone. He is opposed to tlie reciprocity agreement? Mr. Lewis. Sir? EECirKOCITY WITH CANADA. 401 Senator Stone. That firm, the Washburn-Crosby Co., is oi^posed to the reciprocity agreement? Mr. Lewis. Senator, I can not speak for the firm. I simply say that Mr. Bell is very fair and very liberal on this proposition, and I take it that he is not in fa^■o^ of it, although I think the other mem- bers of the firm are. I gather that from his remarks in conversations I have had with him. Senator Stone. I had understood they were against it. Mr. Lewis. I beg your pardon. Senator Stone. I say, I had understood they were against it. I have no personal knowledge. Mr. Lewis. I think there is not any question but that jMr. Bell is opposed to it. Senator Stone. It is common talk. Mr. Lewis. The only thing that I brought it up for is that some- body might say that we are grinding Canadian wheat, and I want to show that we are not grinding very much Canadian wheat in bond, and have not for some time. There is another question, and I think some of the questions you asked of the ^Minnesota delegation suggested this to me; yon were comparing Chicago, Kansas CitA', ^linneapolis, and Winnipeg prices. I want to say that it is very hard to compaix' those [irices unless you compare the same quality of wheat. Senator. So I bought a Chicago jsaper and a New York Times. In both of those papers they quote the cash market for the different grades of wheat in those markets. For instance, here are the closing prices in New York; Xo. 2 red, which is a contract grade in Chicago and is the high-grade winter wheat, closed on that date at 96f afloat for export. I take it that New York quotations mean Buffalo deliveries. No. 1 northern in the same market closed 108^-. This is the contract grade for Minneapolis and Duluth, which shows the difference in its milling value. Senator Stone. Is that No. 2 hard or is that No. 2 soft ? ]\Ir. Lewis. That is No. 1 northern. Senator Stone. I am speaking of the northern. Senator McCumber. The northern wheat. Mr. Lewis. The 96| wheat is the hard winter wheat; it is No. 2 red. The 108:^- wheat is the spring wheat of the Northwest, which is Xo. 1 northern. No. 2 red is not as high a grade wheat as No. 1 red, there being but little of the red winter wheat high enough in quality to grade No. 1 red. Senator Stone. I am asking for information. Is not No. 2 hard raised in Canada, winter wheat? Mr. Lewis. No, sir; I do not understand it that way. Senator Stone. The same grade of wheat in that class of wheat; that Xo. 1 northern is in that class of wheat? Mr. Lewis. It is; ves, sir. Here is a comparison of the value of those two different grades. The contract wheat in the winter-wheat district is quoted at 96§ to Of'.J, against the .^piing wheat at $1.08^ in the same market. That is in the Buffalo market. Here is some- thing you will be interested in. Xo. 1 ^Manitob.'i wheat m the :^;ime market on this date is quoted at $1.03i, suid is a better grade of wheat than our Xo. 1 northern wheat and is equal to, or better than, our 402 EECIPKOCITY WITH CANADA. i\o. 1 hiirrl wheat, the only difference being that in this market if we take !he No. 1 Manitoba A^'heat ^^e have to buy it subject to the grinding-in-bond provisions, and therefore our inferior wheat, which has nothing to prevent its being bouglit and commercialized without any of the expensive provisions of the drawback system, brings about f) cents more than the better Canadian i\heat. If you will permit me, I will show the dilference in Chicago. These are the closing quotations on that market. Winter wheat Xo. 3 Ked sold at 93f to Dr.; Xo. \> Red at 95-;,' ; and our spring wheat, Xo. 2 northern, at $1.05. Xo. 2 northern is not our high-grade spring wheat. It is a grade that sells at about 2i cents less than the contract grade, Xo. 1 northern ; so you see in the Chicago market, as well as in the Buifalo market, that the Chicago and Kansas City grade sells in competition at about 5 or ('> cents lower than our northern wheat, and sometimes more. It there are no questions on that subject, I will call on my next sjieaker. ilr. utcher or packer pays me for keeping, caring for, feeding, and fattening a steer sold at 4- yenrs oM? One street-car fare or less a day is all I receive. Growth is a little slower for cattle in our northern countries; $60 or $('ir> is the averaiie that I receive, which is less than a street-car fare a day. Plas the Ameri- can beef consumer any just cause for complaint against us, who raise the steers and sell them at this price? Is there auy justification for the Government of the United State; seeking to cori'ect rliis concli- tion to the further disadvarit;ige of the farmer 1 Is it just oi- fair that there should be any ari-angeme/it made by law tliat out of tlie one herd — the money I get — I should contribute something to reduce the cost of living to my friend who lives in the city wliom I h.ave assisted since I have been old enough to vote; who has liad the benefit of mv political favor because I believed it was good bu'-iness for me to do"^ it ? 414 EECIPKOCITY WITH CANADA. There are some subjects, gentlemen, that I wish to explain; and am going to suggest that if there be any subject that I touch on that any Senator feels has been sufficiently explained I shall take it as a favor if you will so tell me. 1 do not want to go over anything that has already been made jjerfectly clear to j'oii. The saving to be made to the An.eidcau exporter to Canada is largely upon trust manufactured or controlled goods. The largest saving on any one item of importance being $4.j."').0()0 on coal, the next largest saving $175,000 on cottonseed oil. The packing in- dustry will be able to save on their product $240,000. The above savings are on the ba'sis of last year's business. These three items, making up considerably more than one-third of the duty paid to the American exporter into Canada, do not appeal to the American farmer as offering sufficient reason for making trade concessions to Canada. The United States has need for all her coal, and this Gov- ernment should in no manner solicit its consuanption outside onr border. We rob our progeny by porinitting the coi'sumption of onr coal in Canada. One of the much-advertised benefits to accrue to the American farmer is the admission of wire suitable for fencing free from Canada. The United States imported into Canada last year approxi- mately 100,000,000 pounds of wire. Inasmuch as Canada has only one wire mill, wdiich it has been necessary for the Canadian Govern- ment to subsidize liy giving a bounty of more than $1,000,000 a year, we are not concerned about this proposed introduction of Canadian wire products free. Nor do we fancy that Canada's lone subsidized wire mill will soon become a formidable and controlling competitor of the American Steel Trust. President Taft — I am not here, gentlemen, to cast insinuations against any man, any political party. I hold no commission to impute bad motives to anyone. I believe that President Taft has been im- posed on in some things. If that be true, it is very easy to see that a great many minds might fall into the same errors. President Taft, getting back to the thing that seems to be our specialty, that is, the price of wheat, made the statement — I have it here : " It is said that the price of wheat and other grain at Winnipeg is 10 cents a bushel less than at Minneapolis." He said : " It was not because it cost less for the Canadian farmer to raise it, but was be- cause of the lack of handling and warehousing facilities, high railroad transportation rates, and other disadvantages of that kind that the Canadian farmer labored under and that did not apply to the Ameri- can farmer." If that statement is true, if the American people have better railroad facilities, better warehouse facilities than the Canadian l^eople, I want to inquire of any Senator, Who has paid for their efficiency? To whom does the better service that thej' can render be- long? To the world? Canada? No, no. It belongs to the people of the United States, who have contributed so much for its efficiency already. We are entitled to it. President Taft was simply im- posed on. We have three speculative markets in the international spring- wheat district: Minneapolis, our greatest milling center; Duhith, our American export port ; and Winnipeg, 200 miles away from water, a fine city, on a prairie as flat as this table, devoid of elevators and grain-handling facilities, because the board of trade is located there RECIPROCITY WITH CANADA. 415 that deals in the grains received at Port Arthur and Fort AVdliams. The price of grain at Winnipeg is the Tort Arthur and Fort Williams price. If you buy in Winnipeg 1,000 or 10,000 bushels of wheat, no part of it will be delivered to you at Winnipeg. You can not exact its delivery there because it is subject to delivery at either of the two before-mentioned Canadian export ports. Had President Taft been correctly informed, I presume, for illus- trative purpose, he would ha^'e taken the port of Duluth, on the south shore of Lake Superior, and the port of Port Arthur, on the north shore, because they are fit points for comparison, the only difference being one is in Canada and the other in the United States. They have at Port Arthur elevator facilities better than anywhere in the United States. They have more of the late appliances because only recently they completed the finest elevator in the world. They have the same freight rates. They have the sajne length of seasons to get their shipments away. Senator Williams. You mean that they have the same freight rates to Liverpool? Mr. TwiTCHELL. I mean they have the same rates l)y water. Senator Williams. Do you know what that freight rate is? Mr. TwiTCHELL. The freight rate on lake transportation varies con- siderably, depending largely in our country on the amount of coal and manufactured products brought in from the East. All of the wheat-carrying vessels carry the stuff that the eastern portion of the United States produces and take back with them what we have to sell. Should this agreement go through (unfortunately for us) we wiU have entirely too much wheat to sell, and for the East it will bo unfortunate, that we, having to take a smaller price, will not need so many products coming up from the eastern part of the United States, because we won't have so much money to spend. If this Nation can be made particularly prosperous under such an arrangement you have a different way of thinking than I. Senator Williajis. ^Yha.t I want to get at is this, if you know: Do you know of your own knowledge that freight rates from Port Arthur to Liverpool and the freight rates from Duluth to Liverpool are exactly the same ? Mr. TwiTCHELL. I wired to a reputable commission man in the city of Winnipeg and to one in Duluth. I do not have their answers with me. The answers were that they were identically the same. Though it is farther to Duluth than to Port Arthur and to Fort Williams— these two are a little ways apart — they each have the snme freight rate. Senator Williams. So all three places— Port Arthur and Fort Wil- liams and Duluth — have the same rate? Mr. TwiTCHELL. There is no reason why Port Arthur should not have as low a rate, as it is 200 miles nearer the outlet. Senator Willia^is. I am not arguing with you, I am just asking for information. Mr. TwiTCHELL. Yes; I have that information from reputable commision men. I was very glad this morning, because it lessened the burdens for us— the people of the Northwest are r(;asonably independent, satisfied to take the ups and downs of life or of Govern- ment—I was very glad this morning that Senator Bailey touched a little bit on the wheat proposition. I am of the opinion that the 416 EECIPHdCfTY WITH CANADA. wlieat farmers of Iowa, Illinois, Indiana, Missouri, Nebraska, Kansas, Oklahoma, Pennsylvania, Ohio, North and South Carolina, Ten- nessee, Kentucky, and Texas — more particularly, however, Iowa, ^Missouri, Xcliraska, Kansas, and Indiana — will be hurt fully as much as we in the Northwest. This was explained here this morning and I want to amplify or enlarge on it a little bit. If you pick up the papers you will find that a steer of a certain qualitj' is worth so much per 100 jDounds. When you take steers to the stockj'ards they have two qualities that govern their value — weight and quality-. All bushels of wheat in the United States have but one thing in common. They must weigh 60 pounds. They can be just as different in quality as the cattle or hogs that you send to the stoclryard. It is true the world over — it does not make any differ- ence what your product is — if you can demonstrate that it is of su- perior quality you can get more for it. Out in the Northwest we have some advantages; we have some disadvantages. One of the advan- tages we ha^'e is a natural or climatic one. The farther north you can produceany i)f the small grains and have them mature, the better their weight. This applies to barley. It applies to oats. There is nothing extraordinary about it. To you gentlemen who live down in the East or South and have oats weighing 22 to 30 pounds to the bushel, it is naturally strange to hear that up in Saskatchewan and Alberta they are raising oats weighing sometimes 50 to .52 pounds per measured bushel. AYe r;u>e them weighing around 10 pounds, and once in a while 15. You can not do this in your country. You may raise more bulk bushels than we do, but you can not get the weight. We get a little more sunshine and more blue rays which make the small grains nearer perfection than anywhere else. They, Canada, are just a little nearer the Arctic Circle than we are, and until you get up close to the frost line they have the same natural ad- vantages, so far as the quality of their grain is concerned, except in a larger degree, than we have over the people who live in southern Iowa and raise spring grain. In tlie purchase of a flour mill they have three things to sell to you — the plant, its good will, and its brand ; I mean the standing of its brand. A miller can not successfully run a mill unless he has a standard of flour — that is, a standard of flour that is, approximately, the same thing month in and month out. He sells his products on invoices. It goes across the water with no one going with it. It is shipped everywhere and sold with the idea that it is just like what they bought before; and if it is not, they do not take it; so every good mill in the United States has a man, generally a chemist, now who anal^'zes their product, and they make a gi'ade of flour — not the best they can make, that would not do — but tliey make one to-day that they can make to-morrow and they can make next week. Unusual conditions prevailed with us in the North- vest last year — the worst we ever had ; we had absolutely no rain, and I'aised a crop with less ad'\antage of rain of the finest quality that I ha\e s(>en in 20 years, because of a drought and a cool summer. We did not have mudi of it in bushels, and its quality did not make up for the lade of quantity, but it put into the hands of the northwestern miller the ability to make better flour than at any time in the last 20 years, because they ha\e wheat that is not 56-1 pounds — I have raised wheat that would weigh only 48 pounds — but we delivered RECIPROCITY WITH CANADA. 417 wheat that year that weighed vr.] pduiids as it left the threshina ma- chine, and 63-pound wheat will make a lol better fiour than 56-pound wheat, and what is the result? 1 was in Minneapolis one day this winter when they had receipts of 160 t-irs all told; in 81 of them was wheat from Kansas and Nebraska. They could make so strono- a flour, having the unusually good quality of wheat that we raisecfon account of the unusual climatic coriditio'ns, which gave it its quality— they were going down into the southern country and buying wheat— what for? To do two things— to bring the quality of then- product down to where they could maintain it next year, if they do not hap- pen to raise quite as good a quality of wheat, and to lessen their per barrel cost, the southern wheat being cheaper. I am saying to you. gentlemen, that the bringing in of 25,000,000 50,000,000, or 100.000.000 bushels of the same qualitv— that is, the same kind, but a better quality of wheat, not because' it is raised in Canada, but because it is raised closer to the Arctic Circle and still matured— if you bring that wheat I am going to make the prediction that the wheat I ordinarily raise now, grading Xo. 1 Northern, would not look like Xo. 1 X'orthern by comparison. The States of ]\Iin- nesota and Wisconsin say that "if I raised a bushel of wdaeat that weighs 564 pounds— of hard variety— it is Xo. 1 Xorthern. if there is nothuig wrong with it, if it has not been bin burnt, and if it is not full of smut. The same States say that if the same wheat weighs 58 pounds it is X"o. 1 hard, but Xo. 1 hard in our country is almost obsolete; we did not believe — I did not believe — that I w^ould ever again get any Xo. 1 hard wheat. Naturally, I was very much sur- prised in having eight carloads of No. 1 hard. Now, they graded it as Xo. 1 hard because it weighed 58 pounds or more to the measured bushel. Through climatic accident it weighed 63 pounds, and that climatic accident is at work all the time in northwestern Canada. I am going to ask you, gentlemen, if the States of Minnesota and Wisconsin, which are the two States that grade our wheat — we do not grade it — if they continue to say that No. 1 X'orthern wheat should weigh 56-|' pounds, that it should be reasonaljly sound in other respects, and we ship into Minneapolis wheat from Canada weighing 60 pounds, that every miller knows will make better, stronger, and more flour per pound, I am going to ask, "Wliat will be the result ? Will he need as badly my No. 1 Northern wheat — that is, the higher grade that we have in the United States? Xo; he won't need it, because he will have Canadian wheat than he can get that is better than I can raise. If that is true, I am going to ask you if on the market where it must go to be sold, not to the speculator, but to the man who is going to grind it. and he knowing how many pounds of that particular quality of wheat it will take to make a barrel of ilour and how many pounds of bran and how manj' pounds of shorts will be left, he can tell by looking at it — becau.-e that is his business — w^hat it is worth to him for the purpose of making flour, bran, and shorts — I am going to ask you, will he want my wheat as bad? And if he wants to lessen the cost of the barrel of fiour, I am going to ask 3^ou, will he go down into Missouri, Xeljraska, Okla- homa, Indiana, Illinois, Iowa, or Kansas for any winter wheat if he can get in Minneapolis our present grade of Xo. 1 Xorthern for sufficient discount under Canadian wheat to make the desired reduc- tion of cost per barrel in his product? I am going to ask you, if 418 ];ecipe()city with Canada. this is true, will not the producers of wheat in the South be damaged as much as we are? I do not feel that this committee need to take it for granted that only our three Northwestern States are going to be injured. I take it for granted that anything that hurts the farmer as a class hurts us all. I believe that the production of $9,000,000,000 of new national wealth taken out of the ground by the farmers of the United States last year leaves them in the position where no man can question but that they are still, as they always have been, the foundation of our national prosperity. I say that anyone who does aught to destroy the stability of that foundation is endangering our whole superstructure, not as a political proposition, but as an eco- nomic proposition. If the result of this proposed agreement should be the reduction in the selling price of 10 cents per bushel for our wheat crop, it would mean a loss in re\Tnue and purchasing ability of $25,000,000 a year to the farmers of Minnesota, North and South Dakota alone. It would mean a total reduction in revenue and pur- chasing jDower to the wheat raisers per annum, considering all the American wheat raisers — spring and winter wheat — of more than $70,000,000 per annum. This amount of reduction in our annual revenue from one item alone, if computed on a dividend basis, would show a loss in our national wealth of a billion six hundred thousand million dollars, a tremendous and unwarranted sacrifice to make because a portion of our nearest neighboring nation has a common ancestry with us and speak the same language. A tremendous sacri- fice to make as an experiment having as its aim any material reduc- tion in the cost of living. "We farmers of the Northwest, living iso- lated from our great intellectual centers, without the advantages of many of our citizens, are constrained to criticize the action of the present administration toward the rapid settlement of Canada by inviting the American farmer to take himself, his family, his prop- erty, and his allegiance to an alien country, that he may there enjoy a prosperity that this Government insures him as a Canadian citi- zen by opening up to him this the best market in the world for such products as he can raise in Canada more cheapty than here ; and the Canadian Government, through its governmental policies, guarantees to him a larger purchasing power for every dollar that he may secure b}^ selling in the American market — if spent in Canada. I am going to say to you that, without regard to what we may be politically, economically this proposed reciprocal agreement does not seem sound or fair to the farmers of the Northwest. I am obliged to you. Senator Stone. Before you close there is one matter, and only one, that I would like to ask you about. You evidently have given this Avhole subject a good deal of thought and are familiar with it from the practical standpoint, but I would like to have your views as to this matter of which I speak. It has been said here — you have inti- mated the same thing — that the tendency of this reciprocity agree- ment has depressed the price of wheat, even in the United States; that is your opinion? Mr. TwiTCHELL. Yes, sir. May I enlarge on that? Senator Stone. Of course 1 ha^'o no objection to your enlarging on it, but that is preliminary to what I was going to ask you. Mr. TwiTCHELL. Pardon me ; go on, sir. BECIPEOOITY WITH CANADA. 419 Senator Stone. I have here a tabic showing the average prices by months, running from 1905 to 1910, incUisive. Getting into the mid- dle of that period, I find that in February, or the month of Feliruary, 1908, and also for the months of ^Alarch, April, and Mav of 1908, wheat commanded a higher a\erage jn-ice in Winnipeg than in Min- neapolis. Now, I would like to ask you what, in vour opinion, occa- sioned that situation ? Mr. TwiTCHELL. The history of the Winnipeg markets, which are six years old, sir, shows two instances ; that is. two periods — the result of corners. If you will look back, I think in 1907, you will find that for a few days Avheat was worth a good deal more in Winnipeg than in Liverpool. It was the result of speculation — a corner in the Win- nipeg market. There were two instances of that kind since the marlcet has been established. Senator Stoxe. You think that the higher jirice in Winnipeg was due to speculation and cornering of the market there? Mr. TwiTCHELL. I think that any time the price of wheat Senator Williaims. How long did that condition last ? Senator Stone. Senator Williams suggests that I ask you how long did that condition last ? Mr. TwiTCHELL. I could not say definitely. I just know — having looked the proposition up — I feel that speculation has very much more to do with the price of grain than is generally admitted. I know, for instance, I am scared to death of another phase of this proposition. I know that the opening up of a new country means that a collector is following the threshing machine. New countries are opened up on credit. I know the needs of the homesteader and the nature of the man with energy who goes out into the West and who extends himself almost invariably too far, and who of necessity is forced at the time of threshing to deliver his grain for two reasons : One, he owes money to somebody else, and, secondlv, he has seen fit lo extend his credit for land rather than buildings, and therefore he is not in a position to hold grain, and I want to say to 3'ou this, gen- tlemen, that I have farmed for 30 years. For i'O years we were abso- lutely at the mercy of Liverpool. There never was a time during that period, except for little spasmodic — for a day or two — corners, in Chicago then, that I would not have admitted to you, and I admit it now, that during all the time what we raised in the United States, what we had in the United States, what it cost us, had nothing to do with it. We simply took what Liverpool was pleased to offer. That condition has changed now. Senator Stoxe. In Chicago ^Ir, TwiTCHELL. Or Milwaukee, if you go back further. Their price, Senator, had to be what Liverpool woidd give for it. Senator Stone. Well, now I understand you to say that the higher price at Winnipeg over that prevailing m ^linneapolis on the dates mentioned was due to speculation and in the cornering of the mar- ket; of course, reciprocity had nothing to do with that. Mr. TwiTCHELL. No, sir ; reciprocity had nothing to do with that. Senator Stone. Now, I am going clown to the next year, 1909. I have marked here the months of September. October, November, and December, and the table discloses this state of the case: In September wheat in Minneapolis was $1.01 1. Senator McCumber. What day is that? Is the date given? 420 KECIPKOCITY WITH CAJv^ADA. Senator Stone. It is the average of the month given; the day is not given. lOOO, September, in Minneapolis, $1.01^; in Winnipeg, $1.00i; October, Minneapolis, $1,035; Winnipeg, 99f cents; Novem- ber, Minneapolis, $1.0(jj; ; Wmnipeg, 08^ cents. I will stop there, for there is no need of prolonging the question. j\Ir. TwiTrHELL. Do j'ou want me to explain that? Senator Stone. No; I want to ask a question and draw your at- tention. Mr. Twitchell, to this particular fact: This table shows a gradual advance in wheat in Minneapolis from $1.01^ in September to $1.03^ in October, and on up to $1.06f in November, but at the same time it shows a falling in price at Winnipeg from $1.00J in September down to DDf cents in October, and still down to 98^ cents in November. Now, what is it that caused that? Mt. Twitchell. Go up in one market Senator Stone. To go up constantly in Minneapolis and at the same time go down every month in Winnipeg. Mr. Twitchell. Senator, if you will Senator Stone. Reciprocity had nothing to do with that variation. ^Ir. Twitchell. If you start and examine the tabJes, sir. in th.-it same book — I presume — I do not know what book you have, but I can get it for you Senator Stone. Those were tables prejDared by the Tariff Board. Mr. Twitchell. If you start in the year 1905, which is the first year that we knew anything about Winnipeg, and its conditions during that year, you will find that at the conclusion of the harvest time of the United States, which is the month of August and September, with big deliveries in the month of September, in 1905, as you approach that hca\'y-delivery ]KTiod, you will fiiid tliat our price worked almost down to an export basis, for the reason that that is the time when we, are delivering more grain than anybody has any particular need of. You will find, if you continue, that after the month of December, when winter has closed in and the rush of the delivery period is over, you will find that the market goes up, and the high point for the wheat crop is along at the end of the delivei y period of the crop - along in j\Iay, June, and July. If you take 1900, you Avill find that we had an accumulation of an unusually big crop in 1905 on hand the entire winter. In 1906 j'ou will find that we had so much Avheat available, marketable in the American market, that it was a hurry-up delivery all of the year, and we never got awav from the export prices. If vou take 1907 or 1908 or 1909 Senator Stone. I was speaking now concerning the prices in 1909. Mr. Twitchell. I beg your pardon, sir. Senator Stone. I asked you the reason for this particular thing I was directing your attention to. Mr. Twitchell. I have tried to answer the reason for the de- crease — the dip in price. I think you will find, if you will look, that there was a dip in the price. Senator Stone. There has been a constant raise in price. Mr. Twitcitell. There had been a dip before, had there not? Wheat had gone down? Senatoi' Stone. No. Mr. Twitchell. It ordinarily does, when you have heavy delivery. Senator Stone. Here is how it reads: Beginning with April, it was $1.2Gg- in April; $1.29:} in May. EECIPEOCITY WITH CANADA. 421 Senator McCumber. ^Minneapolis? Senator Sto.ne. Minneapolis — $1.34-1 in June; $l.ol§ in July; ami $1.37^ in August. It did not go down during thtwc niontli:^; it went up. Mr. TwiTCHELL. That was the end. Senator Stone. The trend was upward. Mr. TwiTCHELL. But that is the end of a crop year, and not the beginning. That is the end of the crop year the year before. Your first month of delivery for spring wheat is September. Wheat sold for July delivery or August delivery is the wheat of the year before. That is the tail end of what is left over of the crop. Senator Sto^e. Of course, we can all understand that the price of wheat might be materially influenced by the incoming of a new crop. Mr. TwiTCHELL. Certainly. Senator Stone. If it were large enough. Mr. TwiTCHELL. Certainly. Senator Stone. But are not those conditions common to the mar- kets of both countries ? Mr. TwiTCHELL. Yes. I h a ^'e on! 3' touched on one side of it — and I want to be fair and answer the other side. The American market — ■ when you get a thousand cars of wheat in Minneapolis a day — that is nothing unusual — 1,700 or even 2,000 cars carrying 1,000 bushels to the car — when you commence to glut that market with thousands of threshing machines runnuig all over the three spring-wheat States, a great portion of it until the last 10 years, practically all of it, hav- ing to be delivered, because right at your back was the collector — we have been able the last fewyears to build granaries and put part of our wheat in them to get, after the rush, what we felt it vsas reasonably worth, as other lines of business do. We have gotten away a little from the condition of " What will you give and what will you take "? Xo other line of business is carried on in that way. If any of you gentle- men believe that the farmers of the Northwest are getting more than their share, I am going to say to you this, that I know that there is not a man within the sound of my voice that, should I come here and analyze the business that I run, telling him in what condition it is to-day, if you gave me credit for ordinary common sense, you would not, any one of you, touch it. I have got nearly enough. I do not know how much capacity I have, but I have energy enough and a reputation of being a good farmer, and it is on a big enough scale to suit any of you. Senator Stone. The question I asked you did not relate to the subject we have just been discussing. It was wholly difl'erent. Now, I want to put it to you a little differently : You are now charging, no doubt in good faith, and possibly believe that the variation in the price of wheat in recent months is due to reciprocity. Now, I have called your attention to instances, and I will draw your attention to one more, and then I am through. Take the months of the year 1910, and I will go back as far as May, and the price of wheat at Min- neapolis for that month was $1.11, and yet in June it fell to $1.05, and in July it rose to $1.25i, and went down from there on until November "it was $1.04f. There is a very variable market. Cer- tainly reciprocity did not cause those variations. 93285— No. 6—11 5 422 BECIPKOCITY WITH CAX.IDA. Mr. TwiTciiELL. No, sir; natural causes. Senator Stone. I want to ask you now your opinion — I am not controverting or arguing, I am asking for your judgment — if reci- procity did not cause those things, then what did cause them ? Mr. TwiTCHELL. The fact that we had the most severe drought we have ever known following the favorable early conditions there Avere over the entire West ; and along in the month of July, when that mar- ket advanced, it did not look as if it were possible that we would raise a bushel of wheat at all; we had never had any experience raising grain without water. We managed to squeeze out, as the Govern- ment says, with 36,000,000 bushels, when we ought to have had more than a hundred. That was the reason. Men who recognized that they could protect themselves as farmers, or being inclined to specu- late, went in and bought the market. Senator Stone. That is all. Senator McCumbee. I want to get a little evidence on some other lines, unless j'ou have some one here that will take up to those lines. Now, for instance — you know better than I — but our State, I believe, raises about one-half the flax raised in the United States. Mr. TwiTCHELL. Yes, sir. Senator McCujibbr. And we raise a great amount of barley and oats. I do not want to go into that subject if, under your arrange- ment, somebody else is to present that; but I would like to have your opinion upon its ettect on the flax croj) or barley and oats. Mr. T-wiTciiELL. I lielieve one of our other delegates can handle the flax crop better than I can, because we do not raise flax very largely in the portion of the State I live in. I will say this : So far as the barley crop is concerned, since we have sufficient protection on barley to give the American market to its farmer, we have been able to raise in Wisconsin, Minnesota, Iowa, North and South Dakota, ap- proximately 100,000,000 bushels of barley. This year the American farmer, an account of this same drought — I want to be fair — the barley farmer in Wisconsin or in any of the States has been able to get, along at the tail end of the barley crop — approximately the dif- ference in the tariff, about 27 cents. I have raised a good deal of barley, and that is the condition. We have been able to get for barley — for the last five or six years — in my judgment, possibly 15 cents a bushel more than we would if we had had competition with Canada. I want to say, in reference to the barley proposition, it is truly unfortunate for us if we have to be put out of the barley business. Barley is not a particularly paying crop. It is one of the things that we must raise, or those of us that were wicked to the land when we first got it. There was so much of it and it was so fertile, like the great northwestern country; we went out and scratched it over and raised 20 or 25 or even 40 or 45 bushels of wheat to the acre. I am talking about 25 or 30 years ago. That same land to-day has got to be husbanded; it has got to have proper cultivation; it has got to be sown to clover; and we have got to use just exactly those same methods with whicli we built up southern Wisconsin. You have got to have cattle; you have got to have fertilizer; you have got to have sheep; you have got to do all of the same things that they do in any other country if you are going to conserve and bring back the EECIPEOCITY WITH CANADA. 423 fertility of our soil. One of the great evils that grows up in any country that raises continuously one crop is the e\il of weeds. Certain weeds mature just ahead of wheat, for instance, and every year just before you get your wheat crop ready to cut these Aveeds have reproduced themselves and fallen on the ground. In our short falls— remember in our country by tlie 1st of November the year is over. You have got to put— you have got to put on a great big outfit, and you will turn the weed seeds down into the ground at a period when it is too cold for them to germinate, and you have to wait until the rains of the spring, the sun of the spring, will germi- nate_ those seeds. If you are gomg to raise a wheat crop, you must put it into the gxound just as quick as the frost is out again, and we have used barley advantageously in cleaning up our land, for the reason that it matures in aljout 30 days less tfme. You can wait— either do it one way or the other— vou can wait until you have got through with sowing the wheat and with proper machinery clean up the weeds that have been germinated and later take oif another crop of weeds when you cut your barley crop, or you can sow it early in the spring and take off in their green stage many of the weeds that would have matured and dropped their seed on the ground had you sown your land to wheat. We will lose, if my judgment is good, to the people of five Stntes — in number more than all of Canada — and we are going to lose by a voluntary act on the part of the United States Government from free barley alone not less than $20,000,000 or $2.'i .000,000, and we are going to' give it to who? Senator Stone. You mean annually? Mt. Twitchell. Annually; yes, sir. Can you figure it less? Senator Stone. I have not figured it. Mr. Twitchell. I have. Senator Stone. I am just asking you what you meant. Mt. Twitchell. I mean every year, and besides you are going to make it much harder for the men who are using their best intelli- gence to get back the land that has been misused all over the North- west into a condition where it not only will produce all that we need for an indefinite time and so we can raise more bushels and sell it to you cheaper and still make more money for ourselves. Senator Stone. AATiat five States do you have in mind? Jlr. Twitchell. North and South Dakota, Iowa, Wisconsin, and Minnesota. Senator Stone. We lose $20,000,000 or $25,000,000 annually on barley ? Mr". Twitchell. Yes; we raise about 107,000.000 bushels. Cali- fornia raises more than any of these States. We raise nearly all the barley up in those five States. Secretary Knox said at Cliicago that the purpose of this bill was to give to the millions of American consumers the advantage of the closest supply of food products, and then they slip barley in. When, for God's sake, did barley become a food product? Why did it fall inside of that list at all ? Will the glass of beer be any bigger or any cheaper? Barley is good for nothing else except feed. Is it to Ite the maltsters or the 'millions that are to get the benefit of this assessment against the northwestern farmer of $20,000,000 a year. 424 RECIPROCITY WITH CAXADA. Senator Williams. Right there ; we want to be fair with one an- other. You used the word " assessment " of $20,000,000 against the farmer, and back yonder some time ago you used the phrase that the " (_i(o\('rnmeiit was going to take away from the farmer by legis- Lative act " so much. Do j'ou call reducing a tax levying an assess- ment? And do you call bringing things back nearer the state of nature a " taking away by legislation " ? This is merely a repeal of a law taking away from other people something that has been given you already. Mr. TwiTCHELL. Did I take it away from anybody in the United States? Senator 'W^illiaiis. If you did not, you did not get anything; if you did not manage to sell to somebody in the United States for more by reason of it, then you did not get anything more. One of the two would have hapiDened. Mr. TwiTciTELL. Senator, we feel that there may not be any ethical difference, liut we feel there is a little business difference between coming down here and asking you to create a condition whereby we might get 20 or 25 cents a bushel more for our barley, and asking us to lose it noAv, or to have it changed when we see that other branches of business in the United States are being left alone. Senator Wiixiajis. That statement of it I understand, because frequently vested wrong becomes a sort of quasi vested right, but it is hardly an assessment, is it, taking the tax off of somebody and assessing it on you? Mr. TwiTCiiELL. I have never considered it a moral wrong to raise the revenue of Government tlirough the protective theory. Senator Gallinger. You won't admit that is vested wrong? Mr. TwiTCiii'LL. No; I ha-\e never felt so. Senator AYilliajis. I did not understand you to say that tJie Gov- ernment — you say it is not a moral wrong to raise the revenue in that way, but if b}' tl)is situation 3'ou liave raised any revenue, if it bene- fited you at all, it lienefited you by enabling you to charge somebody else more monej^ Did any of the tax go into the Government Treas- ury on account of that ? Mr. TwiTciiELL. Oh, yes ; but not much. Senator Williams. The tax, if anyone in the country was taxed, went into your pocket out of the pocket of the consumer. I under- stand there is a slight importation, but the benefit that you received, if 3'ou ha^'e received any from this duty at all — now. granting that you ha^■e — that benefit has been mainly received bj^ taking it out of somebody else's pocket and putting it into yours, has it not? Mr. TwiToiiELL. Yes, sir. Senator WiLLiA:\rs. By increasing the price of the product, and it has not got into the Treasury of the United States, except to a very limited extent. Mr. TwiTCHELL. That is largely true, about 3,000 bushels last year. Senator Smoot. Perhaps the Treasury did, indirectly; as you had a chance to sell to a man receiving wages under protection, when he received higher than any other countr)^, and in that way he was able to buy higher-priced protected articles. Senator Williams. That is undoubtedly true, too. EECIPKOCIXY WITH CANADA. 425 Senator Smoot. And buy' products of the country that come m. Senator Bailey (interposing). As I understimd your idea, if you are required to sell barley cheaper in order that the city folks might have cheaper beer, then you ought to have cheaper clothes when you buy from the city folks ? Mr. TwiTCHELL. Yes; that sounds a good deal like they talk back home. Senator. Senator Williams. And that is right. Mr. TwiTCHELL. I am going to say to you, gentlemen who are protectionists, and I am one, that I have here a little clipping — a Government report — which shows that North Dakota pavs the high- est wages in five central States for farm hands, and I want to say to you there is no reason that we should not joay it. It costs more for men to live up there ; they have a shorter period to work ; they have either to steal a long ride on the railroad or pay their fare to get there. Our labor is largely transient. I do not presume of the thousands of men I have employed that there would be one- half of 1 per cent that ever lived in the State. Somebody asked, "A^Tiere does your labor come from?" I will tell you where it comes from, gentlemen. They are those fellows that are not quite good enough for you to keep steadily employed in your factories. That is what we depend upon — shiftless, cheais, irresponsible labor — the drifting labor from all over the United States; and if we are going to pay the high wages, and if it is our policy that we should pay the high wages and that we should estalilish a still higher standard for the man who works with his hands, then it is going to cost us something ; and if we paj^ our proportion of it up in North Dakota, if I make my contribution on this governmental policy, then the Government has got to give it back some way to me in the shape of barle}' or something else, or thej' will have me in tJie poorhouse. Senator Williams. In other words, every tariff tax for protection necessitates another protection tax to protect somebody else against the other fellow's protection. Mr. TwiTCHELL. Possibly. Senator Williams. Yes. Senator Bailet. Undoubtedly. Senator Smoot. That gets you back to this condition : If we had no protection we would have to live in this country as people do in other countries, and our standard of living would be lowered. Mr. TwiTCHELL. You can not get away from that; that seems fundamental with me. Senator Williams. Let me ask vou this: Before we had any i:iro- tection at all, when we were under the same government as Great Britain, was not the standard of wages then higher in the United States than it was in England, and did not we feel when we first levied a protection tariff — levied it ostensibly, at any rate — because the standard of wages already was higher, and we said that there- fore it made the manufacturer's product cost more, and we Avere compensating him for an existing fact. Is not that true? Mr. TwiTCHELL. That is a reasonably fair statement, Senator. Senator Williams. I am saying the thing did create it. Senator Smoot. I suggest this, that at the time the Senator speaks of we had practically no pay roll in this country. 426 BECIPROCITY WITH CANADA. Senator Williams. Oh, yes, we did ; and if I am not mistaken we had woolen mills, iron mills, and we had so frightened Great Britain by it that she was absolutely putting a discriminating duty against her own policies. Senator Ssioot. And wages were from two to three times as high as they Avere in Great Britain. Senator Stone. What was the general price of barley last year at the farm? Mr. TwiTCiiELL. I would not be bound by this, because I have not charged my memory with it, but I think the barley that I sold out of the crop was sold last fall at about 6.j cents at the farm. There would be a toll against it of about 9 cents to get it to a terminal. Senator Stone. The average farm price in the United States, as stated in this table here, prepared by the Tariff Board, is 57.8 cents for that year. Mr. TwiTCHELL. That is out of the crop of 1910 ? Senator Stone. Yes. Mr. TwiTCHELL. Well, that is the crop of barley that is still in ex- istence — that is the last crop — there is no crop for 1911. Senator Stone. The previous year — 1909 — it was 55.2 cents. ]Mr. TwiTCHELL. I do not know where you got that table. Senator. Senator Stone. I said the Tariff Board. ]Mr. TwiTCHELL. I will give you a little information that you can prove by looking at the market report anywhere — that barley was higher than wheat in Minneapolis, Chicago, Milwaukee, or any other place where they sell barley. I do not know where you got your table. I simply state the fact that barley was as high as $1.07 in Minneapolis. Senator Stone. I will tell you where the table comes from, as it ajjpeared from the headmark. Mr. TwiTCHELL. To make it a little plainer, I sold barley for better than a dollar a bushel at the farm inside the last month. Senator Stone. It appears to be the price fixed on importations. Mr. TwiTCHELL. They were iinusual conditions. We have had to hustle to get seed barley, on account of the poor crop. I had a thou- sand acres in barley last year. It took 2,500 bushels to seed it, and when I got it thrashed I had just enough to fill up that same bin and start over again. Senator Stone. The thing I am trying to understand is. even if at 65 cents a bushel in 1910, the five States you named raised approxi- mately 87,000,000 bushels of barley, as shown in the table I have here, Mr. TwiTCHELL. That is 1910? Senator Stone. Yes. Senator Bailey. A bad year. Mr. Tavitchell. Oh, yes ; the year before is a little better. Senator'. Senator Stone. I have not the vear before. ]\Ir. TwiTCHELL. I say it was 107,000,000. Senator Stone. What I wanted to ascertain was how do you figure out the loss of $25,000,000 on 100,000,000 of bushels? Mr. TwiTCHELL. Because the difference between the value Senator Stone. What would reduce the price to that extent? Mr. TwiTCHELL. Because Canada can raise barley cheaper than we can. The same reason that we ought to raise in North Dakota lots of barley would more strongly apply to Canada. Their season EECIPRCCILY WITPI CANADA. 427 is shorter than ours; they can spring plow their hind and raise a crop of barley up there. It is a question of seasons with us. We have iiot all summer and half the winter to do our work in as you have down in JMissouri, sir. Senator Stone. They have not in Canada. Mr. TwiTCHELL. No; they have not until you get farther over toward the Coast Range, and then their winters are as easy and mild as yours. Did you know that you could take Fargo as a basis, and that they can raise, successfully, spring wheat farther from the city of Fargo— the biggest city in the State of North Dakota— farther to the northwest than the extreme point of Florida is south of there 'i Senator Stone. Eaise better wheat? Sir. TwiTCHELL. And raise it. Senator Stone. I have no doubt of that. Mr. TwiTCHELL. And raise it. Senator Stone. Yes; I have not any doubt. Mr. TwiTCHELL. It is an empire that nobody knows the possibili- ties of — Canada — they do not dream of it themselves. Senator Stone. I laiow, but I was not asking about the possibili- ties of that great empire. That is a theme you can enlarge upon with a good reason, but I was confining my inquiry to the question as to the decrease of the barley. You say that you have a hundred million bushels, and you sold it at 60 cents a bushel ? ilr. TwiTCHELL. Yes. Senator Stone. You would get Mr. TwiTCHELL (interrupting). Sixty -five. Senator Stone. You would get $60,000,000. Now, if you lost 35,000,000, you would get $35,000,000. I do not have in mind just what the per cent is, but it is something like 40 per cent, I should say, in round numbers. Mi\ TwiTCHELL. Senator, you are going to force me to say some- thing that has a little politics in its phases. I raised barley when we did not have this same protectioUj and I have sold it in Duluth and paid 12J cents a hundred to get it there, and got 20 cents a bushel for it. Senator Smoot. What is barley to-day worth per bushel? Mr. TwiTCHELL. Barley has "been fluctuating very badly. As I came through Minneapolis three or four days ago I noticed that No. 4 barley, which is contract grade, was worth from 72 to 82 cents. The week before that it had been up as high as $1.08. Barley has fluctuated because the crop is pretty well cleaned up; we did not raise a normal croj^ last year. Senator Smoot. What did the maltster from Buffalo state the price was? Mr. TwiTCHELL. That barley to-day was worth $1.09. Senator Clark. He said he could not get it. Senator Smoot. What I was going to say was, did you figure the $20,000,000 loss would be— that if barley was worth a dollar a bushel, that would be $100,000,000 for 100,000,000 bushels of barley, whereas if you did not have that protection it would be worth 80 cents, or a reduction of 20 cents a bushel, making $20,000,000 ? Mr. TwiTCHELL. Senator, there is no chance of barley ever being worth a dollar permanently in tlie United States, because we will stop raising wheat at that price ; it is an unusual condition here. 428 BECIPEOCITY WITH CANADA. Senator Clark. You have been making a very definite and clear statement, in one-half of the statement, and I would like to have you put into the record with what has been — I do not know whether the stenographer got it down — in regard to permanency of dollar barley you have spoken of. Mr. TwiTCHELL. I say there is no chance of a dollar being the price for barley, because I won't raise any wheat ; I will raise barley. It is out of all proportion on account of the barley territory having unusual conditions last year — there is no chance of barley being a dollar. Senator Williams. There is very little barley on the market now. Mr. TwiTCHELL. The crop is practically cleaned up. Senator Bailey. You have fallen into that bad habit of talking about the extremely low prices and they were all uniform under that Democratic tariff of 1894, and it was under that that you said you sold your barley for 20 cents a bushel, after paying 12^ cents freight. Mr. TwiTCHELL. Yes, sir. Senator Bailey. To bring it to the market. Mr. TwiTCHELL. That is a hundred, not a bushel; it would be half, approximately. Senator Bailey. It would not be 12^ cents a bushel, but this Gov- ernment report gives the farm price of barley during those three years as 33.7 cents a bushel in 1895, 32.3 cents a bushel in 1896, and 37.7 cents per bushel in 1897. Now, it undoubtedly arose under the higher tariff, but they cheated you if they got your barley at 20 cents a bushel. Mr. TwiTCHELL. I have had that done to me. Senator. Senator Bailey. And they are trying to do it again with this treaty, Mr. Twitchell. I hardly thought it necessary to mention that, because the farmer rather expects to get cheated. Senator McCumbbe. I want to insert into the record, with those figures given by Senator Bailey, the figures that were given by the Bureau of Statistics for the same period, and tliey give for 1905 a portion Senator Bailey. I was not reading 1905. Senator McCumbee. A portion of the year being under the pro- portion of 30 cents per bushel, under per cent ad valorem, as being 41 cents; the next year, 1906, has 37; 1907, 31; 1908 has 31.8. Senator Bailey. You mean 1895, 1896, 1897, and 1898— you say 1900. Senator McCumbee. And then it begins to increase immediately, jumping up from 31 or 36 in the latter part of 1896 to 48 the next year, then 49, 57, 50, 48, 54, next 55, 73, and 55 in 1909. Senator Bailey. I want the record to sho\\- that these figures that you mention as correcting Senator Bailey's figures are the figures from the Government publications. The ones I have were. Iwant to correct you. The whole of 1895 there was under the Wilson bill. The Wilson bill jDassed in 1894, in August, as I remember. Senator McCumbee. The bureau gives part of the year under 30 cents a bushel. Senator Bailey. Evidently giving the fiscal year and not the cal- endar year, and I suppose that these were the figures of the calendar year, but that is the way that it will be separated. I want you to miderstand that that did not contest the proposition that it will.in- RECIPBOCITY WITH CANADA. 429 crease the price, and I think an examination of the prices whicli M'ere higher before we reduced the duty and higlier after the Republicans iacreased it, and that is our contention about everytliing — that the duty does increase the prices. Senator Williams. You do not mean to say that that was the sole or chief cause, not only of barley, but everything else being higher, at that time ? Senator Bailey. No ; but if we are right, the tariff will increase the price of anything. I maintain that, however, as to manufactured goods, as well as to agricultural. Senator McCusibee. How many acres do you farm ? Mr. Twitchell. I farm 6,000 acres. Senator McCrjiEEK. You necessarily hire all of this? Mr. Twitchell. I have to Senator McCumbee. Can you give this committee, or file with this committee, a statement such as would usually be kept by a good farmer, showing your cost and your profits on your farm in operating it for any year? I do not ask you to give it now before the commit- tee unless you should desire, but to give the table to us and make it a part of our record. Mr. Twitchell. I have something here, Senator, which is very short and can be put into the record if it is projaer to do it. I have a letter from Mr. Dalrymple. My farm adjoins the Oliver Dalrymple farm, possibly the best-known farm in the United States, about 20,000 acres. Senator Williams. Wliat farm? Mr. Twitchell. The Oliver Dalrymple, the original big wheat farm. (Mr. Twitchell thereupon read the letter as follows:) "A." The Dalrymple Faem, CasscUon, y. Dak., Apiil 11, 1011. T. Twitchell, Esq., Fargo, A'. Dale. Dear Sir : Our per acre cost of producing graiu, including all small grain and com. was .'?8.12 per acre in the year 1910 and ¥S.48 per acre in tlie year 1909. This includes all cost of riroduction, seed, feed, taxes, and depreciation ; also includes the taxes and cost of summer fallowing, etc., on the land that is not In crop. If you wish to figure interest on the investment, you will have to compute interest on H to IJ acres for each acre in crop, as we usually have that much in gi-ass and summer fallow. It is a rather ditflcult thing to get at the cost of production per bushel, as we do not keep our books so as to be able to determine the cost of an acre of the different grains, separately. Our average crop of wheat in 1910 was a little better than 12J bushels per acre; in 1909 it was ISJ bushels per acre. If there is any more information you want, would be glnd to dig it out for you if you would stop in here. I have promised Mr. Button to put my name down on his subscription list. Yours, truly, John S. Dalrymple, Manager. Senator Bailey. Two thousand acres do not need much subscrip- tion — or six thousand. . Mr. Twitchell. They are so constituted up m our neighborhood that every fellow wants" to carry his share of the burden. Senator Bailey. That is right. Mr. Twitchell. I wish to say, in explanation of that letter, that there probably is not a better farm on a better parcel of land of 430 E.ECIPEOCITY WITH CANADA. eqiuil size in the United States. It was piclied out originally by Oliver Dalrymple, the father of the boys that own it now, as the experimental farm — the first experimental farm — the first farm to be opened up in the great land gi'ant that was given to the Northern Pacific Eailroad Co. He selected it with great care. I wish to call your attention to the fact that while this letter says that their crop for the year 1910 was a little better than 12^^ bushels per acre, that it cost $8.48 ; that the land is worth and would sell, if we do not have reciprocity, for $60 or $65 an acre. Six per cent as interest is not too much to figure it, and you will find that he has nothing left, and not quite 6 per cent for last year at the high price that was incident to our having a severe drouth in our country; and I want to call your attention to the fact that while they raised on the farm 12f bushels of wheat per acre and while I raised 10 on mine, the State of North Dakota, so the Government says, did not raise 5. We live in the garden spot of our State. Senator Stone. That was a bad year — drought. Mr. TwiTCHELL. We always raise a little more, because the Lord did a little better, did a little more for the land that we live on. Some parts of Missouri are a little better than other parts. Senator Stone. Do you know what Dalrymple paid for this farm of 20,000 acres in the beginning? Mr. TwiTCHELL. That land was taken over at the time or follow- ing the Jay Cooke failure by Alton, Cheeney & Cass. They were originally directors of the Northern Pacific. Oliver Dalrymple was then a farmer in Minnesota, farming 1,700 acres, which was the larg- est wheat farm in the United States at that time, and they sent him up there, and they picked up 80,000 acres of land on the bonds of the Northern Pacific at a cost of something less than a dollar an acre. Senator Stone. "When did they buy it — about how long ago? Mr. TwiTCHELL. The first breaking was done in 1875; that is, 36 years ago. Senator Stone. 1875, you say? Mr. TwiTCHELL. 1875 ; yes, sir. The first crop they raised in 1876. Senator Stone. They purchased it at about what time? Mr. TwiTCHELL. They purchased it immediately following the Jay Cooke failure in 1873, was it not? Senator Stone. Yes; in 1873, 1 think. Senator McCumber. That is all I wanted to ask you. Mr. Lewis. Mr. Chairman, we have one more speaker, Mr. J. M. Devine, of the extreme northwestern jjart of the State, and he comes from a different section from Mr. Twitchell, and I think he will be brief. Mr. Chairman, Mr. Devine. STATEMENT OF ME. J. M. DEVINE. Mr. Devine. Mr. Chairman and gentlemen of the committee, I realize I will have to be very brief; I shall not hold you very long, much as I would like to do so. I want to reiterate what Mr. Twitchell has already said as regards the impression the North Dakota delega- tion has as to the courtesy of this committee. We appreciate this fully, and shall go back to our homes with nothing but the very best words regarding the Committee of Finance of the Senate. BECIPEOCITY WITH CANADA. 431 First, I want to saj^ that up to this moment that there lias been per- haps, and yet necessariljr, a discussion of the question relative to farm cost of distribution, transportation, cost of production, and a thou- sand things necessary to reach something of a conclusion as to the prices, in order to compare between Canada and this country. But the real thing, to my mind, after all, is the man that is on the farm. I grew up south of Jlason and Dixon's line, and I can not forget, and I am not going to forget, the conditions under which we lived at the base of the Allegheny Mountains ; I am not going to forget to-day the conditions under which my father and my grandfather toiled; I am not going to forget the conditions under which we lived ; I am not going to forget the fact that for years I saw him dreaming, hoping, and expecting, and saw him die with no possibility of that dream coming true. I am not going to forget to-day, and I do not think the Senate ought to forget, and I do not think the Senate Committee on Finance will forget, the conditions under which the farmer for 70 years has toiled. He has never had a square deal — never until the last three or four or five years, perhaps. Everything has developed, everything has grown, everything has added advantage, and he has helped to bring it about. Lord bless you, when I think of the conditions in North Dakota to-day, and the idea that the farmer has in North Dakota to-day, and I want to see it come ; I want to see that division become a fact — I want to see the consolidated school on the prairies, where the mother can stand in the threshold of her home and see and hear the bell ringing that will call her children to a high school on the prairies. It did not occur in Virginia or West Virginia where I grew up. We had not anything. Lord bless you, as I think of the conditions in the "West, and I want to say to you that the "West will go on, the West will blaze the way, and the West will bring conditions by which we can keep that boy and that girl on the farm and away from the cities. As I measure conditions in this country to-day I am beginning to believe that the problem in this country is congested conditions; and yet we are battling, we are on the firing line in North Dakota, we are battling to keep the children on the farm ; we can make them grow bigger and better and more wholesome and stronger there. We have always grown that way on the farm. So there in North Dakota we are using $7,500,000 to build schools and maintain them. We have 900 students in the agricultural college, the greatest in attend- ance in the United States. T^liy ? So that that boy will get the train- ing necessary to enable him to see the beauty and not the simple drudgery from farming conditions. The university of our State has 800 students. We have 20 experiment stations to maintain by the State, by which the farmer of the future will be enabled at the least expenditure of energy and effort in toil to produce the greatest results that eventually sell the cheapest to the consuming population of this country. We are not in favor of this reciprocity, not at all. The con- viction is deep in the West, those farmers want to say to you, and this is the way I see it. They are calm, they are silent, their hands are clenched just a little, but not very much ; patient, waiting— that is. North Dakota. We will go on in North Dakota if you give it to us ; we will struggle and battle along, if we have to endure under it, because, I want to say to you, 432 liECIPKOCITY WITH CANADA. gentlemen of the committee, that some day we will have somebody that will write the story of the pioneer of North Dakota when he calne to the State and battled with adverse conditions and broke up the soil, lived in a sod house, paid 2 per cent a month and a bonus, if he got any money — and that was doubtful in that day — served for four years. I remember, from 1885, perhaps, to 1891 or 1892, it was a stern battle, and hundreds of them were forced to leave the prairie home; and they came from almost every State west of the Ohio, the best people possible, with plenty of backbone, courage, brains, energy, optimism, and hojje; and yet, in spite of that, they were obliged to finally give up the homestead and the preemption. And, remember, in that day we could get 480 acres. Now it is 160 acres. Many faced it ; many could not get away, and they battled. Now, in the days of my father, back there on the Alleghenies, he did all he did to back up and support protection. I want to say to you, gentlemen of the committee, that in the West, and the sons of these men from Ohio, and Missouri, and Wisconsin, and Illinois, and Indiana are living up there, and they will battle hard to maintain the conditions that to-day exist; in other words, keep the equilibrium between the present normal consumption of this country with the normal condition of production, and I will say this, when you talk about high living and that somebody is re- sponsible for it, and perhaps somebodj^ is responsible for it, but I say that, so far as the farmer is concerned in the West, he can not pos- sibly jDroduce that which he has to produce for a single cent less and not injure him in his conception of what the American modern home is — what the American modern farm shall be, and what places his children shall take in the onward march of human progress. He can not do it, and he is not going to do it peacefully. We did not come down here as fighters at all. We have no com- plaint at all except that we know this reciprocity is an absolute reversal of an>' reciprocity we ever heard of in this country. No great leader of the Republican Party ever discussed a reciprocity like this; no great platform ever promulgated it; it is the absolute reverse of any proposition this country has ever had in connection with the trade. Blaine talked reciprocity, and he talked it intelligently and well. We say, as we understand it, if you in Brazil or South America can produce something by reason of climatic conditions that we can not 23roduce in this country, we will let it come in and if, on the other hand, we can produce things in this country that you can not produce, we will let it go in free, and make a square deal. Therefore, we get certain things from Cuba; perhaps certain things from Brazil; per- haps certain things from South America, and we send them our flour and our pork and the jDroducts of our forges. But here we come to a Avonderful emjaire; I live on its border. I will tell you briefly and as rapidly as I can my conception of things as T have seen them for the last iO years. I live in the city of Minot; my farm is 22 miles away from me, and I direct it every day, one way or the other. The Soo passes through that city, an interna- tional transcontinental line, and I want to say to you during the past 10 years, especially in the spring, beginning with March and con- tinuing until probably the 1st of May, there is never a freight train, never a passenger train, that swings through this country to the Canadian border, 40 miles bevond me, that that freight train is RECIPEQCITY ^MTH CANADA. 43:3 not packed with stock wagons, farm machinery, and that pas- senger train packed with farmers going from Indiana, going from Ilhnois gx)ing from IMmne^ota, going from Wisconsin, going from ^orth Dakota, to the land of the Canadians. I have had^manv men m my business say to me, - What are vour knds worth here''' and I have told them our land is worth $25 to $30 an acre I want to say this to you : We are cultivating to-dav 14,000,000 acres of land m iSorth Dakota, and we have got 45,000,000, and if you will iust halt this reciprocity, hold up and stop it, destroy it, if you can and we will add to our wheat production 100,000,000 bushels 'in live years Senator Williams. But without reciprocity it seems that they are moving into Canada anyhow. Mr. Devine. Yes; sure. There is no reason why they should not but I will say this: I have had many a farmer, and usually the father of a family, come to me and say, " What can this half section or this quarter section be bought for, $25 or $30 an acre ? " He has gone to Canada and looked it over. The land there is worth $12. I could give you a description of 150 pieces sent down to our city because we have a great many men in that city who are interested in Canadian lands, raw lands in Alberta, or lands in Saskatchewan, which can be bought at from $12 to $15 an acre, and I had this man go up there and come back and say to me, " Devine, we have decided to stay here." The 30 cents a bushel looks serious on flax, the 25 cents a bushel looks serious on barley, the 25 cents a bushel looks serious on oats, the 25 cents a bushel on wheat looks serious; but, above it all, this is the statement: '' I tell you, Devine, I have lived in this country all my life. I am getting old. I understand its people; my associations are all here; my children, I want them to live here, and therefore I will pay the difference and take the land here, because I would rather sing 'Away Down South in Dixie,' or 'America,' than ' God Save King George.' " You will hear those things often. Senator Williams. In other words, there are some people who pre- fer their native land to increased wealth ? Mr. Devike. Yes, sir. Senator Stone. Let me ask you a question. Mr. Devine. Yes, Senator. Senator Stone. Did you say there were 14,000,000 acres in cultiva- tion in North Dakota ? Mr. Devine. About 14,000,000 acres; yes, sir. Senator Stone. Out of 45,000,000. Mr. Devine. Yes, sir. Senator Stone. I asked it, for it was rather a surprising statement. I have just had laid on my table here at my side a statement that I asked for this morning about seven States. Among others North Dakota; it shows the total acreage in that State as 44,917,000 acres. Mr. Devine. Yes. Senator Stone. The total amount in forests, in cultivation, 28,- 392,000, or double what you say. I was curious to know which was correct. Mr. Devine. It is not correct. I am discussing — when I say 14,000,000 I mean acreage under cultivation. Senator Bailey. That is not necessarily conflicting, because every farm has pasture land. 434 RECIPROCITY WITH CANADA. Mr. Denike. Under the plow, that is what I am discussing. The North Dakotans feci that no one in this Government is going to be benefite,ei!. Is that all you desire to say, Mr. Devine? Mr. Devine. Yes, sir; I am through. EECIPEOCITY WITH CANADA. 437 Exhibit A. Mr. J. M. Devine subsequently submitted the following substitute for the preceding stenographic notes of his interview with the com- mittee : Mr. Devixe. Mr. Chairman and gentlemen of the committee, I realize that the hour is late and I must be brief, therefore I shall not hold 5'ou very long, much as I should like to do so in the dis- cussion of this far-reaching question. I want to reiterate what Mr. Twitchell has already said as regards the impression the North Dakota delegation have as to the courtesy of this committee. We appreciate this fully, antl shall go back to our homes with nothing but the very best words regarding the fair treatment we have received before the Senate Committee on Finance. First, I want to say that up to this moment there has been perhaps a necessary discussion of the question relative to the foreign cost of production, transportation, and many things necessary to reach an intelligent conclusion as to prices, profits, in order to compare between Canada and this countrj'. But the real thing, and to my mind more important, is the condition of the man on the farm. I grew up south of Mason and Dixon's line, and I can not forget and I am not going to forget the conditions under which we lived 40 years ago, there at the base of the Allegheny Mountains. I can see a father toiling, together with his neighbors, under conditions of almost abject pov- erty, dreaming of a day and of a time when brighter and better things would come. I am not, therefore, going to forget in this hour the toil and hardship of that period, neither do I want the Senate Committee on Finance to overlook or forget that the farmers of this country have been sacrificed in order to build up the factories and forges of this country, to give us what we finally have to-day, the greatest home market in the world. By the aid of Federal legisla- tion everything has been developed, specially protected, and the farmer above them all has had to bring this about. When I think of the present up-to-date condition of the farm and farmer in North Dakota, and the conditions of the farm and the farmer at the base of the Allegheny Mountains of Virginia, western Virginia, Kentucky, and Tennessee, it would be easy to understand why we North Dako- tans are here battling against reciprocity, and for a square deal. Given but half a chance, up there on the prairies of our State, and we will blaze the way to a time not far distant when the mother, stand- ing on the threshold of her farm home, will see a high school and hear the bell of that school ringing its call to her children, to the possibilities of an education beyond the dream of the farmers of the States above mentioned. We up our way will bring about such con- ditions so that we can keep the boy and girl on the farni and away from the cities. As I measure and note the conditions in this country to-day I am inclined to believe that the greatest and most serious problem m this country is the congested conditions of our cities. We North Dakotans want to keep the children on the farm. To do tins we must have better farm conditions and opportunities. There is no better place where the youth of this land can grow bigger, better, and more wholesome and stronger than on the farm. To-da Hon ('oiigressnian District, State We, the cousiunei's of malt, with hea\-y iiivpstineiits at vai-ioiis points, under- standing that an attempt is lioiug made to remove the import duty on Canadian barley, (h) hereliy emphatically jirotest against any change in the tariff as it now exists and i-espectfully otter for your cousideratiou the four following reasons : First. TJecause we do not believe it is expedient to breali faith with, nor be false to the agriculturalists who, at the earnest request of our industries, acting througii the Department of Agriculture and the various State agricul- tural stations, ha\e improved and enlarged their barley crop tremendously, as is shown by the figures issued liy thi' Bureau of Statistics of the Deijartment of Agriculture: the first reiiuest to the Department of Agriculture for this improNcnient and enlargement of the crop by our associations being made in the ye.'ir 11X10. The acreage tliat year was 2..S04.2S2 acres and the crop 58.!i2ri.,s;;o Imshels. while this ye.-ir the ai-reage is 7.2r]7,0O0 acres and the crop 102,227,000 bushels. in Ihe fi\e jirineipal barley -growing States of the Mississippi Valley the farnjers 1i;mc increased their acreage during that period of time as follows: Minnesota from :-;2.">,0()0 acres to 1,28-5,000 acres : Wisconsin from 245,000 acres to .860,000 acres: South Dakota from 108,000 acres to 1,025,000 acres; North Dakota from 244,000 acres to 987,000 acres, and Iowa from 444,000 acres to 510,000 acres. Second. Because of the impetus and logical force an antagonistic movement of this nature would give the antisalonn, local option, and prohibition agita- tion in sections of the West and Northwe.st where heretofore, because of the collateral interests of these barley growers in the brewing and distilling business of the United States, such efforts, detrimental to our industries, have been fruitless. That wo now strongly object to having our business made the target for tariff reformers and the perrietuation of our most important raw material imperiled liy experimental tinkering of that nature, and our industries, so often attacked by the antisaloon, local option, and prohibition forces in rural communities with no pro\ocation, placed in greater jeopardy by this assault on the financial welf.are of the barley growers of Jlinuesota, Wisconsin, South Dakota, North Dalvota, Iowa, and the Pacific coast, most certain to Invite retaliation. Tliird. Because our capital was and is invested at places largely on account of their availability to the barley fields and malting centers of the Mississippi Valley. That barley malt is the first and most important ingredient requisite to the brewing of malt liquors, such as beers, ales, and malt extracts and to the distilling of spirits, and to remove this present convenient and constant source of supply or to impair it in any degree would result in financial loss and detriment. That it is absolutely necessary for us to liave barley or the malt of barley of the character and variety at present gro^n in the States of Minnesota, Wisconsin, South Dakota, North Dakota, and Iowa, and we have repeatedly protested to the Department of Agriculture and the a.gricultural stations of the various States against the Introduction of any other species or varieties. That the removal of the duty on Canadian barley would positively result in an immediate curtailment of the acreage in these States and lead to the entire destruction of the barley-raising industry. That this would result in much uncertainty as to our yearly source of sup- plies. That we would be forced to place our chances for obtaining supplies in the balance with the uncertainty of production in a foreign country, oyer which we would ha^■e no control or influence either as to the quantity or quality. ^ That once transform the barley fields that surroimd the breweries of Wiscon- sin and the barley fields of those 3,807,000 fertile acres of Minnesota, South Dakota, North Dakota, and Iowa that at harvest time are nodding their abund- ant heads toward Minneapolis, Milwaukee, Chicago, St. Louis, and Cincinnati for later distribution to intermediate centers and points beyond into acres of wheat, EECIPEOOITY WITH CANADA. 451 corn, and oats, and the question of where to establish houses to convert the barley into malt for our purposes would be a iierpetual hazard and most perilous financial guess. That whether to malt the barley at Uie frontier and ship the manufactured product into our middle west lerritory or to ship the barley to interior points, there to be malted, in both cases at an additional cost to us who are sn located, would prove a situation the reverse of that now exist- ing, one not only inimicil to our financial welfare, but also to the quality of our product. That the map of production would be ever chan.L'eable, and wilhout having malt houses on wheels to follow the most convenient source of supply, we would be ever subjected to a calamitous disadvantage by being deprived of our own present available and const.-mt barley crops of ^liunesota, \\'isconsin, South Dakota, North Dakota, and Iowa. We therefore respectfully urge you to let our wishes and protests in this matter be known in the hails of your legislative bodies. To use your good offices to protect us from the disasters threatened liy the attempt to d'eslroy the barley raising industry upon which we arc dependent for our suiiply of that one cereal without which malt liquors, such as beers, ales, and malt extracts, can not be brewed, and the distilling of spirits, requiring our own domestic, highly diastatic barley, carried on. This was sent out dtifiiig the winter and months before the utter- ance of Secretary of the Treasury ^lai'^eagh tliat Canadian free Ijar- ley will kill our home produeiio]!. Strange coincidence how he. on April 4, voiced the fears of the brewers on the results of free Cana- dian barley, as expre.ised by the brewers in the petition months earlier. I have read this tu show that tlie Inewers whom tliese men from Bufl'alo say were in favor of this reciprcjcity agreeuient, were not. Senator Bailey. Yes; but they gave such a bad reason for it. That is such an utterly selfish reason. You wottld not expect that to appeal to the committee? Mr. AL^uir. I am not trying to defend the brewer; I am trying to show that if he was here he could not possibl^y take the stand that this maltster from Buffalo indicated he would take. As to the ratification of this agreement, the barley over in Ontario is the onlj^ barley raised in Canada suitable for brewing purposes. Senator Bailey. I think we all understood that. Senator Williajis. You are going to put that in the record, are you? Mr. Mauff. Yes, sir ; I did not have time to read it all. It would have taken me too long. Senator Williams. Do you say that our wheat crops have any competition from the Canadian wheat raisers? Mr. Mauff. I think they have very little competition, extremely small, and the matter was mentioned by some one else. We were sup- posed to bring their barley into this country, however, to benefit the consumer. Senator Bever'idge, who is evidently a friend of reciproc- ity, and who wrote a recent article favoring reciprocity in the Satur- day Evening Post, made this remai'k : '■ There was only one thing put on the free list that was wrong, and that was barley, because it would benefit no one but the brewei-, and he was not entitled to it;" and he went on to say that it was demanded ])y tlie Canadians. Oli, they are wide-awake— demanded by the Canadians in exchange for something that we wanted, evidently nothing that would help the farmer. I have quoted Secretary MacVeagli and Senator Beveridge. both friends of this reciprocity agreement, to show you the calamity that will befall the Ijarlev grower'of this counl it. A^'e rest our Itarley case on what those two gentlemen who are friends of reciprocity have admitted. 452 KECIPEOCITY WITH CANADA. The penlleman from Buffalo also said that we were neglecting the character of barley, the quality of barley, and the variety of barley. We have right here in the DeiDartment of Agriculture a gentleman who has given his life to one thing, and that is the improvement of the barley- crop — Mr. H. B. Derr. We have Dr. Mann, a microscopic expert, who has done nothing else ; another gentleman who is giving his entire life to this one particular thing is Mr. Carleton, and Mr. Fairchild is doing the same thing. Mr. Harlan, of the same depart- ment, is at San Anthony Park, on the State of Minnesota farm, ex- perimenting, and has been for some time. Senator Williajis. And that is all for the benefit of beer, and the United States Government is doing it? jMr. ^Iauff. None of those gentlemen have anything at the present time to do with the raising of barley for the benefit of the brewer. Senator Williams. That is the chief thing that barley is used for, is it not ? Mr. jMauff. The world's crop of barley is 1,400,000,000 bushels, and 1,000,000,000 bushels of it is probably fed to animals. Senator WiLLiA:>rs. That is the chief use for it in this country. We do not feed barley to animals very much, do we ? Mr. Mauff. Absolutely not. The impression that Senator Williajis. I am not talking about what the German peasants are doing with barley, or Kussian peasants. The United' States Government is spending all that for barley and doing all that work, and, so far as our country is concerned, it means beer, does it not ? Mr. Mauff. Absolutely not. Senator jMcCuimeer. What percentage of the barley raised in the United States is used for other than malting purposes? Mr. Mauff. I would just like to say this, without fear of contra- diction, that the brewers do not put one bushel of barley into a barrel of beer, and the production is 62,000,000 barrels. That leaves 100,000,000 bushels of barley to find disposition elsewhere. The pearl barley for soup purposes is a small item. Bass & Co. have their agents in the fields in California all the time, buying barley and shipping it over there for their particular ale purposes, but the total purchases of all these others do not amount to 5,000,000 bushels. Senator jMcCubiber. You said something about distilleries. Mr. JMauff. The distilleries use barley in the production of liquors. They use a certain amount, but the amount is small. The total used hj brewers and distillers, I would say, does not exceed 70,- 000,000 1)usliels. Some of the brewers label their product, as I saw on the billboards in New York some days ago, "Lager beer made from Mother Nature's best cereals, barley and hops " — and there is not a barrel of berr in the United States made of barley and hops alone, because the brewers' committee, before the Joint Committee on Food Standards, said the making of beer with malt and hops exclusively is extinct in this country. They use a substitute for barley. They are using, as a substitute, cornstarch and hydrolytic products of cornstarcli, such as sugars, sirups, and glucose. Of course, in the Budweiser Adolphus Busch uses rice. Only recently he has put the word " rice " on his label, and he turns out 500,000 bottles of that brand a day. Budweiser is not made exclusively of barley and hops, but it is made with some rice. EECIPEOCITY WITH CANADA. 453 Senator Heybuen. He states in his advertisement that it is made with rice. Mr. MArFF. That is newspaper advertising, but every Budweiser label for years back has been printed in two languages — German and English — " The best barley and finest saigar hops," and you can now iind on the labels the worcl " rice.'' Senator Willia:ms. If that is true, it would seem that we have very- little use for barley. Mr. !Mauff. They have to use some barley for this purpose. They are raising what they call a diastatic barley. Diastase to some brew- ers is more important than starch. You can not get diastase any- where else. You can always get starch. So. while ISIr. Adolphus Busch is searching our country to get starch from the bai'ley other brewers are searching the countrj^ for diastatic barley that will con- vert the starch and the hydrolytic products of starch used as substi- tutes for the nutritious barley, and if yoii ever get bilious from drinking that kind of beer, it is because it is fermenting in 3'our stomach. The Department of Agriculture is going to take up that proposition — the coiTect labeling of all malt liquors that are not )nalt liquors because they are not made, ordinarily, of malt. We have been fighting for three years to get that, and because of the fact that these brewers are doing this particular thing. And it is what brought us to this particular subject of the reci- procitj' agreement. The barley growers need the pure-food act pro- tection, and now they need also this protection, and it is the protec- tion of the barley growers, as well as the consumers of beer, that we are standing up for in these matters. In conclusion, who ever heard of a surplus grain producing nation asking to have similar products enter free? The old continental nations of Europe, even those raising big crops, but still not enough to supply their home markets, and who Lave to import each year, maintain a liberal protection for the agri- culturist, regardless of the consumer, except when, for extraordinary reasons and a home calamity or famine, the duty is temporarily sus- pended or reduced, but only until relief purchases have been con- cluded and no longer. They realize the fundamental importance of argriculture ; the sys- tem is an old one and has been thoroughly tried and proven. Why, then, should we, a surplus-producing country, experiment, instead of profiting by the experience of others ? Look at France, the bank of the world, where Morgan goes to find a market for stocks and bonds when investors are wanting at home. Where is the wealth of France? The peasants have it, and yet France consumes more wheat than she produces, although her crop averages about 350.000,000 bushels and still her wheat growers have a protective duty, so I understand. Nowj I have a lot on this subject, but I do not thmk I shall go into it at all, because it is getting late. The Chairman. You may file any additional statement you may desire as part of your testimony. Mr. Mauff. It is very voluminous, Mr. Chairman. The Chairman. Suit yourself about it. 93285— No. 6—11 T 454 BECIPEOCITY WITH CANADA. Mr. Mauff. While I am perfectly willing to stay here, I can imagine that it is rather a bore to you. I think I have covered the principal points. Senator McCumber. The statement was that you could file any statement you desired. The Chairman. You can file any additional statement with the committee and it will be printed in the stenographer's notes as part of your testimony. Mr. Maufp. I think that would probably be the wise thing to do on account of the lack of time. I thank you. Exhibit Xo. 3. Protest Filed by John R. JIai'FF, Representing the American Society of Equity, with the Finance Committee, in Washington, on May 13, Against THE Ratification of the Reciprocity Agreement with Canada so far as THE Cereal Products of the Farms are Concerned. The Amei-ican .Society of Equity suggests tlirongb its name tlie cliaractei', purpose, and principles for which it was organized. It is conaposed of 30,000 farmers. 10.000 of whom are located in the State of Wisconsin. Equity granted and demanded briefly defines the position of the society in all relations of life. Agriculture is the foundation upon which rests all industrial and commercial structures. When crops fail, all suffer. Those who attack this interest, wound themselves. We, understanding that the proposed reciprocity agreement with the Domin- ion of Canada contemplates removing the tarifC protection on our products, not onl.v those of the future but on what is left of this crop, without offering any adequate compensation, desire to protest strongly against the consummation or ratification of this agreement by our legislative bodies and we respectfully offer for your consideration the following reasons : First. Our industry is already greatly burdened by an enormous increase in the cost of labor, wliich alone has been made possible by a corresponding in- crease in the values of our products. Since the Hon. James Wilson became Secretary of Agriculture, harvest hands have been granted an increase of 60 per cent and ordinary day labor 65 per cent, and since that time the prices of all necessities i)urehased by us have increased enormously, as shown herewith. The following table was prepared \>y the Department of Labor in Washington. The average wholesale price In New York, and in other primary markets, of each article, tor the years 1890 to 1890, inclusive, is taken as the base price and is represented by 100. The relative price is the average wholesale price for each year from ]S98 to 1009, inclusive, compared with the base price. The relative price in March, 1910, is added : Clothing 96 to 126 Cotton prints 72 to 145 Boots and shoes 96 to 128 Cotton sheetings 86 to 134 Cotton shirtings 83 to 126 Cotton ticking 84 to 132 Wool blankets 107 to 131 Wool flannels 97 to 124 Wool dress goods ,SStol40 Cotton flannels 81 to 128 Cotton hosiery 83 to 93 Miscellaneous 92 to 132 Fuel and li.ghting 95 to 130 Metals and implements 86tol2S Lumber and building material 95 to 151 House-furnisUing goi.ds 92 to 109 Crude petroleum 100 to 153 Refined petroleum 99 to 127 EECIPEOOIIY WITH CANADA. 455 Wool carpets 100 to 117 Wool horse blankets 99 to 1?.5 Cotton thread 98 to 126 Cotton yarns 90 to 131 Cotton ginghams S3 to 124 Cotton 2-bushel bags 95 to 143 Second. Eeeanse the reciprocity agreement does not contemplate any reduc- tion in the duty on these necessities. That the high tariff protected manufacturers, to whom all of the farmers pay heavy tribute for the necessities of life, are to continue to enjoy the protection afforded by the tariff' and largely at our expense, as enumerated below : Carpets, 10 cents per square yard and 40 per cent to 60 cents per sciuare yard and 40 per cent. Cotton clothing. 50 per cent. W^ool clothing, 44 cents per pound and 60 per cent. Silk clothing, 60 per cent. Cotton collars and cuffs, 45 cents per dozen and 15 per cent. Linen collars and cuffs, 40 cents per dozen and 20 per cent. Blankets. 22 cents per pound and 30 per cent to 44 cents per pound and 55 per cent. Leather gloves, $1.25 to $4.75 per dozen. Silk, cotton, and fur gloves, 50 per cent. Common window glass, IJ to 4* cents per pound. Glassware, 60 per cent. Harness. 20 per cent. Fur hats and caps, $1.50 to $7 per dozen and 20 per cent. Hats and caps of other materials, 45 to 60 per cent. Hooks and eyes, 4* cents per pound and 15 per cent. Matting, 6 cents per square yard. Oilcloth, 6 cents per square yard and 15 per cent to 10 cents per square yard and 15 per cent. Nails, of wire, A to i cent per pound. Horseshoe nails, li cents per pound. Needles, 25 per cent. Paints, 30 per cent. Clay pipes, 15 cents per gross to 50 cents per gross and 25 per cent. Porcelain ware, 60 per cent. Manufactures of rubber, 40 per cent. Salt, 7 cents to 11 cents per 100 pounds. Handsaws. 27> per cent. Scissors, 15 cents per dozen and 15 per cent to 75 cents per dozen and 25 per cent. Screws, 3 cents to 10 cents per pound. Sewing machines, 30 per cent. Soap, 20 per cent to 50 per cent. Cotton stockings, 30 per cent. Cotton thread, 6 cents per dozen. Stoves, 45 per cent. Manufactures of tin, 45 per cent. Varnish, 25 per cent. Manufactures of zinc, 45 per cent. Brushes, 40 per cent. Buggies, 45 per cent. Cotton table damask, 40 per cent. Envelopes, 20 jier cent. Ink, 25 per cent. Pens. 12 cents per gross. Pencils, 45 cents per gross and 25 per cent. Glue, 2* cents per pound to 15 cents per pound and 20 per cent. Third. Be'cause the Dominion of Canada has :;.nOO miles of land contiguous to ours, but in value only one-quarter to one-third that of the go.id tarm lands of the Mississippi Valley. ^ ^ ,. . ,, That the farmers tilling that soil would enjoy a cheaper cost of living because of the greatly reduced cost of necessities through the favored tariff relations between the 'Dominion of Canada and Kuglaiid. , , . , v, „ ^ That in order to compete with these conditions, our lands, farm labor, and the value of our products would necessarily have to decline. 456 EECIPKOCITY WITH CANADA. FoiirtJi. Tliat nu ovoi'iirddiictiim in our own country is now in evidence, accdriling to all reports of the trutle and as sliown Ijy the l'ai:t that present prices of onr leading farm iiniducts, with tlic exception of barley, are the lowest in years. Tliat althou.uh the wheat crop for I'MiK as ro)iorted liy the Department of A.^'riculture, was only G'.)r,,()On,0()0 bushels, or 42.()(i(i.0(i0 bushels less than the crop of 10(111, the average farm value on December 1, as compared with 1909, showed a decline <>f about ] lOastern Sttttes of o\er .^fo.OOO.dtio.dOO and in the AVestern States only .fri(X).000.(MiO. The Crop Iteiiorter, published by authority of the Secretary of Agriculture, for January, 1911, shows the following farm values per acre, December 1, 1909, being the latest statistics available : Corn $15. 20 Wheat 15. 64 Oats 12. 27 Barley 13. 41 Rye 11. 90 These figures will have to be very much reduced to correspond with the pres- ent very much lower prices, as compared with December 1. 1909. Taking the figures of the Bureau of Plant Industry, being the 10-year average value per acre of crops in the six principal grain-growing States of the Missis- sippi Valley, we find the following : Corn S12. 71 Wheat 10. 55 Oats 9. 68 Barley 11. 25 It is difficult indeed to figure out how the farmers are receiving an equitable return for their labor, when we consider that the cost of production per acre, not including the now very necessary fertilizer, wear and tear on property, nor Insurance, amounts to from $12 to $13. This is figuring the land to the renter as low as $5 per acre. The planting and seed. $3 i)er acre; plowiu.g, cutting, and shocking, .f2 per acre; threshing, ifl per acre; and hauling to market from $1 to $2 per acre, depending on the distance. In the case of corn, the stalks sell for $1 per acre, and both the oat straw and barley straw have but a small feeding value. Wi- w liu- how those who .are advocating this reciproiaty at the expense of On the date these farm values were calcadated. corn was worth 60 cents, wheat 90 cents, o.its 40 ceuis. barley .55 cents, rye 74 cents. oB the farm. And the farmers wmild like to endure a little real labor on the b.asis of the above- mentioned coin|ieiisation. EECIPBOCITY WITH CANADA. 457 on January 1, 1011, the prices were 4S cents. SS cents, .".?. cents, 60 cents, and 73 cents, showing very serious declines in all cereals except barley and rye. It would appear as though the farmers ot our country were carrying' at the present time the entire burden arising from the effort to reduce the cost of living, and this, too, at a time of overproduction. The farmers in 1910 sowed 2,4S;2,000 acres more to wheat, but even at present prices produced in value !?110.01S.OOO less revenue. Also .^i.2.jl,000 acres nior" corn, producing 353,000,000 bushels in c-^:cess of 1009, producing, however, $121,000,000 less revenue. And 2,0x1,000 acres more oats, producing 120,000,- 000 bushels in excess of lOdO, with a return of ?2."i,000.n(l() less revenue. And 246,000 more acres to barley, producing, however, on account of the drought, 8,0.57,0110 less bushels, and even at the slight advance in price, showing no com- pensation worthy of the toil of working over these additional acres and the cost of the seed that went into them. The visible supply in the United States also points to an overproduction, the amount of wheat being over 2.",000,000 Imshels, corn 5.000,000 bushels, and oats 9,000,000 bushels, and the invisible supply both at terminals and the farmers' granaries is kno-\vn to be innnense. Since the year 1000 the barley acreage has increased from 2,894,282 acres to 7,257,000 acres, and the crop from GS.025,8:!:-5 bushels to 162,227,000 bushels. In the five principal barley-growing States of the Mississippi Valley the farmers have increased their acreage at the request of the United States Brewers' Association, acting through the Department of Agriculture, during that period of time as follows: Minnesota, from .325,000 acres to 1,285,000 acres; Wisconsin, from 245,000 acres to 866,000 acres; South Dakota, from 108,000 acres to 1,025,000 acres; North Dakota, from 244,000 acres to 987,000 acres; and Iowa, from 444,000 acres to 510.oi«i acrr's. Since 1897 the farmers have increased the acreage of corn from 80,000,000 to 114,000,000 acres, and the crop from 1,900,000,000 bushels to 3,125,000,000 bushels. Wheat from 39,465,000 acres to 49,205,000 acres, and the yield from 530,150,000 bushels to 695,443,000 bushels ; oats from 25,730,000 acres to 35,288,- 000 acres, and the yield from 700,000,000 bushels to 1,12(;,765,000 bushels. The value of farm lands in the Mississippi Valley average thi'ee or four times the value of the new farm lands in that section of Canada that have extensive areas and is rapidly increasing in pupulatiou and production. In addition to that, because of the " favored tariff relations between the Dominion of Canada and England," these larmers have the advantage of dbtaining their necessities of life at greatly reduced prices. The total area of Canada lands is 3,619,000 square miles, as compared with 3,000,000 square miles in the United States. The population of Canada Is less than 10,000,000, as compared with 92,000,000 in the United States. The wheat crop nf the whole Dominion of Canada seven years agn was no more than tlie wheat iro]) of the Province of Saskatchewan a year ago. This Province increased during these yeai's from :5,60o,000 bushels to S5,2(k?>^i in my iriclo't. T re;\d law there and slept on the floor for a couple of weeks in the office, and got 3 cents a folio for copying the records and pleadings in the cases until I got started, until I could rent a room, and I guess I can say (what few men can say) to this day, I never owed a man a dollar in my life on anything and never got a thing that I could not pay the cash for, and fdUowing those principles I was able, through the legitimate prac- tice of the law, and. true it is, I followed in the footsteps of a good man and made good, and had money to invest as I grew. Now. as I understand it. briefly, in the entire United States there are something like 836 mills with an aggregate capital, as I say, of about $400,000,000. In Michigan alone we have to-day 30 paper mills and 9 wood and sulphite mills — and I propose to address my- self most wholly to my own locality, for when I went to Kalamazoo in 1868 we had one little mill called the Kalamazoo mill, with less than Sl.50,000 capital. It had not been a success, but in 1868, the year I went there, a gentleman was called from Fitchburg, Mass., to run that mill. He made it a success, and all our other mills in Allegan, St. Joe, Berrien, and Kalamazoo Counties are the product of that mill, carefully managed and handled under the tariff system adopted by the United States immediately after the war. Now, in Allegan County, I will give the names of those mills : The Dayton Folding Paper Box Co. of Allegan with an amount invested of about $.300,000; the Babcock Tissue Paper Co., Otsego, $200,000; Bardeen Paper Co., Otseao. $600,000; the Monarcli Paper Co., $400,000; the .AlicLigaii Papei- Co., located at PJainwell, $600,000. Now, as I have said, this last mill has just been remodeled and two new machines are about ready to start, and I wish to read in that con- 464 BEGIPROCITY WITH CANADA. nection the effect, if this reciprocity bill goes through, that it will have on that mill. I wish to read a letter here from Mr. Dunbar^ Col. G. Edwin Dunbar — who is now a man about 70 years of age, who went in the War of the Rebellion in 1860 and was with Sher- man from Atlanta to the sea, one of the best soldiers, going in a private and coming out a colonel, and serving his country in every M'ay ; after he returned home, very saving and economical, he put all his money in the jNIichigan paper mills at Otsego. I got this letter from him day before yesterday : Kalamazoo, Mich,, Hay 7, Idll. Hon, N. H, Stewart, Washington, D. C. Deak Sir: I want to call your attention to the fact tbat the Michigan Paper Co., of Plainwell, has a two-machine paper mill all completed with the excep- tion of two paper machines, one of which we hope to start by the 1st of June. That is, this coming June. The new mill will cost about !f 400,000. In order to get the money necessary we were obliged to bond both mills for $250,000. over $100,000 of which bonds are unsold. If the proposed reciprocity bill becomes a law, it will certainly interfere with and may prevent the sale of them, which will leave us in very bad condition. As you know, we have a very large number of stockholders, many of them are employees, and most all people in moderate circumstances. Many of them, like myself, have invested their entire savings. Yours, truly, G. B. DtrxD.iR. He has — Col. Dunbar has ; I know he has. He has invested and mortgaged his homestead to raise the money to put in that mill, and everything is at a standstill awaiting the action of Congress — or T should say the Senate — with reference to this treaty. I have a list of every mill in the State of Michigan, but I do not intend to bother the committee with reading it. The Chaiebean. You may file that list, if you want to, Mr. Stewart. Mr. Stewart. Well, I will do that with this the same as the others. Now, coming to Kalamazoo County alone, out of this one mill that was there in 1868 when I went to Michigan from New York, we have the Bryant Paper Co., $3,500,000 invested in that plant. Acres and acres of buildings and three new machines that will not be ready to start before August or September. So they are not rundown mills. One of these, the Kalamazoo Paper Co., with $1,500,000 invested, is modern, comparatively new, and up to date. The King Paper Co. — and I should say that that is capital stock alone — $1,200,000, That mill has just been enlarged with two new machines, the first one starting in February and the second new machine only last month, and the Monarch Paper Co., $800,000. That also has one new ma- chine that has been put into operation only within the last three months. The Standard Paper Co. is a box-board machine of Kala- mazoo, with a capital of $600,000, and it is running; the second ma- chine was put in that plant about two years and a half or three years ago. The AA'estern Board & Paper Co., with a capital of $350,000, is a mill that has been built complete within the past five years. The Lee Pa]n'r Co.. of A'icksburg, which is a little town south of Kala- mazoo, rtliout 10 miles, but in Kalamazoo County, with $1,200,000 capi- tal and that mill has not paid a dividend as yet. They make a writ- ing pa])('r. Then the Kahunazoo Parchment Co., with a small mill, RECIPEOCITy WITH CANADA. 465 with $100,000 capital, all new in the past two years, and has paid no dividends. These mills are not owned— not one of them— bj' any syndicate or combination of men. The stock is parceled out to very many people many of them women ami widows, and estates and small investors' As an investor m the aggregate, perhaps I have much more than mne-tenths of the investors and managers of these mills have. I think there are very few who have more than $75,000 invested in the paper business in Kalamazoo County. Now, I am a revenue Democrat, and I have had my misgivings, I am franlv to say, with reference to the legislation in Washington on this proposition since I became a voter, but I passed that by from time to time, to get fooled every time, as I wish to illustrate right here. I had made some money as a lawyer, so that when the Agri- cultural Department at Washington began to send this literature over the United States as to the feasibility of manufacturing sugar from beets grown in the United States, I was foolish enough to bite on that hook, and early in the winter or spring of 1897, after the State of Michigan had passed a law giving to all manufacturers of sugar 1 cent a pound on sugar grown in the State of Michigan, I became con- nected with Secretary Wilson, and as he sent his bulletins to the Agricultural College of Michigan, I had him send some to me, and as a result a client of mine, a Mr. Streator, and myself in March, 1897 ■ The Chairman. Do you mean 1897 or 1907? Mr. Steavaet. 1897 — bought a ton of sugar-beet seed. I had my boys in the office put it up in 5 and 10 pound packages, gave it to the farmers, together with advice how to plant, weed, and take care of, and pull. It was with great results. In those bulletins we were told what the isothermal line was, and its breadth from the Atlantic to the Pacific, and they became very much interested. As a result on the 19th of March, 1809, through the efforts of Mr. Streator ancl myself, we organized a beet-sugar factory in Kalamazoo, with $500,000 capital— $350,000 in stock and $150,000 in bonds— and those of us who were on the board indorsed the Imnds. and we went on. Most of the machinery then was made in Eurojoe, in France, and Germany. The contract was let and our plant put up, but we found soon we had a crop of 2i.'.000 tons in the field in 1899, and when our sugar went into the m;;rket we found the freight rates between New York and Chicago dropping through the trust" to 1.3 cents a hundred, and from Kalamazoo 11 cents a hundred, and the differ- ential between beet sugar and cane sugar more than ate it up, so we could make no money ^)ut of that. "We struggled on until 1907, getting larger acreage, which ought to have had a 50,000 crop, or 50,000 tons of beets for a year's crop in 1903. Mr. Koosevelt was President of the United States, and we were met with the astound- ing proposition that something must be done for Cuba. As it is now, something must be done for Canada. And he proposes to take the duty off of Cuban cane sugar. Mr. Atkinson and Mr. Havemeyer, who was then alive, wanted it. They were large cane growers in Cuba. As a result we had our State organization. We had $12,000,000 then loosened in the State of Michigan, with four completed plants and five in process of construction, and it be- hooved us to get a move on, and we did. We came down here and 466 EECIPEOGITY WITH CANADA. appeared before the House committee. The House was then more kindly disposed toward the people who put them there than the present House is, and we had a full hearing, with Mr. Payne as chairman of the committee, and we showed what it cost to produce a ton, or 100 pounds of sugar, from the beet to the granulator, and as a result, after being here three weeks they called that bill before the House of Kepresentatives, and it was reported against by Mr. Payne. But Mr. Eoosevelt must do something for Cuba, and it was reported back again, and as the result 20 per cent was taken off of Cuban sugar. That 20 per cent, together with the trust's contract with the railroad for rebates, ruined the Kalamazoo factory, as it did the Rochester plant, near the city of Detroit, and one other in the State of Michi- gan, so that not a dollar's worth of that stock has ever been paid or a man received back a dollar. That is what I got for my faith and credit in the productive legislation and the policy adopted by my country from 1866 on. I have been a loser by it. I vowed then that I never again would go into a business that was controlled by Con- gress. But as time went on I kind of forgot it. These paper mills m my section were continuing to be built. My friends were in the management of them and I had some loose money — as a result of one thing, for instance, I owned down in Texas, within 2^ miles of the courthouse in the city of Fort Worth, 210 acres of as nice land as ever lay out of doors, with the clear fork of Trinity River bounding it on one side. I bought it in 1890, and I got enough out of it to pay taxes and that sort of thing, but the panic of 1893 came on and I could not sell it, but I kept it until about three years ago. It cost me between $15,000 and $16,000, but I finally sold to a gentleman in Fort Worth. I took that money — about $30,000 — and put that into the paper stocks. Senator Bailey. Of course you made a mistake to sell a thing in Texas and invest the proceeds in Kalamazoo. Mr. Stewart. I have concluded that was true. I found the people in Texas kindly disposed, as I have every other southern man, as I have gone through the Southern States. That is true. I have never had a dividend yet, except on certain preferred stock out of a paper mill; not one. The aggregation of this same money invested in my own county in 1909 was $450,000 — pretty good for a little town. When I went there there were less than 8,000 people. I was on the school board of my town for six j^ears, and when I left, about three years ago, they had about that number of school age on the list, until to-day she has a population of between 40,000 and 45,000 people, and she has grown. What has made it? I say here the agricultural interest is the first interest to be considered in this country, and the farmer, after he has gotten his farm to a point where he alone consumes, has no ijiterest to go further except where there is a market, and that market in my State and my city has done its full portion in its growth to take the surplus that he raises not only in Michigan, but in every other State of the Union. And, if anybody is to be considered, it strikes me it is first the agricultural interests of this country and next the manufacturing interests. I have been something of a student of history and of governments, and I have yet to find recorded anywhere where a government has done what it seems to me this Government is about to do and has done, so far as it could be done in the House of Representatives. RECIPKOCITY AVITii CAJ^ADA. 467 I have found that in great stress and in time of war, rulers and governments have debased their c-oin and issued paper money to lielp out and get along, but I have ne\er found any spot or place either in war or times of peace when the Government would strike down the agricultural and manufacturing institutions of the country. This is the first record of the kind I have e\'er known. Now, in the entire State of Michigan, we have invested in this industry $20,- 800,000, and I speak in general for all, as I speak to the tune in my own county of $9,450,000 alone, and my own selfish interests, if you wish so to put it that way, but " a burnt child dreads the fire." Hav- ing learned what the Government did to the beet-sugar proposition, I feel more than apprehensive over the result of this line of investi- gation, and this so-called treaty. Just see — let us go a step further, for I will hurry along. In the Kalamazoo mills, alone, we will say that it is not a large average. We employ 250 people to the mill. Nine of tliem means 2,250 em^Dloyees alone, directly in those mills, and they are most all heads of families, who have come there and own their little homes, and taxpayers, and good citizen?, and the average of four to one is not any too great, and we have 9,000 people living off of those mills in my own county. To stop those wheels running means idleness and starvation for those people ; it means the roofs will tumble down and let in the sunlight and rain in the plants, and as they are destroyed our people are building up an alien country, a country which is our greatest comjDetitor, because it has the same kind of people, and we think well of them as neighbors, but you must remember they were not good enough to let us go in 1776; they were not good enough to keej^ their hands off of us in 1812; they marched their cohorts into this very city and burned down our Capitol; they were not good enough to keep their hands off u? in 1860, when we were in trouble, and we took from their vessels Slidell ancl Mason, and they had to give those men back to us or fight. How, with humble apofogy, they gave them up and waited, and they did not stop there; they allowed to be built on their shores the Alaharaa that ravaged our Navy and merchant marine during the entire war, and would not settle for them until we were a I'nion asain, " one and inseparable," and then a paltry sum was awarded, and they extended across that imaginary line 3,000 miles long, from east to west, with a territory greater than our own, that will yield substantially the same agricultural products that we raise, with a population, as it is put" by certain Members of Congress, about 7,500,000, and they say we will relieve you of all your manufacturnig institutions in the line of paper and pulp and make it ourselves, and you can depreciate us just so much more. Will you do that ( Is that not a fair statement of it? Who brought this about? The question has been asked here, and I have listened patiently for an answer. Where was this child begotten? Where it was born we know, and like all dastardly seducers, the father is at large somewbei'C, while the poor mother can not escape her identity. I candidly do not propose— I do not propose to read this, because it is known to all of you, as it was stated this morning with reference to catth; by Judge Cowan, we can bring cattle across way under this, cut them up, and manufacture it into meat, and we can not take it back across the line and sell it. Under this so-called reciprocity bill as it stands wood pulp can come over here and be manufactured into paper; 468 RECIPROCITY WITH CANADA. they can bring their pulp over here, their paper over here, but we nan not take ours over there. I am a revenue- for-tariff Democrat. I thinlf under tlie Payne-Aldrich bill we have but one year. This is a report ending June 10. Under that report I find that under the reduction of $3.75 a ton, under the report of the Tariff Commission, the difference between paper in this country and Canada is $4.14 a ton, and, as I understand, under the present report not yet made public it stands at $5.19 or $5.33, a difference of $1.19, and that shows that the $4.15 was not sufficient to equalize the difference between the cost of paper in this country and in Canada ; but, first, under the Payne-Aldrich bill there was imported from Canada into this country, after it was passed, until June 30, 1910, 86,766,027 pounds of paper, and at a valuation of $1,615,100, and they paid into the Treasury of the United States for that, which is to be remitted if this reciprocity goes through, $164,686 — 43,353 tons of paper. Now, gentlemen, see Avhat you propose to give Canada, or ^.862 cents a pound. Gentlemen, see what you are doing by that. I have re- ferred simplj' to the money invested in paper mills directly. With that are the pulp mills ; and in the State of Maine alone there are 80 pulp mills; in the State of New York alone there are 180 paper mills. Invested in those pulp and paper mills, in the manufacturing plant and the American machinery that the paper is made from, and the incidentals that go with it — I simply say in round number you certainly have at least $400,000,000 more. And if you stop the paper industry in this country, j'ou have not only wiped out the paper mills; you have wiped out the pulp mills ; you have wiped out the manufac- turing institutions that make the machinery and employ the labor of this country to manufacture that machinery, and by the time you have gotten through directly and indirectly you have annihilated something like a billion dollars in this industry in this country. We have employed in the manufacturing institutions of paper and kindred things, to wit, something like $11 per capita for every man, woman, and child in the United States. Do you want to do that? Is that fair treatment? Senator Cl.vrk. Mr. Stewart, I suppose the question is an ele- mentary one with you ? Mr. Stewart. Yes, sir. Senator Clark. I am very much interested in your discussion, and I suppose that before vou get through you will show us just how this result you expect will flow from this proposed action. Mr. Sti<]wart. Well, sir, it is only my opinion; I will state that now. It has been my experience, I told you before, in the sugar business. We had to go out because we could not compete, and when the Government of the United States tells us that Canada can make paper at $.>.33 cheaper than we can in this country I have a right to assume that it dries up the paper industry, have I not? And with that dried up and anniliilated, wliat use have you for the great iiislitutions and manufacturers of only high-grade machin- ery that makes paper? Senator WiLLiA:\rs. About how much, in your opinion, would it reduce the price of paper? Mr. Stewart. I do not think it will reduce it at all. Senator WiiJjIajis. I thought not. EECIPBOGITY WITH CANADA. 469 Mr. Stewart. They told us that in the beet-sugar industry that the ditt'erence \ve wanted to strike out would go to the cane grower of Cuba. Not one penny of that went to the "cane grower of Cuba, but it went into the hands of j\lr. Atkinson and the Sugar Trust, every dollar of it. Senator Williams. What trust will this go into the hands of? Mr. Stewart. It will go into the hands of thousands of people who are the trustees of this country — American citizens, if you please. Senator Williams. You did not understand me. Mr. Steavakt. I know of no paper trust. Senator Williams. I said, you did not understand me. I asked you. in case this reduction was made, if it would not go to the con- sumers of paper and into what hands would the reduction go. In your case you found the trust to take it. Now, what trust is there to take this? Mr. Stewart. There is no trust, but you would build up Canada; you would transfer from America to Canada; that is what you would do. Senator Williams. How would Canada take advantage of it? You say she would not sell the paper to us much cheaper than she does. Mr. Stewart. She might. "Who would she sell it to ? She would sell it to the newspapers. Senator Williams. If she sold it to the newspapers, would the newspapers get it any cheaper than they do now ? Mr. Stewart. I do not believe that they would. Let me answer your question. She would sell it just cheap enough to prevent our manufacturing it in this country. Senator Williams. That would be $5 and something? Mr. Stewart. $5.33, is what I understand. Senator Williams. They could sell $5.32 cheaper and that would keep you from manufacturing it ? Mr. Stewart. That would keep us out. Senator Williams. Then the newspapers receive $5.32 ? Mr. Stewart. What have you lost on the other side? Senator Williams. I am not talking about the loss, I am talking about the other. Mr. Stewart. I am very glad you put that before me. That is on the line, if you please, of free trade; give us free trade and then we will take it. Senator Bailey. All along the line? Mr. Stewart. All along the line ; but do not single us out. Senator Gallixgee. Suppose it came in here and blotted out our in- dustry: what, then, about the price they would sell paper at? Mr. Stewart. They would have neither circulation nor people to read. Senator Gallinger. You do not understand me, I think. Sup- pose we passed this reciprocity agreement and Canada comes into our markets and undersells, whether it is $5.33 or any other figure, our industries are wiped out. Mr. Stewart. Our industries are wiped out. Senator Gallinger. What price will Canada likely sell our people when she has a monopoly ? 470 RECIPKOGITY WITH CANADA. Mr. Stewart. She has a monopoly, and would sell at what price she pleased. That is the history of all manufacturing. Senator Williams. Let me ask you that question. If the manu- facturer were transferred to Canada, you say the Canadians would enter into a combination and raise the price to whatever figure they chose ? I understand that to be your answer. Mr. Stewart. Yes. Senator Williams. If that be the natural history of all manu- facturing, why has that not been the history of manufacturing in the United States? You, a moment ago, said there was no combina- tion among paper makers in the United States. Mr. Stewart. There is none, because they have not made any com- bination. Senator Williai\[s. How could that happen necessarily among Canadian manufacturers and be the result, when it is so unnatural it has not happened in America, among American manufacturers? jNIr. Stewart. I will answer you like this : In the first place, Cana- dians are quite greedy, and with us exj^erienced with a few greedy Americans, I would take advantage of the conditions more than our own people have done. Senator Clark. We are in competition now. Mr. Stewart. As it stands now we are in competition at S3. 75, as against $5.3.3. Senator Williams. And we have not made anv combination to take advantage of that $3.75 ? Mr Si'EWART. No, sir. Senator Williajis. And they would make a combination on this $5.32 ? j\Ir. Steavart. I think they would if they once got us at their dis- posal, and let us see what they will do with us. Senator Williams. Our paper manufacturers two years ago had the American consumer at their disposal, and did not combine? Mr. Stewaet. That may be true, I won't dispute it; but that does not say that they will not do it now. What was the necessity for this bill ? We have all been trying to find that out. Senator Simmons. You said the newspapers and the magazines would get the benefit of this reduction. Mr. Stewart. Yes. Senator Simmons. Would anybody else get any benefit from it? ]\[r. Stewart. Yes. sir; because the moment you give them the advantage and shut down our news-paper mills in this country they would go right to manufacturing the other kinds of paper, and that would depreciate and destroy the other manufacturers of papers. Senator Simmons. You do not understand my question. I mean, if the newspapers and magazines, liy reason of this agreement, tak- ing the tariff off of pulp wood, are aljle to get jiaper cheaper, will the people who buy tlie magazines, who subscribe for the magazines and the newspapers, l)c able to get them any cheaper than now? Mr. Stewart. No, sir; I do not think so, knowing something about publishers and their kind, they would pocket tliat difference; that is an opinion only. Senator Simmons. That is the trust, then? EECIPKOCITY WITH CANADA. 471 Mr. Stewaet. Yes, sir ; there is where the trust is, as I hope. I do not l^now, but the little e> ideuce I have in my possession, it appears, it looks very much like, as if there was where it was. Senator Williajis. Let me ask you one question along the line you were speaking on a moment ago. You siud there was no combina- tion among the American paper manufacturers? IMr. Stewart. Xone that I know of. Senator Williams. Was there any fixed price at which the manu- facturers sold newspaper' Mr. Stewart. None that I know of. Senator Williams. Could a newspaper man get his jpaper any cheaper by sending to one than to another? IMr. Stewart. There has always been competition, and I am very glad you put that proposition to me, for I have learned to-day — thank God there is one newspaper man in the United States who believes in ])atronizing the American manufacturers, and that is the senior Senator from jlichigan, who jjublishes the Grand Rapids Herald. He told me yesterday that his manager had given his contract to an American mill, for $2.25 a hundred, I believe. Senator Williams. I understand that, and I will give all due credit to the senior Senator from Michigan, who is not only a news- paper man, but a Senator; but there was a good deal of evidence in the House to the effect that the daily quotations of paper were given out. and that they were universal throughout the United States. Now, you deny that that was true, do you ? j\Ir. Stewart. I do not know. I want to say to you. Senator, that I am not a statistician; I am not on any boards, except one, the board of directors in one of these mills. T do not know anything about the price of paper, or the different things that go into it. I do not profess to be a practical paper maker. There are other men who will give you all that information. Senator Williams. Your testimony upon that point is like my own — it would be of no value. Mr. Stewart. Wholly so. Senator Stone. May I interrogate you a moment? Mr. Steavart. Certainly. Senator Stone. Do von think the Canadians can make paper cheaper than the paper mills can make it in this country ? Mr. Stewart. Yes, sir; the statistics show— your own board shows it. Senator Stone. Not mv board. rr. -^ Mr. Stewart. The Government board, in their report— the iariti Board have just reported $5.75 a ton cheaper. Senator Stone. I am asking you. Mr Stewart. I do not think, personally, you asked me such a question. I do not know. Before I could answer that personally I would have to take the data and go through it myself. _ Senator Stone. You have no opinion upon this subject— you are not informed. I mean? , . , ,• t Mr. Stewart. I have no opinion. From what information i can learn . . Senator Stone. I mean your own opinion. Mr. Stewart. No; I have none. 47'2 EEGIPEOCITY WITH CANADA. Senator Stone. You know they get wood cheap? Mr. Stewart. Yes; and water power cheaper; and I know from information in my own town from people who went somewhere in Canada in the last two years and started a mill and took some of the Kalamazoo emplo3?ees clown to operate, those employees have come back again, not liking the climate. They would rather, they said, have their children m schools sing " Columbia, the Gem of the Ocean," and the " Star Spangled Banner " than " God save the King," and they came back. Senator Stone. Well, it was stated by a newspaper man the other day — a newspaper manufacturer — that there was an unlimited, prac- tically an unlimited, amount of timber in the United States out of whicli paper could be made as well as in the forests of Canada; and he said experiments have been made in Wisconsin showing that hemp could be used to make as fine paper as of spruce. Senator Williams. Not hemp — flax. Senator Stone. I understood him to say hemp; say flax, I think he said hemp, but say flax. Do you agree with him in that view? Mr. Stewart. I agree with him in this view, so far as the wood is concerned, for I have been through every State and Territory of the Union, including Alaska and the redwood forests of Mendocino and Humboldt Counties, in California, and I know that there is a great deal of wood. As applied to wood pulp, and that sort of thing, I do not know, for I have nothing to do with that proposition. But, I know that we have not begun yet to destroy the forests of this coun- try, by any manner of means, so far as my personal knowledge is concerned, from Maine to Alaska. Senator Stone. Do you speak now of wood that might be used for paper making? Mr. Stewart. I understand that, although I do not know, that there are 23 different kinds of wood that may be used for paper making; and, in addition to that, Senator, that I learned within the last three weeks that they can make wood pulp that will make pajDcr out of com stalks, best pulp and from the cotton stalk. I un- derstand that they are the possibilities, but I do not know anything about that. Senator Stone. If you have now these woods and other things out of which we can make paper, we are not dependent upon Canada? Mr. Stewart. No, sir; I do not think we are; and God help us whenever we are dependent upon Canada. Senator Stone. Now, then, could not we continue to make paper so far as the wood goes? Mr. Stewart. Yes, sir. Senator Stone. The raw material out of which paper is made — could not we go on making it as cheaply as they make it in Canada? Mr. Stewart. I understand not. I am not a practical paper maker. Let me say this to J^ou, Senator : That in our mills, as I understand it, we have the largest book paper center in the world at Kalamazoo, and about 30 per cent of the material that goes into paper is wood pulp; that is all I know about it. Tt is the statement of the men who run the mills, but not any personal knowledge of mine, that it is not all wood pulp. One mill — the mill at Plainwell — as I understand it, like EECIPEOl'ITY with CANADA. 473 that gentleman from Boston stated here early in the session, is made almost wholty from old jiapers. That is a Michioan mill. Ours use abont one-third, I am told, and the balance is raysand paper. Senator Stone. You quoted the 'J'ariff Board's report. Have you ever read the .Mann report? Mr. Stewart. I never have. Now, in all fairness about this thing, what has brought it about, if such men as jNIr. Fordney and Cannon and Dalzell and these men are up in arms about it, wlio are in posi- tion to know, why should not we object, who have got our money up and put it up on the faith that the Government of the United States is honest and fair with its investors? I would like to read something in this connection, which to me gives the source of this thing — read- ing from Mr. Cannon's speech in the House on this proposition. He says: ''I have referred to j\Ir. Ridder, a friend of mine, who published a country newspaper, who sent me this." Now, this is an indication of where this proposition came from, and the cunning of the author, whoever he may be, this proposition, as applied to paper, at any rate. It reads as follows, and is on a line of what Senator Bailey and said early in these meetings, in reference to his well- founcled suspicion as to what was up : The American XEWsrAi'icK Puclisiikrs' Associatiun, ^Yorld Biiihling, Ncir York. Mnn-li /.I, VJll. Dear Sik : I invite your attention to this point, tliat i)roniptness in r.itifyins the reciprocity agreement of tlie United States with Canada is of tlic utmost importance to newsjwpers. There is danger in amendmenlM or changes, or delay. The two Governments had a tacit understanding that the arrangement would go through as framed. How about the language? The ditflculties attending ratification on the Canadian side miiy be increased greatly if there is hesitation or .-in atteniiit on our part to make a new trade. Will you kindly urge, through your publication and by letters to your Repre- sentatives and Senators, that the agreement as made by the State Department be passed speedily by Congress, and without amendment? Tours, truly, Herman Ridder, President of Ihp Amt'iicaii Nricsixiper Publishers' Associalion. This was written March 11. There was a pact between him and the President and the State Department and the ambassador from Canada. Further back, in 1910, November 18 : My Dear Sir — I want the Democratic members to listen to this. Mr. Cannon says " the independent press " — this is one of the inde- pendent fellows. [Laughter.] The independent press of the country and a large part of the Republican press supported the Democrntic candidates this year because the Republican Senators and Representatives, did not keejj their word in regard to removing the tariff on paper. It is nothing but paper thiit they have any interest In. In my opinion, the way to insure the continued supiiort of those publishers through the camrai'-:ii of 1912 is to put all iirint paper on the free list at the earliest possible moment and to announce I hat it will be the policy of the Demo- crats in Congress. Tours truly, John C. Eastman. Senator Stone. Who is that to? 474 EECIPEOCITY WITH CANADA. Mr. Stewart. This is a letter read by Mr. Cannon. It does not state to whom it was pent, but here is one that does, dated May .5 — since yon have been in session : The American Newspaper Publishers' Association, !iO:i Piilit-er Building, New Yorlc, N. Y., May 5, ISll. Hon. Joseph G. Cannon, Washington, D. G. Dear Sir : At the nunual meeting of the American Newspaper Puhlishers' Association, held in New Torlv April 27, 1911, the following resolution was adopted, and I have the honor to transmit it herewith for your information. The American Newspaper Publishers' Association in annual meeting, assem- bled at New York City, respectfully urges the United States Senate to pass, speedily and without amendment. House bill 4412, l^nown as the reciprocity bill. It also urges the abolition of import duties upon print paper, when made from free wood wherever found. Yours, truly, John Nokris. C'hainiian of Committee on Paper. Now, I say, if you please, here is the source of this part of this so- called reciprocitj? that Uncle Joe Cannon has smoked out. Senator Williams. Let me ask you a question in that connection: Do Toii regard it as a crime or a wrong on the part of these people to use all the influence they have got in an effort to be relieved from taxation? Mr. Stewart. When it robs me of my money put into an institu- tion on credit of faith in the Government that made an inducement for me to do it: yes. Senator Williams. Then, how would you reduce a tariff tax? Mr. Stew.vet. By making it equal; I would not change it in spots; I would go down the line. Senator Williams. Because there is always somebodj' interested in the retention of the tax. Mr. Stew'art. That is true. Senator Williams. He always says he is robbed when you re- duce it. Mr. Stewart. Our money is up. We have not an annual crop coming on. Our money is in these institutions, and as I understand the question here has been to find out how and where this came about. Senator Williams. Is it your '\'iew that wherever the Government by its tariff law has induced investors to put their money in a good industry, they ought to keep up that tax always so as not to dis- courage that industr}'? Mr. Stewart. Keep it up at any rate until such time as it is not going to ruin the industry. Senator Williams. Who will have the right to say Avhether it is going to ruin the industry? Mr. Stewart. Let it come about in some legitimate way and revise the tariff" as it ought to be. It is big enough, it seems to me, to put the entire question of tariff wdiere it belongs instead of singling out agriculture and paper. Senator Bailey. INIr. Stewart, we now collect about $480,000 from wood pulp and print paper, and of course to repeal that duty is to remit that much revenue. Now, I do not understand that the Government can be supported without collecting taxes, and if we take the taxes off of those people we must increase the taxes on the others. EECIPEOCTTY WITH CANADA. 475 Mr. Stewart. That is certainly so. Senator Bailey. Looking at it as a question of taxation. ■Mr. Stewart. Loolving- at it as a question of tax wholly, and I think_ it is only fair that if this question is to be taken up, instead of ruining agriculture and one industry, where there is so much at stake in it, that it had better be passed, or take it now, if you jilease, and revise all down the line. Senator Williams. Our Republican friends won't let us do it. Mr. Stem'art. I might say this is a proposition — and I would be pardoned for a little bit of sentiment on this, because it is the first I have seen on this line — I want to say of Uncle Joe : Oh, Uncle Joe Cannon, had I the satyr's darts. To give the rascals their desserts, I'd rip their rotten hollow hearts And tell aloud their hokus-pokus juggling art To cheat the crowd. God knows I'm not the thing I should be, Nor am I even the thing that could be. But twenty times I rather would be an American citizen clean Than under political creeds bid be just tor a screen. Senator Williams. Who is the author of that ? !Mr. Stewart. I paraphrased it. I do not know Uncle Joe per- sonally, but I admire him for his insight into the cunning that is to rob me of my hard-earned money. My friends are either sports or preachers. I have never played a game for a dollar in my life, but I have saved the money I had and invested it in what I thought was a legitimate enterprise, made so by Congxess, and now I am met for the second time — first in the sugar industry — to find it legislated from me Senator Williams. Is not that the trouble with these businesses; the law is so uncertain and unstable Mr. Steavart [interrupting]. Yes; it ought not to be. The Gov- ernment demands loyalty from its citizens, and the citizens have a right to demand loyalty from the Government. Senator Bailey. As I understand it, you would not complain if this was a proposition to reduce the tariff from top to bottom, share and share alike ? Mr. Stewart. Xo, sir ; I would stand for it. That is all I have to say. gentlemen. Those who will come after me will go into the de- tails, the technicalities. Senator Williams. Would you object to the reduction of the duty of wood pulp to $1 ? Mr. Stewart. Certainly I would. Senator Williams. So vou are not standing with the Senator from Texas ? Mr. Stewart. I am standing with the Senator from Texas on this proposition. That is not fair. I thank you, gentlemen. _ Senator Bailey. You can not select some commodities and leave the others untouched without producing an inequality? Mr. Stewart. No, sir. Senator Bailey. That is the kind of tariff doctrine that you ad- vocated when you were a candidate for Congress? Mr. Stewart. Both when I ran in 1894 against Senator Burrows and again last year, and I would not take the commission even if you would give it to me on a gold platter and the platter with it. I voted for my opponent, Jfr. J. M. C. Smith, as he wanted to come and I 93285— No. 7—11 2 476 RECIPROCITY WITH CANADA. did not want to come. I have always been a Democrat, but not a Bryan Democrat. I took charge of the Palmer-Buckner campaign in my district in 1896. Senator Stone. Have you voted for Air. Bryan ? Mr. Stewart. No, sir; I never did until l'.)()8, and did not like the platforms he before ran on. Senator Bailey. I want to ask you one question. You seem to have had some experience in the sugar business. jMr. Stewart. Yes; I have. Senator Bailey. Do you know whether or not it is joossible to pro- duce sugar beets in Canada ? ilr. Stewart. I know it is, and under this bill, if you please, they can come into this country free ; there is a plant in Canada that some people from my town went down to look over with reference to pur- chasing. They have got in Canada a good place to raise sugar beets. Senator Bailey. On page 16 of this bill I find that among the things admitted free of duty are fresh vegetables. Mr. Stewart. Yes, sir. Senator Bailey. Potatoes, sweet potatoes, yams, turnips, onions, cabbage, and other vegetables. JMr. Stewart. That would include sugar beets. Senator Bailey. Now, here is the beautiful part of it, " in their natural state," thus carefully protecting every process of manufac- ture. INlr. Stewart. Yes ; they can not be corpses. Tn plain English, to pass this so-called treaty is to put " TTncle '' Sam '' in no other position than that of a " bunco steerer," with the American Newspaj^er Publishers' Association as the people running the game. Not one cent would go to the newspaper buyer or reader, but you would enrich a set of men who feed the people of the conn- try on nasty, dirty scandal and libel every one who happens to incur the dislike of any one of them. Neither President Taft nor any other public servant or officer is worth the price that this bunco measure will cost the thriving industries of the countiy. The Gov- ernment by its policv has induced its own people to put their money in the paper business in this country, and now, after their money is up, by this dastardly act to legislate it away from them makes the Government a party to a crime compared with which the "bunco shark " is a decent person. Tf such a thing as this can be done as to the agriculture and the paper industry, it can be done as to every other industry Avhenever the schemer can gain the ear of a President of the United States and tickle his fancy that he can pose as a great benefactor. The scheme is a disgrace to the President and a crime against the agricultural producer and paper industry of the country, and ought to and will brand its author and advocates as traitors to their country. They are more fit to become the subjects of a crowned head than remain citizens of our own so-called Eepublic. Gentlemen, I thank you. (At this point the committee ceased the consideration of H. K. 4412 to ]iroceed to the consideration of H. R. 4413; and later the committee took an adjournment to 10 a. m. Wednesday. May 17, V.Ul.) RECIPROCITY WITH CANADA HEARINGS BEFORE THE COMMITTEE ON FINANCE OF THE UNITED STATES SENATE SIXTY-SECOND CONGRESS OK H. R. 4412 AN ACT TO PEOMOTE RECIPEOCAL TEADE EELA- TIONS WITH THE DOMINION OF CANADA AND FOE OTHEE PUEPOSES SECOND PKINT No. 8 WEDNESDAY, MAY 17, 1911 WAHrllNfiT'lN GOVERNMENT FKIXTINQ OFPICK i91L COMMITTEE ON FINANCE. UNITED STATES SENATE. BOIES PENROSE, rliairmnn. SHELBY M. CULLOM. HENRY CABOT LODGE. PORTER .1. McCVMBIOK. UEED SM(.M.yT. JACOB H. OALLIXGEIl. CLARENCE D. CLARK ot Wyoming. WELDON B. HEYBURN. ROBERT M. LA FOLLETTE. JOSEPH W. B.VILEY. F. M. SIMMONS. WILLIAM J. STONE. JOHN SHARP WILLIAMS. JOHN W. KERN. CHARLES F. JOHNSON ot Maine. y. a' L KECIPROGITY WITH CANADA. Committee ox Fixaxce, T'xited States Sexate, ^yas]lmgton, D. C, Wtilnesday, 2hy 17, 'l911. Present; Senators Penrose (chairman), CuUom. Lodge, McCum- ber, Smoot^Gallinger, Clark, Heyburn, La FoUettc, Bailey, Simmons, Williams, Kern, and Johnson of ]\Iaine. The CiiAiRMAX, We \\ill now resume the hearings, gentlemen, in reference to hmiber, under IL R. 4412. Senator IIeybuex'. I will introduce Mr. Bronson. The CiiAiRMAX. ill-. Bronson was about to conclude liis remarks, and the committee will now hear him. Mr. Bronson. will you appear liefore the committee and introduce the parties who desire to be heard? The committee will also be glad to hear anything that you maj- desire to say. !Mr. CowAN. Alay 1 ask the privilege of filing some documents that I suggested yesterday be filed that have not been filed ? The Chaie^ian. Yes. Senator Stoxe. I desire to make this oliservation, INIr. Chairman : I can not see the necessitj^ of four or five of these gentlemen coming here on the lumber business, any more so than any other subject, and making speeches covering the same ground exacth' and occupying time. I suggest that we let them just make one speech or two and the others may file what they have. Senator Gallixgee. Following out the custom established in Congress. Senator Stox'e. Yes : let them file what the}^ desire to have printed, so that we can bring these hearings to a close. Some gentlemen have attributed some delay to me in examinations here. I will say now that I will ask no additional questions at all. Just let these gentle- men make their speeches and get through. The Chaiemax. We are very confident that they will close within two hours and a half. STATEMENT OF LEONARD BRONSON— Continued. ilr. Beoxson. ]Mr. Chairman, and gentlemen of the committee, allow me to say that the lumber industry is so widespread, being carried on in opposite sides of the country, and all through the middle section, and under such differing conditions, that it is difficult for one man, unless he has taken more time in preparation than I have been able to do, or unless he is posted on more things than any one man, would find it practically im])ossible to give a full and com- plete statement, and furthermore we feel that we are coming before you to give you what information we can. We realize tbut as we do not know all about our own business, you can not know about it. Therefore I am inclined to welcome questions, some of which I can 477 478 KECIPKOCITY WITH CANADA. answer imd some (if which perhaps I can not answer. I do not object to qucslions, though, of course, it is in the interest of speed to make a statement and sit down. Occupying tlie position that I do Senator La Follktte. Let me intermpt you right tliere to ask you to state who you are and wliat association j^ou represent. You have perliaps already stated that, but in this connection please state it again, and the names of the officers of your association. ]Mr. l'>r,oNSOX. I am manager — somewhat an honorary title — of the Xational Lumber ^Manufacturers' As-ociation, which is a federation of associations in the sawmill business, not in logging as such or in the sale of lumber as such, but it lies between the log and the market, or, rather, the tail of the mill, where it is put on cars for shipment to the markets. I gave last Saturday the names of these associations. Senator La Follette. Yes; but will you give the officers of your association now? Mr. Bkonsox. Yes, sir; among which the National people repre- sent here to-day tlie Xorth Carolina pine. The officers of the asso- ciation are: President, Edward Llines. of Chicago; first vice president, Everett G. Griggs, of Tacoma, Wash. ; other vice presidents are Eicliard H. Vansant. of Ashland, Ky. ; Eobert Downman, of New Orleans. La. : William B. Stillwell. of Savannah, Ga., representing the soulheastern interests; secretary, George K. Smith, of St. Louis; treasurer, J. A. Freeman, of St. Louis. The members of the board of go\-ernors are : Mi\ John M. Gibbs, of Xorfolk, Va. ; Mr. F. E. Way- mer, of Lakeland. Fla. : ]Mr. J. B. White, of Kansas Citj', ilo. ; Mr. A. T. Gerrans, of Houma, La.: Mr. E. M. Carrier, of Sardis, iliss. ; Mr. C. A. Bigelow, of Bay City, Mich.; Mr. W. C. Landon, of Wausau, Wis., representing the hemlock and hardwood interests of that region; ilr. William E. Irvine, Chippewa Falls, Wis., repre- senting the northern pine interests; ilr. William C. Deary, of Pot- latch, Jdaho, representing the Western Pine Manufacturers' Asso- ciation: W. C. ]\liles. of Globe, IVash.; J. H. Bloedel, of Bellingham, Wash.; D. E. Skinner, San Francisco: (xcorge X. Wendling. San Fancisco, Cab; and E. A. Long, Kansas City. Is that all? Senator La Follette. It is all, if they are all the officers of your association. Mr. BkojnSon. Yes. sir. One of the associations is somewhat dor- mant, which association I should perhaps mention — with which Mr. Lloyd K. AVentworth, of Portland, Oreg., of the Oregon and Wash- ington Lumber Manufacturers' Association, is connected. They are actively with us in some ways, but not so actively in others. I wish to speak this morning, if I have time, on three subjects, or rather two subjects, wdiich have a close relationship to this in the matter of the lumlier duty, for that is what is involved in the reci- procity bill — the old question as to whether a duty on lumber is justi- fied by the facts, by the correct economical theory, by the condition of the business; and if so, what duty is demanded? But I am espe- cially aslced to represent liere one of the two sections of this country which are to be chiefly affected by this bill. Those two sections are those lying — the one from the city of Washington — south all along the Athmtic coast — so far as lumber is shipped by water or rail, but especially by water from the ports reaching inland 100 to 150 miles to the mills — and especiallj^ to the ports thence hj water to the north; also affecting, of course, the rail shipments — and shipped to the terri- EECIPEOCITY WITH CANADA. 479 tory which comes into direct competition, and will come into direct competition, with the cheap spruce of the maritime Pro\in(('H and (Que- bec. The other section, similarly situated, and in some respects less favorably situated, is the extreme Pacific coast and the northern border. Other sections are interested as well in the low-grade lumber proposition. That is largely a conservation measure. This reci- procity agreement is supposed to be in the interest of conservation, whereas it is destructive of it, as I think any competent — in fact, any recognized — forestry expert, whoever you might call before j'ou to testify, will say, that conservation is practicable only with a jorice for our standing timber and lumber that will enal)le it to be preserved. But I will not go into that right now. I wish to sa^^ something about that later. But the interests lying on the northern border between the east and west are largely of that sort, whereas on the west coast there are peculiar conditions which make them tremble as they look at this reciprocity agreement. The industry there was in a pitiable condition last fall, and conditions are worse now than they were then. Last fall I wrote to one of the leading manufac- turers in Washington — western Washington — inquiring with regard to a large sale at extremely low prices that he made in the East, asking why he did it; I could not understand the report that I had heard. He verified the report and said that he wanted to see if it was possible to sell lumber in the East, and he found it was. at $2 a thousand below actual cost of manufacture, not including stumpage at all. The value of the standing timber did not enter into it. But he concluded his letter with these remarks : " In this district " — mean- ing that manufacturing center, the city and town in which he was located and the immediate surroundings — "there are 1.^ mills. Eleven of them are shut down. Four of the 11 are in the hands of receivers. What we need here is not trust busters, but trust boosters." Wlaat they do need is some opportunity to use their own common sense in the' regulation of their business. I do not suppose that his remark is to be literally interpreted, that he wants a trust, but he does want, and he absolutely admits that the necessities of his busi- ness demand, the opportunity to make a living, to get more than cost for the product. He is an independent manufacturer. He had to go out and buv his timber. Senator 'La Follette. ^Yh!it do you mean by an independent manufacturer ? Mr. Beonson. "Independent manufacturer" is an unhappy ex- pression. It really did not mean anything. Senator La Follette. All right. Mr. Beonsox. I will explain it this way ; and perhaps it is well to do so. Sometimes you will find half a dozen mills through a range of country that have to a certain extent common ownership. While they may be competitive, ordinarily, they are able to work together more or 'less; they do not need to cut each other's throats m the com- petition. This mill is one mill that is absolutely independent. They have to go out in the market and buy timljer at a pretty high price for that country, and his situation is very .serious. Th(.' rest of them are in the same way, the same serious condition, as is shown by that remark of his. . . ■ Ji Senator Simmons. What do you mean by having to go out m the country and buy his timber? Do you mean he does not hold timber land? 480 RECIPROCITY WITH CANADA. Mr. Beonson. He did not acquire his timber land back in the days of low Government prices. Senator La Follette. But he owned timber? Mr. Bronson. He owned timber, yes, sir ; in that respect, the same as the other manufacturers. Senator La Follette. Do you know when he bought his timber? Mr. Bronson. I do not know precisely, but not very long ago — a few years ago, whereas some of fhem hold their timber for 20, 30, and 40 years. They got it at the old Government prices, to which has been added interest and carrying charges. Now, his situation is typical. In order to keep his mill running he has to sell at cost. So it has been with a majority of the manu- facturers in that country. Let me outline the situation as though there were a map here. From the Atlantic coast the forests stretch westward to the head of Lake Superior along the northern border — our forests once did, the Canadian forests do now. The forests are not of equal density throughout, but still it is a forested country. Then there comes the Great Plains region north and south of the line. Then come the ilocky Mountain forests, not so dense as those farther west, but grow- ing denser as you go west in the mountain region. There are densities of as high as 40,000 or 50,000 feet to the acre, perhaps. Then you come to the coast slope proper, where the warm, moist winds from the Pacific are favorable to forest growth, and there you find those wonderful forests of which so much is talked and written. The con- ditions along the border north and south of the line are substantially the same. The ranges run across the border and the valleys run across. The rivers cross the border and sometimes, curiously enough, the rivers run north as well as south. The Kootenai flows south through Idaho, and extreme western Montana, is it ? Senator Heyburn. Idaho. Mr. Bronson. And back through Idaho. Senator Heyburn. On the other side. Mr. Bronson. It just comes around and flows south through Idaho and goes back to the north to its entrance into the Columbia Kiver. The Columbia comes down from the north into our country. Then on the coast proper is that wonderful series of channels — the Straits of Georgia on the Canadian side and Puget Sound on the southern side of the border — furnishing water transportation for logs at the cheapest possible cost. The railroads find easy routes along these valleys north and south ; whereas the east and west lines have to cross the mountain ranges, the north and south lines follow the valleys., with the result that, I believe, there are seven lines from western Montana westward to Puget Sound that cross the border, so that there is an easy interchange of products back and forth. Now, under those conditions, should not reciprocity be the rule? The border is an imaginary line, with transportation and commerce more easily carried on north and south than east and west. That might be so if the conditions of timber ownership were not so di- verse, which is the principal reason, and the fact that we are looking out for the interests of our own family rather than that of the family of our neighbor. You would be told, perhaps, if those favorable to the treaty were here — and you would be told truthfiiUy, though it would lead to a false implication — that we are selling lumber from BECIPROCITY WITH CANADA. 481 the mountain country, from Washington and Idaho and Montana, into Canada. Of course, our importations from Canada are three times as great as our exportations to that country, but still we are exporting Senator MgCujiber. Will you please repeat that last remark? Mr. Bkonson. We are importing from Canada three times as much as we are exporting to Canada, in the aggregate. Senator McCTJ:\rBER. How long have we beerT doing that? Mr. Beoxso^. We are exporting more than we used to — for 10 or •20 years. Senator McCxtmber. We have been importing more from Canada than we have been exporting to Canada? ilr. Beonsox. Yes, sir. Senator ]\IcCu.-\ibee. Does that rule apply all along the border line ? ^Ir. Beonsox. The entire distance. Senator McCumbee. How about the Northwest? Is that true as to the exportations into northwestern Canada and importations from northwestern Canada ? Mr. Broxsox. Not far back. There was no demand, you know, a few years ago from what is now Alberta and Saskatchewan. There were no people there. When this country was developed then there was an immediate call for lumber. The only timber they had was to the east in Manitoba and extreme western Ontario, or in Minnesota, and across the mountains, or nearly across the mountains. Up in the mountains you will find considerable pine. In the far north, in the Saskatchewan Eiver country, you will also frnd some balsam and some spruce, which is available to a cerlain extent for linnber. though it would be chiefly valuable for pul]^. This demand from the northwestern Provinces arose suddenly. The British Columbia mills across the mountains were adjusted to the export and local trade. The export trade was small, the local trade was small, and they could not cultivate the export trade and enlarge their mills on that basis, because they would produce an amount of common lumber suitable for the domestic trade, for which there was no market: consequently, tlie mill capacity of southern Canada and British Columbia Avas limited. "When this sudden de- mand came from the northwestern Provinces of Canada they bought where they could, and at times the prices in that part of Canada in the northwest have been higher than across the l3order in this country, owing to that wonderful development which overthrew all sorts of ordinary trade conditions. But the mill capacity of British Colum- bia is being very rapidly increased, both in the mountain districts and in the coast districts. I do not know the exact figures, but I think there is probably not as much lumber or no more lumber ship- ped across now than there was last year. The new mills of British Columbia are taking care of the increase in the demand and will continue to do so, because their supply is practically unlimited. So we are looking only so far ahead as is necessary to complete the mills and develop that British Columbia industry. Senator Heyburx. I wish you would make plain that proposi- tion that the conditions of transportation rc])rcsented liy those rivers flowing from Canada and the United States anfl then again out of the United States into Canada, iM;pcating that process twice, say in 482 REGIPEOCITY WITH CANADA. the Kootenai and Clarks Fork Rivers, for example, affords them water transportation both ways, and that by reason of that water transportation tl:ie Canadians are able, both for Idaho and Wash- ington, to avail themselves of the water transportation exclusively if they see fit to do it ; and that the same condition is reproduced on the western coast, western Canada being able by water transporta- tion to bring its lumber into the United States in whatever shape it chooses. There are four ^^■ater channels of sufficient importance to float an indefinite quantity of lumber into the United States, without resorting to railroad transportation at all, so it gives Canada an unusual advantage so far as the northwestern country is con- cerned. Any Senator can see, by looking over the map, how those rivers flow for many hundreds of miles, perhaps thousands of miles, north and south across the line; and they are rivers capable of navigation for steamships or bo:;ts of various kinds. Senator Simmons. Inviting mutual trade. Senator Heyburn. That is, inviting the Canadians to come into our household at the same rate that we live in our own household. Senator Kern. And inviting us to go into their household at the same rate. Senator Si:\eimons. That might depend upon whether on one side those streams reached a lumber section ; whether on the American side they reached a lumber-consuming section, and on the Canadian side a lumber-producing section. Is that not true ? Senator Heyburn. And in a producing section, to a great extent. Mr. Bronson. I would like to remind you what I tried to say last Saturday, that with regard to lumber we have less cause for com- plaint. We might be required or expected to sacrifice something of our own interest for the common good if this bill were reciprocal, if it invited us into Canada and had the trade to invite us to on the same terms that we are inviting her; but that is not the case. Senator Hetburn. Canada has no market for our lumber product, comparati\-ely speaking, Mr. Bronson. Dressed lumber there is almost controlling. You gentlemen know that under normal conditions hardly any lumber is shipped rough ; it is shipped dressed. The}' bar out our dressed lum- ber; we, by this bill, practically invite theirs, because our duty on dressed lumber is only one-quarter of theirs. That is a little aside from the question. It simply is in line with that consideration that those lines of trade invite mutuality. I think anybody will admit that. If conditions were uniform — if Canada were a part of the United States, as I think all of us would like to see it — we would welcome their Provinces, individually and collec- tively, into the Union, and greet them as gladly as we greeted Okla- homa, or any other State. Then there would be in this North America a federation of commerce and free trade. The situation on the Pacific coast, therefore, is just at this moment due to tlie extraordinary development in extreme northwestern Canada. The prices there are as high as they are here, and the British Columbia mills are getting as good or perhaps better prices than we are because to a greater extent than is possible with us they can combine. The best we can do is to have some informal under- standing as to prices, something so tenuous that it does not stand against different or adverse trade. They are actually able to make EECIPBOCITY WITH CA^tadA. 483 what amounts to a substantial combination, though I believe the trusts are forbidden over there. Senator La Follette. You will be able now to make a "reasonable combination." [Laughter.] Mr. Bronson. I hope we can. I hope our lives can be saved some- how. Xow, let me go on with this matter of the timljer of British Co- lumbia. The timber of British Columbia is to-day more available for manufacture, economically, than the timber of Washington and Idaho; that is to say. it is held on better terms. The district is not so old in lumbering development, and they have more timber, more available to water courses and railroads, to which the timber can be chiefly put, than is the condition on this side of the line, although British Columbia has no more timber than the State of Washington, in the aggregate. Ours is largeW tied up in forest reservations, Idaho being almost all reserved. It hardly has room enough for the people who want to live in the State to get homes, I believe. Senator Clark. Did you say to get a home, or to go home? Mr. Bronsox. To get homes. I have heard and have seen it stated in speeches in the Senate that some former settlers found access to their clearings cut off by a forest reserve. I do not know how true that is, but at any rate the timber Senator Simmox's. It is not a tresjDass on the Government reserve, is it? Senator Hetburn. It was so held. Tl^ey had to get a permit. Senator Si3ijio:xs. Even to get home? Senator Heyburn'. Yes. Mr. Broxsox. By reserved timber in this case I mean timber held for the welfare of the future ; it is very largely in the hands of the Government, and the private timber that was convenient of access, and cheaply logged was largely cut away, whereas a different cfincli- tion obtains in British Columbia. A year ago last January. I think it was, the Government put a reserve on all the remaining unclaimed timber — unlicensed timber — of British Columbia. It was only about 20 per cent, as I remember it, of the entire estimate of the total tim- ber that had been staked in the Pro-^-ince. That is to say, three-fourths or more — three-fourths to four-fifths — of all the timber in British Co- lumbia has been staked out under licenses or leases have been granted on it or it has been covered by Crown grants. But the Crown-grant area is very small, and the Crown grants were largely made up to 20 years ago — before 20 years ago — and all desirable locations, which are now town sites or near some town, where timber has been cut away. These licenses are made, as T ^-tated the other dny, free. There are some charges for advertising and for staking and little fees; they charge fees, 2.5 to 50 cents or $1— such a matter — per acre; I do not know just what it is; I have the figures here; but they are so unimportant that they are hardly worth consideration. The real charges are these east of the mountains — to repeat what I said— $115 a square mile per amuim for the right to hold these timber leases; west of the mountains, where the timber is heavier, $140 a square mile; when the timber is cut, and for such as is cut, only 50 cents a thousand feet. For about two years British Columbia had a commission, a forestry commission, composed of their best experts, examining into forest conditions in the Provinces and in the United 484 JiECIPROCITY WITH CANADA. States. None (if the l'i-o\'inces would depend upon the effects of the various reguhitions to make a recommendation to British Columbia as to how it slioidd handle its forests. It involved cost. Senator Sijimons. Mr. Bronson, do I understand you to mean that the stumpape cost to the mill, to the manufacturer, is, in British Columbia, only about 50 cents a thousand? ]Mr. Brsoxsox. "When the timl^er is cut; there is nothing- to start with, except these fees. Senator Snuioxs. And they are nil. Mr. BnoNSON. Practically nothing. Then there is this annual lease, or rental, so to si'.eak; it is a rental. I believe it is called a rental, of $140 and ^ITiO a square mile, which I said to you on Satur- day amounts to from half a cent to — well, if you got thin enough timber it would run it up '2 or 3 cents, perhaps, a thousand feet. Senator Clark of Wyoming. That is, per annum. Mr. r»R(ixs()N. Per annum. These leases were granted until last year for a period of 20 3'ears. Now, the privilege of making it per- petual has been extended so it amounts to almost a fee, the exception being that the Government reserves the right to regulate in some way for fire protection, etc.. and for forestry in the future in cutting. Senator Kkrx. They also regulate the sort of timber that can be cut, do they not ? jMr. Bkonsi ix. Not there ; no, sir. They are paying no attention to that. Senator Heyburx. The regulation has been with regard to the policy of conservation. There is some of that in the East, in On- tario and Quebec, but none out there. A man goes on and takes up these leases and does what he pleases with them. But he pays this nominal rent which looks quite large, because, as stated by the square mile, that is really \-ery small on account id' the very large quantity of timber on it, and then when he cuts the timber he pays 50 cents a thousand feet for Mhat we call log scales, and that relieves him of the risk and hazard of fire, etc., between the time lie takes it up- Senator Si-Arjioxs. "V"\Tiat I want to get at is this: Putting all these items of cost together, what is the average stumpage that the lumber manufacturer has to ])ay in that territory? Mr. Bronson. The commission of which I spoke, in its report, dis- cusses that and conchnles that, counting all these things together, and by an actuary metliod, bringing down the future values to the pres- ent, it was about $1.50 a thousand feet, but there are no taxes on top of it. All those charges combined, covering a period of 20 years, amount now to-day to about $1.50. Senator Heyburx. And no taxes? Mr. Broxsox. No taxes at all. Senator Simmoxs. And no risks of fire or winds? INlr. Broxsox. No risks from fire, because the Government takes that, and if a large section, the limit of 640 acres, is burned up, say, it is no longer of any value, and you ma^^ surrender it back to the Government and cease paying them rental, but as fast as you cut out your timber, you turn that back, and then if it is clashed as agricul- tural land, it can be entered; if it is not, the Go\'ernment has got the job of reforesting, if it wants to. KECIPBOCITY WITH CANADA. 485 Senator Simmons. And he has no capital invested in tliese lands, either ? Mr. Beonson. No, sir; except what lie must pay in buying certi- ficates. Now, not every man can get this land from the Government — that is to say, there are stakers who go out and make a business staking. They have staked about three-fourths or four-fifths of all the timber in British Columbia at 640 acres apiece. Then they are in the market to sell this stuff. Now, as to this estimate of the commissioners — I am glad you spoke of that. This estimate of the commission includes what it estimates to be the average price got by those fellows, and what it has actually cost — the timber has actually cost — in the hands of the present holders who have gathered it up. as we have gathered the quarter- section homestead rights, you understand, although there was no opposition there whatever to selling the claim. He stakes it out and then he can do what he has a mind to. Senator Clark of Wyoming. He is limited to one claim, is he? Mr. Bboxson. No, sir; he can stake to-day as much as he wants to. I know people who have staked out 100 or 150 claims. Some men have got, in the mere operation of staking, 150,000 acres, and while there has been an added value in transfer, and sometimes you find that timber is being paid for — these licenses being bought — at a basis as high as a dollar a thousand, yet the general average, so the commission states, is clown to about $1.50, anticipating the future cost. We have an average there of about $1.50 for timber, if that be cor- rect, against a minimum, I should say, of a dollar and a half, ranging from that to $5 in Washington and Idaho, according to location. Senator Simmons. Substantially the same character of timber? Mr. Bronson. Exactly the same. Senator Heybuen. In Idaho, lands belonging to the State — and they are very large holdings, which can not be sold for less than $10 an acre in cash. Senator Clark of Wyoming. That includes the land you take. Senator Hexbuen. Yes. Mr. Bronson. Of course, when you come to transfer, those trans- fers are being made in the business of the mill, and you have to pay, as I say, the minimum prices in Washington for available timber, which is $2 a thousand. I do not think you can get any for less than that, and from that up to $5. Senator Bailey. Then you have the burden of clearing up the land — things like that. Mr. Beonson. Then, after you have bought it, you have your taxes. Senator Simmons. Might it not be well for you there to explain what factors enter into this large margin between the minimum of $2 and the maximum of $5 ? Mr. Beonson. Yes; I think the Senators all understand that, but here is a piece of land— a piece of timber land, 60 miles up in the mountains— only reached by canyons, not a driving stream; no rail- road. The railroad has got to be built, at a cost of anywhere from five to ten thousand dollars a mile, to reach it. You pay ta.xes all the years until it is reached. Of course, that land is not worth much; that kind of land is inexpensive at the present time. That land might 486 EECIPROCITY WITH CANADA. not brin to $1..")0 a thousand in trans- portation cost, so that if it were not for the duty, the British Co- lumbia mills could operate in California, sell their product at terms with which the Washington mills could not compete — absolutely could not compete. I say a dollar to a dollar and a quarter in normal times. During the excessive demand following the San Francisco fire, they ran to $3 a thousand feet, about. Our American vessels, which are the only ones allowed to engage in the trade between our own ports, ran their prices to $6 and $7 a thousand, whereas they are now $4 under normal conditions. The British Columbia mills had free markets for ships; could charter them in the open marlcet and get them at any price they wanted, and simply sold wdiat they wanted down there at their own figure — under our prices enough to sell it, and yet it was all velvet. Senator Ci-ark of "Wyoming. During that period were there great quantities of British Columbia lumber that went there? [Mr. Beoxson. Not a great deal, because the nortliAvi'slei'n boom was still on. The mills had not caught up with the new demand, and they have not yet. If you take the duty off you would not feel it; our people in Washington ^^■ould not feel the removal of that duty for a vear. because the British Columbia mills have much to do up there "just now, and they have had no encouragement hitherto to increase their capacity or build new mills until this new demand sprang up. ScuVitor SiMjroxs. They are busy suiq^lying the home demand? ]Mr. Bronson. Yes. sir;' but as soon as they get adjusted with their enormous supplies of available timber and cheap timljer, tlien they will i:(i out for the foreign trade ami coa-lwise ti'ade, which they will capture in spite of all we can do if this duty is ofi', and I might say again that their adviintai;e is inerensed with length df the v>'atcr transportation. When the Panama C:uial is opened, our people are figuring on usini;- that canal to a gieat advantage, particularly on the Pacific coast. But with this long haul the British -Columbia advan- tage will be still greater. . . Senator 3IcCu:MP.f.r;. Will you explain to me why it is we have been able from our western coast to increase our ex]..ats ot lumber to Australia and west at a far greater percentage than cattle? Mr. Bkonson. Yes, sir. • , n ■ iv. Senator Mf Cimber. Plow can we compete with Canada m the shipment, for instance, to Australia ? Mr. Beoxsox. On account of transportation. Senator MrCrMiiEE. I want to know how we can do it. Mr. Broxsox. There are two reasons. One is we have this im- mense domestic demand for a certain part, or a barge part, of the pro- duction of the mill, so that the part suitable for export canbe made and sold— rather you Mirmld put the exj^orts first. Ihere is only a part of the product suitable for export. You can not attord to make that unless you can find a market for the balance. ^^ e have the market for the balance, consequently avc can export largely because we can dispose of our otfal and our low grades at home. 488 EECIPKOCITY WITH CANADA. Senator McCumber. You have got to sell as cheap, or cheaper, in the Australian market in order to compete with Canadians — that the Canadians sell for, have 3'ou not? Mr. Bronson. Yes, sir. Senator McCumber. Well, if you can produce the lumber in this country of practically the same character as that which the Canadians also export and export it to Australia cheaper than the Canadians, why can you not defend your own market against the Canadians? ^fr. Bronson. Because Canada has not got the market for the lower grades. She can not increase her exports by increasing her liroduction of export lumber — that part of that product — without increasing the other part, which so far she has been imable to do, be- cause she has not had a market in proportion to the ex^oort possi- bilities. Senator Heyburn. They could not afford to produce this high- grade lumber in Canada at all on account of having a greater demand for the lesser grades than we do. They have the demand for the lesser grades which made that bj^-product. Mr. Bronson. Yes, sir ; so we can compete with her on prices, not rhat we want to do it. She has no advantage in the export market in the way of transportation, because in that foreign trade we can charter any kind of a vessel. Senator iIcCu?.iBEE. Do j'ou sell that same lumber cheaper for the Australian trade than you do for the American trade ? Mr. Bronson. No, sir; the mills try to sell as much of that as they can, but, after all, the export trade from that coast is not — now here la a statement. This man goes into that a little bit Senator SuutoNS. That in competing with Canada in the foreign .narket you are not under the handicap that you spoke of a little while ago with reference to the difference in freight rates? Mr. Bronson. No, sir; not at all. In fact, sometimes we are a little bit at an advantage over Canada in the matter of freight rates to foreign jDorts, for the reason that we bring in more vessels — more vessels come to our ports with commodities than to Canada. Of course, San Francisco is a much larger city than Vancouver and much larger in the amount of foreign tonnage. And a much larger tonnage comes to our port than goes to Vancouver, and when they are convenient they can be chartered for foreign use a little bit cheaper than they would go to Vancouver empty for loading out. Mr. Ames says : "As you are aware, Oregon, Washington, and British Columbia ship bj' water, in what is known as the cargo trade, about 1,750,000,000 feet board measure of lumber per annum; and over 400,000,000 of this is exported, and about 40,000,000 shipped to the Hawaiian Islands, the Philippines, and Alaska. This means over 1,250,000,000 which is shipped by water from Oregon and Washington to the State of California alone, California being a big market." I would like to have my statement, made a while ago, corrected, if jDOSsible. I think I stated one billion and three-quarters. It is incorrect. Senator Sizmmons. That is what you did say awhile ago. Mr. Bronson. Now, under these conditions the west-coast people say they know from bitter experience that the ordinary mill has got to go out of business soon if this dutj^ is removed, and unless they are given some benefit in the management of our shipping laws they EECIPEOCITY WITH CANADA. 489 have got to go out of business as fast as British Columbia can erect mills. They may not individually go out of business. They may move across to Canada — across the line into British Columbia. That may help the British Columbia de\elopment, and our people are buj'ing timber over there in anticipation of this, and some of our people have built mills over there. Over half the mills in the moun- tain district of British Columbia are built by Americans who. handi- capped by their own conditions, were looking ahead to free lumber, who are attracted by the timber of that country and have gone over there and taken their men wiih them to the damage of our business. Senator HiM:\roNs. Would it not be more accurate to say that they have got to go out of business or sacrifice their timber? ilr. BnuNSiiX. Onedialf of the mills on the Columlua River and on Puget Sound own no timber, and those are among the largest mills there. There is the most marked example of the division of business between logging, manufacturing, and wholesaling of the products. They will have to sacrifice timber, of course; that is. th.e timbe» owner who is a manufacturer. There are some timber, owners out there who manufaclure not at all, who are holding oft' for the future in the hope that interest and taxes will not exceed the rate of increment in value;- so that they will come out ahead. But every man who is an operating lumberman, with merely an ordinarily reasonable supply of timlx'r l.i.ick of that particular mill, has been cutting into his capital and losing tl;e value of his timber every day for three or four years. There is iiot a man out there to-day v.'ho is as well ott, of that class, as he was four years ago, and if his'timber is not paid for he is facing bankruiitiy. and a large percentage of that sort of mills in the State of AVasJiington has ■ione into baulmiptcv. In that one district lliat 3Ir. r)]oedel wrote Jiie about, four of the fifteen mills in that district are in the hands of receivers. The man who has no timber is perhajis better olf than the man who has. If he bought his timber at this '^1.25 an acre price, he mav figure out that it has^cost him 0]ily a dcdlar lo-day.and jjossildy he 'can cet that dollar liack in the sale of his lumber, but if he has gone into the market in more recent times and paid within 10 year- any price that he could h;-.ve liought timl)er within 10 years— and most of them have Ijouizht witliin that time— then he is actually losing out on his invested capital, to say nothing of his interest. All the mills along i'liGct .--rnuid— all along the rivers— wdl profit great! v if you will insist on an amendment to this bill making substan- tially the same provision tha.t vou did in regard to pulp wood, that m cons'lfieivtir.n of our admitting free to this country, the markets ot this countrv. the Can;idian product of sawed lumber, that Canada '4iall o-ive us a.-ee^s to h-r f<.rest re-ources which the TreHdeiil says this bTll does, but whi.-h it does not do. by relaxing or removing or striking out everv prohibition on the export of logs, bolts, etc. ihen these men all along the h.order, from Minnesota even— well, from the Atlantic to the Pacific, the water mills— can all go across and bring the loiis. ., i n .i -o t j-i + Se7iator IImley. Can the Canadian (.Tovernment do that ^ Is that not a matter je-ting with the Pj'oviiices'^ , Jh Bronson. The (Jovernment can not, as I understand it so far as the timber is concerne.l that belongs to ll,e Pr<,viures: ( anada controls the timber of Manitoba. The Canadian commissionei. Mi. 490 KECIPJROCITY WITH CAI^AUA. P'iclding, said in his letter accompanying the pact, as I understand it, that tliat matter ^^■ils out of the control of the Canadian Govern- ment, but he said that I Ijclieve, in regard to pulp — he did not say anything about saw logs, as I undei'stand it — but he ^Yas a little bit insincere and disingenuous in omitting to state or failing to say any- thing about what the Canadian (>o\ernment would do with the timber that it controls — and it controls all the timber in Manitoba, Sas- katchewan, Alljerta, and all the Territories in that 40-mile railroad belt through British Columbia, and in some of the Indian reserves, and it has the same prohibition of export that the Pr(jvinces have on their timber. 11 looks to me like bad faith. Senator Heyburn. It would immensely reduce the value of thn- bered land to admit logs free. Mr. Broiv'son. Yes; I am speaking of this as reciprocal — what would help the particular people of your section. Senator Heybtjrn, We do admit logs free of duty now. It just tepiDens that because of their peculiar law no logs came in. Our logs are on the free list now. Mr. Brdnson. Yes, sir; logs have always been on the free list, as I understand it, unless in the early part of the last century. I think joerhaps there was an ad valorem duty on logs, as well as almost any- thing that did come into the countr}^ Now, if you will change this dressed-lumber business, and if you will put ships on the free list or change our coastwise laws in some way so as to remo^"e that handica]) under which our mills are to-day laboring; if you can secure free admission or free passage to Ameri- can ships, bound between our own ports, at least, on opposite coasts, through the Pananut Canal when it is opened, then perhaps we might have some show in this competition, even as against the value of lumber there, l>nt take the duty off, as things stand to-day, and you ruin the operating lumbermen in the sawmills of the coast and the northern border. I think, gentlemen, that that is all I wish to say on that subject. Probably there is a great deal more that I might say. Senator Bailey. It will probably save me the trouble to turn to the book, and I will ask jmu what is the average duty upon the machinery which the sawmill uses? Mr. BiKiisSON. At the present time, I do not know. I would have to look that up in the book myself. The Canadian duty ranges at about 2"! per cent, winch is ordinarily lower than ours, ordinarily so, and yet Canada buys a good deal of her sawmill material in this country and pays duty on it. Senator Bailey. I will ask 3'ou in connection with your statement to put in the record here a list of what the sawmill needs in its oper- ation, and I can find for m^'self what duties the Government levies on those several parts. Mr. BnoxsoN. If you will allow me. Senator. I will say in connec- tion witli that matter that a good many of our manufacturers of sawmill machineiw have put up plants in Can:ida to avoid the Canadian duly. You know that modern sawmill machinery, as A\-e know it on this continent, is largeljr of American invention, and is not made abroad — just types that please those people in Canada and the United States. German}^ malces a good deal. Senator Bailey. I am not interested in the comparison between the two countries. That is the protective view of it. What I am KECIPKOCITY WITH CANADA. 491 interested in is to see wliether or not they want the sawmill men to pay a duty on their machinery and then use it to turn out a free product. I hardly think that is fair. If thev are goinij to turn out a free product, they ought to be permitted to turn it out with free machinery, it seems to me. Mr. Bronson. A free list on the sawmill equipment would be of immense Aalue to us. We import very little sawmill machinery or appliances, yet they are many of theni most costly, of the sort that are made abroad though not of just the type to please us. Senator Bailey. You put into the record a list of the things that the sawmill must buy to equip it. Mt. Bkonson. And that could be brought from abroad. Senator Ballet. I do not care where they are from; I just want the list. Senator Simmons. Is it not a fact, Mr. Bronson, that in the prac- tical operation of a milling business the logging road has become as much a part of j^our equipment as j'our mill machinery ? Mr. Beonsox. That is often so, and often not. It may look a little fictitious to some of you gentlemen, so familiar with lumber opera- tions in Xorth Carolina and Mississippi, to make this arbitrary divi- sion between logging and manufacturing, or sawmilling. A water mill where we can buy these logs from an open market usually finds a log market where it can buy logs, and it either establishes its prices on its own logging, if it does it, or it owns no timber at all, as is the case on Puget Sound and the Columbia River. However, as to the milling out there — some big mills own no timber; they just go on the log market and buy at the regular prices of the market. There is a good deal of difference between the market price of logs and the market price of lumber. Senator Heybuen. In connection with the statement given with regard to that, I would like to have you give us a statement as to the labor problem Senator Simmons. "Will you just let me finish on this subject? Senator Heybtjex. Yes, certainly ; I thought you had finished. Mr. Bkoxsox. But when you build a mill in the interior of the country that is not available to water coun^es, then you justify the erection of a mill there with no open market for logs to go to only by the ownership of timber to insure its continued operation is it justi- fied. Allien the timber ownership and the logging and milling is not under one operation, and the owners builcl a railroad to reach the timber and put in their logging appliances- Senator Simmons. I am not at all familiar with the physical con- ditions of the Pacific coast, but on the Atlantic coast most of the timber lying immediately upon the streams has been cut. Nearly every large mill in that country owning large tracts of land have to get their logs by tramroads — not a tramroad but regular railroad; logging railroad. They use pretty good sized iron, probably 56- pound iron. Xow if the Canadian could get his steel rails for $0 or $8 a ton less than the American miller could get his, would that not make quite a difference in the cost of production in favor of the Canadian ? Mr. Beonsox. Oh, yes, sir; but these mills are also logging by wire cable, steam skidders, and wire rope. That is another instance 0328.5— No. 8—11 2 492 EECIPROCITY WITH CANADA. of it. As I lia\e s;ii(l, wi- lia^'c not made any formal request to this eifect, but we have said, " If you are going to put lumber on the free list, i;-ive us, notably, the steel rail, wire cable, saAv blades, and shafting- — saw steel oi' (lie completed saws, either one, and shafting. Those things alone would help greatly, they are very highly pro- tected. You can not go outside of this country for them. Senator Heybuen. Now, will you state the wage proposition, as to the number of men, the wage earners, employed in connection with the lumber industry in this country? Mr. Beonson. Anj'thing stated just now, before the census report on that proposition, is somewhat of an estimate, but I shall place the minimum at 800,000 actively engaged as workmen. Senator Heyburn. What are the wages of those men? Mr. Bronson. The wages range from the wage of the common laborer in the negro districts of the South, perhaps the lowest aver- age anywhere would be a dollar, perhaps more than that. Senator Hetburn. I refer to the Northwest more particularly. Mr. Bromson. I have not looked that up recently, but my under- standing is that it ranges from about $1.75 for the cheapest common labor up to $12 and $15 a day that you have to pay for the high-class skilled labor sometimes. Are there any other questions on that particular line? I said, gentlemen, that I wanted to talk something about trusts and also about conservation. Senator Heybuen. Mr. Chairman, I would ask that the gentleman be given the time to cover those subjects, which are important, and I suggest that he may be permitted to resume later. The Chaie.^tax. He can resume at any time to which the committee adjourns, which I suppose will be at half past 3 o'clock, when we will endeavor to hold a meeting, if the business of the Senate permits. IMr. Bronson. If I could have 15 minutes more I think I could absolutely finish — not saying all I wish, but touching on the main points. The Chairman. The committee will be glad to give you every op- portunity. Mr. Osborn, the governor of Michigan, is here, and he desires to briefly address the committee, and, as he has been advised that he must return home immediately on acount of matters pertain- ing to his executive office, the committee ought to defer to his engage- ments and hear him at half past 3, and then we can resume the hear- ings of the lumber people. Senator Simmons. Have you any idea how long Mr. Osborn will take ? The CHAiE:\r'AN. I understand the governor has no set or prepared speech, and will not be long. Senator Si]\rMONS. Mr. Bronson says he can finish in 15 minutes. Senator Heybuen. I would not like to have this subject curtailed. I would like these men to have full time to cover the subject. The Ciiairjcax. I fullj' agree with you, Senator. Senator Heybuen. I presume Mr. Bronson, on account of the press- ing nature of the public business of the governor, you would be glad to have him go on and resume after he has finished. Senator Simmons. We want these gentlemen from North Carolina and South Carolina to be heard this afternoon, because a good many of them desire to return home. EECIPEOCITY WITH CANADA. 493 The Chairjman. They may go on to-morrow, if agreeable. The committee will now stand adjourned until half past 3 o'clock this afternoon. AFTER RECESS. At the expiration of the recess the committee resumed its session. The Chairman. The committee will come to order. The committee has before us this afternoon, whom we will hear before proceeding with the lumbermen, the governor of Michigan, Mr. Chase S. Osborn. Governor, we will be very glad to hear younow. Gov. Osborn. INIr. Chairman and gentlemen of the Finance Com- mittee, I want first to thank you very much indeed for the courtesy and consideration you have shown iSIichigan by permitting me to intervene, and I only ask you to show consideration for Michigan because of the fact that social conditions really make it necessary that I shall be through as soon as possible. Beyond that fact, I am here as a private citizen, and I think it is fair to you and fair to me to say that I come here representing nobody. I was asked to come by nobody. I think that this is a momentous question, and I think that all citizens should come here and give you gentlemen, who are so pa- tiently endeavoring and so patriotically striving to thresh this matter out, their views, in so far as they may be views bearing upon the sub- ject. For that reason I wired President Taft I was willing to come down here and say a word if it was desirable, and he wired me tc come ; so I am here, and I thank you. I wish to address you in respect to the sentiment in Michigan. And I presume that men who are representative in character may have and can have a different attitude of mind from those who are in an executive capacity, and I feel that we should try to realize that ; but I wish to say, in relation to the sentiment in Michigan, if that may be be of importance in consideration, that those who have been here from my State, our State, while they have been honest, I have no doubt, and are intelligent citizens no doubt, I disagree with them in the position they have taken here and in their representa- tions which they have made to you gentlemen. I am of the opinion that the people of Michigan are in favor of this reciprocity pact, and I have some reasons for my belief. I know that a plebiscite has not been taken, and probably from sheer temeritv I might be licensed to say that Michigan is^ for reciprocitv with as "much authority as one may say the State is against' it ; but there are some little indications that show the way the trend of public opinion runs, and one of them may be said to be this, that you had the president of our Michigan Agricultural College before you the other day, a most distinguished, eminent gentleman and a scholar. He appeared upon the side of a debate recently, within a month or so, upon the question of this reciprocity proposition. He was against it, and some of the other professors of the faculty werp against it, and arrayed for it against these debaters were a number of the youno-er professors, and when they had concluded the judges of the debate refused to give a verdict, and it was left to the vote of about 1.100 of the young students, representing the farming element of Michigan. They decided in favor of reciprocity three to one. I simply give you that as an indication of the fact that these younger 494 EECIPROCITV WITH CANADA. representatives of the farm homes have given this some thought, and that probably may be taken in a measure to reflect the sentiment of their fathers. Then, again, the editor of one of our leading news- papers, one of our most influential newspapers, the Grand Rapids Herald, of which Senator William Alden Smith is the owner, has taken a census of the country newspapers of Michigan, and GO per cent have l)een found to be in favor of the reciprocity proposition. So I take it that those are indications that the people of Michigan are not all against it. but that many of them are for it. Alluding personally — and I hope, without undue immodesty, excusable — I ap- peared before a large Republican club in Flint not many months ago, and in spite of the fact that they had proposed to change the name of the club from the Taft Club to the Fordney Club, they per- mitted me to address them in favor of reciprocity. I appeared before the State convention and addressed the convention for some time in fa\or of reciprocity and received at least cordial treat- ment. So I am moved to think that, because of these facts, many of our peoiDle are for the treaty of reciprocity. Then, again, I walk in our State, and I have walked a great many miles within the last six weeks; I ha^-e ridden horseback and I have gone some in automobiles and some on railroad trains, and I have asked all classes of people, and only j^esterdaj' I asked 11 citizens of jNIichigan upon trains as to their views on reciprocity, and found every single one of them in favor of this pact. Now, that is all I care to say upon that particular point. I live in the Upper Peninsula of Michigan, upon the Canadian border. Michigan has an area of about 59,000 square miles. The Upper Peninsula of ^Michigan has an area of about 19,000 square miles; the acreage of Michigan is a little more than 36,000,000, and of that acreage between 10,000,000 and 11,000,000 may be said to be under cultivation. Of the acreage in the Upper Peninsula less than a million are under cultivation, but the Geological Survey has re- ported that the percentage of tillable land is greater in the Upper than in the Lower Peninsula. So, if anyone has to come into direct competition in Michigan at all with Canada, it is the Upper Penin- sula, the undeveloped section of Michigan; yet I say the Upper Pen- insula of Michigan, while it is undeveloped, indeed — it has a popu- lation of but 300,000, against 2,500,000 in the balance of the State- is in favor of reciprocity. Some of the grangers in the Upper Peninsula tore up tlie petitions that were sent to them by the master of the Grange, Mr. Hull, who appeared here a few days ago. I may be pardoned for stating it, but I think I am just as much a granger as some of those gentlemen, and I am interested in 100,000 acres of land in Michigan, some of it farm land, but the bulk of it timber- land. Senator Gaixinger. Are you interested in land in Canada? Gov. OsBOEN. I will be glad to tell you that I am not. I wish to state, in fairness, that I have walked 2,200 miles, with pork and flour on my back, through Canada in the Saskatchewan district. I am the discoverer of an iron range. I am interested in a business lot in the Canadian Soo, and I also own some acres in the American Soo. However, almost all the interest I ha\'e in the world is in the United States. A great deal of that is undeveloped property which may be taken to come into direct competition with the new zone that may EECIPKOCITY WITH CANADA. 495 be said to be opened more freely to development by tliis treaty of reciprocity. I do not know just what bearing this treaty will have upon land, or anything of that kind. I wish to state, also, if you will permit me, that I own a little hunting house, and have for about 20 j^ears, in the Saskatchewan country, on a lake about 20 miles north of ]\Ioose Jaw, and I own a little summer house in the wilder portion of Georgian Bay. I say that in order to show you that I am familiar with Canada. I have witnessed the development of the Saskatche- wan region for more than 20 years, since about the coming of the first wheat farm. I have seen the wheat area grow, and I think I know of the fact that the Saskatchewan country of the great northwest can not com- pete with Michigan, or any other section of the United States where wheat is raised and where the climate permits wheat to ripen. I think I am within the facts when I state that the greater percentage of the wheat grown in the Northwest does not ripen, that the frost comes too early, and that more of it is No. 4 than anything else, and very little of it is No. 1 wheat; and I take that as an argument to show that Canada can not compete even in wheat growing and with- out reference to where the price of wheat is made, which I think is in the markets of the world. May I not call attention to the fact that the arable region of Canada is very small? Now, Temiska- ming, which is the beginning of the so-called New Ontario, to Port Arthur, on the west, is an undeveloped forest. Everywhere on the height of land it is true the frost comes every single month of the year, so there can be absolutely no intelligent or any material successful competition between any part of Canada and at least Michigan, and I think there can be no competition with any jDart of the United States, in a sense. Now, in Michigan we do raise 6,000,000 bushels of peas annually, and I think they can raise peas over in Canada, and in that sense they might compete, but they can not compete with ^Michigan fruits in the Berrien County district ; and now the ^Michigan fruit district has taken itself away clear up to the Straits on the west side, where the weather is warmed by the winds that come over Lake Michigan. Senator Gallingee. You are giving us some very valuable sug- gestions, quite in contrast to some other testimony that has been given here, I think. But do I understand you to say they can not raise wheat in Saskatchewan in competition with our wheat fields'^ Gov. OsKORX. I do not think they can, because they are far away from many things. Senator McCumbbe. What has been the increase in Saskatchewan in the last 10 years ? Gov. OsBORX. I can not give the figures. JDut I do know they never have reached the 100,000,000 mark, but I noticed that Mr. Hill has repeatedly prophesied that the hundred million would be reached as against our 700,000,000 in the States. Senator McCumber. How long are you going to give Saskatche- wan to reach the one hundred million mark if she only started to raise crops a very few years ago ? Gov. OsBORN. T think Saskatchewan wdl pass the one hundred million mark; I think Saskatchewan will raise some day 250,000,000 bushels, such as it is, but it is not your wheat; it is not the wheat of your State that usually ripens and gets to be at least No. 2, and 496 RECIPEOCITY WITH CANADA. hardens properly, but it is a soft No. 4 wheat tliat does not sell for tlie price of your wheat. Senator McCumber. Some portion of it sells in competition with ours and is a better No. 1 northern wheat. Crov. OsBORx. What ]5ercentai;(>? Not a large percentage. Senator McCumber. Well, there is a very considerable percentage. Go\'. OsBORN. But that is the ;(mietimes from 30 to GO bushels of grain to the acre of that other kind. The greater por- tion tliat comes in competition with us is of the hard variety or the No. 1 north. Now, to say just exactly what proportion of this was No. 1 and what proportion of No. 4 I could not say any more than I could from my own State. Gov. OsBOEX. The statistics will show that, though. Senator Gallingee. One other question, if you will pardon me, as to its possibilities for the future. There is identically the picture that was drawn 40 or 45 years ago of the great American desert. Gov. (JsBORx. No. sir; I do not think so at all. Senator Clark. Have any settlers gone back? In North and South Dakota tliey sold out their homesteads for enough to buy railroad tickets to New England, and came back farther east. They did that more than once in North and South Dakota, because they could not make a living and raise crops. It is at present the greatest corn-producing country in the world. Gov. OsBOEN. At least, it did not have frost every month, and the Saskatchewan country is apt to have a frost every month. As to the section you refer to. Senator, does the wheat crop attain perfection — does it ripen properly? Senator McCumber. Every few years that will be touched with frost. Gov. OsBORX. In the northwest country they raise considerable quantities, and on a guess I should say eighty to ninety million bush- els — I do not know how much. I do not want to be misunderstood about the raising of wheat in that territory. They can raise it, be- cause they do raise it, and people are doing well, and the country is settling up and prospering, but I think they can not raise it in com- petition with the United States under more favorable conditions. I think we farm better and have a greater diversity, and conditions of farming are happier, and everything that goes to make success- ful agricultural conditions are in our country better than in the Northwest. Senator [McC umber. Eight here, we can bring that down to a prettv close point. Do you think our farmers are making any more than "they ought to make— making an unreasonable amount, the value of their crops to-day ? Gov. OsBORX. I wish they could make twice as much. Senator McCumber. Do you think they are making any more than is necessaiy for them to properly exist at the present time? Gov. OsBORN. I will go a little further and say, not enough. Senator McCu:wber. Then they are receiving for their products on an average 15 per cent more than their Canadian neighbors, and their Canadian neighbors have got the same kind of products that they can dump over on the same market, and are our people not going tobe iniured in that way? . . Gov OsBOEN. That is just the point. They are receiving more because thev are raising better wheat. They are receiving more because they pay less for transportation. Transportation m Canada is a tremendous problem. They have no competition there— abso- lutely not any. -. , -, Senator McCtjmber. You do not understand my question. 506 EEGIPROGITY WITH CANADA. Gov. OsBORN. I do not think I misunderstood you. Senator McCumbee. The points that are equivalent. Gov. OsBORN. You have no points that are equivalent. Senator McCumbee. You might take Duluth and Port Arthur. Gov. OsBOEN. Duluth and Port Arthur are not equivalent. Senator McCumbee. Does it cost more to take wheat from Duluth to Liveri30ol than it does from Liverpool to Duluth ? Gov. OsBOEN. It takes more to get it from the Canadian fields to Port Arthur than from the American fields to Duluth. Senator ^IcCumbee. I am not speaking about the Canadian fields, but Port Arthur and Duluth. Gov. OsBOEN. I understand, but the Port Arthur market is in- fluenced, and is measured indeed by the cost of carrying the North- west product to Port Arthur, just as it is measured in Duluth by the cost of transporting it there, and consequently is costing more. Senator McCumbee. Costing more to the farmer ? Gov. OsBOHN. The farmer must pay it; he gets the difference in the cost of transportation, which is much more important as influ- encing the wheat prices than the tariff. Altogether he gets the dif- ference of transportation of about, I should say, over the Canadian fields to Port Arthur and between the American fields and Duluth. Senator Bailey. I understand that if it takes more to carry wheat from the Canadian fields to Port Arthur than it does from the Ameri- can fields to Duluth that would explain the higher price of wheat at Port Arthur. Gov. OsBORN. Not necessarily. Wheat is not bought at Port Ar- thur. The wheat is bought at the nearest elevator to the wheat field, and the farmer is paid for it at the nearest elevator to his fields, and on account of the transportation charge, the cost of getting this wheat down to Port Arthur, he gets a price less the transportation charge, quite naturally, no matter what the theory is ; that is the fact. Senator Bailey. That would explain a lower price at the fields the higher cost of getting the wheat from the field to Port Arthur. It does explain a lower price at the field, but it would not explain a lower price at Port Arthur. Gov. OsBOEN. I think I may say no wheat is bought or sold at Port Arthur. Senator McCumbee. Is not wheat all sold for delivery at Port Arthur or Fort William? Gov. OsBOEN. You mean the wheat sold at Port Arthur? Senator McCumbee. You take Winnipeg quotations — it always means delivery at Port Arthur. Gov. Osborn. The Winnipeg wheat might be, but what I am en- deavoring to say, and I think with accuracy, is this : That the farmer is paid for his wheat locally. He is paid for it at the elevator nearest to his farm to which he hauls his wheat, and that price is very nat- urally influenced by the increased cost of getting that wheat to the market. Mr. Farmer pays that transportation. Senator Gallingee. li this is purely a sentimental matter, why should we, if Canada can not compete with us in the matter of wheat raising, remove the duty at all, when by the testimony of other interests it is going to harm them ? Gov. Osboen. You mean the duty on wheat? EECIPBOCITY WITH CANADA. 507 Senator Gallingek. Yes. Eemember, the removal of the duty on wheat means the removal of the dutj' on other things, if we agree to this reciprocity agreement, which you advocate so warmly. Gov. OsBOEN'. Japan has just opened the Korean. Manchurian, and certain Chinese fields, but principally Korean resources, which have been untouched since primeval times, and since the earliest dawn of mankind, and that if we are to go on in this country successfully competing, we must not turn and give a blow in the face always and that to the very neighbor and to the very region from which we can obtain our raw materials of certain kinds. Senator Gallingek. What raw materials do you refer to? Gov. OsBORN. Timber, just at the present time. Senator (talliivGek. Do you think the arrangement in this agree- ment regarding timber is reciprocal? Gov. OsBOKN. As to the exact eft'ect of the arrangement, I can not speak ; I am not informed as to the efl'ect of this, but Canada is devel- oping vai'ious mineral resources of a very valuable nature, including cobalt. All the nickel, or nearly all the nickel in the world, is now coming from there. Their fields are greater than the Caledonian fields. Xearly all the nickel is from the Sudbury nickel field in Canada ; but the cobalt region, that is primarily a silver camp ; and I believe that the Canadian resources have barely been touched, and that the richness of the country has just been touched; but I confess my larger reasons are sentimental; that I do not want to fortify 4.000 miles of danger line. I want to make that line one of friend- ship rather than a line of danger or of menace. Senator Lodge. You said something a moment ago about " giving Canada a blow in the face."' Do you think Canada regards the present relations between the United States and Canada as " a blow in the face " ? Gov. OsBOEN. I do not think the present arrangements may be considered '• a blow in the face," but if Canada has been given to un- derstand that a treaty of reciprocity will be entered into, and this work has been done by the Dominion Government and its agents, and the work as done here can not be brought to a culmination, it can be really taken as an expression lacking friendship, and certainly a lack of serious consideration. Senator Lodge. You think the Canadians all desire this arrange- ment ? Gov. OsBORN. iS^'ot all, of course. England is, I believe, consider- ably opposed to it, and some Canadians also, but the Liberal Party, particularly, and many of the Conservative Party are for it. Senator McCtjmbek. AVhy do they favor it? Is it because of that sentimental reason, blood and relationship? Gov. OsBORN. I do not think this is a question to be referred to so hghtly. , , , i . 1 Senator McCumbee. I want to know whether they were actuated by the same reason ? ^i , ■ i . i Gov OsBOEN. Let us teach them the way; we are the big brother, and they are the little brother, and I think th.ey are pretty good people. T 1 , o Senator 3IcCu:siber. Will we be at a disadvantage? 9.32S5— Xo. S— 11 3 508 EECIPEOCITY WITH CANADA. Gov. OsBORN. I do not think we will. I am sorry to say that, because I do not wish to beat Canada out of anything. I think we are getting the best of her. Senator Bailey. Governor, T think j'ou made a statement a moment ago whicli was particularly interesting, to the effect that we were manufacturing for the world ; that we wanted our raw materials free, I believe. If with those free raw materials we can make them sell our jDroduce in the markets of tlie world we certainly ought not to have any duty on those manufactured products, ought we? Gov. OsBOEN". I guess that would be another question entirely. Senator, and I did not quite exactly say free raw materials. I would saj "next-door neighbors" free materials that are nearest, and can be had at the least cost of transportation, and naturally come for treatment into our country. Senator Bailey. The idea that these people are neighbors and have our blood — and I would be therefore inclined to apply somewhat different rules to them than to others — and I see very plainly that you have not troubled yourself with the details of this treaty at all. Gov. OsBORN. Not to any great extent, no; because I have felt keenly on the larger question without any particular economic con- sideration, although, in a general way, because of the things that I have said here, I believe that Canada can not comjaete with us in anything. Senntor Bailey. Even if you thought they could successfully com- pete with us, you would still be in favor of this? Gov. OsBOEN. I do not know that it is fair to drive me to say that, but I believe it makes for the growing together of the two peoples that ought to be together as naturally as Texas and Michigan. Senator Williams. I would like to ask a question. Have you been keeping up with the Canadian debates on this reciprocity question? Gov. OsBORN. Not very closely. We have had some matters of our own which kept me busy. Senator Williams. Have you been reading any of the arguments the representatives of the farming interests have been making that this treaty would ruin Canada? Gov. OsBOEN. Some of them think so, and I agree with them, be- cause in my own section, where I live — and one is only required to speak of his own neighborhood or know the conditions — we would get all the best of it. Senator Bailey. You said a moment ago that we sent hay there and paid the duty and bridge charges and then made a profit. Do 3'ou know, however, that we only exported about 7,000 tons of hay to Canada, as against their 97,000 to this country? Gov. OsBOEN. I think it must have all come from our country. Senator Bailey. Those are the figures given in the Government publication. Gov. OsBOEN. I wish that we got all of our hay in Canada and raised none in this countr}', because I think the farmers can raise nothing that is so hard on their soil as hay. Senator Bailey. If they raise it with timothy and clover, it is an excellent restorative. Gov. OsBOEN. That does not make good hay. KEGIPEOGITY WITH CANADA. 509 _ Senator Gallinger. "\Aliat substitute could we have for hay in the little State of New Hampshire ? Gov. OsBOEN. I do not think I would make any substitute there. Senator Gallinger. "We are entitled to consideration. Gov. OsBOEN. Oh, indeed; and I wish that this might be consid- ered as a question for the entire United States and not of Michigan and not of New Hampshire, but of Georgia and Kentucky and Texas and Tennessee and Michigan and Massachusetts, Iowa, and Mon- tana — the whole country. Senator Bailey. If you will read the Constitution, you will find that Eepresentatives are elected in the State ; Senators are elected for the State. Gov. OsBORN. You are first for the Nation; you are yourself and all of them. Senator Bailet. Well, I like my immediate ancestors rather more than my remote ancestors. [Applause.] Senator Clark. Governor, you spoke about the benefit this would be to the manufacturers in raw materials which they use. Just what you refer Gov. OsBOEN. Just what kind of raw materials? Senator Clark. Yes. Gov. OsBOEN. That might be gotten out of Canada ? Senator Clark. Yes. Gov. OsBORN. That is difficult to say. It may be possibly iron ore, certainly timber of the various kinds, certain rocks, certain fertilizers. In Michigan we expect to build most of our roads from the Canadian rocks. Senator Clark. Does the Canadian Government have control of the timber that would come into this country ? Gov. OsBORN. In some instances, not in all. Wliere lands were deeded previous to enactment of certain export laws and the timber comes in free ; but that is a very small percentage. Senator Clark. Does it not depend upon the Province from which it comes? Senator Lodge. Is the timber Crown lands controlled Gov. OsBOEN. Not in all instances, but in some instances, because I know of an arrangement being made by a comjsany to secure certain lands that have not been transferred from the Dominion to the Province, I think Ontario. Senator Clark. I was speaking of the control of the export of timber. Gov. Osborn. These lands contain timber and there are certain other lands that have been privately deeded for mining concessions. Senator Clark. You misunderstood my question. My idea was that the Canadian Government would not have the control over the export of timber; that that authority lay most generally in the Prov- inces in which the timber was grown and cut. Gov. Osborn. I think that is true. Senator Clark. And your raw materials, so far as that is con- cerned, would not be derived from any governmental action, except as the governmental action might be by the provincial act. Gov. Osborn. Which would be reasonable to expect might follow. Senator Smoot. You understand, they have free logs to-day from Canada ? 510 KECIPROCITY WITH CANADA. (iov. OsBoitx. I do not know whether the}' are entirely free. Senator Smoot. The logs are. (iov. OsBORN. Are they entirely? Senator Smoot. They are absolutely free to-day, and what I was wondering was this — you spoke of the raw material E^d that we would take advantage of that by this treaty, whereas we have all the advantages to-day under the tariff act we would have under this treaty. (tov. Osi;' rx. Logs are nut the only raw material, and raw mate- rial, you know, so much better than I, is a comparative statement; it may be in half process of manufacture. Senator Sjioot. The treaty is not going to give stone from Canada free to Michigan to make your roads with. Gov. Osi'.dRN. I am not in favor of the treaty for that especial purpose, at least. Senator Smoot. I say it does not help you. (ro\'. OsisiiKN. It might and it might not; I do not know what practical arrangements might grow out of that treaty. Senator McCitmbee. The principal raw materials that will come from Canada to this country are wheat, oats, barley, rj'e, flax, potatoes, and hay; those will be the principal things that will be imported from Canada into this country. Gov. OsBORN. I think not. Senator McCumber. "What will they import, unless it be some lumber ? Gov. OsBORN. I say Canada is a dominion with 3,600,000 square miles area, with only 8,000,000 population. They have not devel- ojDed yet. I suggested, as a possibility, that probably there are so many things that we send there as compared with what they may send here, at tho present time, that the thing exchanged seems to be altogether one-sided. They have no coal. Senator jMcCumber. They have iron ore in competition with the ranges of Minnesota ? Gov. (*si!uRN. Some; they are doing some iron mining. Canada has very little iron ore at present. Senator McCu:\rBER. But the main things exported to this country would be agricultural products in competition with agricultural jDroducts which we produce in a slight excess of our home demand. Gov. OsBORx. The agricultural exportations here, exported from Canada, might be able to enter a little distance into the United States, but not very far, because of the transportation charges. Senator McCumber. For instance, take Manitoba, Saskatchewan, and Alberta — all north of Minnesota and North Dakota and Mon- tana, they would be about as contiguous to Minneapolis markets as the IMontana, Minnesota, and North Dakota products, would they not ? Gov. O.si'.oRN. Not to-day, because the lines of railway do not, as you recall, run north and south, but east and west. Senator McCutmber. Have not the Hill roads branches in several instances crossed over and got wheat from Canadian branches? Gov. OsBORN. I think not, but that coidd be done. That would not enter into the question seriously, because if they desire ways of profitable transportation of wheat and those products to the State they would easilj' get them. E"CIPKOCITY WITTT CANADA. 511 Senator McCumbee. Is it not an established fact that the same grades of wheat throughout the Northwest are about 10 or 12 cents higher on the American side than on the Canadian side, and have been for several years? Do you think that all of the possibilities of this great Northwest, and with the steady growth of the Saskatche- wan crop, and with that diiference, that we will not suffer any by the Canadian grain coming in in conflict with ours or competition with it? Gov. OsBORN. Permit me. Senator, to repeat. I think that differ- ence in price is entirely made up of the character or quality and the cost of transportation. Senator McCumbee. I will have to correct you there again, be- cause we will take the Hill branches — what we call the Hill branches, the Great Northern, which has some 20 or 25 branches running to the hne of the Canadian side, some of them crossing over — and while the rate is 10 cents and has been as high as 22 cents a bushel on the wheat in our State and for a number of years averaged more than 10 cents on the American side, where there is absolutely no difference what- ever in the cost of transportation, because they are in the area where the prices are fixed. Gov. OsBOEX. I think that would pertain to a verj' restricted area and to a very small production. We know that in the future, whether this treaty is or is not entered into, that whenever it comes to a question of competition between transportation lines the Cana- dian roads will hold their own because of their somewhat shorter route, cross by way of Alontreal to the European markets. Senator McCtj:.iber. The Canadian lines run into the United States; for instance, the Soo that you speak of, both at St. Paul and Minneapolis. Gov. OsBOEx. The Soo is not a Canadian road. Senator ]\IcCumbee. It is owned and operated through the same interests that operate Gov. OsBORX (interrupting). Not at all. Senator. Senator McCumbee (continuing). The Canadian Pacific. Gov. OsBOEN. Not at all ; in nowise. Senator Gallingee. The Grand Trunk and Canadian Pacific run into Canadian ports. Gov. Osboen. They do. Senator McCumbee. I always regarded the Soo as a Canadian road. Gov. Osborn. I think I can tell you the exact condition of the road. The Canadian Pacific guaranteed in the early organization of the Soo Line certain bonds of the Soo Line— guaranteed the inter- est upon them, with the included agreement that in the event of this interest being forfeited that they should assume some directory con- trol, but the interest has always been paid. I know something of the relationship of the two, but t do not think that is particularly ger- mane to this matter. Senator McCumbee. They are managed by the Canadian Pacific. Gov. OsBOEN. Not at all. Mr. Pennington is president of the Soo Line, and is one of the most independent railroad managers in the United States, and is one of the best, and he has forced a great many extensions of his road in opposition, m a measure, to Sir Thomas Shaughnessy's lines. The Soo started with American capital. American capitalists furnished the first money, and it has been ex- 512 EECIPEOCITY WITH CANADA. tended by various financial schemes, I suppose getting the money wherever they could get it in the best financial market. Senator McCumbee. I notice particularly that they run Canadian Pacific coaches a great deal over these lines, and especially freight cars. Gov. OsBORN. They have better equipment than the Canadian Pa- cific of their own. Senator Sjioot. Governor, let us refer again to that raw-material proposition. If this bill was going to help the American people so much — you referred to logs. Of course, we find they are free to-day. Next in line is ore. Do you think that this bill provides for free iron ore from Canada — this reciprocity bill ? Gov. OsBOEN. I do not know that it does. I have read the bill, but my idea of the bill economically — and I am afraid it is not worth very much economically — is that the bill is not perfect to-day, but that you can perfect it if you can get in touch — if you can get in diplomatic touch with Canada, and if Canada can be convinced that the United States, of which she has been afraid all these years, will treat her fairly I think you can get a fair and square commercial deal with Canada. Senator Smoot. This is all they could get from Canada, so I am told. Gov. OsBORN. To-day? Senator S^rooT. Yes. Gov. OsBOEN. But, the first time a commercial man approaches a customer the customer does not always purchase, and does not always do as much business as later. Senator Smoot. Do you think, then, that this is an approach to Canada from us, and not from Canada to the American people? Gov. OsBOEN. I am glad to say that it comes from both upon more or less a feeling of equality. Senator Smoot. Then, when the merchant sends for the salesman, he generally knows what he is going to buy and buys what he wants. Gov. OsBOEN. If they had had an understanding through the years. Senator Sjioot. I wanted to call your attention to the fact that iron ore in this bill is not on the free list. Gov. OsBOEN. That would not be important. Senator Smoot. It carries a duty of 10 cents per ton, and the pres- ent rate of duty from all over the world is only 16 cents a ton. Gov. OsBOEN. That would not be important, for the reason, to begin with, that most of the Canadian ores are produced without royalties. There are not many to begin with, and all are owned — the fees in the property are all owned by the producers, and they do not pay any royalty, and consequently could ship in, so really that is not an important consideration. I think the great consideration in- volved is the drawing together of the two countries for future rela- tionship and accomplishment and understanding. Senator Gallingee. Might that be done by joint resolution? Gov. OsBORN. I would be in favor of it if we could. Senator McCumbee. If I understand you rightly, you claim the Canadians would not receive better prices for their farm products by having this agreement than they are receiving at the present time. Gov. OsBOEN. That would be a guess on the part of any man. RECIPKOGITY WITH CANADA. 513 Senator ^McCumber. You do not think they would ? Gov. OsBORN. I think they would not, with the possible exception of a limited zone along the border. They could not get their product, in any event, far into the United States, because of the extra trans- portation cost and because of coming into competition at once with people who can produce better and more. portation and because of coi'iing into competition at once with people who can produce better and more. Senator McCumber. I think it is proper for me to put in the record herea statement from an eminent statesman in Canada, Mr. Laurier, in his address of March 9, in which he seems to take an entirely dif- ferent view, because he uses these words : I stated a moment ago that the agreement we umile is phnply to give bettei- prices for the produce of the Canadian farm. This is a proposition so obvious — Xote the words '^ This is a proposition so obvious " — I am surprised that it should have received the treatment it has received on the part of our friends on the other side. It is quite evident there that the Premier thinks Canada will get better prices for our products, and if she does it must be at the expense of our Gov. OsBORN (interrupting). I do not concede that she does, and I can readily see why the Premier should make that statement. The Premier is a politician and statesman of the first class, and he is now working for the certainty of the adoption of his treaty on his side of the line, and he is going to say anything, almost, that is within the bounds of reason that will effect the desire of his people's selfish incli- nations, and I do not say this thing in an unkind or small waj'. Too much selfishness is given to the consideration, in my oj^inion, of this question on both sides of the line, and I do not say that impolitely. I am trying to sa^' that, because I am inspired that the coming together of the peoples is far more important than any economical considera- tion. Senator McCtjmbee. Governor, in that connection, have you read the act passed in April, 1910? Gov. OsBOEN. I have not, I am sorry to say, Senator. Senator McCu^rBER. It practically prohibits every export of wood of everv kind and sort from New Brunswick — all the lumber — into the United States. That is a very recent act, but I have it already printed in a Senate document. Practically every Province in Canada has passed a more or le=~ restrictive act. Gov. OsBORN. And you will find them more restrictive if this treaty is turned down. Senator ]^JrCL3iBER. You can not make it more restrictive than that. Gov. OsEORX. Yot there ; but more widely so. Senator ifcCrMEER. But Xew Brunswick, that passed this act, declared against reciprocity; so they did not do it because we were slow in adopting the treaty. Gov. OsBORN. I can readilv undei-staiid how they might think we are cutting out all the best of it, if considered solely from a selfish standpoint. . , . , Senator JMcCumbek. There is a necessity for considering the sub- ject. Gov. OsBORN. I think it very proper to do so. 514 EECIPROCITY WITH CANADA. Senator Smoot. Do you know whether the farmers of Canada ex- pect to receive a better price for their wheat or not when this bill passes? Gov. OsBORN. Senator, I can not tell you as to that. The wheat- raising people of Canada are confined to the far Northwest. Senator Smoot. I have received a good many letters from farmers up in Alberta asking me to support this bill. I have written back to a good manj' of them, as they were old friends of mine, asking them why they wanted the bill passed. There has not been a solitary one of them but what said because thej' would receive 5 or 10 cents more a bushel for their wheat. Gov. OsBOEN. They repeat the argument of Premier Laurier, that is all. Senator, and they believed that, and I think they expect and hope for it, but I think they will be disappointed. Senator Stone. Governor, before you sit down — you spoke very rapidly as well as interestingly. Gov. OsEORN. Tliank you for the latter. Senator Stone. And under the rules here you have the privilege of revising your remarks. I am afraid you spoke so rapidly that the reporter could not get it all. Go^'. OsBtiRT^. I hope the stenographer could not get all of it. Senator Sr.'xe. I hope he has it all, for it is one of the strongest and clearest statements we have heard, and I would like for you to look it over before it is finally printed. The Chaiejian. A first print will be sent, and the committee would be very glad if you would revise it. Gov. OsnoRN. I am afraid I will have to consider that a command. I may say I have never seen a stenographer who could report me, and I shall take fur granted the necessit}' fy a Government department. In December, 1(106, both Houses of Congress called for an investigation 1)}" the Secretary of Commerce and Labor as to the reasons for the high prices of lumber, antl especially as to the existence of any com- bination, trust, etc., in the industry. I am not quoting verbatim, but that was the substance of it. I would like to put into this hearing the text of the Senate reso- lution, which is on page 10 of this particular document. It should be noted that the particular purpose of this investigation, as shown by the resolution, was to ascertain the existence of combinations, conspiracies, trusts, etc., in restraint of trade in lumber or to in- crease its market price. The resolution closes with this paragraph: That the Secretary of Commerce and Labor be required to make the said investi- gation at his earliest possiljle convenience and to furnish the information above required and as soon as it can be done consistently with the performance of his public duties. He seemed to find nothing in the way of immediately proceeding to that investigation, sending out scorces of men all over the country, entering the offices of lumbering concerns by the hundreds, and going through the books exhaustively, in some cases the records of the lumber concerns being sent to Washington by freight, there to be examined more at leisure, and so far as we know the onty result has been a report on the standing lumber of the LTnited States. That undoubtedly is available, but it was not what the Senate of the United States particularly demanded. In his introductory paragraph in these letters, the Commissioner of Corporations, who is in charge of the inquiry, says that subsequent parts will deal with the cost of manufactured lumber from standing timber, the price of labor, and the competitive conditions in the marketing of lumber. That is, that at some time or other at his convenience he will answer the ]")articular question which he was called on to answer by the Senate. We believe that the Senate, EECIPEOCITY WITH CANADA. 519 which was so precise in its reciuest as to tiie scope of the inquiry and as to the prompt furnishing of its results, might well ask that the chiei question should be answered. llie report on standing tinil)er, however, has been used bv a considerable ixirtion of the press and bv sensational writers to create the impression tliat there is, in fact, a Luml)er Trust which controls the prices. I wish to call your attention, however, to iiortions of the report on pages 11 and 12. Shall I brief it or read it I It is not long, I might read it. He says, as an excuse and a reason for making this report on standing' timber — the trade, the "stumpage." No answer to the request of the resolutions as to the course of pnces, or the existence of combination and its effect on the lumber business and the public, could safely be made without first determining approximately (1) the amount of the remaining supply of standing timber, and (2) the degree of concentra- tion m the ownership thereof. These facts are basic. _ True enough, yet there is no reason why this indictment, so con- sidered by the public, against the lumber business, or at least our part of it, the sawmill end of it, which has been carried on so aggressively for four years, could not have been rendered. Then he says: The rapidly increasing concentration of control of the lumber industry is not due to any particular economy of large manufacturing plants. Conditions are such that the output of the most efficient plant is small compared with the tolal output. The largest sawmill in the country cuts less than one-half of 1 per cent of the total annual output of lumber. Four-fifths of the out]3ut comes from mills each cutting less than 25,000,000 board feet, or about one-twentieth of 1 jier cent of the annual cut. A recent report of the Ikireau of the Census gives the l\iniber cut o[ the United States for 1909 as 44,509,000,0':0 board feet, sawed by 46,584 sawmills. The conditions of the lumber industry do not fav(.r such enlargenicni. of individual plants as is ad-^-antaL'Cous in the refining of petroleum, for example, nr the making of steel. The bulk and weight of timber are great in comparison with its value. The relati\e cost of transporting logs for consideralile distances is great, exce]it in the few localities where it is possilile to float them, Moreover, a large part of the Iul; is waste. There is a great saviiiu' in cutting up the log ct-se In its point of origin and shipping out only the valuable parts. It is therefore impractical ile to establish a few great central sawmill plants and bring timber long distances to these from the forests, A sawmill of small size and small in\-estment can manufacture economically and com- pete in the industrj'. To work most economically, a mill in most localities should have a lugging railroad; but a mill of very moderate size will justify such a road and the economical maximum will still be ratlier closely limited by transportation costs. A sawmill can not lie moved without loss of most of its investment. Its term of activ- ity must be long enough to allow it to pay for its cost. The larger the mill the farther it is apt within a given period to ha^'e to bring its logs, and the growing c(jst of trans- portation will soon counterljadance any saving in manufacturing cost which might be attained by great size. In view of these considerations, and especially the great number of .sawmills and the ab,sence of any one or any few plants of dnminaling size, it is apparent that the eco- nomic conditions in the m;:nufaf ture of lumber (iS distinguished from the ownership of standing timber) are not exceptiouLilly conduci\-.^ to concentration,^ .■\ somewhat similar condition exists with respi'ct to the distribution of lumber, whether wholesale or retad, although here the opportunities tor combination ore more nearly comparable with those in most other industries. Let me interject tliere. The commissioner might \:e\\ have said the conditions in a good num.luT of mills made effective combination impossible. He says: The conditions existing in the wholesale and retail business are more nearly com- parable with those in most other industries. Evidently, he, then, by liis wording, thinks there is not so much chance there as in other industries. 520 EECIPKOCITY WITH CANADA. The chances for combination in the manufacturing end are still less than that. It is for that reason that I say that he practically says that there is no controUing trust or combination in the manu- facture of lumber. He deals in the case with the concentration in lumber land after dismissing that problem, giving us little hope that he will issue an}- enlightening report on the lumber trust so far as manufacture is concerned. The report goes on: Probabl\' no important industry has failed to attempt combination. The lumber industry h^'s made such attempts nn its own account. There has been no effort to brinj^- the different Ijranches of the industry into cimbination — That is, to make any general controlling trust — as it was so manifestly impracticable; but such attempts had been made with single woods or in distinct manufacturing- districls; not one of them, however, has been successful, and to-day there is no combination of the lumber-manufacturing industry, and the only influence worth mentioning is found in a few selling corporations which bu\- outright the product of certain mills and place that product on the market. So far as we linow, and as exists in the o])inion of the Government authorities, tlicv have placed themselves out of the purview of the la\\', or rather they have placed themselves within the ]irotection of the law by their methods. They are simph* corporations which buy on quite a large scale, and sell what they buy. There are two prin- riivil selling organizations of tliat sort — two principal ones. The rej)ort of tlie Bureau of the Census on forest products for 1909 is interesting in this connection because of certain facts it very plamly brings out. On pages 46 to 49, inclusive, are tables showing the sawmills of the country by size and relative products. The total number of mills reporting for 1909 was 51,260, but the number of active mills was 48,112, differing in that particular from the commissioner's report, which was published before the census was reallv completed or the Census Bureau ^cas in condition to furnish satisfactory figures. Of these 42,041 were classiiied by quantity of output. These tables show that 45.1 per cent of the total output of 1909 was produced by mills each cutting less than 5,000,000 feet annually, while 57 per cent was hy mills cutting less than 10,000,000 feet. These are in the smaller mill classes. The standard merchant mill, with two princij.ial sawing machines — that is, what we call a double- deck mill, a double mill with two circular or two bands, one on either side of the deck — should produce in a full season over 20,000,000 feet of lumber, whereas mills cutting less than 10,000,000 feet annually cut 67 per cent of the total product of the country. The further significance of these figures is that probably half of the luniber product of the United States is from mills of the class which are not ordinarily backed by reserved supplies of timber except sometimes in hardwood. That is to say, the miUs of these smaller classes do not ordinarily possess timber reserves. They ordinarily buy standing lumber from year to year, or buy logs in the open market. Yet the number of such mills is increasing more now than in 1909 or 1899. They would not be in existence if they could not find timber, and, consequently, it is a fair assumption that when decade after decade we see the number of small mills increasing and their products likewise maintaining its proportion of the total that there are standing timber resources not ordmarily considered by the large mill operators. EECIPKOGITY WITH CANADA. 521 Going back to the commissioiKn's statement I find — and I am reading; or speaking without my notes and omitted something that I should have said — the comniissioner's statement that "a some- what similar condition exists with respect to the distribution of lumber, whether wholesale or retail, though here the opportunities for conibinatioji are more nearly comparable with those in most other industries" — is in a negative way; than in most other fines of business, and that the combinations among sawmills are less practicable than in the distribution of the product. The ordinary reader, even the ordinary newspaper editor, seems to have missed the meaning of this important statement, wliich is practically an admission that there is practically no trust or combination in restraint of trade which in ail}' substantial way controls the lumber industry of the United States. Senator Wiltjaiis. What is that language — "which in any sub- stantial way controls" — is that the language? Mr. Broxsox. Yes, sir; that is what I say. That is, it can not find anything of substance. Senator Williams. Any substantial way. Mr. Broxsox. Perhaps iny choice of words is not ha])p3- — any real way, if at all, and 3-et it woidd not be correct to say that nothing an3-where controls prices. There are two selling companies that I have referred to. I presume vou imght find them — though I do not know of any — any three or four mills in a to^\Ti, or in the immediate neighborhood, which to some extent work together in the matter of prices, just as in ain* other business. Senator Wiixiams. Just one question there. I understood 3^ou some time during the course of the hearing to sa^- that somewhere out West thev were shipping a lot of lumber very cheaply at a very low cost, and" 3-ou wrote to them to know why they were doing that. Now you are the secretary of this whole lumber association, are you not? '}.h. Beoxson. The manufacturers, yes, sir; so far as they are organized. Senator Williams. Why did you -BTite ? Those people were out on the Pacific slope, are they not ? ilr. Broxsox. Yes, sir. Senator Williams. ^^Tiy did you write to them to know \vhy they were selling lumber at such a low price ? , . . Mr. Broxsox. Well, it was a matter largely of personal curiosity. I knew the situation was very bad out there, but I did not suppose it was as bad as that. We are interested in the welfare of our people, and when I found that it was reported— rather I did not know it, but it was reported in the press that they had sol.l 50 carloads ol their ordinarv mill stock— shipped for the retail trade— sold 50 carloads in Minneapolis at a price which netted them S6 a thousand teet, and I wondered why, and I just wrote to find out. Senator Williams. You live where? Mr Bronson. In Chicago, and for maii3- years I have been cori- nected with a paper-a lumber paper-of nationa circulation, which deals with all this question of prices, supply and demand, and the mechanical methods, and everything. I am mterested m ah these things, and I carry on a good many, and make a great many inquiries that have no relation t(. the lumber business, or have relation to 522 ilECIPKOCiXY Vv'ITH CAKAUA. other departments than that with which I am directly concerned. Some of tiiem are purely individual questions, much as yo'u may ask outside of the committee room. What the conuiiissioner tJiought he found was a tendency toward control of tlio standing tiiidjei', which if it would become effective would produce a serious condition. Vv^liat he says is: The bvireau lind.s now in the making a comy^inalimi caused fundamentally by long- standing public policy. This formidable proccsn of concentration, in timber and in land, certainly involves grave future posribilitief of impregnable monopolistic conditions. Those words are somewhat long; but they properly wind up so formidable a paragraph. He concludes his introduction bv saying: Such are the jjast hi«tnry, pre:^eiit status, and apparent future of our timber resotirces. The underlying cause is our public-land policy, resulting in enormous loss of wealth to the public and a monopolization by few interests. AU L-K he says — the only useful lesson he draws from his study — lies before u- now as a forcible object le-snn for the future management of all natural resources still remaining in the lands of the Government. He can not do anything sibout it now exccjit as here and there land might have b(M>n acquired illegally and go back, of course. But tliis vast amount of timber and Luid is in the hands of private citizens who got it legally Ijocaiise it was given to them by the public, or sold to them at a low ])rice, or nominal price, and all it amounts to is that We shoidd not do so aity more. It is doubtless a matter of sentimental regret that to so large an extent an important natural resource has passed from the ownership of the people as a whole into the hands of private holders, but this transition lias taken place and these large properties have gone into private possession because of controlling economic forces. So long as timber seemed to be in abundance above our needs, it was lightly valued by the Government or by individuals. Few have been the men farsighted enough to forecast the forest history of tlris country. Hardlj- more than 10 years ago the Northern Pacific was offering its Government-granted tijnbeiiands in Washington to whoever would buy. It originally obtained them from" the Government because it was thought by the authorities at that time that a railroad connecting with the Pacific Northwest was more important than timber not needed and not ap])reciated; and then the railroad in turn thought that it needed a jialtry ?G,(KJ(),W)l) more than it needed those miUion acres of timberland. The only man who had foresight enough to see into the future of timber values in that remote region was Frederick Weyerhaeuser. Even this man, who for 50 years had by his wisdom and integrity commanded tlie couperatidu of many lumbermen, was unable to convince some of those assciciates wlio had gained wealth under his leadeisnip tlwt this million acses out of tlte many millions of acres of timber in that far-av.-av countiy was worth buying. Tliey did not beheve that in tlu>ii' lifetime it woidd iiud a market. And so tliey stayed out of the field- many of them yet now it is dhiiciilt to place an estimate' uj^on its value. If i(. slxnild' be estimated to earn- 20,000 feet of tiniber to tb(> acre on the average, and to be worth 12 per thousand feet, we have a valuation of $i() an acre on what was sold a decade ago for $6. RECIPROCITY WITH CANADA. 523 Whatever our regrets may be iis to the condition of timber owner- ship, it is a matter of congra.tidation that tliere is a growing apprecia- tion among timber own(M-s of tlieir responsibihty to tlie public. They are caring for tlieir lands and safeguarding them as they awake to the need and the possibilities of jointly serving their interests and those of the public. At any rate the public should understand this: That since a considerable portion of the timber supply of the future is in private hands it is well that its holders should deal \vith it intelli- gently and safeguard it for the future. And when this timber, not at present needed, is finally utilized, at least 80 per cent of the benefits arising from that utilization will go to the public, and many of its owners \^'ill be fortunate if the increase in the value of timber during the next 2.5 or 50 or 1 00 years \vi\\ be enough to pay interest and taxes. You will remember that before recess I read an extract as to these things from a letter from a Washington gentleman as to the influence of this matter of interest and taxes on the valuation of timberland which cost almost nothing to start with. Senator Clakk of Wyoming. Right along the line which you have just read: have you got any estimate of the time in which our present supply of timber will be exhausted at the present rate of cutting? I have iocri various estimates of that and I was wondering if you had made any. Mr. Broxsoin. I assisted in making some of them. Senator Clark of Wyoming. Wlmt was the conclusion that you arrived at? Mr. Bronson. Well, Senator, I am not so ready to arrive at any conclusion as I used to be wdien I was a little younger and more enthusiastic and more optimistic as to my own knowledge. Senator Clark of Wyoming. I confess I have been a little skep- tical as to some of the conclusions. Mr. Beoxsox. :Mv first introduction to this subject was in the earlv eighties. About that time they were trying to take a timber census in connection with the census of 1S80, following it, of the white pine rescurces of Wisconsin, Minnesota, and Michigan. It was published in 1SS4. That G-ave an amount of standing white-pine timber m those three Strifes which would absolutely fie exhausted in seven .vears at the then rate of production. Production rapidly increased— greatly increased — and the year of greatest production of white pme of those States, I think, w-as 'lS94, and it is still producing white pme. About twelve years ac;o R. A. Long, a prominent lumberman of Kansas City — it was not so long ago as that — about that time made a prediction of alono- about a thousand milhon feet of standing timber in the United St.-ites. A httle later .Mr. Long estimated, all told, eleven thousand milhon as the amount of standing timber. Then Mr Pinchot got it up a httle bit. Mr. B. E. Furno, former State forester— former United States forester-^and now professor of forestry in the University of Toronto— put it up still more until in 1905 I estimated two thousand milhon of feet, which estimate was adopted by the Forest Service in numerous publications, ihey referred to it directly at first and then adopted it and spoke about two thousand milhon feet. This report says twenty-eight thousand million. r,30s,-— Xfi. S— 11 i 524 RECIPKOCITY WITH CANADA. Senator Williams. The estimate is growing, whether the lumber is increasing or not. Mr. Bronson. It is going up, the more we cut it the more there is of it. Senator Clark of Wyoming. I was going to say for Senator WiUiams's benefit that about three or four j^ears ago we were going to have all our coal consumed in 50 years. They raised it to 150 3'cars, and the last estimate that I saw was several thousand years, so that it gives me but little confidence in the estimates of the final extinction of our national resources. Senator Williams. Did I understand you to say that it gave you confidence in the estimate? Senator Clark of ^Vyoming. No; it caused me to lose confidence in tlie estimate as being something absolutely uncertain. Mr. Bronson. I will say that it is contrary to the opinion of some people — a good many well-informed people, who say we are not exhausting our timber, but I believe v/e are cutting heavUy into our timber resources. SeiUvtor Clark of Wyoming. I would not gainsay that for a moment. Mr. Bronson. We are cutting into it very rapidly, and we must naturally in regard to the future, conserve our resources as much as we can; conscr^ e them Ijy utilization — hj closer utilization, and con- serve them by perpetuation. The CHAiJiMAN. Is not the second growth to be reckoned with? I know in Pennsylvania it is quite an industry, the cutting of the second growth. Ml'. Bronson. It has a wonderful influence. These gentlemen representing North Carolina pine are largely cutting their second growth of timber. But that is on the dtlier part of my subject, which I am afraid I will have to give up — conservation. As yet there is no lack of timljer to meet the requirements of the lumber market in this country. We do not need to go tu Canada for it. In fact, more is being put on the market annually than is needed, at fair prices. We have more than four times as much standing timber as Canada, and to add her supply to ours by placing lumber on the free list would simply increase tlie competition and the conse- quent forest waste without for any long period prolonging the exist- ence of our forests in any material way. Senator Williams. Wlien we go to build a house, or add to it, or buj' furniture either, they always tell us that 10 ycai's or 15 j^ear-s ago buildings could be put up at half this price, ]>ut lumlnT has got up so much. "What is the cause of that ? If there is no wholesale trust, has there been aii}^ retail dealers' trust ? Mr. Bronson. None, in a general \\-ay. Senator Williams. If there is plenty of lumber, and we are pro- ducing all we Avant out of it at reas(juable profit to the man that deals in it, \y\ij is it that we can not get lumber for houses, and can not get furniture, or even dry goods boxes, or tomato boxes as cheap as we did 10 or 15 years ago, or anywhere near it, or even eight years ago? Mr. Bronson. Senator, if you go into an uninhabited country you will find land per acre worth nothing. Senator Williams. Find what? EECIPEOCITY WITH CANADA. 525 ^Ir. Bkonson. Land per acre worth nothing. If you buy some of that hmd that has any v;due at all, get it at the old Government price of §1.25 per acre and hold it, but do not occupy all the land, it is worth no more mtrinsically than it was then. So', as people come in the value grows, applies to it. That is perhaps a crude and rough and not entirely logical explanation, but the older ones of us can remember Senator V''lL^TA^^s. All land has a fixed quantity, has it not? The population is increasing: the land is lying still. Of course it grows in value, but I understood you to say that the rate of production of lumber was keeping up with the increase in consumption in the Tnited States. Mr. Bkoxsox. Fully. Senator "'^'iLLi.VMs. Of course the rate of increase of land never keeps up with the number of people who want it. Then if tins is cjoing (^n and you are sawing at a reasonable profit and have plentv of lumber and the lumber -estimated, at any rate — is increasing, whv is it that you are getting it higher and higher CA'cry time we want it? !Mr. Beox'sox. The advance figures in 10 j^ears are .38 per cent, according to tlie Government statistics, about the same increase as in the cost of production. Senator Heyburn. Has it increased to tlie present over 20 or 30 years ago ? Mr. Broxsox'. Oh, no, sir. Senator Heyburx'. Lumber is lower now than it was .30 years ago, is it not ? Mr. Broxsox. Somewhat. Senator Williams. You said it has increased 3S per cent, and sometime ago you said we were sawing plenty of it, and I believe you said sometimes too much ? Mr. Broxsox". "\Vc are using too much now, and have been for four years. Senator William.s. Evidently the production has increased beyond the demand '. ilr. Broxsox. Yes, sir. Senator Willia:ms. If we are producing so much that we are get- ting too much, and vet the price, wlien we want to build a house, is higlier, and when I want to buy furniture it is enormously higher — that mav be a separate jiardwood problem. Mr. Broxsox. Yes, sir; there are some things Senator Williams. Now, coming down to the matter of building houses, why is it — and I am asking merely for information; I do not know mncli about anvthing, and since these hearings I know less than I ever did — but 1 would Hke to have you explain that to me if vou can. i • • i . Mr. Broxsox. I am very glad to tr}' to present the situation as best I can. I appreciate verv much the attitude of the committee. I feel that the questions voii ask are not for the sake of asking questions to confuse me, but simplv to arrive at facts and draw out what little knowledge I m^y have. I appreciate it very much. Blease look back, and to illustrate tliis and show why o v u Senator Bailey. Will vou let me interrupt you there? lou have not understood, in my opinion, Mr. Wilhams's question. Jlr. Broxsox. I think I did. 526 KECIPROCITY WITH CANADA. Senator Baii.ey. To whicli you inadc. one answer. He asked you if we were increasins; our growth of timber as rapidty as we were con- suming it, us 1 understood it. Senator AViLLiAMS. Ko; 1 am talking about production from tlie sawmills — whelher we are des(r(!ying our forests. He said we were producing as much lumber as the Tiiited States needs — and more, too, and for the lost four days we were getting more than we needed. Now, if we have been producing more than we needed, the supply has exceeded the demand, and yet it has gone down. Senator Bailey. Then I misunderstood your illustration. You said that the land was fixed and could not grow, and the timber was different. Now, the explanation is that the timber while not a fixed quantity like land, yet does not increase as rapidly as the de- mand for it and the consumption of it. Senator Clark of Wyoming. The lumber has not increased in value as ra]}idly as the land. Senator Bailey. I was going to say Senator Williams. I asked the question of one witness and there are three of you. Senator Bailey. I assume that you want to know, and I thought you gentlemen did not understand each other. Senator Williams. I understand him, and I think he understood my question. Senator Bailey. Then he did not answer it in what I would consider an intelligent way, because while it is true that while the timber is not fixed as land is, it is also true that we have not been increasing our timber supply as rapidty as the demand for it. The demand for the timber has been increasing faster than the su])])ly and timber- land that could have been bought 15 years ago for So an acre will command $20 to $25 now. Senator Williams. I understand that. Do you adopt that answer? Mr. Bronsdn. Xo, sir. Senator Bailky. And the raw material has increased faster than tlie finished product. Mr. Bronson. If I were to express it as an editorial writer does oftentimes, or a news writer — in a single paragraph at the head of his story he would say, "I would say because the future sometime disappearance of the forest is now known to be a fact." Senator Williams. Now that leatls up to what I want. Mr. Bronson. That simply would introduce my explanation. Senator Williams. Now the cause of this consists in the fact that a lot of standing timber is held by people for speculation, is it not ? Mr. Bronson. Partly that — only partly. Senator Williams. I say, a lot of standing timber is held by people for speculation. Would the introduction of Canadian lumber have a tendency to decrease the price of that standing timber and bring it upon the market and thereby lower the price of timlier to the home builder ? Mr. Bronson. I doubt very mindi. Senator Williams. Then if that is the case the answ^er that the Senator has given — that you partially adopted — must be in error somewhere, because if lumber has been kept from going down by the fact of the increase in price of standing timber, then you say that, coining into competition with timljcr that has been cut from other EECIPEOCITY WITH CANADA. 527 standing timber, would not have a tendency to decrease the specu- lative jH-ice of stanchng timl)or, because if it does decrease the price — the specuhitive in-iee, 1 wiU call it— it will put some of it on the market. Do you tlunk it would have no tendency to decrease that speculative price at all ? Mr. Beonson. I think that in some instances it would tend to put some of that timber on the market. 1 would hke^ Senator Williams. And in this instance would it not in the case of the very strong holders ; it is just like holding anything else for specu- lation; they could hold it still and run the risk of still further loss of a speculative character in the future. But in the case of those who were on the verge, or near the edge, and who are not strong holders, they would have to unload, would they not? Mr. Beonson. Well, those people have not got much timber ordi- narily. Senator, would you allow me to answer that by going back to my own original answer that I wish to make ? Senator Williams. I beg your pardon. I did not intend to inter- rupt you at all. Jlr. Beonson. I was trying to answer you, and other matters came up. As to these reasons for these things, there is an economic reason, I think, that is entirely beyond the control of anyone, that lies in our history, which is responsible for this situation that we find to-day. I started to ask you — those of you who are older than I am or as old — most of you are j^ounger — go back as far as you can remember, when all this western timber was such that there was not any appreciation of its values; it did not have an)^. You can remember — I can remember — when timberland down in Texas brought sometimes — I think it was as low as •'S12.50 an acre; a pecuHar class of land and a peculiar title; I do not know just what it was, but about that price and way down anywhere below a dollar an acre. That was only a little while ago. Go back a little further, to the time of my father, and the time when all this eastern part of the country this side of the Alleghenies had practically no value — it was an encumbrance. Go back a little further to the forest — ■ except as a range, as a shelter for game, a range for the hunter, it was an encumbrance and a nuisance. You had to cut down the trees to get a place to plant corn. It was more important to raise men than it was trees. This lumber was not worth anything in the estimation of the people; it had no market price. Men would clear off 10 acres or 2(J acres and, barring what he could rail over, making fences or split up into rails, or use for the crib, burn up the rest of it. That thing went along until 40 years ago, about, before people began to reaUv discover that there was a value in standing timber because it was getting lust; there was an end to it. There was finally no end to it. The appreciation of its value ])i()gressed, of course, with the development of the countiy. In the very early days it was found that the timber up on tlie Hudson Jlivcr had some value, and up in the Chenango River it had some value, and so forth, and 60 years ago the white pine of ^licliiguri began to have a little value, and you could afford to ])ay ])n''es at two or three dohars an acre for it. But still timl)er was unlimited, apparently because they heard about these immense s(juthern ix-sourccs, before the white pme was anvwheie near there. We began to hear about the immense 528 EECIPEOCriT with CANADA. southern resources and work — this country was full of thxiber, there was no end to it. Yihj should there be any particular value put on it? And all of a sudden we woke up to the fact that we were actually cutting more off than the forest was producing and at the same time we could not measure the distance — and can uot measure it now. It may be 40 years or 80 years ahead when at the present rate the forests will be gone. The}^ began to wake up to the fact that there was a time when it would be gone. Then the men were far-sighted — the man who looks to the future in his investment, and the man who had the money put it into this timber, and the timber man to-day, the owner of the timber, is the onlA^ man who has really made money in the lumber business. The timber has gone up with this appreciation of it steadily, not j^ear by j-ear, but on the whole steadily, and has never gone down. There has never been a time but what some poor fellow has had to throw his stumpage on the market because he got caught in a financial pinch, that timber as a whole in no section has ever declined. The production of the timber, subject to the annual demand, instead of a century demand, has gone up and down, and every time that lumber has gone up timber has gone up some. So when the slump comes in the lumber it is often below a profit on the stumpage. So the stumpage man only is the man who has made mone}^. He is the man who will make it, and you can not help him nraking it, and you can not take it away from him under the law Senator Williams. Why can you not turn an unlimited amount of stumpage loose on him? Mr. OsBOtntNE. There is about one-fourth of the stumpage in Canada that there is in the United States, and I was going to say with regard to that there is among the older operators in Canada, and has been for 10 j^ears, a decided hostility toward our taking the dutj' off of lumber. The younger operators, "the men who are mainng fortunes, would like it off, and there is where the sentiment is. Just about 10 A^ears ago I took a long trip through the eastern Provinces from Detroit to St. Johns, interviewing the lumber men of Canada of those old Provinces and largely the older ones — and almost inva- riably the proposition was, "You have got a big market, to be sure. They thought we wanted this duty off. They thought we objected to it in 1897, but we are doing well enough and we do not want to get mixed up in that maelstrom of competition that you have got over there, and that we can not control and do not know anything about." Senator Williams. So they are afraid of us as well as we are of them * Mr. BR0>fS0N. Just on that point, yes, sir; aitd that is where one of the great dangers of this reciprocity bill is to lumber, and especially to forest conservation, which 1 was to have talked about next, in that it simply makes this continent- wide, this infernal competition wliich is ruining the iictive lumber producers of this country to-day. You speak about a reasonaiile profit. Wliy, Senator, I believe that the arer.igc sawmiller in the I'nited States has not -ot back one- fourth during the last four years of profit of what this sawing cost him. He is out of pocket. Many of them — I would almost say, perhaps a majority ol them — have sold lumber actually at cost. EECIPBOCITY WlTli CANADA. 529 Senator Williams. I do not know how it is in j'our conntry, but in mj- countiy the sawmiU men are the richest men in the State. Mr. Beonsox, Tliey are rich, not I)ccause they are running a saw- miU, but because they are transferring some timber into lumber. They areselhng some timber. Xow, there is a man, I suppose, in your section who bought timber at §1 a thousand feet a few years ago. To-day we say that timber is worth $R — considered worth it, and it can be sold for .'=;.5. ^^Hiat shall he charge it in his account for ? Fire dollars, will he not ? And if he can produce by the ex|)end- iture of labor and time on these logs of that timber a' product that will sell for a ]irice that wiU retmir him that $5 that he must sell it for, he has ti'ot $40 more than he can pay for that stumpagc, has he not? From a bookkeeping standpoint, he has lost monej^; howeyer, he made no mone}- : but if he has made money he has made it out of the timber — the mcreased yaluation of the timber which is due to this general appreciation of it, which is collntry-^vide, and not out of the manufacturing propc.sition, and as a matter of fact the conditions are such that many — a great many sawmills all oyer this countiy — have not only failed to make any profit '.m. that basis, but any basis, and have not got back their stumpage yalue, lots of them. Senator WiLLiAirs. Let me ask ]\Ir. Beoxsox. Excuse me. I had not cpiite finished. In the sa.\y- mill business, more than in any others, experience and ability and skill counts m making a profit, and a good many concerns — some concerns will make what is apparentl}' a very good profit under the same conditions under which another will lose money. It is a hard proposition, but the rich men are the timber owners who have been able to realize on it. Now }-our question, sir. Senator V\'illiams. The question I interrupted to ask has been answered. Senator I^a Follette, ilr. Chairman, I move that the committee do now adjourn until 10 o'clock to-morro\v morning. Senator Williams. Mr. Bronson, have you finished ? Senator Heybl^ex. Xo; I want to go into the question of the prices of lumber with him to some extent. The C'iiairmax. The committee will now stand adjourned until to-morro%y morning at 10 o'clock. (Accordingly, at 6 o'clock p. m., the committee adjourned until to-morrow, Thursday, May 18, 1911, at 10 o'clock a. m.)